                      THEA~TORNEYGENERAL
                                         OF     TEXAS

                                   Auwmiv.      TEXASI       78711



                                         September     20,    1974



The Honorable     Carlos F. Truan                             Opinion   No.   H-   406
Chairman
Committee     on Human Resources                              Re:, Whether      licensing    of child
House of Representatives                                      care institutions      by the state
P. 0. Box 2910                                                requires    compliance      with non-
Austin,   Texas                                               discriminatory       laws by institu-
                                                              tion.
Dear     Representative         Truan:

     You have indicated       that your committee       has been presented      with
evidence    of racial    discrimination      by private   child care facilities    licensed
by the State.     To determine       whether   there is any necessity     to recommend
state legislation    directed    at this practice    you ask:

              Is the issuance      of a license    by a State agency       or by a
              political   subdivision     of the State to any kind of private
              child-care    institution     such a State action,      within existing
              federal    law or the U.S.       Constitution,    as would require
              non-discriminatory        admissions       and services     by the
              licensee?

     Your inquiry     is directed     solely  to the question    of whether    a state
licensing   program     constitutes     “state action”    and whether    on that basis alone
a licensee   would be prohibited        by federal   law from engaging      in discriminatory
practices.     Accordingly,       our opinion is limited      to that question    and does not
consider    whether    state law or federal       law based on foundations       other than the
state acticn concept,       such as the commerce        clause   or the receipt     of federal
benefits,   would require       a child care facility     to avoid discriminatory        action.
See e.g.,    42 U.S.C..       Sec. 2000e,     et seq. (equal employment        opportunity):
The Child Nutrition      Act of 1966, 42 U.S. C., Sec. 1771, et seq.;              7 C. F.R.,
Sec. 215.14.

        The    Fourteenth    Amendment        to the United    States   Constitution     provides
that:




                                                 pe 1896
The Honorable        Carlo6    F.   Truan,    page   2   (H-406)




         No state shall 0 . . deny to any person  within                its
         jurisdiction the equal protection of the laws.

      If a state program      of licensing      child care facilities       is sufficient
to trigger    the operation      of the Fourteenth          Amendment      by constituting     the
requisite    state action,     licensed     facilities     could    not adopt discriminatory
policies.      The relationship      of the Fourteenth          Amendment      and a state
licensing    program     was recently       discussed       by the United States Supreme
Court in Moose        Lodge No. 107 V. Irvis,             407 U.S.     163 (1972).      Moose
Lodge No. 107 was a private            club which had been granted             a liquor license
by the state of Pennsylvania.           Liquor     licenses     were not freely     available.
A quota established       the limited      number       of licenses    which could be issued,
and recipients      had to comply      with detailed        regulations.      Nevertheless,
the Supreme       Court said:

          The Court has never held,        of course,   that discrimination
          by an otherwise   private   entity would be violative      of the
          Equal Protection   Clause    if the private   entity receives     any
          sort of benefit  or service    at all from the State,     or if it is
          subject to state regulation     in any degree    whatever    . . .

          Our holdings     indicate    that where the impetus       for the
          discrimination      is private,     the State must have “signi-
          ficantly  involved    itself with invidious     discriminations,”
          Reitman     v. Mulkey,      387 US 369, 380. (1967). in order
          for the discriminatory        action to fall within the amhit
          of the constitutional      prohibition,     a .

          However     detailed  [liquor    license]    regulation   may be in
          soroe particulars,      it cannot be said to in any way
          foster   or encourage     racial    discrimination.      Nor can
          it be said to make the State in any realistic            sense a
          partner    or even a joint venturer        in the club’s   enter-
          prise   a . .

          We therefore      hold that, D . e the operation     of the
          regulatory    scheme     enforced by the Pennsylvania
          Liquor    Control    Board does not sufficiently    implicate
          the State in the discriminatory      guest policies     of
          Moose    Lodge     so as to make the latter “state action”
          within the ambit      of the Equal Protection    Clause     of
          the Fourteenth      Amendment.
          407 U.S. at 173. 176, 177.

                                              pe 1897
The Honorable      Carlo6    F.   Truan,   page        3    (H-406)




     We believe     the reasoning        of Moose     Lodge compels       a similar   answer
to your question.        We beli.eve       it would be held that the mere fact that
a child care facility       receives      a license  under Article      4442a,   V. T. C. S.,
or other similar       statute does not, under the existing             case law, sufficiently
implicate    the State in the discriminatory            practices    so as to make them
“state action”     within the ambit of the Equal Protection               Clause of the Four-
teenth Amendment.           This is not to say, of course,           that an aggrieved    child
or parent might not have a civil remedy                against    a child care facility   that
practiced    discrimination.          See, e. g.,    42 U.S. C. Set 1981; Gonzalez         v.
Fairfax-Brewster         School,     Inc.,    363 F.Supp.     1200 (E. D. Va. 1973); cf.
Tillman    v. Wheaton-Haven           Recreation     Assoc.,      410 U.S. 431 (1973); Sullivan
v. Little   Hunting Park,        396 U.S.       229 (1969).    Noris it to say that statutes
with foundations      other than the state action concept             may not prohibit
discriminatory      practices.

     Because    of our answer    to your       first       question      it is unnecessary   to
consider    your second   inquiry.

                                  SUMMARY

               State licensing   of private   child care facilities
         does not sufficiently     implicate     the state in the
         policies    of the child care facilities      so as to make
         their discriminatory       practices     state action  for
         Fourteenth      Amendment     purposes.

                                                 Very        truly     yours,
                                           A




                                                 Attorney            General    of Texas
                                      //




                                           ps 1898
The Honorable   Carlo8   F.   Truan   page    4     (H-406)




APPROVED:




-;a
DAVID
Opinion
          M. KENDALL,
           Committee
                          Chairman



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