                                   United States Court of Appeals,

                                             Fifth Circuit.

                                            No. 91–8574.

   Franklin YEAGER, Walter Brandt, Don C. Yeager and Mark Yeager, Plaintiffs–Appellants,

                                                   v.

                       CITY of McGREGOR, et al., Defendants–Appellees.

                                             Jan. 5, 1993.

Appeal from the United States District Court for the Western District of Texas.

Before GOLDBERG, JONES, and DeMOSS, Circuit Judges.

       EDITH H. JONES, Circuit Judge:

       Appellants were voted out of membership in the McGregor, Texas Volunteer Fire Department

(MVFD). Unwilling to let bygones be bygones, they sued the City of McGregor, MVFD and three

individual defendants. From the district court's grant of summary judgment to the defendants, the

former fire fighters have appealed. We affirm, principally because appellants did not raise a fact issue

supporting their assertion that MVFD is a state actor or an agency of the City of McGregor. Where

there is no state action, no section 1983 constitutional claim exists.

                                          BACKGROUND

       The MVFD has existed since the 1920's and has received subsidies from the City of

McGregor. The City currently furnishes a building, two fire trucks and equipment to the volunteer

program and pays each fireman a $300 yearly stipend plus a $10 contribution to a state pension

program. Some City tax dollars are annually budgeted to MVFD, although its primary sources of

revenue are donations and proceeds from the annual barbecue.

       In 1965, the City of McGregor approved the Constitution and Bylaws of the MVFD as a

voluntary unincorporated association. The undisputed affidavit evidence reflects, however, that the

City exercised no day-to-day management or control of MVFD and, in particular, had no role in its

membership decisions. The summary judgment evidence showed that the City does not approve

MVFD's choice of Fire Chief or its Chief Engineer.
        Appellants Franklin Yeager, Don Yeager, Mark Yeager and Walter Brandt were members of

MVFD until December 1, 1988. In November of that year, Franklin Yeager, Don Yeager and Walter

Brandt met with a newspaper reporter and alleged racial discrimination at the MVFD. They gave the

reporter a copy of an ancient MVFD application form in which an applicant had to certify that he was

"white male, 21 years of age and of good moral character." Appellants' allegations generated

widespread media attention. On December 1, appellants complained of financial improprieties

concerning MVFD funds at a McGregor City Council meeting. Appellee Tom Kirk, a member of the

city council and influential local businessperson, allegedly stated after the meeting, "I want them out,"

indicating that he wished plaintiffs to be expelled from MVFD. (Kirk and several witnesses deny that

he made this statement.) Shortly after the city council meeting, the MVFD met in special session and

voted overwhelmingly by secret ballot to remove the appellants from membership. At that time,

former defendant John Blake was department Chief and former defendant Ronnie Spradley was

President of the MVFD.

        Nearly two years later, appellants filed suit in the district court alleging that they were

discharged because of their public statements concerning racial discrimination and MVFD financial

irregularities. They alleged a conspiracy between Councilman Kirk and MVFD officials to deprive

them of First Amendment rights. Named as defendants were the City of McGregor, the MVFD, Kirk,

Blake and Spradley. After conducting substantial discovery, the appellants voluntarily dismissed the

MVFD officials. The remaining defendants filed separate motions for summary judgment, which the

court granted. This appeal followed.

                                     STANDARD OF REVIEW

        In reviewing a district court's ruling on a motion for summary judgment this court applies the

same standard that governs the district court. Bache v. American Telephone & Telegraph, 840 F.2d

283, 287 (5th Cir.), cert. denied, 488 U.S. 888, 109 S.Ct. 219, 102 L.Ed.2d 210 (1988); Brooks,

Tarlton, Gilbert, Douglas and Kressler v. United States Fire Insurance Co., 832 F.2d 1358, 1364

(5th Cir.1987). We should therefore not affirm a summary judgment ruling unless we are "convinced,

after an independent review of the record that there is no genuine issue as to any material fact and
that the movant is entitled to a judgment as a matter of law." Brooks, 832 F.2d at 1364. When a fact

question controls the disposition of a summary judgment motion this court must "review the evidence

and any inference to be drawn therein in the light most favorable to the non-moving party." Baton

Rouge Building Construction v. Jacobs Constructors, 804 F.2d 879, 881 (5th Cir.1986) (per curiam).

