TOWN OF BROOKLINE & others [Note 1] vs. THE GOVERNOR & others. [Note 2]

WILKINS, J. The court holds that the Governor had no authority under G. L. c. 29, Sections 9B and 9C (1988 ed.), to withhold $210,000,000 in local school aid funds, commonly called Chapter 70 aid, appropriated in the fiscal year 1990 budget. St. 1989, c. 240, Section 2, line item 7061-0008. We further hold, on an entirely separate issue, that Section 6 of St. 1989, c. 240, lawfully limits distributions of certain State lottery proceeds to cities and towns during the 1989 and 1990 fiscal years.

A judge of the Superior Court reported the case to the Appeals Court on a statement of agreed facts. We transferred the case to this court on our own motion.

1. In its fiscal year 1990 general appropriation act (St. 1989, c. 240), the Legislature appropriated funds for Chapter 70 school aid (line item 7061-0008) to be distributed to cities and towns. Purporting to act pursuant to G. L. c. 29, Section 9C, the Governor has withheld $210,000,000 of the Chapter 70 aid appropriation from distribution, pending receipt of sufficient revenues. We conclude that the funds appropriated by line item 7061-0008 are not subject to reduction pursuant to G. L. c. 29, Section 9C.

Page 379

Line item 7061-0008, under the headings of Department of Education, Board of Education and Commissioner's Office, appropriated more than $1,218,000,000 for "school aid to cities, towns, regional school districts, counties maintaining agricultural schools and independent vocational schools to be distributed pursuant to the provisions of section three of this act." Section 3 in turn recites that the "amounts to be distributed from item 7061-0008 of [Section 2] are hereby deemed to be in full satisfaction of the amounts due under" G. L. c. 70, Sections 3, 6, and 7. Section 3 also states that "[n]othwithstanding the provisions of any general or special law to the contrary, the total amounts to be distributed and paid to each city, town" and other political subdivision from item 7061-0008 of Section 2 of the act "shall be [as] set forth" in the list included in this section. That list recites the precise dollar amount of 7061-0008 Chapter 70 aid to be distributed to each municipality and political subdivision. Section 3 also provides that the State Treasurer shall make no payments to cities and towns pursuant to Section 3 after November 30 of the fiscal year until he receives (1) certification from the Commissioner of Revenue concerning the prior year's financial reports submitted pursuant to G. L. c. 44, Section 43 (1988 ed.), and (2) certification from the Commissioner of Education of acceptance of the end of year pupil and financial report submitted pursuant to G. L. c. 72, Section 3 (1988 ed.). Section 4 of St. 1989, c. 240, directs the State Treasurer to make "two equal payments" of various assistance programs to cities and towns during each fiscal year.

What these sections of the annual appropriation act provide is a specific amount of money for school aid to each city and town, in lieu of the amounts provided for in Chapter 70, notwithstanding the provisions of any general or special law to the contrary. The State Treasurer must pay to each city and town its specific amount in two equal payments during the fiscal year, but he may do so only after certain certifications have been delivered. These provisions are self-contained guidelines for the furnishing of Chapter 70 school aid in the 1990 fiscal year. They bar the application of G. L. c. 29,

Page 380

Sections 9B and 9C, or any other general or special law, to the determination of the amounts that must be paid as Chapter 70 aid. No party argues that Section 3 of St. 1989, c. 240, is unlawful in any aspect because it is an improper provision for an annual appropriation act.

Even if Section 3 did not bar the application of Sections 9B and 9C to the appropriation for Chapter 70 aid, those sections do not authorize the Governor to reduce Chapter 70 local aid amounts set forth in Section 3 of the 1990 fiscal year appropriation act. Section 9C of G. L. c. 29, which is set forth in the margin, [Note 3] allows the Governor to reduce allotments under Section 9B, in certain circumstances, when available revenues during a fiscal year will be insufficient to meet authorized expenditures. Section 9B, the first part of which is set forth in the margin, [Note 4]

Page 381

is the crucial statutory provision here. It describes which monies or allotments the Governor may reduce under Section 9C. These monies or allotments are funds "made available by appropriation or otherwise, to state agencies under the control of the governor or a secretary." Section 9B also directs the Governor to divide each agency's funds into allotment periods. In this way, it is generally expected that an appropriation will be expended proportionately over the course of a fiscal year.

