59

attempt to negotiate resolutions. All eight agencies dre | 4!
reguizes te #cllow Dov‘e regulation and enforcenont pelioieni: Ac
a lt, state and leeai governments are not subject to

conflicting or énccnsistent standards.

The agencies designated to investigate title tx complaints
ware selected beceusc of their expert‘an in the regulated subject
matter, These egencics have weli-established programs to
investigale Secticn 504 complaints againat recipients of Federal
financial ussisvance. | Because cite 11 cnmplainee fcequently
allege violations of Section 504 as weil, the designated agency
system reduces the burden on atate and loos: agencies by allowing
a single aguucy to investigate both violations at the same tima.

‘this cymtem algo assures otete and local governments that
investigations will be carried out by an agency familiar with the
nature of their proyrams and the conatrsints they operate under.
Por example, complaints about achoole are investigated by the
Departrent of Edication; complaints abour acce: Ke ore
investigated hy the Dcpertmont of the Interior. if all
investigations were consolidated in one agency, a grrat Seal of
expertise would be losl.

Ey

To Gate, che system hes worked well. There is no evidence
thal conse:idacing all responsibility for technical assistance
and investigations ire single bureaucracy weuld benefit. state
and local goveromenta.

5) ACIR Recommendation: Lawsuits against atate and local
geverpments sheuld be limited to actions brought by the federal
government.

This recommanastion apparently stems from ACTR’s concern
that the sbilacy ot individuals tu sue may create enormous
litigation copes and administrative uncertainty tor etate and
local governments. As applied fo the ADA, this recommendation ta
Unacceptable because it would mean that Americans with
Gloabilities would be singled out as Lhe only people unable tc
peek the assistance of the courts to enforce statutorily
prolected civil rights.

Ic i= prefexoble co implemant the ADA threush voluntary

lianoe or, when disputes arjne, through altemative means of
diepute resolution, Wowever, alternative dispute resoiution, to
be successful, wust be accompanies by a alrong enforcement
policy. If private inidiviguale are unably to eve to enforce
thatr own vighte, publie entities will have ao incentive to
comply wilh the law.

6) AcIR Concern:
gutticieat technt

The rederel government bac net provided
1 aseiatence te help entities comply with the



123

STATEMENTS OF HON. VINCENT F. CALLAHAN, JR., MEMBER,
VIRGINIA HOUSE OF DELEGATES; MICHAEL A. RESNICK,
SENIOR ASSOCIATE EXECUTIVE DIRECTOR, NATIONAL
SCHOOL BOARDS ASSOCIATION; GEORGE G. BALOG, CHAIR-
MAN, URBAN FORUM, AMERICAN PUBLIC WORKS ASSOCIA-
TION; AND LEE SAUNDERS, ASSISTANT TO THE PRESIDENT,
AMERICAN FEDERATION OF STATE, COUNTY, AND MUNICI-
PAL EMPLOYEES

Mr. CALLAHAN. Thank you, Mr. Chairman. As I was talking to
you earlier, I’m one of these politicians who actually represents the
district within the Beltway, and there’s not too many in this coun-
try. So I perhaps have a little different view of Washington and my
service in Richmond.

I've been a member of the House of Delegates for 28 years and
served the Past 6 years as chairman of the Virginia Advisory Com-
mission on Intergovernmental Relations, the ACIR. As a matter of
fact, it was my legislation that created the Virginia ACIR some 7
years ago. I have witnessed the effects of unfunded Federal man-
dates on the Commonwealth and its localities, especially the dif-
ficulties posed by concurrent increases in Federal statutory and
regulatory requirements and decreases in Federal aid.

As an example, Danville, VA, a city of less than 55,000 people,
is statistically ranked as one of our localities with above average
fiscal stress. In fiscal year 1993, Danville reported spending 13,800
staff hours to comply with the Americans With Disabilities Act.
These costs, combined with other ADA-related costs, totaled
$176,000 for that single mandate alone. Despite the ADA’s laud-
able goals, the commitment of that level of personnel and financial
resources for a locality experiencing fiscal stress seems too much

ask,

In all, $6.3 million, or almost 16 percent of Danville’s local source
revenue, was spent in 1993 funding 10 of the more than 200 Fed-
eral mandates. As you know, all costs are not quantifiable.

I would like to tell you about the unfunded Federal mandates in
my State, to assess the progress that has been made, and to pro-
pose further improvements. I appreciate the opportunity to be be-
fore this body, particularly on the first anniversary of the Un-
funded Mandates Reform Act.

The new law has already made a difference. It played a major
role recently in averting a proposed mandate in the telecommuni-
cations legislation that would have profoundly affected local gov-
ernments. This was something, particularly in my neighborhood,
when we got in this business of monopolies. You might have heard
that term. It helped preserve local zoning authority and control of
public rights-of-way. This is progress.

The Unfunded Mandates Reform Act was also the catalyst for the
new cost estimation unit of the Congressional Budget Office, which
has established networks of State and local officials and other ex-
perts throughout the country to collect data about the cost of Fed-
eral mandates. The Virginia ACIR helped identify 60 such individ-
uals in our State who have a; d to participate in the CBO’s net-
works and are standing by. Getting accurate data about the cost
of mandates, including long-term cost, opportunity cost, and hidden
cost, is critical for relieving the burdens that mandates impose.


25

estimate published in the Congressional Record prior to consider-
ation of the bill, as is required under the mandates law. So CBO,
under a lot of pressure to do a lot of things, did its job.

There were no intergovernmental mandates that in the aggre-
gate exceeded $50 million, the threshold, and the private sector
mandates were fully disclosed. It is also important to note that the
rule on the immigration bill expressly indicated that it was not
waiving any mandates or points of order against consideration of
the bill. I think that’s important. As Mr. Towns mentioned, we
would perhaps like to see that more, but I think it’s important that
that happened.

Nor dia it explicitly waive the mandates motion to strike, which
applies, as you all know, only to intergovernmental mandates. The
motion to strike, unlike what has been stated on the floor on occa-
sion, does not apply to the private sector mandates.

Even if the rule had waived the points of order and the commit-
tee had failed to do its job where there were public sector mandates
in the bill, of course a Member could still get a recorded vote on
the mandates issue by raising a point of order against the rule.

So there is a lot of protection for State and local governments in
the event that committees fail to do their jobs properly. But the
good news is that the committees now do seem to understand the
requirements of this new law and, from what we can tell, they are
complying with the new law.

Despite these early indications of success, we are continuing to
work aggressively with this committee, with the substantive or au-
thorizing committee, CBO, State and local government reps, the
Rules Committee, and so on, to ensure the law’s proper implemen-
tation.

CBO reports, as of this week, that they have provided a total of
26 State and local government estimates since the mandate provi-
sions took effect on January 1 of this year, that five bills contained
public sector mandates, and that none of these five had mandates
above the $50-million threshold. As I mentioned earlier, the Teleco
conference report was fixed before it reached the floor.

CBO also reports that calls from Members and committees indi-
cate that, in many cases, the mandates issues are being addressed
before introduction of a bill and before markup in committee.
Again, I think this is expressly how we hoped the process would
work.

We have also been working with the House Parliamentarian’s Of-
fice with respect to some of the novel procedures that the mandates
law created to achieve our important public policy goals. In m
view, no technical corrections are merited now, but we still will
continue to monitor how well these provisions are working. It is
quite complicated.

With respect to other titles of the Mandates Act, let me just say
briefly that I look forward to reviewing the annual statement on
agency compliance. As Chairman Clinger has said, it is very impor-
tant that we continue to focus on the agencies. It is a vital part
of the effort to reduce the burden of mandates.

Finally, as a_ new member of ACIR, I look forward to working
with you, Mr. Chairman, now that we are on ACIR, in the impor-
tant task of reviewing existing mandates. In my view, passage of


154

ably the fairest way of all is that, if there’s going to be Federal re-
sponsibility, at least help out in the funding mechanism, and that
was not forthcoming.

Let me ask this: The Unfunded Mandates Reform Act, of which
I was one of the four major sponsors in the House, talks about pilot
programs that OMB can establish to test innovative and flexible
regulatory approaches to governing. Can any of you think of any
pilot programs we might work out, that OMB might look at, in
terms of testing new approaches in government? If you don’t have
anything off the top of your head, that’s all right.

ir. RESNICK. Well, in the last Congress, there was legislation en-
acted, under the extension of the Elementary and Secondary Edu-
cation Act, that does provide for half a dozen States to engage in
a special ed. flex program, to begin combining more educational
programs and engaging in waivers. I think that test, in effect, in
education is underway.

What we would also like to see occur is for us to begin to look
at flexibility of programs among Federal agencies. Very frequently,
school districts do receive money from several sources, from dif-
ferent agencies, that we feel could be combined and be used more
effectively. That is, of course, inside the grant and aid programs,
but that’s certainly one area that we're very interested in pursuing.

Mr. Davis. One of the concerns I’ve always had is that, when the
Federal Government mandates and doesn’t fund it, that we are ba-
sically shifting the cost from a fairly—at least today—progressive
income tax to very regressive local pro rty taxes. And in terms of
who should be paying and those kinds of things, we never talk
about the fact that we’re hitting, in many cases, some of the
underclass and people who aren’t as well off, to pay for these pro-
grams at the local level, than you would get from a progressive in-
come tax.

Any thoughts on that tax shift, as well?

