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AGO 1983 No. 27 - December 02, 1983
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Ken Eikenberry | 1981-1992 | Attorney General of Washington

OFFICES AND OFFICERS ‑- STATE ‑- WASHINGTON STATE CONVENTION AND TRADE CENTER ‑- CIVIL SERVICE ‑- EMPLOYEES ‑- CIVIL SERVICE STATUS OF EMPLOYEES OF STATE CONVENTION AND TRADE CENTER

(1) The Washington State Convention and Trade Center corporation which was created pursuant to § 2, chapter 34, Laws of 1982 to construct and operate the State convention and Trade Center is a state agency for purposes of the state civil service law, chapter 41.06 RCW.

(2) Identification, based upon the foregoing conclusion, of those offices or positions within the corporation which are, nevertheless, exempt from civil service coverage under RCW 41.06.070.

                                                              - - - - - - - - - - - - - 

                                                                December 2, 1983 

Honorable Leonard Nord, Director
Department of Personnel
600 South Franklin
Olympia, WA 98504

Cite as:  AGO 1983 No. 27                                                                                                                

Dear Sir:

             By letter previously acknowledged you requested our opinion on the status, under the state civil service law, of the Washington State Convention and Trade Center and its employees.  We paraphrase your questions as follows:

             (1) Is the public nonprofit corporation which was created pursuant to ‑ 2, chapter 34, Laws of 1982 to construct and operate the State Convention and Trade Center a state agency for purposes of the state civil service law, chapter 41.06 RCW?

             (2) If so, are any of the employees of the corporation nevertheless exempt from coverage under that law?

             We answer your first question in the affirmative and respond to your second question in the manner set forth in our analysis.

              [[Orig. Op. Page []]

                                                                     ANALYSIS

             RCW 41.06.040, a part of the state civil service law which originated with the passage of Initiative 207 in 1960, sets forth the scope of coverage of that law as follows:

             "The provisions of this chapter [the state civil service law] apply to:

             (1) Each board, commission or other multimember body, including, but not limited to, those consisting in whole or in part of elective officers;

             (2) Each agency, and each employee and position therein, not expressly excluded or exempted under the provisions of RCW 41.06.070."

             In turn the word "agency," as used in RCW 41.06.040, supra, is defined in RCW 41.06.020(1), as follows:

             "'Agency' means an office, department, board, commission, or other separate unit or division,however designated, of the state government and all personnel thereof; it includes any unit of state government established by law, the executive officer ormembers of which are either elected orappointed, upon which the statutes confer powers and impose duties in connection with operations of either a governmental or proprietary nature."  (Emphasis supplied)

             Question (1):

             Your first question asks whether the Washington State Convention and Trade Center corporation is an "agency", as thus above defined, for purposes of the state civil service law and its various provisions regarding classified state personnel.  We believe that it is.

             The Washington State Convention and Trade Center corporation was formed in accordance with chapter 34, Laws of 1982.  See, § 2 of that act, now codified as RCW 67.40.020, which reads as follows:

             "The governor is authorized to form a public nonprofit corporation in the same manner as a private nonprofit corporation is formed under chapter 24.03 RCW.  The  [[Orig. Op. Page 3]] public corporation shall be an instrumentality of the state and have all the powers and be subject to the same restrictions as are permitted or prescribed to private nonprofit corporations, but shall exercise those powers only for carrying out the purposes of this chapter and those purposes necessarily implied therefrom.  Thegovernor shall appoint a board of nine directors for the corporation who shall serve terms of six years, except that two of the original directors shall serve for two years and two of the original directors shall serve for four years.  The directors may provide for the payment of their expenses.  The corporation may causea state convention and trade center with an overall size of approximately three hundred thousand square feet to be designed and constructed on a site in the city of Seattle.  In acquiring, designing, and constructing the state convention and trade center, the corporation shall consider the recommendations and proposals issued on December 11, 1981, by the joint select committee on the state convention and trade center.