In contrast, we review questions of law de novo. Kirkland v. North Side Independent School Dist.,

890 F.2d 794, 798 (5th Cir.1989). We may affirm a summary judgment on a ground not utilized by

the district court if it was raised below and has proper support in the record. In re Jones, 966 F.2d

169, 172 (5th Cir.1992); Bernhardt v. Richardson–Merrell, Inc., 892 F.2d 440, 444 (5th Cir.1990);

Sapp v. Renfroe, 511 F.2d 172, 175 n. 2 (5th Cir.1975).

                                   STATE ACTION DOCTRINE

       The threshold inquiry in this section 1983 action is whether there was any intentional

involvement of a state actor. Wyatt v. Cole, ––– U.S. ––––, ––––, 112 S.Ct. 1827, 1830, 118

L.Ed.2d 504 (1992); Carey v. Piphus, 435 U.S. 247, 254–57, 98 S.Ct. 1042, 1047–49, 55 L.Ed.2d

252 (1978); Jett v. Dallas Ind. School District, 491 U.S. 701, 731, 109 S.Ct. 2702, 2720, 105

L.Ed.2d 598 (1989). Appellants have contended that MVFD and the City are state actors responsible

for their expulsion from MVFD, while councilman Kirk "conspired" with MVFD officials. For

reasons to be stated, we disagree with these contentions.

A. McGregor Volunteer Fire Department

        The district court "assumed without deciding" that the volunteer fire department was a state

actor and proceeded to the merits of the First Amendment claims. If not corrected, this assumption

might be costly to the thousands of volunteer fire departments around the country that may be

needlessly exposed to section 1983 lawsuits. While the district court's reluctance to wade into an area

as rife with conceptualism as the state action doctrine is understandable, that alternative is less

appropriate for an appellate court. On examining the question, we demur from establishing a broad

rule concerning volunteer fire departments in general; but conclude that under present Supreme

Court authority, cases from this circuit and Texas law, MVFD was not a state actor.

       The ultimate issue in a § 1983 case is whet her the alleged infringement of federal rights
stemmed from conduct fairly attributable to the state. Lugar v. Edmondson Oil Co., 457 U.S. 922,

938, 102 S.Ct. 2744, 2754, 73 L.Ed.2d 482 (1982). While this goal is, as Judge Goldberg has

observed, "relatively well-marked," Frazier v. Board of Trustees of Northwest Mississippi, 765 F.2d

1278, 1283 (5th Cir.1985), the state action inquiry is inherently difficult. Judge Goldberg also wrote,

"Imbued with an identity all its own, every state action inquiry partakes only slightly of the factual

stuff of other cases." Frazier, 765 F.2d at 1284.

        The Supreme Court has adopted a variety of guidelines for determining whether an individual

or entity acted on behalf of the state for purposes of affixing section 1983 liability. Among the most

prominent talismans of state actor status are the exclusive government function concept, the state's

encouragement or coercion of private activities, the symbiotic relationship and the entanglements

formula. 2 R. Rotunda, J. Nowak and J. Young, Treatise on Constitutional Law: Substance and

Procedure § 16.2–16.4 (1986) (Supp.1991). Among these guidelines, appellants have relied solely

on the "exclusive government function" standard, asserting that "a city in Texas has the responsibility

for protecting its inhabitants' property against destruction by fire." Before analyzing the appellants'

authorities, it is necessary to recur to the Supreme Court's explanation of the exclusive public function

concept—and its limitations.

        The Supreme Court rejects the notion that any entity that performs a "public function" is a

state actor. The question is not "whether a private group is serving a "public function,' [but instead]

whether the funct ion performed has been "traditionally the exclusive prerogative of the state,' "

Rendell–Baker v. Kohn, 457 U.S. 830, 841, 102 S.Ct. 2764, 2772–73, 73 L.Ed.2d 418 (1982)

(quoting Jackson v. Metropolitan Edison Co., 419 U.S. 345, 352, 95 S.Ct. 449, 454, 42 L.Ed.2d 477

(1974)). Thus, the Court held that Massachusetts' legislative decision to educate special needs high

school students at public expense "in no way makes the services the exclusive province of the State."