Mr. RESNICK. Well, for us—and it’s a point that we elaborated on
in our written statement—you raise a matter of particular concern,
because anytime the Federal Government does legislate a mandate,
and there is no funding, the school districts have a choice: They
can either raise their local property taxes, which, as you point out,
is a regressive tax to fund a Federal priority; or they can reduce
their expenditures in other areas of the school program.

Particularly in poorer communities, that really puts them on the
horns of a dilemma: that is, whether or not local property taxes
reach beyond the taxpayers’ ability to pay, on the one hand, or
whether the school program will begin to suffer and provide a level
of education that is not the same, and therefore it doesn’t provide
the same educational opportunity for children who are in other dis-
tricts.

Overall, though, the property tax is a regressive tax that prob-
ably has a negative impact on most citizens and most communities.
Mr. Davis. Any other thoughts? .

Mr. BaLoc. I think it has a very dramatic effect on the cities.
Most of the cities are poor and struggling, and their growth isn’t
great. And what happens is, they have to cover for cultural events
that the surrounding counties have. When the taxes go up, the peo-
ple leave the city and go to the county. There’s a flight. And I know


149

Statement of Lee Saunders
Assistant to the President
American Federation of State, County and Municipal Employees, AFL-CIO

Good morning Chairman Shays and members of the Commitee. We appreciate the
opportunity to appear before you today. My name is Lee Saunders, and | am an Assistant
to President Gerald McEntee of the American Federation of State, County, and Municipal
Employees (AFSCME). AFSCME represents 1.3 million state and local government and
health care workers across the United States. We are pleased to offer comments on the
Unfunded Mandates Act as well as on the recommendations of the Advisory Commission
on Intergovernmental Relations’s (ACIR) report, "The Role of Federal Mandates."

AFSCME is a member of a broad-based coalition called Citizens for Sensible
Safeguards which strongly opposes the preliminary ACIR Report. ‘The Coalition has issued
its own report, “Shirking Responsibility," which lays out in dewail the various reasons why
this coalition of over 150 organizations opposes the ACIR report.

1am primarily focusing my testimony on three labor protections that currently cover
state and local government employees: the Fair Labor Standards Act (FLSA), the
Occupational Safety and Health Act (OSHA), and the Family and Medical Leave Act (FMLA)
that the ACIR believes should be repealed. ‘If the recommendations put forth by ACIR are
enacted into law, every one of the millions of state and local government workers would
be adversely affected.

‘The Advisory Commission on Intergovernmental Relations’ Report

The ACIR’s recommendations directly contradict recent acts by Congress. Afte
widespread criticism that Congress failed to give its employees the same labor and
rights protections that it bad long ago extended to private sector and state and local
government workers, the House and Senate, in near unanimous votes, approved the
Congressional Accountability Act last year. It is therefore profoundly troubling that the
ACIR recommends stripping state and local employees of the very labor protections that
Congress just extended to its own workers.

As an employer , no level of government is justified in treating its employees
differently from all other workers in the country. Indeed, government should be a model
employer, not a delinquent one. As Labor Secretary Reich said in his comments on the
report, “If the recommendations in the report were implemented, state and local
government workers would become second class citizens - deemed unworthy of the same
basic protections as their neighbors, friends, and family who work in the private sector or
for federal agencies.” All workers are entitled to be treated equitably.

AFSCME and other unions representing federal employees have demonstrated their
willingness to work in a cooperative manner to re-examine the role of government where it
needs to be re-examined. Front line workers and their unions were involved in Vice
President Gore's reinventing government project from the very start. We are therefore
disappointed that the Commission, in compiling this report, did not adopt an inclusive,
“reinventing government’ style approach.

The ACIR never reached out to state and local government employees or their
representatives for their input, comment, or recommendations. The only voices that the
ACIR chose to listen to were state and local elected officials and their representatives and
managers. Until now, this has made for a very one-sided investigation and debate. It is no
wonder that the recommendations do not reflect the voices of the workers who perform
the services that every American depends upon.


COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT
WILLIAM F. CLINGER, JR., Pennsylvania, Chairman

BENJAMIN A. GILMAN, New York

DAN BURTON, Indiana

J. DENNIS HASTERT, Illinois

CONSTANCE A. MORELLA, Maryland

CHRISTOPHER SHAYS, Connecticut

STEVEN SCHIFF, New Mexico

ILEANA ROS-LEHTINEN, Florida

WILLIAM H. ZELIFF, Jr., New Hampshire

JOHN M. McHUGH, New York

STEPHEN HORN, California

JOHN L. MICA, Florida

PETER BLUTE, Massachusetts

THOMAS M. DAVIS, Virginia

DAVID M. McINTOSH, Indiana

JON D. FOX, Pennsylvania

RANDY TATE, Washington

DICK CHRYSLER, Michigan

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

WILLIAM J. MARTINI, New Jersey

JOE SCARBOROUGH, Florida

JOHN B. SHADEGG, Arizona

MICHAEL PATRICK FLANAGAN, Illinois

CHARLES F. BASS, New Hampshire

STEVEN C. LATOURETTE, Ohio

MARSHALL “MARK” SANFORD, South
Carolina

ROBERT L. EHRLICH, Jr., Maryland

CARDISS COLLINS, Illinois

HENRY A. WAXMAN, California

TOM LANTOS, California

ROBERT E. WISE, Jr., West Virginia

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

JOHN M. SPRATT, Jr., South Carolina

LOUISE McINTOSH SLAUGHTER, New
York

PAUL E. KANJORSKI, Pennsylvania

GARY A. CONDIT, California

COLLIN C. PETERSON, Minnesota

KAREN L. THURMAN, Florida

CAROLYN B. MALONEY, New York

THOMAS M. BARRETT, Wisconsin

BARBARA-ROSE COLLINS, Michigan

ELEANOR HOLMES NORTON, District of
Columbia

JAMES P. MORAN, Virginia

GENE GREEN, Texas

CARRIE P. MEEK, Florida

CHAKA FATTAH, Pennsylvania

BILL BREWSTER, Oklahoma

TIM HOLDEN, Pennsylvania

BERNARD SANDERS, Vermont
(Independent)

JaMEs L. CLARKE, Staff Director
KEVIN Sapo, General Counsel
JupitH McCoy, Chief Clerk
Bup Myers, Minority Staff Director

SUBCOMMITTEE ON HUMAN RESOURCES AND INTERGOVERNMENTAL RELATIONS
CHRISTOPHER SHAYS, Connecticut, Chairman

MARK E. SOUDER, Indiana

STEVEN SCHIFF, New Mexico

CONSTANCE A. MORELLA, Maryland

THOMAS TM. DAVIS, Virginia

DICK CHRYSLER, Michigan

WILLIAM J. MARTINI, New Jersey

JOE SCARBOROUGH, Florida

MARSHALL “MARK” SANFORD, South
Carolina

EDOLPHUS TOWNS, New York
TOM LANTOS, California

BERNARD SANDERS, Vermont (Ind.)
THOMAS M. BARRETT, Wisconsin
GENE GREEN, Texas

CHAKA FATTAH, Pennsylvania
HENRY A. WAXMAN, California

Ex OFFICIO

WILLIAM F. CLINGER, JR., Pennsylvania

CARDISS COLLINS, Illinois

LAWRENCE J. HALLORAN, Staff Director and Counsel
THomas M. Costa, Clerk
CHERRI BRANSON, Minority Professional Staff Member
CHERYL PHELPS, Minority Professional Staff Member
MATT PINkus, Minority Professional Staff Member

rere)


119

But I still have a problem with what I feel was the tone in a
number of the comments going through here and a number of the
assumptions. It’s one thing to say that State and local governments
should be model employers. It’s another thing for us to say “must.”
In fact, when we do things that say they have to do certain things,
we're not into the realm of encouraging, saying they should be.
question here is, must they be, and do we enforce that?

I also think that, while it’s not at a personal level, and it’s driven
by legitimate concerns for individuals and the issues that you work
with, nevertheless, there is a tone of hostility that comes through
and, to some degree, arrogance, that the Federal Government is
some sort of protector of the environment, of working people, of
schools; State and local governments are not.

There’s also this implication that the Federal Government some-
how is going to do a better job of protecting State and local employ-
ees; that, if we, for example, don’t enforce these laws, somehow
there is going to be this terrible persecution of State and local em-
ployees.

The environment is going to go to pieces, we won’t have as good
an education system, we'll have workers persecuted again, if it
wasn’t just for this fortunate thing that we have the Federal Gov-
ernment to come down and do this type of thing. And there’s a tone
there underneath it that says, without us, these other elected offi-
cials and these other Americans aren’t going to do a very good job.

Now, in fact, when it’s clear cut—and I think that where we're
going to have agreement on our panel here and there is that there
are some things that, at the very least, historically, have been
not—I mean, we can look at labor. We can look at how minorities
were treated. We can look, in the IDEA, and say the Government
stepped in. The question is, how much are we going to back off,
how fast? Are the conditions the same? When you have a situation
where you try to rectify it and then move it back, where do you go?

But I have a concern that when, for example, in Dr. Anderson’s
testimony, you said that you favor eliminating mandates only when
they are duplicative, or that—and this is really where I want to
come—I want to make a statement—come to this question, and
that is, I didn’t hear any concerns about one group of elected offi-
cials telling another group of elected officials what to do, or about
how we draw a balance of one government telling another govern-
ment that they, in effect, need to raise taxes and revenue in order
to do certain things that the other branch of government feels.