             "TheCorporation may acquire real and personal property by lease, purchase,condemnation of privately owned land, or gift, accept grants, request the financing provided for in RCW 67.40.030, cause the state convention and trade center facilities to be constructed, and do whatever is necessary or appropriate to carry out those purposes.  The corporation shall maintain, operate, promote, and manage the state convention and trade center."  (Emphasis supplied)

             Thus, although in form a nonprofit corporation, the Convention and Trade Center corporation was expressly declared to be an instrumentality of the State.  It is governed by a board of nine directors who are appointed by the Governor for specific terms of office.  Moreover, as indicated in the second paragraph of RCW 67.40.020, supra, it is authorized to exercise the State's power of eminent domain.  In addition, under RCW 67.40.050, it is subject to specific appropriation control by the legislature.  And, under RCW 67.40.040, its funds are required to be deposited in the state General Fund.  Also, we note that under RCW 67.40.090, a state excise tax is imposed for the payment of a substantial portion of the costs of the project involved (i.e., the State Convention and Trade Center itself).  Furthermore, the primary source of initial funding for the facility is sale of state general obligation bonds, which were recently issued by the State Finance Committee in  [[Orig. Op. Page 4]] accordance with RCW 67.40.030.

             In short, in every respect save that of its corporate form, the State Convention and Trade Center corporation has virtually all of the usual attributes of a traditional state agency.

             We next note that the definition of an "agency" in RCW 41.06.020(1),supra, is very broad.  It covers any ". . . separate unit or division, however designate, of the state government and all personnel thereof."  It includes ". . . any unit of state government established by law."  Also, the powers and duties of the entity involved need not be restricted to "governmental" functions but may relate (either instead or as well) to functions of a "proprietary nature".  Thus, the mere fact that the body here involved is, in form, a corporation‑-a form presumably chosen by the legislature because of the proprietary nature of its principal activities‑-does not in our judgment afford any basis for concluding that it is not an "agency" within the meaning of the state civil service law.

             We think it also notable that in construing this state's civil service laws, our Supreme Court has generally favored civil service coverage.  Thus, inState Employees v. Community College, 90 Wn.2d 698, 585 P.2d 474, the Court said, at page 703:

             ". . . The civil service laws embody a determination that the interests of the state are best served by a system of merit selection of personnel.  Such a determination goes beyond considerations of mere costs to encompass other benefits such as efficiency and avoidance of the 'spoils' system [citation omitted].  Thus, an anticipated or real savings in cost cannot be a basis for avoiding the policy and mandate of civil service laws. . . ."

             To the same effect, in the federal sector, see Lodge 1858, American Fed'n. of Gov't. Employees v. Administrator, NASA, 424 F.Supp 186 (D.D.C. 1976) in which the Court, referring to the interpretation given to the federal civil service laws by the general counsel for the Civil Service Commission, said, at page 190:

             "'In the absence of clear legislation expressly authorizing the procurement of personnel to perform the regular functions of agencies without regard to the personnel laws, we must insist on scrupulous adherence to those laws and the policies they embody. . . .'"

              [[Orig. Op. Page 5]]

            In the instant case, of course, our own legislature could have excluded the State Convention and Trade Center corporation, and its employees, from the coverage of chapter 41.06 RCW by its enactment of an express provision to that effect.  The legislature did not, however, do so.  Nor, indeed, did it give even the slightest hint‑-anywhere within the confines of chapter 34, Laws of 1982 (i.e., what is now chapter 67.40 RCW)‑-that any sort of exclusion from civil service applicability was intended.  Yet, in the past, the legislature has clearly evidenced its intention to carve out exceptions to civil service coverage, by express provision, when it desires to do so.  See, e.g., § 28, chapter 136, Laws of 1981 (RCW 41.06.071), exempting certain employees of the Department of Corrections from civil service coverage; § 11, chapter 62, Laws of 1970, 1st Ex. Sess. (RCW 41.06.070), doing likewise with respect to certain employees of the Department of Ecology; and, in the same vein, what is now RCW 41.06.075 for certain employees of the Office of Financial Management; RCW 41.06.076 with respect to certain personnel of the Department of Social and Health Services; RCW 41.06.077 with regard to certain employees of the Department of Veterans' Affairs; and, finally, RCW 41.06.079 with respect to certain employees of the Department of Transportation.