Id. The private school that contracted with the state to perform this function was not transformed

into a state actor. With similar reasoning, the Court foreclosed a claim that nursing homes were state

actors because they operated with state subsidies under requirements that the Medicaid program

imposed on the state. Blum v. Yaretsky, 457 U.S. 991, 1012, 102 S.Ct. 2777, 2789, 73 L.Ed.2d 534
(1982). The Court has also held that neither an extensively regulated electric utility nor a

warehouseman that enforced its lien by invoking a U.C.C. self-help sale provision was engaged in an

exclusive public function amounting to state action. Jackson, 419 U.S. at 352, 95 S.Ct. at 454;

Flagg Brothers, Inc. v. Brooks, 436 U.S. 149, 160, 98 S.Ct. 1729, 1735, 56 L.Ed.2d 185 (1978).

       In dicta, the Court once mentioned fire protection among a list of traditionally exclusive

public functions including education, police protection and tax collection. Flagg Brothers, 436 U.S.

at 163–64, 98 S.Ct. at 1737. The Court then added:

       We express no view as to the extent, if any, to which a city or state might be free to delegate
       to private parties the performance of such functions and thereby avoid the strictures of the
       Fourteenth Amendment ... [R]esolution [of such factual situations] should abide the necessity
       of deciding them.

Id. This self-qualifying reference does not decide the present case. First, the Court itself later

determined in Rendell–Baker that a state educational function could be assigned to a private party

under certain conditions without rendering the private school subject to § 1983. Second, to the

extent that the reference in Flagg Brothers suggests that it would be impermissible to delegate an

exclusive public function for the purpose of avoiding § 1983 liability, that underlying premise is

absent from this case.1 Finally, as Flagg Brothers states, the state action question remains fact

specific even where the exclusivity of the public function is at issue. Lower courts must therefore

consider the history, tradition and local law surrounding volunteer fire departments before concluding

whether they are state actors.

       Under a fact-specific review, the MVFD does not appear to perform a "power traditionally

exclusively reserved to the state." Jackson, 419 U.S. at 352, 95 S.Ct. at 454. Texas law states that

a home rule municipality, the form in which the City of McGregor is organized, "may provide for a

fire department." Texas Local Government Code § 342.011 (Supp.1991) (emphasis added). This

language hardly sets up fire fighting as an exclusive public function, and no Texas cases hold

otherwise.


   1
   The Court has similarly qualified Evans. v. Newton, 382 U.S. 296, 86 S.Ct. 486, 15 L.Ed.2d
373 (1966), as establishing a narrow, fact-specific application of the public function concept. See
Flagg Brothers, 436 U.S. at 160 n. 8, 98 S.Ct. 1735, n. 8.
        Appellants rely on two cases to support the contention that fire fighting is an exclusive public

function in Texas, but neither case stands for that proposition. In one of them, the state court found

that members of the Mission Volunteer Fire Department served in a governmental capacity under a

now-repealed state law, Tex.Rev.Civ.Ann. art. 9205, to the extent that the worked under the

supervision of paid employees of the local fire department. Genzer v. City of Mission, 666 S.W.2d

116, 120 (Tex.Civ.App.—Corpus Christi 1983, writ ref'd n.r.e.). The question in Genzer was not

whether the Mission Volunteer Fire Department was acting in any kind of public function on its own,

but was confined to considering whether its members participated in performing a public function for

purposes of the Texas Tort Claims Act, when they served at a fireworks display under the direct

supervision of the City's full-time employees. Id. There was no discussion of an "exclusive" public

function. In the other cited case, the court decided simply not to limit a city's police power to re-zone

in order to enhance fire protection. City of McAllen v. Morris, 217 S.W.2d 875 (Tex.Civ.App.—San

Antonio, 1948, err. ref'd). Morris does state in dicta that "a city is one of the most ancient and

familiar forms of municipal organization and it has vested in it the responsibility for protecting its

inhabitants against violence and their property against destruction by fire." 217 S.W.2d at 877. The

case befo re us deals not with an "ancient and familiar form of municipal organization" but with a

home rule municipality governed by specific Texas law.

