Posted by Jonathan Adler:
The Stimulus and the Spending Clause:
http://volokh.com/archives/archive_2009_03_01-2009_03_07.shtml#1236122945
Several governors may reject some portion of the stimulus funding for
their state. In a recent post, [1]Jack Balkin suggests that �the
governors' threats to refuse federal money actually help establish the
constitutionality of the stimulus bill, and its proposed bargain of
federal funding in return for state regulatory obligations.� He
writes:
if one or more states seriously suggests that they may refuse some
or all of the stimulus money because of the federal strings
attached, this tends to demonstrate that the stimulus bill is a
constitutional exercise of the spending power: it is evidence that
pressure to accept federal monies has not turned into compulsion,
that a genuine offer is being made and that each state can still
freely decide whether or not to accept the money.
I disagree, as I explain below.
([2]Click for rest of post.)
Under [3]South Dakota v. Dole, the Court identified four primary
constraints on Congress� use of conditional federal spending to induce
state action. First, the appropriation of funds must be for the
�general welfare,� as determined by Congress, and not for a narrow
special interest. Second, there can be no independent constitutional
bar to the condition imposed upon the federal spending. In other
words, Congress may not seek to use the spending power to induce
states to engage in conduct that would otherwise be unconstitutional.
Third, any conditions imposed upon the receipt of federal funds must
be clear and unambiguous so as to ensure that recipients of federal
funds have notice and voluntarily assumed any legal obligations.
Fourth, �the condition imposed by Congress is directly related to one
of the main purposes for which . . . funds are expended.� In addition,
the Dole Court suggests a fifth potential constraint: �in some
circumstances the financial inducement offered by Congress might be so
coercive as to pass the point at which �pressure turns into
compulsion.��
Of these, only the third and fourth appear to be particularly
meaningful constraints on federal use of the spending power,
particularly the former. The �coercion� limit, on the other hand,
seems to have little independent force. Though successful spending
clause challenges are rare, states have been successful in lower
courts challenging federal efforts to impose conditions on the receipt
of federal funds that were unclear, and some appellate judges have
expressed a willingness to enforce a relatedness requirement. (I
summarized some of the relevant cases in [4]"Judicial Federalism and
the Future of Federal Environmental Regulation," 90 Iowa Law Review
377 (2005).) Of note, neither of these conditions is affected in the
least by whether some states refuse federal money. This does not mean
the stimulus is unconstitutional. But it also does not mean that the
decision by some governors to forgo some or all stimulus money has any
implications for whether the imposition of conditions on receipt of
federal money in this, or any other, bill is constitutional.
One potential conflict that could arise is whether governors are
required to treat the stimulus money as an �all or nothing� offer.
That is, if a state takes one portion of the stimulus money, it must
also take money for other things, even if the other money has federal
strings to which the governor objects. This, some claim, was Congress�
intent. Senator Schumer, for one, wrote to OMB Director Peter Orszag
that stimulus funding is [5]all-or-nothing. So, if Governor X takes
money for highway construction, he would also be required to take
money for medicare or unemployment insurance, and abide by whatever
conditions are attached to the latter. I am not so sure of this
either.
It seems to me there are two potential objections to this position,
based upon the third and fourth constraints on conditional spending
found in Dole. The first is that since the stimulus legislation does
not contain an explicit provision stating that governors are faced
with an all-or-nothing choice, the federal government could not now
impose that condition on them. At the very least, any such condition
would have to be made explicit, through a regulation perhaps, before
the first checks are cut. If a challenge were made to an effort to
impose an �all or nothing� rule, I suspect this would be the stronger
legal argument states could make.
A second, admittedly more speculative, objection would be that there
is not a sufficient relationship between the different portions of the
stimulus bill, or the conditions placed upon some portions of the bill
(e.g. the welfare or unemployment insurance provisions) and other
spending in the bill (e.g. highway funding and construction projects),
to sustain the imposition of this requirement. A potential
counter-argument would be that insofar as all of the provisions of the
bill are meant to stimulate the economy, they are all related to each
other, even if the conditions imposed on some provisions bear little
relation to other funding in the bill. Even if one rejects the
counter-argument, states would be on weaker ground here. Thus far,
lower federal courts have been reluctant to impose a strict
relatedness requirement under Dole.
The other constitutional issue with the stimulus bill that I am still
wrapping my head around arises from the provision that purports to
allow a state legislature to bypass a governor�s refusal to accept
stimulus funds.
ADDITIONAL FUNDING DISTRIBUTION AND ASSURANCE OF APPROPRIATE USE OF
FUNDS
SEC. 1607. (a) Certification by Governor- Not later than 45 days
after the date of enactment of this Act, for funds provided to any
State or agency thereof, the Governor of the State shall certify
that: (1) the State will request and use funds provided by this
Act; and (2) the funds will be used to create jobs and promote
economic growth.
(b) Acceptance by State Legislature- If funds provided to any State
in any division of this Act are not accepted for use by the
Governor, then acceptance by the State legislature, by means of the
adoption of a concurrent resolution, shall be sufficient to provide
funding to such State.
(c) Distribution- After the adoption of a State legislature's
concurrent resolution, funding to the State will be for
distribution to local governments, councils of government, public
entities, and public-private entities within the State either by
formula or at the State's discretion.
Here I am inclined to agree with Jack that the federal government
cannot circumvent a state�s internal structure to ensure the
disbursement of federal funds. If, for instance, a state legislature
were to pass a concurrent resolution accepting federal funds for the
state that was subsequently vetoed by a state governor in accordance
with state law, it seems quite clear to me that federal law could not
override that determination in a manner inconsistent with state law,
as state governments are only capable of consenting to the receipt of
federal funds in accordance with state law. Just as the federal
government could not, as an initial matter, tell a state government
that it must expend state funds in a particular manner absent the
state�s concurrence through the normal means by which a given state�s
funds are appropriated, the federal government cannot tell a state
that it must spend federal money in a particular manner, absent the
state�s concurrence in the same fashion. This, I think, is the logical
implication of the anti-commandeering bar on regulating states as
states. The feds can seek to �bribe� the states all they like, but
they cannot manufacture state consent anymore than the feds can simply
tell states, as states, what to do (absent a specific constitutional
mandate).
([6]hide)
References
1.
http://balkin.blogspot.com/2009/02/offer-republican-governors-can-refuse.html
2. file://localhost/var/www/powerblogs/volokh/posts/1236122945.html
3.
http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=us&vol=483&invol=203
4. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=690827
5.
http://www.huffingtonpost.com/2009/02/24/schumer-to-gop-govs-on-st_n_169411.html
6. file://localhost/var/www/powerblogs/volokh/posts/1236122945.html
_______________________________________________
Volokh mailing list
[email protected]
http://lists.powerblogs.com/cgi-bin/mailman/listinfo/volokh