Specifically, how would you delineate, since the report doesn’t ap-
pear to, where there is a compelling national interest versus a feel-
ing that one government would like to run the other government?

Ms. Katzen. If I could start, just as a general overview from the
administration, I regret if there is any perception of arrogance. I
think what this President has stood for fom the very beginning is
consultation with, working with, harmonization with our intergov-
ernmental partners.

These are terms which I had not heard in Washington in the last
25 years until we had a former Governor. And I thought Jamienne
Studley’s comments about the Department of Education, which has
two former Governors at its helm, is very telling. So if you per-
ceived that beneath the surface, as I say, I regret that. I think this


68

Mr. Says. I thank you, Ms. Katzen.

At this time, Ms. Metzenbaum.

Ms. METZENBAUM. Thank you, Mr. Chairman. I appreciate the
opportunity to appear here today before your committee to discuss
how we have implemented the Unfunded Mandates Reform Act.

I would like to talk about three things: First, EPA’s effort to ag-
gressively strengthen our partnership with State, local, and tribal
governments; second, our implementation of the act; and finally our
concerns about the ACIR report. I will try to be brief in my re-
marks this morning and provide you with the full statement for the
record.

Over the past 3 years, the Clinton administration has made a
very aggressive effort to work with State, local, and tribal govern-
ments to build a strong partnership in which each governmental
party works together, doing what it does best to deliver environ-
mental Protection to the American people. With flexibility and a
partnership approach, we have made a great deal of progress.

Under the Clinton administration, EPA has been undergoing a
fundamental shift in the way we do business, away from tradi-
tional command-and-control to more flexible, community-based ap-
proaches. We are committed to working with people in their com-
munities and in their regions to craft environmental protection so-
lutions from the bottom up, not just from the top down.

We began by engaging our governmental partners to try and un-
derstand what their concerns were. We heard that they wanted
more flexible approaches to environmental protection, not a one-
size-fits-all approach. They wanted better communication and bet-
ter information. They wanted to be included in the process of de-
signing the rules and the policies they would be asked to imple-
ment. And finally, they wanted us to focus on achieving improved
environmental results, not on burdensome processes.

In response, we began working with our governmental partners
to develop new tools that will allow and encourage flexibility and
local innovation while continuing to achieve greater environmental
results. One of the best examples of that is our National Environ-
mental Performance Partnership System. At a meeting last May
with all the State environmental commissioners, we reached an
agreement to pursue this new, common-sense approach for delegat-
ing more activity and working with State partners more effectively.

‘e have included a copy of that agreement, for your information,
with my testimony.

Today, not even a year later, five States have signed environ-
mental performance partnership agreements, and about two dozen
more are working with our regional offices on their fiscal year 1997
agreements.

EPA’s new philosophy is also reflected in our Project XL-Com-
munities. The “X” stands for “excellence,” and the “L” for “leader-
ship.” Project XL embraces our new way of doing business, focusing
on results, but allowing and encouraging flexible approaches to
achieve them. Project XE offers communities a flexible approach in
return for a pledge to go beyond compliance with environmental
laws to achieve better environmental results.

Small towns also face difficulties due to their limited resources
in implementing environmental regulations within the timeframe


152

First, the ACIR has failed to demonstrate that the FMLA imposes a significant
financial burden on state and local governments. The ACIR recommendation asserts that
the FMLA creates costs related to revising leave policies and continuing health insurance
policies. According to the Department of Labor, the bipartisan Commission on Leave
reported very different findings in two reports released in October 1995. Over an 18
month period, 90 percent of private sector employers reported little or no costs associated
with administration, hiring and training, and continuation of benefits under the statute.
Eighty-five percent reported no noticeable effect on employee turnover, absence, or
productivity. We find it difficult, if not impossible, to accept that the experience in the
Public sector is so dramatically different, especially since state and local governments
offered more extensive family and medical leave than the private sector prior to FMLA’s
enactment (56 percent of public employees were covered versus 34 percent of private
employees)

Moreover, state and local governments are granted flexibility under FMLA for several
implementation issues, including whether to require medical certifications for leave,
whether to require employees to exhaust accrued paid sick and annual leave, whether to
allow employees to use accrued sick or annual leave during leave, and how to treat
benefits other than health insurance during leave

Unfunded Mandates Act

Regarding the unfunded mandates reform act, 1 would say that although AFSCME
‘opposed it, we believe that Congress made certain beneficial modifications from the
original version, including dropping the original "no money, no mandate requirement.
‘The law, as signed by the President, only applies to prospective federal mandates and the
law also has several important exclusions, including ones for constitutional rights, rights
that prohibit discrimination and Social Security. Nevertheless, we remain concerned that
the Act is still flawed. Instead of providing relief from the bleak fiscal situation confronted
by state and local governments, the Act provides opponents of federal health and safety,
environmental and labor protections and safeguards a new procedural mechanism which
can be used to grind legislative and regulatory processes to a standstill.

We continue to believe that many so-called federal “mandates serve compelling
national purposes. While the federal government may indeed ask state and local
governments to do too much without adequate financial resources, we should not lose
Sight of the fact that the federal government has the paramount responsibility to safeguard
the public's health, safety and welfare.

We appreciate the opportunity to appear before you today, and we are pleased to
answer any questions you may have.


19

TH. Regulatory Reinvention

As a part of regulatory reinvention, EPA has also engaged state, local, and tribal officials
as well as the regulated community and general public in identifying problems and proposing
specific changes to existing regulations. Where new authorities are needed to address these
concemns, we have also made legislative proposals.

On March 4, 1995, the President charged all federal regulatory agencies with a review of
all exiting regulations to identify those that were outdated or otherwise in need of reform. EPA
was already engaged in revising many regulations last spring when the President issued this
directive. These preliminary efforts have already borne fruit. Many of the rules and policy
changes described in the preceding section were well underway at that time, as was the Common
Sense Initiative (CST) in which stakeholders are working together to devise more effective
strategies for controlling pollution from six industries.

In carrying out this assignment, EPA conducted an extensive outreach effort to solicit
suggestions from all stakeholders, including state, local, and tribal officials. More than 50
meetings were held around the country to gather suggestions for changes. Among the groups
providing specific recommendations were EPA's Small Town Task Force and the newly-
established Environmental Council of the States, comprised of the commissioners of the state

environmental agencies.

EPA is working closely with states and localities, industries, and public interest groups to
identify ways to modify these existing regulations to reduce the regulatory burden while
maintaining progress toward health and environmental goals, The changes will run the gamut
from simple clarifications to major program redirection.

As part of the broader reinvention effort, EPA has also committed to several initiatives
aimed at streamlining reporting and recordkeeping requirements. First, EPA will reduce existing
monitoring, recordkeeping, and reporting requirements. This effort is expected to save the


15

Congresswoman Connie Morella

Statement before the Government Reform and Oversight
Subcommittee on Human Resources and Intergovernmental Relations

The Unfunded Mandates Reform Act of 1995: A One Year Review
March 22, 1996

Mr. Chairman. I would like to thank you for holding this hearing
to examine the implementation of the Unfunded Mandate Reform Act
of 1995. The President signed this bill into law exactly a year ago
today, and it is important that we ensure that it is working as we
intended it to. Today’s witnesses will provide us with additional
insight into how many of the agencies are implementing the Unfunded
Mandate Reform Act and how state and local governments and
community organizations have been impacted.

This legislation was passed with overwhelming bipartisan support
because we recognized that state and local governments have long been
asked to assume an overwhelming burden of federal mandates.
Although the Congress and the Administration have failed to agree how
to balance the budget, this legislation aims to end the practice of asking
states and localities to pick up the increasing costs of federal programs.


128

currently serves as a resource to help states and localities with
intergovernmental issues, the highly respected U. S. ACIR. is slated for
termination by the end of the year.

States and local governments need more relief. In some cases, it can
be provided through specific manageable changes. I do not dispute that
important national interests, such as protecting endangered species,
ensuring safe drinking water, and controlling air and water pollution can
Justify mandatory federal standards. But our commitment to national goals
should not undermine intergovernmental relations. A balanced federal-
state-local approach to these issues—a partnership—will be more effective «
than imposed, rigid, intrusive prescriptions. Because service delivery 1s
local, the benefits of consulting state and local representatives before
creating a mandate are apparent. Those directly affected can identify
alternative, less costly technologies, multijurisdictional approaches, or
other win-win solutions.

Besides more consultation, let me suggest other changes Congress
might consider. Mandated federal programs should emphasize
performance goals but should not dictate specific procedures. States and
localities should be encouraged to achieve results in the manner they think
best. Incentives should be built in. Federal standards should be based not
only on benefits but also on costs. From that perspective, a completely risk-
free environment may not be feasible. Therefore, the highest priorities, the
most serious threats, should be addressed first. The federal government
should offer resources, such as sctentific data and technical support, to help
strengthen governments at the state and local levels. Statutes and
regulations should be clearly written to reduce the exposure of states and
localities, especially smaller ones, to the risks of Utigation. Rules should be


134

Because the federal government is disconnected from the financial responsibility of its
mandates, we believe that it has little incentive to: 1) set priorities among or within
mandates; 2) engage in meaningful cost-benefit analyses; 3) or reevaluate existing.
mandates once they are put on the books. Meanwhile, school systems across the
country are struggling to find the money to pay for the programs the federal
government has required. Too often, the consequences of implementing costly,
federally mandated programs means school boards face unpalatable trade-offs: larger
class sizes, postponing purchases of up-to-date curriculum material, even eliminating
educational programs— especially in those communities that do not have the capacity

to raise taxes.