        This court also takes judicial notice of the fact that there are a variety of private sector fire

fighting alternatives;2 and fire fighting is not generally an exclusive government function.3 What is

   2
    See e.g., John A. Conway, Firemen for Hire, Forbes, December 22, 1980 at 8 (noting "a
dozen private companies have taken over the job of fire protection in cities and towns around the
country."); Dick Davies, A City Considers Private Fire Service, The New York Times, January
30, 1983 at p. 15, col. 1 (nothing that for 30 years, cities in the south and southwest have used
private fire companies); Rural Metro, Business Wire, September 3, 1987 (available on Lexis)
(discussing Rural Metro Corp., a private national emergency fire fighting service which operates
the equivalent of 25 fire departments throughout the United States.); Carolyn Lockhead, Taking
Cities Private, Saturday Evening Post, May 1988 at p. 30 (noting that "many Rural Metro clients
maintain full or part ownership of their fire stations and equipment."); Lori Frearson, Company
Proves Privitization Works to Contain Fires, Expenses, Arizona Business Gazette, Dec. 7, 1987
at p.23.
   3
    In Colonial America all firefighting was done by private volunteers. Ron Coleman,
Opportunities in Fire Protection Services 5 (1990). In Europe the trend continues to the present
day. Lucy Holdges, Inefficient Fire Service Should be Competitive, The Daily Telegraph
more, only half the population of the United States is served by exclusive government fire protection.4

According to Martin Tolchin of the New York Times,

             "Private Fire Departments, which thrived when the nation was young, are serving a growing
             number of communities ... about 75 communities in 15 states ... have hired private companies
             to provide protection against fires ... [one company] ... protects, 20% of Arizona's population
             and has private fire departments in New Mexico, Texas, Florida and Tennessee."5

             The one federal circuit court decision that held a volunteer fire department to be a state actor

pre-dates Blum and Rendell–Baker and at one point suggests that it is ruling on the "symbiotic

relat ionship test" as well as the exclusive public function concept of state action. Janusaitis v.

Middlebury Volunteer Fire Department, 607 F.2d 17, 23 (2d Cir.1979).6 Omitting the problems of

archaism and ambiguity, however, Janusaitis is predicated on a state law different from that of Texas:

             The Connecticut statute authorizing agreements with volunteer fire departments implicitly
             recognizes that fire fighting is essentially the exclusive function of government.

607 F.2d at 24. Mo reover, in Connecticut, volunteer fire fighters are considered employees of a

municipality for workers compensation purposes, and a municipality is required to indemnify them

for specific liabilities. 607 F.2d at 21. These distinctions are sufficient to render Janusaitis less than

compelling precedent for the instant case.

             As we reject appellants' reliance on the exclusive public function concept of state action, it

is important to point out that MVFD would not have been deemed a state actor under any of the


(Britain) September 18, 1989 at p.4 (nothing that West Germany uses volunteer fire brigades and
that in Denmark "almost half the country is served by commercial fire protection firms.")
      4
    Donald DeVine, New Look of Local Government, The Washington Times, February 22, 1992
at B. 1 (noting "more than half the population is served by private or volunteer protection"). This
is not a new trend, but a long term phenomenon. Robert Masters, Going to Blazes (1967) (noting
that in 1967 volunteer firefighters responded to two-thirds of fires and that there were eight times
more volunteers than paid firemen); Ernest Ernest, The Volunteer Fire Company Book 2 (1979)
(noting that only 250,000 of the 2,000,000 firefighters in the United States were government
employees).
      5
          Martin Tolchin, Localities Shift to Private Firefighters, New York Times, July 28, 1985 at
22.
      6
    Lower courts have been split in their reading of Janusaitis because of this ambiguity.
Krohnmuller v. West End Fire Company, 123 F.R.D. 170, 174 (Ed.Pa.1988) (symbiotic relation);
Jensen v. Farrell Lines, Inc. 625 F.2d 379, 386 (2d Cir.1980) (same); Lombard v. Eunice
Kennedy Shriver Center for Mental Retardation, 556 F.Supp. 677, 680 (D.Mass.1983) (exclusive
government function); Wiseman v. Sherry, 514 F.Supp. 728, 732 n. 8 (M.D.Pa.1981) (same).
Supreme Court's other formulae. These formulae all depend on the degree to which the state and the

regulated entity exist in a "symbiotic relationship"7 or under circumstances where the conduct of the

private actor can be fairly imputed as that of the state. Jackson, 419 U.S. at 351, 95 S.Ct. at 453;

San Francisco Arts & Athletics, Inc. v. U.S. Olympic Committee, 483 U.S. 522, 556, 107 S.Ct. 2971,

2991, 97 L.Ed.2d 427 (1987).

