Appeal of P.S. Docket No. 38/163 -- ZION'S HOPE, INC.

 In the Matter of the Petition by       )  August 23, 1993
                                        )
 ZION'S HOPE, INC.                      )
 PO Box 690909                          )
 Orlando, FL 32869-0909                 )
                                        )
 Denial of Application for Second-Class )
 Mail Privileges for ZION'S FIRE        )  P. S. Docket No. 38/163


 APPEARANCE FOR PETITIONER:             George R. Grange, II, Esq.
 Robert J. Barlow, Esq.
 Gammon & Grange, P.C.
 8280 Greensboro Dr., 7th Floor
 McLean, VA 22102-3807


 APPEARANCE FOR RESPONDENT:             Kenneth N. Hollies, Esq.
 Law Department
 United States Postal Service
 Washington, DC 20260-1143

POSTAL SERVICE DECISION

Respondent, United States Postal Service, has appealed from an Initial Decision of an Administrative Law Judge reversing the denial of an application filed by Petitioner, Zion's Hope, Inc., to change the second-class mail authorization for its publication Zion's Fire from that of a requester publication to that of a "church" under Domestic Mail Manual (DMM) § 423.212(d). Petitioner opposes the appeal, contending that the Administrative Law Judge correctly concluded that Petitioner qualifies as a "church" under the definition contained in the DMM.^1/

Background

The facts in this matter are not in dispute. Petitioner, which had previously been granted second-class mail privileges as a requester publication for its publication Zion's Fire, sought to take advantage of special second-class rates by applying to re-enter the publication as a church publication pursuant to DMM § 423.212(d). The application was ultimately denied by the Director, Office of Classification and Rates Administration (OCRA), who concluded that Petitioner was not a "church" within the meaning of the Postal Service and Postal Rate Commission regulations.^2/ On appeal, the Administrative Law Judge concluded that Petitioner met the definition of a "church" under DMM § 423.212(d) and reversed the decision of the Director, OCRA.

Discussion

Petitioner desires to re-enter its publication Zion's Fire as the publication of a "church" under DMM § 423.212(d) so that it will be eligible to use the special second-class rates available to non-profit organizations under DMM § 424 without the need to maintain a list of paid subscribers. Under its current status as a requester publication (DMM § 423.4) Petitioner is ineligible for these special second-class rates (see DMM § 424.11). The parties have stipulated that the sole issue presented for determination is whether Petitioner qualifies as a "church" within the meaning of 39 C.F.R. Part 3001, Subpart C, Appendix A (DMCS), § 200.0106(k), and DMM § 423.212(d). The parties agree that if Petitioner so qualifies, it should be granted the special second-class rates it is seeking.

Respondent concedes that Petitioner meets the literal definition of a "church" contained in DMM § 423.212(d) -- i.e., that Petitioner conducts local worship services^3/ -- but argues that meeting that definition is insufficient to classify Petitioner as a church. Instead, Respondent argues that to qualify as a church under the regulation, Petitioner must demonstrate that it is "organized and operated" in a manner similar to a "local church."

Respondent contends that the Administrative Law Judge and the Judicial Officer are obligated to interpret DMM § 423.212 so as to avoid any "constitutional infirmity" which might exist as the result of a literal reading of that section. According to Respondent a literal reading of § 423.212 so that it would apply only to those organizations which conduct local worship services is an interpretation which favors religious organizations over non-religious organizations, a result prohibited by the "establishment" and "free exercise" clauses of the First Amendment.^4/ Thus, Respondent urges adoption of its interpretation -- that the Section applies to groups "organized and operated" in a manner similar to "local churches" -- as one which maximizes the likelihood that the regulation will withstand a constitutional challenge.^5/

Respondent does not define in concrete terms the test it would use to determine whether a group is organized and operated in a manner similar to a local church. However, suggestions as to the tests it would apply appear throughout its submittals. In its appeal brief, Respondent quotes from the OCRA decision as identifying the "salient characteristics of a qualifying organization:"

"[T]he term 'church' applies only to local congregations of worshippers who meet regularly to engage in services the contents of which are determined by their particular faith. Congregants typically contribute funds to the church, which also publishes a periodical that is directed to, among others, the congregants."

In its Proposed Findings of Fact [and] Conclusions of Law, submitted to the Administrative Law Judge, Respondent offered a more general description of the characteristics of a qualifying organization, which it stated were revealed in the legislative history of the Section's statutory predecessor, 39 U.S.C. § 355(a)(9):

"... local groups whose organization and operation are typified by regular local meetings led by group leaders, existing financial support by members of the group, and a second-class periodical published by the group and sent to its members."

Further, in its appeal brief Respondent argues that there are other characteristics which cause Petitioner not to "resemble the class of organizations to which Congress intended to extend the benefit of exemption from the paid subscriber rule." In this connection, Respondent argues that:

"1) Petitioner has two or three ordained ministers ... who generally do not conduct local meetings, but who perform priestly functions at other locations.

2) Petitioner does not appoint ministers or other staff normally associated with local churches.

3) The purpose statement of Petitioner's Articles of Incorporation is quite general, ... omitting any mention of the organization and operation of a local church.

4) In its 'Statement of Principles and Practices' Petitioner urges its members to join local churches that are extrinsic to and wholly unaffiliated with Petitioner. Thus, Petitioner simultaneously claims to be a local church, and to urge its followers to join other local churches....

5) Petitioner is classified by the Internal Revenue Service and Dun and Bradstreet as an organization other than a church.

6) At best, local meetings serve an incidental or adjunct role in the overall organization and operation of Petitioner. The general absence of Petitioner's ordained leadership from local meetings emphasizes the incidental role of these meetings in Petitioner's organization and operation.

