March | April 2017

Focus on Federalism

CSG Initiative Aims to Restore ‘Laboratories of Democracy’

by Alaska Sen. Gary Stevens, 2013 CSG Chair, and Tennessee Sen. Mark Norris, 2014 CSG Chair


Since the founding of our nation, there have been enormous fluctuations in the balance of power between states and the federal government. Although the 10th amendment of the Constitution clearly reserves the preponderance of power to the states, the growth of the federal government has served to tip the balance increasingly in favor of Washington.
As chairs of The Council of State Governments for the next two years, we have committed to launching an enterprise-wide effort by The Council of State Governments to elevate the role of states in the federal system.
One of the most striking elements of our federal system is the separate but equal division of power, influence and authority between federal and state governments. States are very aware of federal overreach and seek to clarify conflicting responsibility between governments.
Before 1900, only 29 statutes enacted at the federal level pre-empted state law. Federal pre-emption is steadily increasing in both number and scope; since 1900, there have been more than 500 federal pre-emptions.
Washington also increasingly uses both legislation and rulemaking to impose mandates on states, often with little or no funding to implement them. When Congress passed the Unfunded Mandate Reform Act in 1995, state leaders across the country welcomed it as an important step in limiting Washington’s proclivity to commandeer states to accomplish federal purposes. Since the legislation does not address partially funded mandates, such as the strings attached to education funding in the No Child Left Behind Act, and since the legislation excluded independent federal agencies from review, its impact has been limited.
A 2011 report by the White House’s Office of Management and Budget—known as the OMB—noted that unfunded mandates and regulations cost states, cities and the general public between $44 billion and $62 billion each year. The same report stated the public benefits of these rules, including cleaner air and water, far outweigh the monetary cost of compliance. For states left to cover the costs of a growing set of federal mandates and rulemaking actions, however, the balance often looks decidedly different.
The cost of Washington’s overreach is about more than dollars; it is about lost opportunities for innovation and effectiveness. States are uniquely able to craft solutions to meet the needs of their people. When power flows from the state house to the White House, we lose opportunities to explore new approaches to education, economic development and a host of other areas of vital importance to our nation’s future.
Although Washington’s role in public policy has arguably reached a high water mark, the dollars it uses to influence local level decisions are clearly receding. According to Federal Funds Information for States, 30 of the 42 major state-federal grant streams will see cuts of 5 percent or more as a result of sequestration. In addition, efforts to limit the impact of sequestration on defense spending and drive down federal budget deficits even further could see grants cut by as much as 10 percent in the years ahead.
Given that we have entered into a new age of austerity, where federal funding will be constrained for the foreseeable future, it is vital both that states are afforded maximum flexibility in meeting the needs of their residents and that our country reaches a much clearer understanding of the costs of mandates, regulatory action and pre-emption.
To accomplish this goal, CSG has launched a two-year Focus on Federalism initiative to enhance the role of states in our federal system. For 80 years, CSG has helped states solve problems by connecting leaders to innovative ideas and successful policies within the community of states. State-based innovation, however, is increasingly impacted by a growing web of federal policies and regulations. If states are to continue to play a role as drivers of innovative solutions to difficult public policy challenges, then a fuller understanding is needed of the duties, responsibilities and limitations within our federal system.
The initiative will be led by a newly appointed Federalism Task Force, which includes key leaders from across CSG who will provide strategic direction and oversight. The broad campaign will examine, highlight and advance the role of states in the federal system and incorporate a broader focus on federalism through all CSG programs and activities.
The initiative will feature forums on federalism at CSG meetings to promote dialogue between state leaders and federal cabinet officials, senior members of the judiciary and other experts to ensure a fuller understanding of the state of federalism today. CSG also will utilize Capitol Ideas and a wide variety of publications to highlight key issues in the state-federal relationship.
CSG also will utilize its media outreach to emphasize the role states play in solving important problems facing our nation. States are able to solve critical problems both by partnering across state lines through interstate compacts and by utilizing their close connections to their constituents to craft locally appropriate solutions. Examples of such innovative developments include the efforts of a wide range of states to drive down higher education costs by entering into an interstate compact on distance learning and Arizona’s success in achieving dramatic Medicaid cost savings through careful program management.
Finally, the initiative will play a prominent role in CSG’s federal advocacy for the next two years. CSG was one of the principal supporters of the original Unfunded Mandate Reform Act in the 1990s. In the succeeding years, however, weaknesses in the bill have become increasingly apparent. The Focus on Federalism initiative will provide an opportunity for CSG to partner with other state and local organizations and to work with key offices in Congress to promote legislation that would address these weaknesses.
The idea of dual federalism is a well-established constitutional principle. It encourages our federal government and state governments to work cooperatively in solving the enormous problems we face. The states are rightly concerned that over time, the federal government has been encroaching on the governing power of the states. It is our hope that CSG’s Focus on Federalism initiative can play a small but important role in helping states restore their role as the “laboratories of democracy” envisioned by our founders.