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Multnomah County v. Azar

United States District Court, D. Oregon, Portland Division

August 30, 2018

MULTNOMAH COUNTY, an existing county government and a body politic and corporate, Plaintiff,
ALEX M. AZAR II, in his official capacity as Secretary, U.S. Department of Health and Human Services; VALERIE HUBER, in her official capacity as the Senior Policy Advisor for the Office of the Assistant Secretary of Health; and U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES, Defendants.


          Yim You, United States Magistrate Judge.

         Plaintiff Multnomah County (“the County”) has brought this action to enjoin the administration of the 2018 application and selection process for Teen Pregnancy Prevention Program (“TPP Program”) grants by defendants U.S. Department of Health and Human Services (“HHS”), Secretary Alex M. Azar II, and Senior Policy Advisor Valerie Huber (collectively “defendants”). Am. Compl. ¶ 1, ECF #28. The County alleges four claims: In Count One, the County asserts that the 2018 Tier 1 Funding Opportunity Announcement (“2018 Tier 1 FOA”) must be vacated under the Administrative Procedures Act, 5 U.S.C. § 706(2)(A) (“APA”) because it is not in accordance with law, specifically the Consolidated Appropriations Act, 2018, Pub. L. No. 115-141, 132 Stat. 348, 733 (2018) (“2018 CAA”), the Purpose Statute, 31 U.S.C. § 1301(a), and the Appropriations Clause, Art. I, § 9, cl. 7. Id. ¶¶ 97-104. In Count Two, the County claims that under the APA, the 2018 Tier 1 FOA is arbitrary and capricious and defendants have abused their discretion. Id. ¶¶ 105-11. Count Three alleges that the 2018 Tier 1 FOA violates the APA in that it is contrary to HHS regulations, specifically 45 C.F.R. § 87.3(1). Id. ¶¶ 112-16. Finally, in Count Four, the County asserts that the 2018 Tier 1 FOA is an ultra vires action. Id. ¶¶ 117-20.

         The County has filed a Motion for Preliminary Injunction and Partial Summary Judgment with respect to Counts One, Two, and Four. ECF #29.[1] Defendants have filed a Motion to Dismiss or for Summary Judgment against all counts. ECF #42.

         This court has federal question jurisdiction over this action. 28 U.S.C. § 1331. All parties have consented to allow a Magistrate Judge to enter final orders and judgment in this case in accordance with Fed.R.Civ.P. 73 and 28 U.S.C. § 636(c). For the reasons set forth below, the County's motion for summary judgment with respect to Counts One and Four is granted, and defendants' motion for summary judgment on those claims is denied. The County's motion for preliminary injunction is denied as moot. The motions for summary judgment on Counts Two and Three are also denied as moot.


         Although Congress first became involved with sexual-health education in the early 1900s, the passage of the Adolescent Family Life Act in 1982 provides the necessary context to frame the issues here. Pub. L. No. 97-35, 95 Stat. 582 (1981) (codified at 42 U.S.C. § 300z). From 1982 until 2010, Congress funded “abstinence education” with the purpose of promoting “abstinence from sexual activity.”[2] During this time, Congress funded “educational or motivational program[s]” that had the “exclusive purpose [of] teaching the social, psychological, and health gains to be realized by abstaining from sexual activity.” 42 U.S.C. § 710(2)(A) (2000). These programs taught “abstinence from sexual activity outside marriage as the expected standard for all school age children, ” and “that sexual activity outside of the context of marriage is likely to have harmful psychological and physical effects.” Id. §§ 710(2)(B), (E) (2000). To date, Congress has continued funding programs that promote abstinence from non-marital sexual activity. See 2018 CAA, 132 Stat. at 733 (appropriating $25 million in FY 2018 for “making competitive grants which exclusively implement education in sexual risk avoidance”); 42 U.S.C. § 710 (2018 Suppl.) (appropriating $75 million in FY 2018 to Sexual Risk Avoidance Education Programs under Title V of the Social Security Act).