The Economic Policy Institute study entitled, Where's the Money Gone? released in 1995,
estimated that 26 cents of every new dollar spent by schools systems between 1967 and
1991 were invested in the general education program, while 38 cents were spent on
mandated special education programs. Of the remaining 36 cents, a substantial portion
was spent on other unfunded federal or state mandates. Most taxpayers would be
surprised to know how much of their local property taxeé, which they thought were
being spent for basic education, were being preempted to meet unrelated federal
mandates.

Local school boards across America are trying to ensure that our students obtain the
education they deserve. But the federal government must understand that every dollar
we spend to fulfill an unfunded or under-funded federal mandate either comes at the
expense of an increasingly resistant local property taxpayer or at the expense of the
educational program. The result is that school districts are increasingly losing the
public's confidence that we are meeting our main educational mission, as they see
increasing costs and bureaucracy, which all to frequently, as verified in the EPA study,
are caused by the implementation of federal mandates.


189

of a project” is frequently difficult to determine, especially in anticipation of
construction of the project. Experience under the labor standards provision
in the Housing and Community Development Act of 1974, for example,
demonstrate that the scope of a “project” is an elastic concept that is
susceptible to varying interpretations depending on what effect size will
have on various federal requirements.

These changes, if enacted by Congress, would address several of the
programmatic concems expressed to the Commission by state, local and
tribal governments.

Adoption of this recommendation would likely result in application of
Davis-Bacon prevailing wage requirements only to projects covered by the
Federal-Aid Highway Act which finances between 80 and 90 percent of the
cost of such projects. In any event, it is fair to say that adoption of the
Commission's recommendations would essentially result in emasculation of
most of the “Davis-Bacon Related Acts.”

It is submitted that the Commission's concern about the burden

imposed upon state and local governments by Davis-Bacon prevailing wage

-18-


178

Commission believes “public accountability of [state and local] elected
officials and the collective bargaining powers of employee unions will
provide adequate protection for workers” or, in the case of the Occupational
Safety and Health Act, because all states should be allowed to “set their own
health and safety standards taking into consideration their priorities and
budgetary constraints.” In essence, the Commission's recommendation to
repeal the provisions of each of these statutes that extend their application
to state and local governments appears to be based on a sense of the
sovereign authority of state and local governments. It is submitted, however,
that this rationale is inappropriate under our federal system of government.

This is because, with rare exceptions, the Constitution does not carve
out express elements of state sovereignty that Congress may not use its
power to displace. Instead, state sovereignty is protected from overreaching
by Congress by the very structure of the Federal Government. That is, state
sovereignty is protected by the structure of the federal system whereby the
states have a defined constitutional role in the selection of the President and

both chambers of Congress. As a result, many federal statutes including the


14

This policy was developed based on pioneering experiments going on in Oregon,
Washington state, Idaho, and Nebraska. EPA has worked closely with these states and their small
towns over the past year to develop this new approach, with EPA working locally to address
specific needs and nationally to develop a supportive federal policy

EPA's willingness to try innovative approaches that will help state and local governments
address problems is further illustrated by a landmark agreement between EPA, the state of
Oklahoma, and the city of Tulsa. Under this agreement, Tulsa, an attainment area, has been
deemed the first flexible air attainment region (FAR). As a FAR, Tulsa is allowed to tailor an
ozone reduction plan which reflects the local economy, weather conditions, and driving habits
Through FAR, EPA will give Tulsa time to implement and evaluate its program in the event of a
violation of the ozone standard before taking further action. A: key component of the city's
strategy for addressing ozone problems is the voluntary “Ozone Alert" program, supported by a
coalition of business, energy industry, and media representatives as well as elected officials, The
program includes such measures as providing incentives for carpooling and vanpooling and
providing free bus service on days when ozone levels are predicted to be in the unhealthy range

In response to the concems of community leaders about the difficulty of redeveloping
urban areas that may have been contaminated, EPA initiated the Brownfields Action Agenda. As
part of this effort, we are working to clean up and redevelop the abandoned and contaminated
property that lies idle in communities across the country. EPA has removed 27,000 sites from the
Superfund master list, which eliminates the federal review level thereby speeding redevelopment.
We have removed 12,000 small parties from the threat of liability, and by the end of this year will
remove at least another 10,000 parties. We have new policies in effect that make it clear that if
you are a municipality that involuntarily acquires contaminated property, or if you are a lender or
prospective purchaser who is not responsible for pollution at the site, you will not get caught in
the liability net. We have funded Brownfields projects in 40 communities. Recently, President
Clinton proposed an additional important element of this effort -- that targeted tax incentives be
provided to those, including purchasers, who clean up contaminated sites.


32

Mr. Suays. Mr. Portman, I really appreciate having you.

I would like to be able to move fairly quickly to our next panel,
but I would welcome any question that any Member has of the wit-
ness. Mr. Towns.

Mr. Towns. I yield to Mr. Fattah.

Mr. Suays. Mr. Fattah.

Mr. FaTtaH. Thank you, Mr. Chairman. Congressman, are you
familiar with this report, ACIR?

Mr. PorTMAN. Is that the preliminary report from ACIR?

Mr. Fattan. Yes.

Mr. PorTMaN. I have it in my office; I haven’t read it.

Mr. FatTrau. OK. This report suggests that—and this was called
for in the act—that we repeal, for instance, the Family and Medical
Leave Act for State and local government. Would you like to com-
ment on that?

Mr. PoRTMAN. I really would prefer not to.

Mr. Fattan. The Fair Labor Standards Act.

Mr. PorTMAN. I was really asked to come this morning to talk
about implementation of the act, which I’ve done. I am glad I’m on
ACIR. I haven’t been on it—for 2 weeks, I guess, and I will be look-
ing at all of this.

ir. FATTAH. I understand.

Mr. PORTMAN. I'm just not prepared yet to give you an answer
to it, but I am going to look at all of it.

I hope, perhaps, Mr. Chairman, we will have an opportunity to
do that together and then report back.

Mr. Fattau. Thank you very much.

Mr. PORTMAN. Yes.

Mr. Suays. Thank you, Mr. Fattah.

Mr. Payne had wanted to get answers to certain questions in
that report. What might make sense, while you are still here, Mr.
Payne, is just to ask the questions that you want answered from
those of us who are now members of this committee, for the record,
and then we will get answers to them. If you want to just put those
questions on the record.

Mr. Payne. Yes. I would just like to have some clarification on,
first of all, from what I understand—and I was there—there was
not a quorum present for approving the report. It has been said
that ‘ACIR members were not sure exactly what they were voting
on, whether this was to approve this report or not, or whether it
was a preliminary report. What does a “preliminary report” mean?
Is that a final report? There was some confusion, it seems.

There was some question about whether these were the actual
recommendations or the publishing of some ideas in the Federal
Register for comment. ACIR has not released the actual votes of
the commissioners. In other words, since there were so few commis-
sioners there, they said they just voted by mail, and it all hap-
pened—and I’m sure that the chairman is honest—but it happened
that, overwhelmingly, this report was approved, although many of
the members were not present.

I know I was present. I voted no. There was a conference that
was supposed to be held instead of a public hearing. The registra-
tion fee for the conference was $400, and therefore I’m sure that
would exclude a lot of people who would normally like to come. And


103

and community groups and getting technical assistance from us as
the federal partner.

The Administration is also working with states and localities to
create successful charter and magnet schools. In 1993 the
President proposed to provide start-up funds for public charter
schools around the nation; today 11 states are taking advantage
of these funds. The Department is using its expertise to
evaluate what makes for effective charter schools, so that states
and localities can increase their chances of success.

Increasing Flexibility and Providing Waivers

One of the clearest indicators of true partnership is trust. The
President’s Regulatory Reinvention Initiative asks all agencies
to increase flexibility, reduce regulations, and in general to
base our relationships with our partners and customers on trust.
If actions speak louder than words, the Department of Education’s
actions in this area speak loudly indeed.

The Department has eliminated 79% of the regulations (234 pages)
affecting its elementary and secondary programs (Office of
Elementary and Secondary Education and Office of Bilingual
Education). Where regulations are essential (such as when they
are required by Congress or necessary to promote educational
quality or avoid abuse), the Department’s “Principles for
Regulating” require us to do so as flexibly, and with as little
burden, as possible.

Even with fewer and more flexible rules, sometimes the best way
to advance our partnership with states and localities is to waive
federal requirements that make sense generally but that interfere
with a specific state or district educational strategy. Goals
2000, School-to-Work, and the Improving America’s School Act gave

3


39

comnTTEE JAMES P. MORAN,
‘wos OF
compose” Congress of the Anited States wasps OFF
sungouare on cv sence Bouse of Representatives Reena
patent wastncton O tetsn
conmrTee Bashington, BE 20515-4608 (2021 228-4376
INTERNATIONAL RELATIONS
IwTERNWATIONAL OPERATIONS February 12, 1996
henge

The Honorable William F. Winter

Chairman

Advisory: Commission on Intergovernmental Relations
800 K Street, N.W.

Suite 450

Washington, D.C. 20575

Dear Chairman Winter:

We are writing to express our concern with the decision of a
majority of ACIR members to endorse a specific set of
recommendations on the "The Role of Federal Mandates in
Intergovernmental Relations."