          The Fifth Circuit has been asked to interpret this group of tests in a variety of circumstances,

most pertinent of which are those involving government-funded hospitals. In the hospital cases, it

has been found that even when a hospital accepts substantial governmental financial support, uses

facilities constructed with government guaranteed funds, and is heavily regulated and reviewed, such

a relationship is "not sufficient to subject the act of that business to the restraints of the First and

Fourteenth Amendments". McCroy v. Rapides Regional Medical Center, 635 F.Supp. 975, 980

(W.D.La.1986) aff'd 801 F.2d 396 (5th Cir.1986).8              Further, the court has held that "the

government's acquiescence or approval [of a private entity's actions is] insufficient to create

government action." Smith v. North Louisiana Medical Review Ass'n, 735 F.2d 168, 173 (5th

Cir.1984). Even when state law granted civil immunity to a peer review committee, the court has

declined to find state action. Goss v. Memorial Hospital System, 789 F.2d 353 (5th Cir.1986).

          The only case in which this court has found state action in a hospital setting is A.M. Jatoi v.

Hurst–Euless–Bedford Hospital Authority, 807 F.2d 1214 (5th Cir.1987). Three factors were

considered to distinguish Jatoi from the previo us hospital cases. First, a government authority

initially operated the hospital. Jatoi, 807 F.2d at 1221. Further, the "Authority derived a direct

financial benefit from the private lessee. The Hospital Authority's repayment of bonds it issued and

   7
       Burton v. Wilmington Parking Authority, 365 U.S. 715, 81 S.Ct. 856, 6 L.Ed.2d 45 (1961).
   8
    See also Greco v. Orange Memorial Hospital Corp., 513 F.2d 873 (5th Cir.1975), cert.
denied 423 U.S. 1000, 96 S.Ct. 433, 46 L.Ed.2d 376 (1975) (hospital that was largely funded
with public bonds and whose building and lands was owned by the county was not a state actor);
Madry v. Sorel, 558 F.2d 303 (5th Cir.1977) cert. denied, 434 U.S. 1086, 98 S.Ct. 1280, 55
L.Ed.2d 791 (1978) (hospital that received financial support and whose bylaws allow public
officials to serve as ex officio members was not a state actor); Wong v. Stripling, 881 F.2d 200
(5th Cir.1989) (no state action where private hospital was within the purview of state legislation
that authorized doctor's revocation and made available option review of procedural fairness in
court system).
the mortgages it entered into were dependent on successful operation of the hospital." Id. The court

also found, significantly, that the governmental authority "retained the ability to prevent or control

racial discrimination by its private manager." Id.9

       This case before us more closely resembles the hospital cases in which no state action was

found than it does Jatoi. The City's operating expense subsidy and payment of token sums to fire

fighters are insufficient to develop the close nexus between the City and MVFD that would convert

the voluntary association's decision into state action. Unlike Jatoi, the City did not profit from the

existence of MVFD, never operated its own fire department, and retained no ability to control

MVFD. The City was not involved in MVFD's membership policies and did not "coerce or

encourage" expulsion of appellants. Cf. Blum, 457 U.S. at 1004, 102 S.Ct. at 2786. Appellants have

never suggested how the City's initial exercise of a right of approval over MVFD's constitution and

bylaws (which did not permit the City to approve their amendments) results in continuing control of

MVFD by the City. See Rendell–Baker, 457 U.S. at 842, 102 S.Ct. at 2772. We are confident that

the connections between the City and MVFD are not so close as to establish the volunteer fire

department's status as a state actor.