7) Petitioner is not burdened by the administrative problem Congress sought to rectify by enactment of 39 U.S.C. § 4355(a)(9), since a) it sends out 40,000 copies of Zion's Fire; b) has only 200 congregants who may or may not need to engage in the 'smokescreen' of filling out subscription cards; and c) has at least 39,800 subscribers for whom interest in receiving Zion's Fire cannot be presumed from Petitioner's organization and operation." (Respondent's Appeal Brief, pp. 27-28, with references to the administrative record omitted).

It is apparent from this recitation of additional factors which Respondent would add to the test of whether an organization is a "church" under DMM § 423.212(d), that the Administrative Law Judge correctly concluded that what Respondent is advocating cannot reasonably be considered merely a new "interpretation" of the regulation, but instead would effectively constitute an amendment to the regulation. Thus, the Administrative Law Judge properly considered whether he had authority to amend the regulation.

In its Exception #6, Respondent misstates the Administrative Law Judge's holding when it argues that the Administrative Law Judge concluded that he lacked the authority to adopt a modified interpretation of the regulation. In fact, the Administrative Law Judge correctly concluded that he lacked the authority to adopt what would be an amendment to the regulation rather than an interpretation of the regulation. Respondent cites NLRB v. Bell Aerospace Co., 416 U.S. 267 (1974), apparently for the proposition that the Administrative Law Judge has the authority to effect a change in the section and is not required to await formal rulemaking proceedings. That case, however, held generally that administrative agencies have discretion to exercise their authority to adopt rules either by general rulemaking proceedings or through adjudication of individual cases. While the Postal Service as an agency might have the authority to amend the regulation so as to adopt the revised definition of "church" advocated by Respondent (a question which is not decided here), there has been no showing that the agency has delegated that authority to the Administrative Law Judge. Similarly, although, under 39 C.F.R. § 226.2(e), certain authority has been delegated to the Judicial Officer in connection with the performance of his "quasi-judicial duties" that authority does not extend to amending the Domestic Mail Manual. Therefore, whatever the merits of Respondent's arguments concerning the constitutional defects of a literal interpretation of DMM § 423.212 (which could not, in any event, be decided by the Administrative Law Judge or Judicial Officer, Canadian Express Club, et al., P.S. Docket No. 28/52 (P.S.D. December 23, 1991); Columbia Flier, P.S. Docket No. 26/17 (P.S.D. May 11, 1988)), neither the Administrative Law Judge nor the Judicial Officer has the authority to cure any such defects by amending DMM § 423.212.

Similarly, the Administrative Law Judge also properly declined to rely on the legislative history of 39 U.S.C. § 4355(a)(9) in considering the applicability of DMM § 423.212(d). The DMM section, unlike the statute, unambiguously defines the term "church." Reading into the unambiguous language of the DMM section the legislative history of the statute would, as concluded by the Administrative Law Judge, result in amending the DMM language, which the Administrative Law Judge and Judicial Officer may not do.

Finally, although there have been no Postal Service decisions involving the definition of a "church" under DMM § 423.212(d), Respondent has not shown that the Administrative Law Judge improperly looked to the decisions which interpreted the word "church" under 39 U.S.C. § 4355(a)(9) as providing support for his conclusion in this case. These decisions defined the term essentially the same as the DMM definition which is at issue here.

Conclusion

Respondent has failed to establish that the Administrative Law Judge erred in deciding that Petitioner qualifies as a "church" under the definition contained in DMM § 423.212(d). Accordingly, Respondent's appeal from the Initial Decision of the Administrative Law Judge reversing the decision of the Director, OCRA, is denied.

                                        James A. Cohen
                                        Judicial Officer

1/ The provisions of the Domestic Mail Manual are part of the system of "regulations" of the Postal Service. 39 C.F.R. § 211.2(a)(2).

2/ The regulations referred to by the Director were 39 C.F.R. Part 3001, Subpart C, Appendix A (Domestic Mail Classification Schedule), § 200.0106(k) and DMM § 423.212(d). Although the DMM has since been revised the citations in this decision are to the former DMM provisions which have not been substantially modified in the new publication. See DMM Part E222 § 1.2g (July 1993 edition).

Section 200.0106 of the Domestic Mail Classification Schedule promulgated by the Postal Rate Commission provides in pertinent part:

"Except as provided in section 200.0107, second-class matter containing no advertising other than that of the publisher, is exempt from the requirements of sections 200.0104 and 200.0105 if it is:

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k. Published by a church or church organization."

Section 423.212 of the DMM provides in pertinent part:

"Eligible Publications Containing General Advertising. The following types of publications that meet the basic requirements of 422 and contain only the publisher's own advertising are eligible for second-class mail privileges. These publications may also carry general advertising under 423.213 as follows:

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d. Published by a church or church organization. The term 'church' applies only to congregations of worshippers who actually conduct religious services..."

3/ See Respondent's Proposed Findings of Fact and Conclusions of Law, p. 13, ¶ 20. In Exception #2, Respondent argues that it did not concede that Petitioner "is qualified as a 'church.'" The Exception, however, misstates the Initial Decision. The Administrative Law Judge did not conclude that Petitioner had made such a concession. Rather, the Administrative Law Judge concluded only that Respondent had admitted that Petitioner conducts local worship services and, therefore, meets the literal definition in the regulation. The Administrative Law Judge recognized and addressed Respondent's argument that more is required for an organization to qualify as a church.

4/ "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; ...."

5/ Respondent also argues that its interpretation is consistent with the intent of Congress when it enacted the former 39 U.S.C. § 4355(a), which provided generally that publications of a "church or church organization" could be mailed as second-class mail, but did not define the terms "church" or "church organization."