             There is, however, one other‑-somewhat technical‑-argument to be considered.  In defining the word "agency," RCW 41.06.020(1), supra, speaks of that term as including ". . . any unit of state governmentestablished by law. . ."  But here, the State Convention and Trade Center corporation was actually "created" by the Governor actingpursuant to law.  In other words, the corporation was not actually established by the law itself‑-as a self-executing legislative enactment‑-but, rather, it was established by executive action following (and by reason of) the legislature's enactment of that law.

             Nevertheless, in our opinion, it is highly unlikely that a court would permit that technical distinction to take precedence over all of the other factors we have heretofore identified as supporting an affirmative answer to your initial question;i.e., that the State Convention and Trade Center corporation is, indeed, a state agency for the purpose of the state civil service law, chapter 41.06 RCW,supra.1/

                          [[Orig. Op. Page 6]]

            Moreover, in any event, it will also be noted that the language "established by law"‑-with which we are here concerned‑-only appears in a subordinate, explanatory, portion of the statutory definition of an "agency."2/ Thus, it does not even necessarily follow that the words "established by law" serve to modify, or qualify, anything other than the last preceding antecedent in the subordinate clause in which those words appear.  Cf.,Martin v. Aleinikoff, 63 Wn.2d 842, 389 P.2d 422 (1964).  And without that clause we would have, simply, a definition of the term "agency" as meaning ". . . an office, department, board, commission or other separate unit or division,however designated, . . ."  (Emphasis supplied)

             For all of the foregoing reasons, therefore, we answer your first question in the affirmative.  The Washington State Convention and Trade Center corporation, as above described,is, in our opinion, a state agency for purposes of the state civil service law, chapter 41.06 RCW.3/

              [[Orig. Op. Page 7]]

            Question (2):

             Your second question anticipates the foregoing answer to question (1) and asks whether, nevertheless, any of the employees of the corporation are exempt from the coverage of the state civil service law.

             Once again, RCW 41.06.040 (quoted earlier) says that:

             "The provisions of this chapter [the state civil service law] apply to:

             "(1) Each board, commission or other multimember body, including, but not limited to, those consisting in whole or in part of elective officers;

             "(2) Each agency, and each employee and position therein, not expressly excluded or exempted under the provisions of RCW 41.06.070."

             In addition, as also earlier noted, various other exemptions for certain employees of specified agencies have been provided for by the legislature.  See again, RCW 41.06.071-41.06.079, supra.  Since none of those other exemptions, however, relate to the "agency" here involved, we need not consider them further and, instead‑-based upon our answer to your first question‑-we may now turn directly to those exemptions contained in RCW 41.06.070.

             First, there is in subsection (8) of that statute a general exemption for the members, themselves, of a multimember board, commission or committee appointed by the Governor,i.e., in this instance, the members of the board of directors of the corporation itself.  They, therefore, are exempt from civil service coverage.

             "(b) If the members of the board, commission, or committee serve on a part time basis and there is a statutory executive officer:  (i) The secretary of the board, commission, or committee; (ii) the chief executive officer of the board, commission, or committee; and (iii) the confidential secretary of the chief executive officer of the board, commission, or committee;"

             We believe that, under that provision, the chief executive officer of the corporation (i.e., the president) would also be exempt from civil service coverage.  The only hurdle to be overcome on that count involves the legitimacy of characterizing the president of the corporation as a statutory chief executive officer.  Without question, chapter 67.40 RCW itself makes no specific reference to the position of chief executive officer.  As we earlier noted, however, that law does contain a cross reference to chapter 24.03 RCW, the nonprofit corporation law.  See again, RCW 67.40.020,supra, which begins as follows:

             "The governor is authorized to form a public nonprofit corporation in the same manner as a private nonprofit corporation is formed under chapter 24.03 RCW. . . ."  (Emphasis supplied)

             In turn, RCW 24.03.125 lists the statutory officers of a nonprofit corporation formed under that RCW chapter.  And those officers include a president‑-who would be the statutory chief executive officer of the corporation.