         However, in fiscal year 2010, Congress charted a new course by creating the Teen Pregnancy Prevention (“TPP”) Program. See Consolidated Appropriations Act of 2010, Pub. L. No. 111-117, 123 Stat. 3034, 3253 (2009) (“2010 CAA”); H.R. Rep. No. 111-366, at 1040-41 (2009). Through the TPP Program, Congress appropriated funds toward sexual-health-education initiatives with evidence of effectiveness, with few restrictions on the underlying subject matter. Specifically, the 2010 CAA appropriated no less than $110 million “to fund medically accurate and age appropriate programs that reduce teen pregnancy, ” no less than $75 million for “replicating programs that have been proven effective through rigorous evaluation to reduce teenage pregnancy, behavioral risk factors underlying teenage pregnancy, or other associated risk factors” (known as Tier 1 grants), no less than $25 million for “for research and demonstration grants to develop, replicate, refine, and test additional models and innovative strategies for preventing teenage pregnancy” (known as Tier 2 grants), and any remainder to “be available for training and technical assistance, evaluation, outreach, and additional program support activities.” Id. Every year since 2010, including through fiscal year 2018, Congress has appropriated between $100 million and $110 million to the TPP program with the same operative statutory text as the 2010 CAA and the same 75% allocation for replicating programs that have been proven effective through rigorous evaluation and 25% allocation for research to develop additional models and strategies. Compare 2010 CAA, 123 Stat. at 3253 with 2018 CAA, 132 Stat. at 733.

         In tandem with the creation of the TPP Program, HHS has sponsored the “TPP Evidence Review, ” i.e., an ongoing systematic review of TPP research to identify programs with evidence of effectiveness in reducing teen pregnancy, STIs, and associated sexual risk behaviors. ECF #33-2. Every consolidated appropriations act since 2010 has made funding available to conduct the TPP Evidence Review. See, e.g., 2010 CAA, 123 Stat. at 3253 (appropriating $4, 455, 000 “to carry out evaluations (including longitudinal evaluations) of teenage pregnancy prevention approaches”); Consolidated and Further Continuing Appropriations Act, 2015, Pub. L. No. 113- 235, 128 Stat. 2130, 2483 (2014) (appropriating $6.8 million for the same purpose); 2018 CAA, 132 Stat. at 733 (same). “The TPP Evidence Review is a joint effort sponsored by three divisions within [HHS]: the Office of the Assistant Secretary for Planning and Evaluation, the Family and Youth Services Bureau within the Administration for Children and Families, and the Office of Adolescent Health within the Office of the Assistant Secretary for Health.” ECF #33-25, at 1. The TPP Evidence Review “identifies, assesses, and rates the rigor of program impact studies and describes the strength of evidence supporting different program models. Findings are used to identify program models meeting the criteria for the HHS List of Evidence-Based Teen Pregnancy Prevention Programs.” ECF #33-2, at 1. HHS contracts with Mathematica Policy Research (“Mathematica”) to conduct the review.

         In April 2010, Mathematica published the results of its initial review in which it identified 28 programs proven effective in preventing teen pregnancies, sexually transmitted infections (“STIs”), or sexual risk behaviors. See ECF #33-2, at 7-8, 15. At HHS's request, Mathematica has updated its findings five additional times (in April 2012, July 2014, February 2015, April 2016, and April 2018), resulting in the identification of 20 additional programs showing evidence of effectiveness in preventing teen pregnancies, STIs, or sexual risk behaviors. ECF #33-2, at 12; ECF #33-25, at 1 (“the total No. of programs meeting the review criteria for evidence of effectiveness is now 48”); Mathematica Policy Research, Review Protocol Version 5.0 at 1, v5.pdf.

