an unanticipated consequence of
Jack M. Balkin
Jack Balkin: jackbalkin at yahoo.com
Bruce Ackerman bruce.ackerman at yale.edu
Ian Ayres ian.ayres at yale.edu
Mary Dudziak mary.l.dudziak at emory.edu
Joey Fishkin joey.fishkin at gmail.com
Heather Gerken heather.gerken at yale.edu
Mark Graber mgraber at law.umaryland.edu
Stephen Griffin sgriffin at tulane.edu
Bernard Harcourt harcourt at uchicago.edu
Scott Horton shorto at law.columbia.edu
Andrew Koppelman akoppelman at law.northwestern.edu
Marty Lederman marty.lederman at comcast.net
Sanford Levinson slevinson at law.utexas.edu
David Luban david.luban at gmail.com
Gerard Magliocca gmaglioc at iupui.edu
Jason Mazzone mazzonej at illinois.edu
Linda McClain lmcclain at bu.edu
John Mikhail mikhail at law.georgetown.edu
Frank Pasquale pasquale.frank at gmail.com
Nate Persily npersily at gmail.com
Michael Stokes Paulsen michaelstokespaulsen at gmail.com
Deborah Pearlstein dpearlst at princeton.edu
Rick Pildes rick.pildes at nyu.edu
Alice Ristroph alice.ristroph at shu.edu
Brian Tamanaha btamanaha at wulaw.wustl.edu
Mark Tushnet mtushnet at law.harvard.edu
Adam Winkler winkler at ucla.edu
In the recent Stimulus Package, Congress gave states the option of turning down their billions in federal money. Like most federal dollars, the stimulus money comes with conditions attached, and for some Republican governors (mostly presidential hopefuls, it seems) those conditions appear to be too onerous to be worth the cash. But Congress also inserted a provision allowing a state legislature alone to accept the money on behalf of the state (“the state leg. clause”). On this blog, Jack Balkin has opined that the state leg. clause is probably unconstitutional, because the question of who has authority to accept conditional grants on behalf of a state is a question of purely state law. The Congressional Research Service also lately came to a similar conclusion.
I am here to offer the contrary view. I’m interested not purely in the Stimulus controversy, but more generally in the question: when it comes to accepting conditional grants, who speaks for states? Is Jack right that it’s solely up to states? Can a federal court enforce against states a condition of a grant when that grant was not accepted in the manner state law requires? And, similarly, can the court refuse to enforce a grant accepted by lawful state procedures? My view is that, except in special cases, state law is not controlling. Disclosure: I am opposed to most restrictions on conditional federal grants, for reasons that I set out here and here.
My basic assumption is that state determinations of what appear to be state law may be denied preclusive effect if they bear on significant federal interests. Take, for instance, the Michigan v. Long rule that federal law determines what is an adequate and independent state-law ground. Or, similarly, in the 2002 Lapides case, the U.S. Supreme Court held that, when states’ attorneys appear in federal court, whether a state actor has authority to waive sovereign immunity is a question of federal law. The rationale, evidently, was that the state legislature should not get to decide how to balance state sovereign immunity against federal considerations of judicial economy and fairness to litigants.
So, to flip Jack’s earlier janitor example, suppose that a state legislature determined that the effectiveness of the terms of federal-grant conditions for all citizens in the state would turn on whether the capital custodian opted to accept the conditional funds. In a challenge by other state officials to the applicability of those conditions, must the court treat the custodian's acceptance as meaningful (assuming there are no state-law principles that would also nullify it)? My argument is that it would be legitimate to refuse to give the acceptance meaning to the extent that one can articulate some federal norm for doing so.
What sorts of federal norms might there be that could justify setting aside state law? Some scholars of conditional spending, such as Professors Ernie Young & Lynn Baker, believe that such spending is inconsistent with state autonomy. They support the “clear statement rule” of Pennhurst and other cases as a way of requiring bicameralism and presentment before any conditional grant can be enacted, so that enacting the grants will be very difficult, if not as difficult as possible. By the same logic, they should also support a requirement of bicameralism and presentment at the state level before any state grant can be accepted. Otherwise, states could by their individual decisions undermine a system of federalism that benefits them all.
Or, on my account of conditional spending, additional judge-made resistance to grants is unnecessary because resistance is intrinsic to the motivations of state actors. But that may depend on the structure of state decisions. I argue that state officials’ self-serving incentives to refuse a grant or demand more money before accepting can act to preserve state autonomy. So suppose it were the case that state agency officials are those most driven to reject federal grants. (I didn’t consider that particular question in my paper, but let’s just suppose.) The rule most consistent with the spirit of the 10th amendment then should be that state agency officials get to decide on grants, because giving the decision to the legislature, by hypothesis, would reduce state autonomy overall. Indeed, in this story, federal law has to protect state populations and the federal structure against state legislatures that will enact rules giving themselves sole authority to accept grants, and accept grants too readily. Thus, no matter what rule the state selects, federalism would dictate that the rule be that only state agency officials can validly accept grants.
One might resist these claims by arguing that, once we say we can reject the janitor, federal law can also dictate any other state arrangement that would impede the acceptance of federal grants. For instance, why not quadruple the number of state legislators and require unanimity to accept grants? Or, put another way, the argument against conclusive state power to dictate the terms on which they will accept grants is a sort of federal paternalism – protecting the States from state lawmakers. Once we start down that road, where do we stop?
I am actually sympathetic to that argument, but I would argue it cannot be reconciled with the Pennhurst case and other decisions requiring that any condition on federal spending be made explicit in the federal statute. This clear-statement rule cannot be defended unless one accepts the premise that it is legitimate to impose restrictions on a state's power to undermine federalism interests. (I have set out that argument in detail in the article I mentioned earlier.) So perhaps one could agree that states have complete autonomy to set the terms of their acceptance of grants. But then I think one also has to say they should have complete autonomy to accept grants whose conditions are unclear, a freedom currently denied them under existing law.
It is true that states don't have to challenge the applicability of the unclear provisions they accept. But 15-year-olds don't have to void their voidable contracts, either. And yet as a practical matter it's very, very difficult for a 15-year-old to enter into a meaningful contract. At best, the clear statement rule reduces the value of the payment states can command for their consent, denying them the ability to make the best deal available.
Having said all that, I'm prepared to concede that we may have special reasons for trusting or distrusting the determination by certain institutions of who can accept a federal grant. On my theory or Baker & Young’s, we'd be very suspicious of Congress, who we would fear would try to make resistance too low. Thus, the state leg. clause might be a situation where my general rule could give way to special suspicion of Congress.
On the other hand, my analysis shows the inadequacy of the CRS opinion. CRS claims in its analysis that the state leg. clause is a constitionally-prohibited “conscription” of the South Carolina governor, forcing him to spend money he never accepted, but that is at best question-begging. No one would seriously argue that it is conscription when the governor and legislature together accept, pursuant to state law, conditions that bind other state officials, such as inferior executive officers. What distinguishes the two must be some analysis of whether the decision to accept funds is constitutionally acceptable, an analysis wholly absent from the CRS report.