The short answer to the question whether the Governor may use Section 9C to reduce amounts appropriated by line item 7061-0008 is that the school aid funds appropriated by that line item, and assigned in specific amounts to cities and towns by Section 3 of the fiscal year 1990 appropriation act, are not "made available" to any State agency "under the control of the governor or a secretary." Neither the requirement that the Commissioners of Revenue and Education must certify certain information before the State Treasurer may distribute those school aid funds, nor the fact that the appropriation appears under the heading "Department of Education" makes those school aid funds available to any State agency described in Section 9B. Moreover, the provision in Section 4 of St. 1989, c. 240, that the school aid funds be distributed twice a year is inconsistent with the allotment provisions described in Section 9B.

The provision in Section 9C concerning reductions in Section 9B allotments obviously has no application to amounts that are not subject to allotment, and amounts not available to agencies under the control of the Governor or one of his secretaries simply are not subject to allotment. [Note 5]

Page 382

2. The plaintiffs claim that Section 6 of St. 1989, c. 240, which purports to limit the distribution of State lottery funds as local aid in fiscal years 1989 and 1990, is unlawful. Their argument is that Section 6, an outside section of the fiscal year 1990 general appropriation act, attempts to enact general legislation and that a general appropriation act may not lawfully be used for that purpose. We need not now decide whether an outside section not related to an appropriation may constitutionally be included in a general appropriation act because we conclude that Section 6 is sufficiently related to the subject of the appropriation of funds that, even if the premise of the plaintiffs' argument is correct, Section 6 is lawful. [Note 6] For the same reason, we need not decide whether G. L. c. 29, Section 7L (1988 ed.), would apply to invalidate a nonappropriation-related outside section of a general appropriation act. [Note 7]

Page 383

Each quarter the balance in the State Lottery Fund, after deduction for expenses and prizes, is credited to the Local Aid Fund, established under G. L. c. 29, Section 2D (1988 ed.). G. L. c. 10, Section 35 (1988 ed.). Under G. L. c. 58, Section 18C (a) (1988 ed.), the State Treasurer quarterly must distribute amounts credited to the Local Aid Fund to cities and towns "without further appropriation." It is thus apparent that, under the General Laws, the Legislature has appropriated the net proceeds of the State lottery to cities and towns through the Local Aid Fund.

Section 6 of St. 1989, c. 240, the second paragraph of which is quoted in the margin, [Note 8] if lawful, eliminated the planned automatic distribution of certain lottery funds to cities and towns for fiscal years 1989 and 1990. Under Section 6, certain amounts of lottery funds in excess of $306,000,000 in each year are to be treated differently from the manner in which the General Laws provide. In modifying the normal appropriation of lottery funds made by the General Laws, the Legislature engaged in a process that directly concerns the appropriation of funds for local aid. See Slama v. Attorney Gen., 384 Mass. 620, 625-626 (1981), and cases cited; G. L. c. 29, Section 1 (1988 ed.), defining "appropriation" for the

Page 384

purpose of G. L. c. 29; G. L. c. 29, Section 7L, which, in turn, includes local aid within the permissible range of subjects to be included in an appropriation law. Cf. Massachusetts Coalition for the Homeless v. Secretary of Human Servs., 400 Mass. 806, 816-817 (1987) (fixing the aid for dependent children standard of need in annual budget "is not unambiguously a provision on a `subject matter' other than an appropriation"). Because Section 6 relates to an appropriation, we need not consider the plaintiffs' constitutional and statutory challenges to Section 6. [Note 9]

We do not understand the defendants to argue that the plaintiffs lack standing to challenge Section 6 on the ground that Section 6 violates Section 7L. The defendants do challenge the plaintiffs' standing to argue that Section 6 could not constitutionally replace the local aid distribution procedure described in the General Laws. We have answered this challenge unfavorably to the plaintiffs, and, therefore, the standing question (which is not a jurisdictional one) need not be resolved. [Note 10]

3. The plaintiffs urge us, in a generalized argument, to enforce G. L. c. 29B (1988 ed.), which provides in part for a "general appropriation bill which shall constitute a balanced budget for the commonwealth" (G. L. c. 29B, Section 2). Section 7 of G. L. c. 29B authorizes this court, and the Superior Court, to enforce its provisions on the petition of twenty-four taxable inhabitants, not more than six of whom shall be from any one county.