         In 2009, through the Office of Adolescent Health (“OAH”), HHS issued a Tier 1 Funding Opportunity Announcement (“FOA”), soliciting applications for five-year grants for fiscal years 2010 through 2014 (“First Cohort”). See ECF #33-3 (“2010 FOA”). In 2014, OAH issued two Tier 1 FOAs, soliciting applications for five-year grants for fiscal years 2015 through 2019 (“Second Cohort”). ECF #33-8 (“2015 Tier 1A FOA”); ECF #33-9 (“2015 Tier 1B FOA”). Under the 2010 Tier 1 FOA, funding was restricted to “evidence-based programs that have been shown to reduce teenage pregnancy, behavioral risk factors underlying teenage pregnancy, or other associated risk factors.” ECF #33-3, at 3-4. The 2010 Tier 1 FOA defined “[e]vidence-based program models” to mean “[p]rogram models for which systematic empirical research or evaluation has provided evidence of effectiveness.” Id. at 44. Applicants could either replicate programs identified as effective by Mathematica's “independent, systematic review of the evidence base, ” or replicate other programs if they met “a set of stringent criteria, ” including review by Mathematica “using the same evidence review criteria” it used in its independent review. Id. at 6-7. The 2015 Tier 1A and Tier 1B FOAs similarly required that grantees replicate “[p]rograms identified by HHS as having undergone a rigorous evaluation [and] been shown to be effective at preventing teen pregnancies, sexually transmitted infections, and/or sexual risk behaviors.” ECF #33-8, at 79; ECF #33-9, at 89.

         In 2018, HHS requested “$0.00” or a “decrease of $100, 808, 000 from the FY 2017” budget for the TPP Program. ECF #33-16, at 6 (“The Budget eliminates the TPP program.”). However, Congress declined the invitation to eliminate the TPP Program when it issued the 2018 CAA, retaining the same operative text used in prior consolidated appropriations acts since it created the program. Compare 2010 CAA, 123 Stat. at 3253 with 2018 CAA, 132 Stat. at 733.

         Although the Second Cohort of grants ran through fiscal year 2019, HHS terminated 81 TPP Program grants without explanation on June 30, 2018. In four separate lawsuits, courts held that HHS's actions were unlawful on grounds it violated the APA. Healthy Teen Network v. Azar, No. CV CCB-18-468, 2018 WL 1942171, at *7-*8 (D. Md. Apr. 25, 2018), appeal docketed, No. 18-1709 (4th Cir. June 26, 2018); Policy & Research, LLC v. United States Dep't of Health & Human Servs., No. 18-CV-00346 (KBJ), 2018 WL 2184449, at *13 (D.D.C. May 11, 2018), appeal docketed, No. 18-5190 (D.C. Cir. June 21, 2018); King Cty. v. Azar, No. C18-0242-JCC, 2018 WL 2411759, at *7 (W.D. Wash. May 29, 2018), appeal docketed, No. 18- 35606 (9th Cir. July 27, 2018); Healthy Futures of Texas v. Dep't of Health & Human Servs., No. 1:18-CV-992 (KBJ), 2018 WL 2471266, at *6 (D.D.C. June 1, 2018). On April 20, 2018, the day after the court in Policy and Research orally announced its decision that HHS's actions violated the APA, HHS issued the 2018 Tier 1 FOA. Healthy Futures, 2018 WL 2471266, at *6.

         In 2015, the County received a $6.25 million, five-year Tier 1B grant as part of the Second Cohort so that it could offer comprehensive sexual education through the Adolescents & Communities Together (“ACT”) program. ECF #28, ¶ 86. The County alleges that it plans to compete for a grant under the 2018 Tier 1 FOA. Id. ¶ 92. If the County does not obtain some or all of its remaining Second Cohort funding, it plans to use the funds it receives through the 2018 Tier 1 FOA toward sustaining the ACT program. Id. If the County is successful in obtaining all of its Second Cohort funding, it would use the funds from the 2018 Tier 1 FOA to expand evidence-based, comprehensive sexual education. Id.

         Before this court is the question of whether the 2018 Tier 1 FOA issued on April 20, 2018, is lawful.