We voted against the recommendations because of the limited
opportunity of the full body of members to meet, review the draft
recommendations, air disagreements and discuss different
perspectives. Obviously, the federal furlough and the government
shut down prevented many of the federal members from attending
the December 19 meeting. If we are unable to convene a meeting
where a full quorum is present, we would prefer to have the final
report present the full set of recommendations described in the
December 1, 1995 draft.

ACIR's proper role is to smooth bumps in the
intergovernmental system, identify the problems and build a
consensus on appropriate remedies. ACIR compromises this role
and invites controversy when it endorses specific legislative
remedies without a fairly high degree of consensus among its
members. Where a near consensus exists, a preferred
recommendation may be endorsed.

We look forward to an opportunity to raise our concerns at
the next meeting.

Sincerely,

Tapes P. Moran Donald M. Payne


164

Mr. Davis. Thank you very much.

We now have a member of the ACIR, the distinguished gen-
tleman from New Jersey.

Mr. Payne. Thank you very much.

Let me ask Mr. Saunders a question. You said that there will be
hearings on Tuesday, which would be March 26th, that will be
held. As you know, the comment period ended on March 15 for the
public review and comment. Will your comments be accepted? Will
they revise their date?

And second, I think you had some criticism about the content of
the ACIR report. In your view, this report, does it comply with the
intent of the Unfunded Mandates Reform Act, in your opinion?
First of all, have you had any conversation about the hearing? Is
it official, and will testimony be included in this public comment.
period which has ended?

Mr. SAUNDERS. Well, it’s my understanding that the comment pe-
riod has been extended beyond the March 15 date, and therefore
you have the public hearings taking place on Tuesday. Although,
again, I would like to stress that initially those public hearings
were not scheduled. What was scheduled was a pay conference. We
thought that was completely inappropriate. But because of the
pressure, those public hearings are extended, and the public testi-
mony will be accepted on Tuesday.

We believe that the ACIR just went completely off track. They
did not respond to their charge. They essentially looked at what
they called “mandates” and made recommendations with no input
from labor unions, from consumer organizations. They made no at-
tempt to do that whatsoever.

Their charge was also to look at the cost factor, cost analyses. To
our knowledge, that was never done in formulating the report. As
far as health and safety, and I mentioned this before, as far as
OSHA, we don’t even consider OSHA to be a mandate, because it
is a voluntary program.

So we look at what the ACIR did and really have fet to strongly
oppose not only how they went about doing it but also the results
of the report.

Mr. PAYNE. Thank you very much. I’m a member of the commis-
sion. I agree with you on those points.

Also, I have some question, too, about even the composition. I
think there is a lack of balance in the commissioners. You have
various categories: Governors, for example. If you look at the Gov-
ernors, you will find that they are from small States, you know, the
kind of rugged individualism, you know, get-government-out-of-my-
face-type philosophies. I’m not saying that’s necessarily the philoso-
phy of those Governors. .

But if you look at the composition of the commission, I think
there could be, perhaps, at least in that category, perhaps a better
balance, to get more diversity in the views.

I do have a question to Mr. Resnick from the school boards.
IDEA provides and extends important civil rights protection, as you
know, to make sure that all children have access to a public edu-
cation. And I agree, too, that funding from the Federal Government
is tremendously low. I mean, we were doing $350 billion in defense.


Fair Lahor Standards Act (FLSA)

The ACIR report recommends repeal of FLSA’s coverage of state and local government
workers.

By guaranteeing a minimum wage and premium pay when an individual works more than
40 hours week,. the FLSA establishes minimum labor standards below which no one
should be required to work. There is no reason to deny public servants these fundamental
protections and thereby make them second class citizens. ‘In recent years, the provision of
public services such as nursing care, transportation, sanitation, water and sewer service,
has increasingly been done by both public and private entities, and in these instances, the
Act simply ensures that every employee, regardless of his or her employer, is entitled to
minimum protections. Allowing state and local governments to pay fess than the minimum
wage and to avoid paying premium pay for overtime is unfair to the public workers and

could place private employers that observe fair labor standards at a competitive
disadvantage.

Congress amended the FLSA in 1985 and gave special accomodations to state and local
governments by providing for compensatory time off in lieu of overtime pay, special rules
for the use of volunteers, and delay in implementing compliance obligations to allow for a
transition period. The report notes that the Department of Labor has provided assistance
to stzte and local governments with respect to their FLSA obligations, and acknowledges
that DOL has worked with state and local governments io recognize the unique issues that
arise in the enforcement context. Despite DOL’s efforts, it clear that concer with FLSA
can be traced to an inability to adequately monitor compliance and a persistent
misunderstanding of the requirements of the Act. These are not reasons for denying
workers basic minimum rights, but arguments for strengthening the Department's ability
to work with state and local governments, rather than dismantling it. While the report
decries the rights of workers to seek judicial redress under the statute, rolling back those
tights suggests far more than a restructuring of Federal/State relations. It would deny basic
rights to public servants to be paid the minimumwage and overtime pay when they are
forced to work excessively long hours.

In several instances, the report levels criticism against application of the FLSA to the public
sector that has no foundation in fact. For example, there is no basis for the suggestion
made in the report that Federal agencies have been able to manipulate FLSA regulations in
order to meet budgetary restrictions.


148

Finally, Mr. Chairman, my written statement sets forth
AFSCME’s views pertaining to the implementation of the Un-
funded Mandates Act, and I would be prepared to answer any
questions.

Thank you.

[The prepared statement of Mr. Saunders follows:]


35

Mr. Payne. I just would like to submit for the record—I’m not
sure I will be here at the end.

Mr. Suays. I understand.

Mr. Payne. A letter to Chairman Winter expressing my concerns
about the report, with Congressman Moran, and also an opening
statement. If I could have that put into the record?

Mr. SHays. They will be put in the record. I appreciate, Mr.
Payne, your coming and voicing your concerns.

[The prepared statement of Hon. Donald M. Payne and the letter
referred to follow:]


67

5

maintenance costs. The report also ignores the fact that the DBRA prevailing wage is based
on “measures of central tendency’, and there ‘will always be contractors who pay lower
then the prevailing wages in a community.

ACIR claims that DBRA wage surveys are “voluntary and sporadic,” but fails to
acknowledge DOL's significant regulatory reforms undertaken over the past decade to
‘ensure that its wage determinations accurately reflect wages paid in the local community.
‘They also claim a scarcity of data leads to importation of non-local rates When there is a
lack of recent construction, DOL looks to the surrounding area for wage data, not to
“distant” areas as ACIR charges. The report asserts that DBRA may reduce the hiring of
local persons with limited experience. In fact, regulatory provisions also encourage
apprenticeship and training of persons with limited experience by allowing for exceptions
to the journeyevel wage under approved training programs.

‘The Clinton Administration’s Davis-Bacon reform bill last year would have raised the
OBRA threshold to $50,000 for alteration and repair projects, and $100,000 for new
construction projects, in addition to reducing administrative burdens and costs. DOL
cannot concur in the report's proposal to limit DRBA to projects of more than $1 million
which receive over 50 per cent of their financing from Federal funds. These proposals
would eliminate prevailing wage protections for thousands of workers under the guise of
reform, and make the administration of Davis-Bacon requirements more troublesome for
states and local goverments.

Similarly, we have serious concems with the report’s recommendation to base coverage on
the percentage of Federal finance provided to the construction project. DBRA coverage
must be established before the competitive bidding process begins. ACIR’s proposal
would disrupt that process, and impose additional burdens on state and local contracting
agencies to determine if DBRA applies.


190

requirements, relative to the amount of financial assistance provided is
without merit because, as we discussed hereinabove, unlike “federal
mandates” as defined in the Congressional Budget and Impoundment
Control Act of 1974, as amended by Section 101(a) of the Unfunded
Mandates Reform Act of 1995, state and local governments are not
compelled to accept federal financial assistance if they determine that the
costs exceed the benefits to be derived. Hence, there is no need to adopt
higher thresholds for application of Davis-Bacon prevailing wage require-
ments to federally-assisted construction projects in order to relieve state and
local governments from what some may perceive as heinous federal

mandates. They can just say “no thank you.”

-19-


104

the Secretary of Education unprecedented authority to provide
waivers from many statutory and regulatory requirements, and we
are using that authority boldly.

Close to 100 waivers have been granted to states and local
partners in the last year. These include waivers that allow
the Fort Worth, Texas schools to target extra Title I funds
to overhauling four high-poverty, inner city schools, and
the Riverview Consortium in Shippensburg, Pennsylvania to
use its teacher training funds beyond math and science to
focus on needs identified by member districts.

The most dramatic example of the Department’s new
flexibility is the Education Flexibility Partnership
Demonstration Program ("Ed-Flex”) established under Goals
2000. Under Ed-Flex, the Secretary has given six state
education agencies the authority to waive certain federal
statutory and regulatory requirements to remove barriers to
effective teaching and learning. Kansas, Massachusetts,
Ohio, Oregon, Texas, and Vermont have been approved as Ed-
Flex states, joining the federal government in a unique
partnership.

Of course, our state-local-federal partnerships go well beyond
the statutory and regulatory spheres to characterize all aspects
of the Department's operations. For example, we are working to
consolidate and make more user-friendly the technical assistance
services we provide to state and local school systems. We are
Also helping states develop consolidated plans for education
reform and improvement that promote broader, system-wide planning
and eliminate unnecessary paperwork and burden.