B. City of McGregor

        Appellants assert two grounds for imposing liability on the City of McGregor for their

expulsion from MVFD. First, they argue, because the City must provide fire protection for its

residents, MVFD has fulfilled this exclusive prerogative of the City, and the City is liable for the

constitutional torts of the MVFD. The previous discussion disposes of this contention. Second,

appellants contend that under the principles of Frazier and Monell, the City can be held liable because


   9
    Absent these factors, even if a private actor receives a state financial benefit, state action will
not be found. Fulton v. Hecht, 545 F.2d 540 (5th Cir.1977) cert. denied 430 U.S. 984, 97 S.Ct.
1682, 52 L.Ed.2d 379 (finding no state action even though the state of Florida regulated and
shared in the business revenues of Greyhound racing against Greyhound owners). Outside of the
hospital setting, extensive regulation and review will not turn private action into state action.
McLellan v. Mississippi Power & Light Co., 526 F.2d 870 vacated in part on other grounds, 545
F.2d 919 (1977) (5th Cir.1976). Finally, absent other facts, it has been determined that if an
organization is organized and incorporated under state law and receives federal and state monies,
such as a private university, state action does not exist. Blouin v. Loyola University, 506 F.2d 20
(5th Cir.1975).
of its exercise of policymaking authority over the MVFD.

           In Frazier, supra, one of this court's cases considering a government-funded hospital's status

as a state actor, it was held that a city can be found responsible for the termination decisions made

by a private association only if it exercises coercive powers or provides such significant

encouragement either overt or covert that choice must in law be deemed to be that of the city.

Frazier, 765 F.2d at 1284 (citations omitted). By contrast, the district court here found "the plaintiffs

have provided absolutely no summary judgment proof that the defendant city has coerced or

encouraged the MVFD's actions." The deposition excerpts and affidavits contained in the record fully

support this finding. Appellees have cited nothing in the record which contradicts the district court's

finding.

           Appellants also seek to avail themselves of the Monell, principle that the City may be liable

under § 1983 for an act consistent with official policy or custom or an act consistent with a custom

or policy of an official to whom final and complete policy-making authority has been delegated.

Monell v. Dept. of Social Services, 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978); City of

St. Louis v. Praprotnik, 485 U.S. 112, 123, 108 S.Ct. 915, 924, 99 L.Ed.2d 107 (1988). Appellants

urge that the final policy-making authority over the membership in the MVFD was delegated by the

City to the MVFD. This doctrine is applicable, however, only if there is a delegation of government

powers. Because the MVFD was a private association, the mayor, the city council, and the city

manager of the City of McGregor did not hold, in the first instance, authority to regulate membership

in the MVFD and therefore could not delegate that authority. Equally significant, the mayor and the

city manager each executed an affidavit saying that neither they nor the city council had any

connection with or exercised any influence over the vote to expel appellants from membership in the

MVFD. The only link between the termination and a city official—however tenuous—was the

alleged statement of Councilman Kirk. Appellants have not shown that Kirk is an authority holding

discretion to hire and fire employees or that he individually holds full policy-making authority in the

area of personnel matters. Neubauer v. City of McAllen, 766 F.2d 1567, 1574 (5th Cir.1985).

           Since the City neither had policy-making authority over the MVFD nor exercised significant
overt or covert encouragement in the termination of appellants, we uphold the court's granting of

summary judgment for the City of McGregor.

                                      COUNCILMAN KIRK

       Appellants finally contend that Councilman Kirk used his position to influence the city council

and certain businessmen to remove them from the MVFD. They do not allege that Kirk was a state

actor in this regard but have instead relied on the presumed state actor status of John Blake and

Ronnie Spradley, former officials of the MVFD, with whom Kirk allegedly conspired. Because we

have determined that MVFD was not a state actor, its officers were not state actors either, and the

allegations against Kirk must fall.

                                           SUMMARY

       A private association of volunteer fire fighters chose to remove four individuals from its

membership after an internecine struggle. Neither the City of McGregor nor Councilman Kirk was

officially involved in this decision. Because it does not appear that Texas law renders fire fighting

an exclusive public function and because none of the other hallmarks of state action are present, the

district court properly granted summary judgment to appellees on appellants' § 1983 claims.

       AFFIRMED.