         I. Consideration of Evidence Outside the Administrative Record

         The County has submitted a No. of extra-record materials in support of its various arguments. Typically, judicial review of an agency decision is restricted to documents in the administrative record. 5 U.S.C. § 706; Fla. Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985). “When a reviewing court considers evidence that was not before the agency, it inevitably leads the reviewing court to substitute its judgment for that of the agency.” Asarco, Inc. v. U.S. Envtl. Prot. Agency, 616 F.2d 1153, 1160 (9th Cir. 1980). However, “it is both unrealistic and unwise to ‘straightjacket' the reviewing court with the administrative record.” Id.

It will often be impossible, especially when highly technical matters are involved, for the court to determine whether the agency took into consideration all relevant factors unless it looks outside the record to determine what matters the agency should have considered but did not. The court cannot adequately discharge its duty to engage in a ‘substantial inquiry' if it is required to take the agency's word that it considered all relevant matters.

Id. These conflicting considerations can be resolved:

If the reviewing court finds it necessary to go outside the administrative record, it should consider evidence relevant to the substantive merits of the agency action only for background information . . . or for the limited purposes of ascertaining whether the agency considered all the relevant factors or fully explicated its course of conduct or grounds of decision.


         The Ninth Circuit has more recently explained that the court may consider extra-record materials (1) if necessary to determine whether the agency has considered all relevant factors and has explained its decision, (2) when the agency has relied on documents not in the record, (3) when supplementing the record is necessary to explain technical terms or complex subject matter, or (4) when the plaintiff makes a showing of agency bad faith. Sw. Ctr. for Biological Diversity v. U.S. Forest Serv., 100 F.3d 1443, 1450 (9th Cir. 1996). “These exceptions are to be narrowly construed, and the party seeking to admit extra-record evidence initially bears the burden of demonstrating that a relevant exception applies.” San Luis & Delta-Mendota Water Auth. v. Locke, 776 F.3d 971, 992-93 (9th Cir. 2014).

         The County asserts that the last two exceptions apply-the extra-record materials are necessary to explain technical terms and complex subject matter and to show the agency acted in bad faith. ECF #58, at 12. This court does not have to decide whether those exceptions apply because this matter can be resolved without considering most of the extra-record materials the County has proffered. Moreover, in those instances where this court has considered extra-record documents, it is because the second exception has been satisfied, i.e., HHS relied on them in making its decision. For example, while the 2010 and 2015 Tier 1 FOAs are not contained in the administrative record, clearly HHS considered them in making its decision to alter course with the 2018 Tier 1 FOA. Also, the TPP Evidence Review is referenced repeatedly in the administrative record. See, e.g., Press Release, August 28, 2017, AR000029 (referring to “TPP Program's approved list”); AR003250 (referring to TPP Evidence Review).

         II. Article III Standing

         To establish Article III standing, the County “must have (1) suffered an injury in fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to be redressed by a favorable judicial decision. Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016), as revised (May 24, 2016) (citing Lujan v. Defs. of Wildlife, 504 U.S. 555, 560-61 (1992)). “The plaintiff, as the party invoking federal jurisdiction, bears the burden of establishing these elements.” Id.

         Defendants do not assert that the County has failed to satisfy Article III's injury-in-fact and causation requirements. ECF #42, at 11-12. Rather, defendants assert that the County's proposed relief-vacating the 2018 Tier 1 FOA-will not redress its alleged injury. Defendants contend that if this court vacates the 2018 Tier 1 FOA, the matter will have to be remanded back to HHS; however, the appropriation must be used by September 30, 2018, and it will be impossible to draft and promulgate a new FOA, receive applications, and issue new awards by that date. ECF #42, at 12. ECF #73, at 11. Thus, defendants contend, vacating the 2018 Tier 1 FOA will deprive every applicant-including the County-from receiving any funds. ECF #42, at 12.