Implementing Title II of the Unfunded Mandates Act

4


167

came in and said everyone has to do it, other States which are not
good corporate or good State citizens failed to do it.

And if you waited then for the Federal Government to come in
to pay for doing it, then no one—I think this is something that
would—why do it, just wait, because then the government’s going
to come in and pay it, even though it should be a local responsibil-
ity. You’re almost saying that we have no real responsibilities other
than to pick up the garbage, I guess, and have policemen.

So this whole question really becomes—like I said, I agree. I
don’t think that they had adequate hearings on this report. I don’t
think that the commissioners really were totally aware that this
was a final report they were voting on. I think many of them
thought they were just talking about printing it up. Next thing you
find it’s in a form, because it had been approved.

Like I said, there are just so many questions that I hope that,
at a future hearing, these questions can be answered. The vote was
taken when the Federal Government was closed down. You couldn’t
even call some of the agencies that were there, because they were
closed. For something so important, it was done sort of a flimsy
way.

And I’m on the commission, and I'll be the first to admit it. So
I guess I’m part of the problem, but that’s the fact. And that’s what
I val continue to reiterate whenever the commission reconvenes it-
self.

Mr. Davis. Thank you very much.

Let me just make a couple of clarifying remarks before we con-
clude. First of all, as I take a look at Public Law 104~4, of which
I was one of the four sponsors in the House, it notes that “A Fed-
eral mandate means any provision in statute or regulation, or any
Federal court ruling that imposes an enforceable duty upon State,
local, or tribal governments, including a condition of Federal assist-
ance or a duty arising from participation in a voluntary Federal
program.” So ACIR has a very wide-ranging mandate.

Now, the reality is that ACIR is just one set of recommendations.
We're going to want to hear from AFSCME and anyone else before
we touch or make any changes in that. But we want to hear from
ACIR, and I can just assure you that we want to make sure you're
going to get wide participation before Congress changes any of
those laws. Because, of course, there are a lot of different pressure
points. When you start changing one thing, it has some unintended
consequences downstream.

Mr. SAUNDERS. It’s my understanding, Mr. Davis, that that is
prospective only.

Mr. Davis. Right. No, no. We asked them to take a look at exist-
ing laws, as well, in terms of what their effects are. Now, that’s
just a report.

Mr. SAUNDERS. Sure. I understand.

Mr. Davis. I don’t think you need to fear a report of the facts.
That doesn’t mean anything is going to happen. And we are very
grateful to hear from you, in terms of the other side and what else
is affected | by that. But I oe ae is within the charter that we
gave a it’s just to clarify that. This is only a preliminary
report we’re talking about today, as well. yar


126

UNFUNDED FEDERAL MANDATES: REPERCUSSIONS AND RECOMMENDATIONS

Remarks made on March 22, 1996 by the Honorable Vincent F. Callahan, Jr., Member of the
Virginia House of Delegates and Chairman of the the Virginia Commission on

Intergovernmental Relations before the U. S. House of Representatives Subcommlttee on

Human Resources and Intergovernmental Relations, The Honorable Christopher Shays,

Chairman

Mister Chairman, Members of the Subcommittee, my name is Vincent

Callahan. I have been a member of the Virginia House of Delegates for
twenty-eight years and have served for six years as Chairman of the Virginia
Advisory Commission on Intergovernmental Relations. I have witnessed the
effects of unfunded federal mandates on the Commonwealth and its
localities—especially the difficulties posed by concurrent increases in federal

statutory and regulatory requirements and decreases in federal aid.

An example: Danville, Virginia, a city of less than 55,000 people, is
statistically ranked as one of our localities with above average fiscal stress.
In fiscal year 1993 Danville reported spending 13,800 staff hours to comply
with the Americans with Disabilities Act. These costs, combined with other
ADA-related costs, totaled $176,600 for that single mandate. Despite the
ADA's laudable goals, the commitment of that level of personnel and
financial resources for a locality experiencing fiscal stress seems too much
to ask. In all, $6.3 million, or almost 16% of Danville’s local source revenue,
was spent in 1993 funding ten of the more than 200 federal mandates. And.
as you know, not all costs are quantifiable.

T would like to tell you about unfunded mandates in my state, to
assess the progress that has been made, and to propose further improve-
ments. I appreciate the opportunity to address this body—especially on the
first anniversary of the signing of the Unfunded Mandates Reform Act. This
new law has already made a difference. As you know, it played a major role
recently in averting a proposed mandate in the telecommunications
legislation that would have profoundly affected local governments. It helped
preserve local zoning authority and local control of public rights-of-way.
This ts progress.


45

100 early to evaluate its effectiveness. On the other hand, Title II, which addresses the Executive
Branch, went into effect upon enactment, March 22, 1995. Title II built on Executive Order
12875, by establishing consultative and analytical requirements for agencies in developing rules.
It also includes a requirement that OMB report to Congress on agency compliance with Title I;
OMB filed its report today and I am submitting a copy along with my testimony.

Finally, Title III of the Act called for a detailed study on issues by the Advisory Commission on
Intergovernmental Relations (ACIR). Many witnesses today are addressing this issue, and
therefore let me start there and then speak to agency compliance with Title I

ACIR Study

Title IMI asked ACIR to report on a variety of issues, including:

. ‘What is the role of Federal mandates in intergovernmental relations?

. ‘What is the impact of unfunded mandates on the competitive balance between State, local,
and tribal governments and the private sector?

. ‘How do unfunded State mandates affect local governments?

* How can the Federal goverment best provide flexibility to its intergovernmental partners?

. ‘How can the Federal government best reconcile existing and inconsistent mandates?

. How do we properly define and measure the costs and benefits of Federal mandates?

The reason for addressing these critical questions was a felt need to provide a context -—-
specifically, an informed analysis — for this debate. As someone who was involved in the
development of the legislation, it was clear to me that the answers to these questions are neither
readily apparent nor easily attainable. Congress set a formidable research task for ACIR — to take
a conceptual as well as practical look at the scope and size of unfunded mandates in this country.


87

STATEMENT OF BERNARD E. ANDERSON
ASSISTANT SECRETARY FOR EMPLOYMENT STANDARDS
U.S. DEPARTMENT OF LABOR
BEFORE THE
SUBCOMMITTEE ON HUMAN RESOURCES AND

NTERGOVERNMENTAL RELATIONS
HOUSE commrntEE ON GOVERNMENT REFORM AND OVERSIGHT

March 22, 1996
Mr. Chairman and Members of the Subcommittee:

I am pleased to have the opportunity to appear today to
discuss the recommendations set forth in
Mandates _in Intergovernmental Relations, the preliminary draft
report of the Advisory Commission on Intergovernnmental Relations
(ACIR). You have also asked that I discuss the Department of
Labor's (DOL) implementation of Title II of the Unfunded Mandates
Reform Act in the formulation and adoption of regulations.

Mr. Chairman, from its beginning, this Administration has
worked hard to strengthen the intergovernmental partnership and
to address state and local government concerns about unfunded
mandates. It supported enactment of the Unfunded Mandates Reforn
Act. And it has taken significant steps to obtain state, local
and tribal government views during the development of federal
regulations and to ensure that new regulations do not place undue
burdens on states and communities. ‘The Department of Labor has
been an active player in these efforts and, as I will discuss
deter, participated with other agencies in the Administration's

fforts to implement Title II of the Unfunded Mandates Reform
het.

The Department has made it a policy and practice to consult
with state, local and tribal officials in promulgating
regulations that would have a significant impact on their
governments. And if a final rule covers such government
entities, the Department includes them in its education and
compliance assistance efforts. Some examples of how DOL agencies
involve state, local and tribal governments in rulemaking or in
the post-rulemaking education and outreach process include the
followin

* The Department's Occupational Safety and Health
Administration (OSHA) actively seeks and considers state and
local governments' views through its own State Plans!
promulgation process.

* OSHA also conducts a number of outreach efforts which
include inviting state representatives to participate as
members of OSHA taskforces which develop new standards and


OPENING STATEMENT OF
THE HONORABLE WILLIAM F, CLINGER, Jr. (R-PA)
CHAIRMAN
COMMITTEE ON GOVERNMENT REFORM & OVERSIGHT
Hearing on
“The Unfunded Mandates Reform Act of 1995:
A One Year Review”
Human Resources & Intergovernmental Relations Subcommittee
March 22, 1996

Mr. Chairman, one year ago today I remember standing in the Rose
Garden for the signing of the Unfunded Mandates Reform Act, a bill with
bipartisan support and a key piece of the “Contract with America.” It was a
proud day. And despite the dire predictions of those opposed to the
legislation, the sky has not fallen. Indeed, Americans are better off and

Congress is better informed as a result of this law.

Testifying before us this morning are two colleagues without whom the
Unfunded Mandates Reform Act would never have been a reality:
Representative Rob Portman of Ohio, and Representative Gary Condit of
California. They have been as instrumental in the Act’s implementation as

they were in its passage, and I am eager to hear their thoughts this morning.

I can tell you that from my perspective, the law works. The few test
cases we have had since Title I took effect in January bear that out. Congress

is more sensitive than ever before to the impact of legislation on State and


THE UNFUNDED MANDATES REFORM ACT OF
1995: ONE YEAR LATER

FRIDAY, MARCH 22, 1996

HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON HUMAN RESOURCES AND
INTERGOVERNMENTAL RELATIONS,
COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT,
Washington, DC.