Page 385

The plaintiffs have made no specific proposal for judicial action under G. L. c. 29B. The defendants properly question the right of the Legislature and Governor to restrict their respective successors through G. L. c. 29B. The defendants also suggest that any order under G. L. c. 29B would present art. 30 (separation of powers) questions. We put aside the constitutional issues and simply state that the plaintiffs have failed to present an adequate basis for judicial action under G. L. c. 29B.

4. A judgment shall be entered in the Superior Court declaring that (1) the procedures set forth in G. L. c. 29, Sections 9B and 9C, did not authorize a reduction in the amounts of Chapter 70 aid provided in St. 1989, c. 240; (2) Statute 1989, c. 240, Section 6, lawfully authorized the Legislature to limit the distributions to cities and towns from the proceeds of the State lottery during the 1989 and 1990 fiscal years; and (3) the plaintiffs are not entitled to relief under G. L. c. 29B.

So ordered.

LIACOS, C.J. (concurring). Although I join in the court's substantive interpretation of the relevant statutes, I write separately because I believe it may be appropriate to comment on some issues not fully discussed by the court.

The plaintiffs contend that:

1. The Governor's withholding of $210,000,000 of Chapter 70 aid appropriated for fiscal year 1990 is an invasion of the General Court's authority to appropriate funds for a specific purpose;

2. If G. L. c. 29, Section 9C (1988 ed.), authorizes the Governor's action, the statute constitutes an unconstitutional delegation of the legislative power to appropriate, and a circumvention of the General Court's power to override a veto;

3. Section 9C may be construed in a manner which removes all doubts about its constitutionality;

Page 386

4. If the power to withhold appropriated funds may be delegated by the General Court, that delegation must contain appropriate standards, and Section 9C does not;

5. Chapter 70 aid is not subject to the allotment procedures under G. L. c. 29, Section 9B (1988 ed.);

6. Section 9C was unconstitutionally adopted as an outside section in an earlier general appropriation act (St. 1976, c. 283, Section 3F), is invalid, could not bind future legislative sessions, and may not serve as a basis for the Governor's withholding of Chapter 70 aid;

7. The Governor's use of Section 9C to allocate Chapter 70 aid on a per capita basis is an unconstitutional application of the statute;

8. Section 6 of the general appropriation act for fiscal year 1990 (St. 1989, c. 240, Section 6), an outside section, unconstitutionally purports to amend the statutory scheme and formula for distribution of lottery revenues which do not require legislative appropriation; and,

9. The court should enforce the provisions of G. L. c. 29B.

In my view, the plaintiffs have no standing to raise issues 1, 2, 4, 6, 7, and 8 for the following reasons.

Standing. The plaintiffs are municipalities, as well as individuals who are plaintiffs in their official capacities, and as they are residents of, and taxpayers in, those municipalities.

a. Municipalities. We have held that a municipality cannot challenge the constitutionality of State statutes. Trustees of Worcester State Hosp. v. The Governor, 395 Mass. 377, 380 (1985) (governmental entities may not challenge the constitutionality of State statutes); Spence v. Boston Edison Co., 390 Mass. 604, 608 (1983) (city may not invoke certain constitutional challenges). When considering whether a school committee had standing to challenge a statute, we said: "In general, the constitutionality of a statute may be

Page 387

litigated only by persons whose interests are affected." Attorney Gen. v. School Comm. of Essex, 387 Mass. 326, 328 (1982). [Note Concur-1] The municipalities do not have standing to present constitutionally-based challenges to the statutes at issue. [Note Concur-2]

b. Municipal officials. Municipal officials lack standing to challenge the constitutionality of statutes, unless their private rights are involved. Id. at 329. Trustees of Smith College v. Assessors of Whately, 385 Mass. 767, 771 & n.3 (1982) (local assessors lack power to challenge constitutional validity of granting exemptions to real estate owned by charitable or educational institution because of alleged violation of State law). Assessors of Haverhill v. New England Tel. & Tel. Co., 332 Mass. 357, 362 (1955) (public officer whose private rights are not involved may not question the constitutionality of a statute). The officials in this case have not made the requisite showing.