         Contrary to defendants' contention, redressability does not hinge on whether the 2018 Tier 1 FOA funds will revert to the Treasury on September 30, 2018. “In general, a federal agency's budget authority lapses on the last day of the period of which funds were obligated.” Population Inst. v. McPherson, 797 F.2d 1062, 1081 (D.C. Cir. 1986) (citing 31 U.S.C. § 1502(a)). “After that date, any unobligated funds revert to the Treasury.” Id. (citing 31 U.S.C. § 1552(a)(2)). “Nevertheless, it is well settled that federal courts may award appropriated funds to a successful litigant even after the statutory lapse date if, as here, the suit was initiated on or before that date.” Id. (citing Connecticut v. Schweiker, 684 F.2d 979, 996-99 (D.C. Cir. 1982), cert. denied, 459 U.S. 1207 (1983)); 31 U.S.C. § 1502(b).[3] That is because “[t]he equity powers of the courts allow them to take action to preserve the status quo of a dispute and protect their ability to decide a case properly before them. In such situations, the courts simply suspend the operation of a lapse provision and extend the term of already existing budget authority.” City of Houston, Tex. v. Dep't of Hous. & Urban Dev., 24 F.3d 1421, 1426 (D.C. Cir. 1994) (citing Rochester Pure Waters Dist. v. EPA, 960 F.2d 180, 184 (D.C. Cir. 1992)); see also Schweiker, 684 F.2d at 997 (“This court has repeatedly reaffirmed the power of courts to order that funds be held available beyond their statutory lapse date if equity requires.”) (citation omitted); Nat'l Ass'n of Regional Councils v. Costle, 564 F.2d 583, 588 (D.C. Cir. 1977) (“Decisions that a court may act to prevent the expiration of a budget authority which has not terminated at the time suit is filed are completely consistent with the accepted principle that the equity powers of the court allow them to take action to preserve the status quo of a dispute. . . .”).[4] In this case, the court's ability to exercise this equitable power is available because the County filed suit before the appropriation is set to lapse. Population Inst., 797 F.2d at 1081.

         Additionally, the County seeks redress for a “competitive injury.” “[W]hen challenged agency conduct allegedly renders a [competitor] unable to fairly compete for some benefit, that [competitor] has suffered a sufficient ‘injury in fact' and has standing.” Preston v. Heckler, 734 F.2d 1359, 1365 (9th Cir. 1984). “[E]conomic actors suffer an injury in fact when agencies lift regulatory restrictions on their competitors or otherwise allow increased competition against them . . . . This doctrine of ‘competitor standing' is grounded in the basic law of economics that increased competition leads to actual injury.” Int'l Bhd. of Teamsters v. U.S. Dep't of Transp., 861 F.3d 944, 950 (9th Cir. 2017) (citation omitted); see also Sherley v. Sebelius, 610 F.3d 69, 72 (D.C. Cir. 2010) (“Because the Guidelines have intensified the competition for a share in a fixed amount of money, the plaintiffs will have to invest more time and resources to craft a successful grant application. That is an actual, here-and-now injury.”). “The grant competitor is not required to show that it would have received the grant but for the disadvantage it faced. Rather, ‘the “injury in fact” is the inability to compete on an equal footing in the bidding process.'” City of Los Angeles v. Sessions, 293 F.Supp.3d 1087, 1094 (C.D. Cal. 2018) (quoting Ne. Fla. Chapter of Associated Gen. Contractors of Am. v. Jacksonville, 508 U.S. 656, 666 (1993)).

         Here, the County contends that “[t]he changed terms of the new FOA have intensified the competition by allowing programs that do not qualify under” the 2018 CAA to apply. ECF #29, at 31. This is sufficient to allege a competitive injury, and vacating the 2018 Tier 1 FOA is likely to redress that injury.[5] See Hispanic Affairs Project v. Perez, 206 F.Supp.3d 348, 371 (D.D.C. 2016) (holding that a competitive-standing plaintiff need only articulate the “basic economic logic” undergirding its claims to demonstrate redressability).