The subcommittee met, pursuant to notice, at 10:05 a.m., in room
2247, Rayburn House Office Building, Hon. Christopher Shays
(chairman of the subcommittee) residing. .

Present: Representatives Shays, Morella, Davis, Chrysler,
Souder, Towns, Green, and Fattah.

Ex officio present: Representative Clinger.

Also present: Representative Payne.

Staff present: Lawrence J. Halloran, staff director and counsel;
Doris F. Jacobs, associate counsel; Thomas M. Costa, clerk; Kris-
tine Simmons, professional staff member, full Committee on Gov-
ernment Reform and Oversight; and Cherri Branson, Cheryl
Phelps, and Matt Pinkus, minority professional staff members.

Mr. Suays. I would like to call the hearing to order and welcome
one of our first witnesses. I have a statement to make before I ask
him to address this committee. I also thank our guests, as well.

On March 4, 1801, in his first inaugural address, Thomas Jeffer-
son called for “the support of the State governments in all their
rights, as the most competent administrators for our domestic con-
cerns.” On March 22, 1995, President Clinton joined this Congress
in our commitment to respect the rights and the competence of our
sovereign State partners by signing the Unfunded Mandates Re-
form Act. I might say, I read his entire statement, and it was a
very gracious statement, when he signed the bill. Today, exactly 1
year later, we examine the extent to which implementation of the
Mandates Act has answered Jefferson’s call.

The debate over unfunded mandates involves both constitutional
principles and fiscal realities. It is a debate about ends justifying
means and the need to acknowledge and respect whose means are
spent to reach national ends.

In the past, it was enough to declare a problem national and
mandate a solution. The fiscal implications of Federal laws and
regulations on State and local governments were seldom an explicit
part of the debate.

As the Advisory Commission on Intergovernmental Relations
(ACIR), observes in their preliminary report on existing mandates,
“the Washington tendency has been to treat as a national issue any

@


150

Our disappointment in the process which ACIR employed to reach its conclusions is
exceeded only by our opposition to the substance of the report. For a report which was
required by federal law to determine the financial burden of unfunded federal mandates, it
is most disturbing that there is no cost data, or cost-benefit analysis of any of the worker
protections it recommends for repeal. The ACIR was charged with identifying those
mandates which are “duplicative, obsolete, or lacking in practical utility’. “But, as the
Department of Labor's letter correctly states, in the case of FLSA, FMLA, OSHA, and other
protections, "there are no comparable federal laws and where corresponding state laws do
exist, they are often weak or inconclusive."

Fair Labor Standards Act (FLSA)

‘The ACIR has recommended repealing those provisions of the Fair Labor Standards
Act extending coverage to state and local government employees, including the minimum.
wage, the 40 hour work week, and requiring comp time or overtime pay for hours worked
over 40. No such recommendation is made for employees with exactly the same jobs who
work in the private sector, including secretaries, laborers, clerks, nurses, doctors, prison
guards and sanitation workers, among others. [s it fair to extend FLSA protection to some
trash collectors and not to others, to some prison guards and not to others, to some
hospital workers and not to others?

As the U.S. Supreme Court found in its 1985 decision, Garcia v. San Antonio Transit
Authority, efforts to distinguish between the governmental and proprietary functions of
state and local governments were "unsound in principle and unfair in practice." Moreover,
in response to state and local officials, Congress amended the FLSA in 1985 to provide
state and local governments more flexibility in applying the law than it has extended to
private sector employers. It allowed them to grant compensatory time instead of overtime
pay, included special rules for the use of volunteers, and delayed the implementation of
compliance obligations.

The ACIR claims that under the FLSA “a state or local government cannot amend its
personnel policies to accommodate situations unique to government employment or to
reduce its budgets." This is patently false. Nothing in the Act denies employers the
flexibility to change work schedules, work shifts, operation schedules and hiring practices
for the purpose of controlling overtime hours. As with any other organization, controlling
overtime in the public sector relies primarily on good management

There is little reason to believe that state and local governments will automatically
adopt provisions similar to current federal law if current coverage under FLSA is repealed.
Twenty-three states and the District of Columbia currently lack a minimum wage law
applicable to state and local government employees or have one that sets the wage lower
than the federal minimum wage. Thirty-two states, plus the District of Columbia, lack
‘overtime provisions in their laws applicable to state and local government workers.

Moreover, the Commission's argument that public employee unions will negotiate
these protections even if Congress repeals them lacks credible supporting evidence. Nearly
tworhirds of state and local government workers do not belong to labor unions, and
nearly 5.5 million lack collective bargaining rights ahogether.

Oceuy Safety and ct (OSHA)

ACIR's recommendation that coverage under the Occupational Safety and Health Act
(OSHA) be eliminated for state and local government employees should also be rejected. |
would like to quote directly from the Department of Labor's comments, which I think hi
the nail on the head:



42

port. We noted that it did not address the legislative request in a
number of ways, including providing a conceptual framework for
consideration of unfunded mandates. It did not address how State
mandates affect local governments.

It did not address how we should measure the costs and benefits
of mandates. Cost-benefit analysis is a wonderful thing, but how
you go about doing it is very complicated, and we were looking for
guidance, as well. It failed to consider the positive impact on work-
ing men and women of Federal mandates.

Mr. Clinger has mentioned the failure to identify the competitive
balance between the private sector and the State and local. This
was a serious concern during the debates on the statute as to
whether, if the State or local government is doing an entrepreneur-
ial type or commercial type activity and it were relieved of a man-
date, how that would impact the competitive balance. That is whol-
ly missing from the report, as well.

We understand that a number of people have made such con-
structive critical comments on the staff report. The administration
is committed to working with the ACIR staff as it incorporates
these comments, revises its draft, so that what is presented to the
commission will, I hope, reflect, the legitimate comments and con-
cerns that have been expressed.

Let me then just, in closing, say that I think, 1 year after pas-
sage of the act, we’ve done very well. I think that the act has had
a very positive effect. There is a highly constructive change in atti-
tude and approach of the Federal agencies in promulgating regula-
tions and in their other programs and activities.

President Clinton believes strongly that Government cannot
serve people unless there is cooperation, a real partnership, among
all levels of Government. With that objective, we will continue to
work with all of you as we try to develop and implement what we
think was a significant statute.

Thank you very much for the opportunity to appear.

[The prepared statement of Ms. Katzen follows:]


161

Statement of Representative Gene Green
Subcommittee on Human Resources and Intergovernmental Relations
March 22, 1996

Thank you, Mr. Chairman for an opportunity to
speak this morning. One year ago, the President
signed into law the Unfunded Mandates Reform Act.
The purpose of the Act was to make Congress more
accountable in the mandates it gives to states and
localities. As a former State Legislator myself, I was
sympathetic with the goals of the bill and I voted for
it.

The Act did not require that mandate end or that
we repeal current mandates. Rather, it established a
process by which a Member could object to the bill on
the ground that it contained an unfunded mandate, and
force the House to go on the record in support or in

opposition to the mandate.


73

EPA's new philosophy is also reflected in EPA's Project XL-Communities. Like
performance partnerships, Project XL embraces our new way of doing business: focusing on
results and using flexible, common-sense approaches to achieve them. The X stands for
excellence; the L for Leadership ‘Through EPA's Project XL, communities are being invited to
demonstrate excellence and leadership -- to find creative new ways to meet and exceed

environmental goals, often for less money.

‘Administrator Browner recently announced that EPA had selected the very first
community to work with EPA to develop a Project XL-Communities reinvention project, The
city of Anaheim, Califorua requested regulatory flexibility from an acid rain regulation that would
have required installation of upgraded air pollution monitoring equipment at a power plant that
was inherently low polluting. In exchange, the city proposes to use the money they save to
implement higher priority projects demonstrating technologies for reducing air emissions, facilitate
closure of abandoned wells threatening ground water quality, and help manufacturing facilites
move away from using chlorinated solvents.

EPA also heard about the difficulties small towns face because they have limited resources
to implement environmental regulations within the time frames set forth in the statutes and
regulations. EPA responded by adopting a new policy on flexible state enforcement responses to
small community violations. Small jurisdictions with populations under 2,500 will be able to use
thei limited resources to attack their biggest environmental problems first, without fearing state
or EPA sanctions for failing to comply with mandates immediately. Under this new policy, states
‘can negotiate enforceable compliance agreements and schedules that allow small jurisdictions to
set priorities for coming into compliance based on comparative risk, ultimately leading to
correction of all of their environmental violations. The worst problems would be corrected first,
and dangerous circumstances corrected immediately. As an incentive to encourage small
communities to request compliance assistance, states can also waive part or all of an enforcement
penalty.


82

are being fixed are still presented as problems. This leaves the erroneous impression that further
“fixes” are needed

We have major concerns with respect to the preliminary report's recommendations
regarding specific environmental statutes or issues. They are:
-- the recommendation to withdraw citizens’ rights in the enforcement of
environmental laws, .
-- the call for significant relaxation of water pollution control by municipalities;
-- the proposed long-term goal of eliminating federal authority to set and enforce
standards for drinking water, and
-- the proposal to limit federal authority to assure the effective control of harmful air
pollutants.