             In addition, having thus concluded that RCW 41.06.070(8)(b) applies, it also follows that the secretary of the board and the confidential secretary of the chief executive officer would likewise be exempt.

             We next call your attention to the following exemption contained in subsection (23) of RCW 41.06.070, supra:

             "(23) Executive assistants for personnel administration and labor relations in all state agencies employing such executive assistants including but not limited to all departments, offices, commissions, committees, boards, or other bodies subject to the provisions of this chapter and this subsection shall prevail over any provision of law inconsistent herewith unless specific exception is made in such law;"

             Conceivably, depending upon its internal organization, the corporation may also have personnel who would come within the purview of that provision and, accordingly, are likewise exempt from civil service coverage.

                          [[Orig. Op. Page 9]]

            Another potentially pertinent exemption to be noted is contain in subsection (12) of the statute which covers,

             ". . . part time professional consultants, as defined by the state personnel board . . ."

             And, finally, in RCW 41.06.070(24), a procedure is outlined whereby additional exemptions may also be obtained through interaction with the State Personnel Board.  That subsection of the law reads, in pertinent part, as follows:

             "(24) In addition to the exemptions specifically provided by this chapter, the state personnel board may provide for further exemptions pursuant to the following procedures.  The governor or other appropriate elected official may submit requests for exemption to the personnel board stating the reasons for requesting such exemptions.  The personnel board shall hold a public hearing, after proper notice, on requests submitted pursuant to this subsection.  If the board determines that the position for which exemption is requested is one involving substantial responsibility for the formulation of basic agency or executive policy or one involving directing and controlling program operations of an agency or a major administrative division thereof, the personnel board shall grant the request and such determination shall be final.  The total number of additional exemptions permitted under this subsection shall not exceed one hundred seventy-five for those agencies not directly under the authority of any elected public official other than the governor, and shall not exceed a total of twenty-five for all agencies under the authority of elected public officials other than the governor.  The state personnel board shall report to each regular session of the legislature during an odd-numbered year all exemptions granted pursuant to the provisions of this subsection, together with the reasons for such exemptions.

             ". . ."

             Unless such exemptions have been obtained, however, or the particular employees come within the purview of one of the other subsections of RCW 41.06.070,supra, which we have here noted, our answer to your second question must be in the negative.  SUch "other" employees of the corporation, who are not exempt from  [[Orig. Op. Page 10]] civil service coverage under one of those provisions, are not for any other reason exempt from coverage under that law.

             This completes our consideration of your questions.  We trust that the foregoing will be of assistance to you.

 Very truly yours,
KENNETH O. EIKENBERRY
Attorney General

CHRISTINE O. GREGIORE
Deputy Attorney General

RICHARD A. HEATH
Senior Assistant Attorney General 

                                                         ***   FOOTNOTES   ***

 1/Unlike the nonprofit corporation that was involved in the conduct of Expo '74 in Spokane some years ago‑-which was already in existence as a private entity before the Expo '74 legislation was enacted (see, chapter 1, Laws of 1971, 1st Ex. Sess.)‑-the State Convention and Trade Center corporation only came into existence as a consequence of the Governor's exercise of the power placed in him by the here subject law.

 2/Repeated here for ease of reference, RCW 41.06.020(1), supra, reads as follows:

 "'Agency' means an office, department, board, commission, or other separate unit or division, however designated, of the state government and all personnel thereof; it includes any unit of state government established by law, the executive officer of members of which are either elected or appointed, upon which the statutes confer powers and impose duties in connection with operations of either a governmental or proprietary nature."

 3/As a practical matter, of courts‑-particularly in light of our further response to question (2), below‑-this conclusion will have little immediate effect in view of the relatively few employees who are currently working for the Convention and Trade Center corporation.  Once the facility is constructed and becomes operational, however, the necessary work force will then be substantially larger.  And, at least under the rationale utilized by our State Supreme Court inState Employees v. COmmunity College, 90 Wn.2d 698 (1978),supra, it is unlikely that the Court would then sanction, or permit, the corporation to avoid the applicable provisions of the state civil service law (unless it has in the meantime been amended) by the device of contracting out for services which could otherwise be performed by state civil service employees. 

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