         III. Reviewability Under Administrative Procedures Act

         A. Final Agency Action

         “The APA expressly declares itself to be a comprehensive remedial scheme: it states that a ‘person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of a relevant statute, is entitled to judicial review'. . . and then sets forth the procedures for such review.” Western Radio Serv. Co. v. United States Forest Service, 578 F.3d 1116, 1122 (9th Cir. 2009) (quoting 5 U.S.C. §§ 702, 704, 706). Judicial review is allowed “so long as the decision challenged represents a ‘final agency action for which there is no other adequate remedy in a court.'” Id. (quoting Webster v. Doe, 486 U.S. 592, 599 (1988)); 5 U.S.C. § 704; see also Ukiah Valley Med. Ctr. v. FTC, 911 F.2d 261, 264 n.1 (9th Cir. 1990) (“[F]inality is . . . a jurisdictional requirement.”) (citation omitted).

         For an agency action to be final, it must (1) mark the consummation of the agency's decision-making process and (2) be one by which rights or obligations have been determined, or from which legal consequences will flow. Bennett v. Spear, 520 U.S. 154, 177-78 (1997). Regarding the first prong of the test, finality requires that agency action “must not be of a merely tentative or interlocutory nature.” Id. at 178. Rather, the action must be the agency's “last word on the matter.” Whitman v. Am. Trucking Ass'ns, 531 U.S. 457, 478 (2001). “As the Supreme Court has stated, the core question is whether the agency has completed its decisionmaking process[] and whether the result of that process is one that will directly affect the parties.” Indus. Customers of Nw. Utilities v. Bonneville Power Admin., 408 F.3d 638, 646 (9th Cir. 2005) (quoting Franklin v. Massachusetts, 505 U.S. 788, 797 (1992)) (quotation marks and alteration omitted). Courts must ask “whether the action amounts to a definitive statement of the agency's position or has a direct and immediate effect on the day-to-day operations' of the subject party, or if immediate compliance with the terms is expected.” Oregon Nat. Desert Ass'n v. U.S. Forest Serv., 465 F.3d 977, 982 (9th Cir. 2006) (internal quotation marks and alteration omitted). Importantly, the “finality element must be interpreted in a pragmatic and flexible manner.” Id. (internal quotation and alteration omitted). “It is the effect of the action and not its label that must be considered.” Id. at 985 (internal quotation and citations omitted).

         With respect to the second prong, legal consequences flow from an agency's decision that prohibits future federal funding. Arizona State Bd. for Charter Sch. v. U.S. Dep't of Educ., 391 F.Supp.2d 800, 802 (D. Ariz. 2005). Legal consequences also flow from an agency's decision to condition grant funding on compliance with the federal government's interpretation of a statute. State ex rel. Becerra v. Sessions, 284 F.Supp.3d 1015, 1031-32 (N.D. Cal. 2018).

         Defendants contend there has been no final agency action because its issuance of the 2018 Tier 1 FOA is merely the “first step” in the decision-making process to award grants and “[s]everal steps must follow the FOA for a grant to be awarded.” ECF #42, at 14. However, while additional steps must be taken to actually award grants, no further steps need to be taken to disqualify applicants such as the County from receiving grants at all. As the County contends, “HHS's decision to adopt the unlawful criteria in the 2018 Tier 1 FOA is unequivocal and imposes significant legal and practical consequences on both the County and the agency.” ECF #58, at 7.

         Indeed, the 2018 Tier 1 FOA plainly states:

We will review your application to determine whether it meets the following responsiveness criteria. If your application does not meet the responsiveness criteria, we will eliminate it from the competition and it will not be reviewed.

         AR000060 (emphasis added). As part of the responsiveness criteria, an applicant must demonstrate that “[o]ne of the two eligible programs is clearly identified, ” i.e., the Systematic Method for Assessing Risk-avoidance Tool (“SMARTool”) and the Tool to Assess the Characteristics of Effective Sex and STD/HIV Education Programs (“TAC”).[6] AR000043-44, 60. The 2018 Tier 1 FOA elsewhere reiterates that if the application fails to meet the responsiveness criteria, “it will not be reviewed and will receive no further consideration.” AR000061-62 (emphasis in original). No. appeals are allowed. AR000094.