Thus, neither the municipalities nor the individuals who are plaintiffs in their official capacities (such as selectmen, mayors, and school committee members) have standing to challenge the constitutionality of the statutes at issue.

c. Individuals. The plaintiffs in their individual capacities as residents and taxpayers must have suffered, or be in danger of suffering, legal harm in order to compel the courts to pass on the validity of the acts of a coordinate branch of government. Doe v. The Governor, 381 Mass. 702, 704 (1980). This requirement is not avoided by a prayer for declaratory relief. Id. Over sixty years ago this court described as a "general principle" the concept that only one whose rights are impaired may question in court the constitutionality of a statute. The court stated: "It is only when some person invokes

Page 388

[the] aid [of the courts] to protect him in his liberty, rights or property as secured under the Constitution against invasion through the operation of a statute, that the courts examine objections to its constitutionality." Horton v. Attorney Gen., 269 Mass. 503, 513-514 (1929). The court added that, in order to question the validity of a statute, one must be directly affected as to some personal interest. Id. at 514. The principle that strangers have no standing in the courts is considered to be "a part of the very fabric of our law." McGlue v. County Comm'rs of Essex, 225 Mass. 59, 60 (1916).

Additionally, for plaintiffs to invoke the remedy of declaratory judgment under G. L. c. 231A (1988 ed.), there must be more than controversy in the abstract; there must be a legally cognizable injury entitling a person to initiate judicial resolution of the controversy. Massachusetts Ass'n of Indep. Ins. Agents & Brokers, Inc. v. Commissioner of Ins., 373 Mass. 290, 293 (1977). See G. L. c. 231A, Sections 1, 9. Only one who can allege an injury within the area of concern of the statute under which the injurious action has occurred has standing. Id. In declaratory judgment proceedings this court has required that one who seeks declaratory relief must allege a breach of any duty owed to him. Penal Inst. Comm'r for Suffolk County v. Commissioner of Correction, 382 Mass. 527, 532 (1981).

The plaintiffs point to "the severe reductions of local services they and others . . . suffer as a result of . . . the Governor's withholding of local aid"; mention "cutbacks in education, public works, police, fire and general government services"; and claim that these are particularized injuries directly affecting each plaintiff.

The argument is not so persuasive as to warrant a grant of standing in the individual plaintiffs. While reductions of local services may occur, I am not persuaded that the plaintiffs in their individual capacities have suffered, or are in danger of suffering, legal harm; that a personal interest is directly affected; that their rights have been impaired; that they have demonstrated legally cognizable injury; or shown a breach of any duty. Moreover, any reductions in local services may be

Page 389

attributable, at least in part, to other factors such as a lack of additional local revenue or the absence of expenditure adjustments which could contribute to an ability of the Commonwealth to continue to provide a comparable level of services.

Although, in the past, the court has recognized variations on these principles, they are not ones which aid the plaintiffs in this case. Individuals who were citizens and qualified voters had standing to argue that a measure commonly known as Proposition 2 1/2 was not constitutionally adopted. Massachusetts Teachers Ass'n v. Secretary of the Commonwealth, 384 Mass. 209, 214 (1981). See Cohen v. Attorney Gen., 354 Mass. 384, 387 (1968), and cases cited (standing shown to question whether proposed initiative amendment contains excluded matter). It is true that the court has considered actions brought by "private parties who are legitimately concerned in the performance by public officers of a public duty." Quinn v. School Comm. of Plymouth, 332 Mass. 410, 413 (1955), quoting Cape Cod S.S. Co. v. Selectmen of Provincetown, 295 Mass. 65, 69 (1936), and cases cited. See Police Comm'r of Boston v. Boston, 279 Mass. 577, 585 (1932), and Brooks v. Secretary of the Commonwealth, 257 Mass. 91, 93 (1926). However, the opportunity is applicable to actions for relief in the nature of mandamus; these plaintiffs request declaratory relief from this court. See Brewster v. Sherman, 195 Mass. 222, 224-225 (1907). [Note Concur-3]

d. Summary. I conclude that neither the municipalities nor their officials have standing to challenge the constitutionality

Page 390

of the statutes and actions at issue. The plaintiffs in their individual capacities as residents and taxpayers do not have standing to challenge any of the statutes or actions on constitutional grounds.