         Thus, the 2018 Tier 1 FOA unequivocally makes clear that if an application fails to identify “one of the two eligible programs, ” “it will not be reviewed and will receive no further consideration.” AR000043-44, 61-62. This eligibility requirement, which by its terms eliminates an application from contention, amounts to the agency's “last word on the matter.” Waiting to see which projects are actually funded before calling this a final agency action would force the County to engage in a futile exercise that would not put the parties in any meaningfully different posture than the one they are in now. Following such an approach would improperly disregard the “effect of the action” and fail to interpret finality in a pragmatic way. Oregon Nat. Desert, 465 F.3d at 985.

         Defendants also fail to acknowledge that the 2018 Tier 1 FOA is the consummation of HHS's decision-making process. Before drafting the 2018 Tier 1 FOA, HHS “reviewed the rigorous evaluation studies of the TPP Program.” Reply to Senator Murray, AR000442; see also Summary of Findings from TPPP Grantees, Tier 1 (FY2010-2014), AR000024. In a press release dated August 28, 2017, HHS announced that “[t]he evidence tells us that most of these programs are not working, ” “[c]ontinuing the TPP Program as it is currently structured would be a waste of taxpayer money, ” and it was “precisely for this reason that HHS chose to end the [current] implementation of the TPP Program.” AR000029. That HHS engaged in this decision-making process further demonstrates that the 2018 Tier 1 FOA is its last word on eligibility criteria for TPP funding in fiscal year 2018. See Whitman, 531 U.S. at 479 (“Though the agency has not dressed its decision with the conventional procedural accoutrements of finality, its own behavior thus belies the claim that its interpretation is not final.”). Again, “[t]he core question is whether the agency has completed its decisionmaking process, and whether the result of that process is one that will directly affect the parties.” Franklin, 505 U.S. at 797; see also California ex rel. Harris v. Fed. Hous. Fin. Agency, No. C 10-03084 CW, 2011 WL 3794942, at *10 (N.D. Cal. Aug. 26, 2011) (finding first prong of Bennett test had been satisfied on motion to dismiss where agency presented statement at issue as “the consummation of a decision-making process that involved careful review and over a year of working with federal and state government agencies”) (internal quotation marks omitted).

         The second prong of the Bennett test is easily satisfied. Legal consequences flow from HHS's decision to deny federal funding to applicants who do not identify “one of the two eligible programs.” See Arizona State Bd., 391 F.Supp.2d at 802 (legal consequences flow from an agency's decision that prohibits future federal funding); XP Vehicles, Inc. v. Dep't of Energy, 118 F.Supp.3d 38, 60 (D.D.C. 2015) (“it is clear beyond cavil that the rejection of a request for a government benefit . . . ‘fixes some legal relationship' between a private party and the government”).[7]

         Remarkably, defendants contend that “[e]ligibility is not contingent on compliance with th[e] requirement” that an application identifies “one of the two eligible programs” in the 2018 Tier 1 FOA. ECF #73, at 5 (emphasis in original). This ignores repeated statements in the 2018 Tier 1 FOA to the contrary, specifically that “OAH will fund projects that will replicate one of the two effective programs described in the summary, ” “[p]rojects are required to replicate a risk avoidance model or a risk reduction model that incorporates the common characteristics outlined in one of the two programs, ” and “[o]ne of the two eligible programs” must be “clearly identified” or OAH “will eliminate it from the competition and it will not be reviewed.” AR000035, 43-60. Defendants also contend that “[t]he identification requirement determines only whether the application is reviewed as an SRA [(sexual risk avoidance)] or an SSR [(sexual risk reduction)] project.” ECF #73, at 5. However, sexual risk avoidance and sexual risk reduction are at the ...

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