We elaborated on our concems about these four specific items in our it

itial response to the
Commission, which is attached to this testimony for the record

Finally, we are also very concerned about the proposal that health and safety standards
applied to state and local government be different from those applied to private industry and the
federal government and about the proposed changes to the Endangered Species Act. We also
believe the proposal to designate a single federal agency to make binding decisions about each
mandate needs careful evaluation; the solution may not fix the real problem,

The ACIR has a long tradition of serving as an honest and open forum for identifying
problems in the intergovernmental system, for formulating possible solutions, and for building
intergovernmental consensus among its Commissioners in support of the proposed solutions. It
has done that by focusing on facts ~ by trying to separate the reality from the rhetoric, It is our
hope that the ACIR will continue in that tradition, and deliver to the President, Congress, and the
American people a far more balanced and informative repor:


THE UNFUNDED MANDATES REFORM ACT OF
1995: ONE YEAR LATER

HEARING

BEFORE THE

SUBCOMMITTEE ON HUMAN RESOURCES
AND INTERGOVERNMENTAL RELATIONS

OF THE

COMMITTEE ON GOVERNMENT
REFORM AND OVERSIGHT
HOUSE OF REPRESENTATIVES

ONE HUNDRED FOURTH CONGRESS
SECOND SESSION

MARCH 22, 1996

Printed for the use of the Committee on Government Reform and Oversight

ae

U.S, GOVERNMENT PRINTING OFFICE
41-231 CC WASHINGTON : 1997

For sale by the U.S. Government Printing Office
Superintendent of Documents, Congressional Sales Office, Washington, DC 20402

ISBN 0-16-055286-9
a



108

concerns. I am pleased to report, however, that there are
grounds for optimism that the ACIR‘s draft report can be turned
into a thoughtful and useful document. We have had promising
discussions with ACIR staff and look forward to further
conversations.

Mr. Chairman, this concludes my remarks. Assistant Secretary
Heumann and I would be happy to answer your questions.


182

intergovernmental mandate or a federal private sector mandate, as defined
in paragraphs (5) and (7).”

Thus, it is clear that the Commission's authority is limited to reviewing
and making recommendations concerning “federal mandates,” as defined in
the Congressional Budget and Impoundment Control Act of 1974, as
amended by Section 101 (a) of the Unfunded Mandates Reform Act of 1995.

The Davis-Bacon Act is designed to protect wage standards in the local
construction industry by preventing competition for federal construction
contracts and subcontracts based on paying wages lower than those
prevailing in the same locality. According to Congressman Bacon, co-author
of the bill, the purpose of the Davis-Bacon Act is “simply to give local labor
and the local contractor a fair opportunity to participate in [federal building
programs].”

In order to accomplish this objective, the Davis-Bacon Act requires
payment of a prevailing wage and prevailing fringe benefits to laborers and
mechanics on projects over $2,000 “to which the United States or the

District of Columbia is a party, for construction, alteration and/or repair,

-1-


131

We certainly share the concern that was raised by Mr. Towns
earlier regarding the infrastructure needs of school districts. We
believe the potential of repealing Davis-Bacon, Mr. Towns, may
give school systems more flexibility to have their construction dol-
Jars go further.

In some circumstances, of course, having a mandate for construc-
tion will result in the inability of school districts to fund their regu-
lar program. For example, in the case of California and other
States that have assessment caps on them, if they seek to raise
more money to fund construction—and have even difficulty passing
bond issues—financing the expense may translate out into less
money for the rest of their education program.

In the area of asbestos, school districts continue to face enormous
abatement costs, even though scientific evidence now suggests that
the kinds of asbestos fibers used in school construction do not pose
the same risk as the industrial fibers that were identified as the
basis for establishing the original mandate. Unfortunately, since
Congress is not paying for the abatement cost, it has not shown
any interest in determining whether modifying this mandate is jus-
tified, despite what may be unnecessary costs for school systems.

Extending OSHA to school systems provides another example of
an unfunded mandate that cannot stand up to cost-benefit analyses
in the school setting. The vast majority of public school employees
are not doing jobs where OSHA could substantially improve their
safety; therefore, why mandate the system upon us?

Finally, the Individuals With Disabilities Education Act is a
prime example of an underfunded mandate whose costs are some-
what out of control. This mandate costs school systems over $30
billion a year in additional costs. School districts have paid an av-
erage of 38 cents of every new school dollar spent, year in and year
out, since 1967, for this program. In the face of these costs, the
Federal Government only pays about 8 percent of the cost of its
mandate, despite its legislative commitment to pay 40 percent.

As indicated in our written testimony, IDEA is laden with ad-
ministrative costs and rules that cost school systems billions of dol-
lars per year in paperwork, lawyering activity, and opening school
systems to costs that should reside with insurance companies and
other agencies.

Changes can be made without diminishing the commitment and
appropriate services that are needed by children with disabilities.
Therefore, NSBA, like the ACIR report, supports continuing the In-
dividuals With Disabilities Education Act, but with modifications.
Although Congress, after 20 years, is finally considering making
changes, they are only modest, at best.

In conclusion, the time has come for Congress to re-evaluate ex-
isting mandates, especially in light of Federal cuts being proposed
in the appropriations process. The time is especially ripe for Con-
gress to remove unnecessary and lower priority mandates, as well
as to assume greater financial responsibilities for the mandates
that are kept.

I appreciate this opportunity to testify and would be happy to an-
swer any questions that you may have.

[The prepared statement of Mr. Resnick follows:]


159

It is a mandate, but I don’t know if it fits right up there with
some of the other things that we consider a selective burden be-
cause it applies to everyone. And that’s the other frustration, be-
cause we, last year, passed a bill here that made Congress live
under the laws that we pass, which was part of the effort. By not
having mandates are we then saying, “Well, if you’re a school dis-
trict or a city, you don’t have to comply with something like drug
testing of the local delivery or the local permit person may have?”

I know you heard my question about Davis-Bacon. Again, in
Texas, we have prevailing wage laws that apply. And I know
Davis-Bacon typically doesn’t apply unless the school districts are
using some Federal funding to build that local building. So Davis-
Bacon may not be the best case for a Federal mandate that’s not—
they are not paying for the whole school, but they are paying for
something on it.

I guess what I’m concerned about, as I see the testimony from
the school boards, if you could point out some of the mandates. And
Davis-Bacon and drug-free commercials drivers are probably not
the best. Let’s talk about some that are so egregious that we can
deal with, and that’s, I think, what you do in your agencies, as well
as we do.

Thank you, Mr. Chairman. That’s what I would like to see if we
could ask about. For example, Davis-Bacon, on the State level or
on the school district level, and I know on the city level, most
States have some type of Davis-Bacon or prevailing wage require-
ments. They are the ones that are in force against my school dis-
tricts.

Mr. RESNICK. If I can try to respond to that, Mr. Green. Cer-
tainly, there are a number of States that have legislated their own
Davis-Bacon programs. To a great extent, I think, there was a lot
of political pressure on States to mirror the Federal law. So, in ad-
dition to the Federal law itself—the Federal law provides a level
of leadership that becomes very persuasive, probably, on many
State legislatures.

In my own experiences with the Davis-Bacon Act, some years ago
I served on a school board in northern Virginia, and we sought to
apply for Federal vocational funds to help us build a facility, and
found that the amount of money that would be awarded By the
State would have been equal to or exceeded the additional cost that
we would incur through Davis-Bacon. So the issue for us was, do
we receive the money and have it serve no real substantial pur-
pose, if you will?

And then it raised a concern for us, as a school board, either
rightly or wrongly, that that would then add to the general stand-
ard with which we would have to perhaps pay, in future contracts,
that were not federally funded. So, for us, Davis-Bacon does raise
a number of concerns that are the inferences of the legislation as
well as what may be viewed as the specific mandate itself.

,_ On the drug program, one of the difficulties that Congress has
is that any issue that is right in front of it does seem very compel-
ling at the time. And certainly we support the idea that school em-
ployees, where appropriate, should be subject to drug and alcohol
testing. The issue is, what is the best way of doing it? Sometimes
local school systems have a better way that is better suited to their




109

UNITED STATES DEPARTMENT OF EDUCATION
‘THE SECRETARY
March 6, 1996

Honorable William Winter

Chair

Advisory Council on Intergovernmental Relations
South Building, Suite 450

800 K Street, NW

Washington, DC 20575

Dear Governor Winter:

As a member of the ACIR, I share your commitment to effective
local, state, and federal partnerships and to development of a
useful, balanced report from ACIR to the Congress on Federal
mandates. In addition, as Secretary of Education I have a
special responsibility for implementing the Individuals with
Disabilities Education Act (IDEA) in a manner that is consistent
with the legislative goal of promoting educational opportunities
for children with disabilities. I am therefore taking this
opportunity to explain to you the grave concerns I have with the
IDEA portion of the draft staff report, beyond those noted in
Marcia Hale’s letter to you of March 1, 1996.

At the outset, I want to underscore my strong belief that
inclusion of IDEA in the staff draft report is inappropriate
because IDEA enforces the Constitutional rights of disabled
individuals under the Equal Protection Clause of the Fourteenth
Amendment and establishes statutory rights that prohibit
discrimination on the basis of disability. Section 4 of the
Unfunded Mandates Act itself indicates clearly that, for the
purposes of the Act, such rights are to be given a preferred
status. In addition, the rights established under IDEA are not
only personal rights, but rights that directly reflect the
fundamental obligation of State and local governments to avoid
discrimination in carrying out their governmental functions. For
these reasons, IDEA should not even be included in the report,
and, to my mind, its inclusion makes the report unacceptable.

Turning to the specifics of ACIR’s draft recommendations, I have
the following serious concerns, each of which supports my view
that the discussion of IDEA should be dropped from the report:

(1) “Increase Federal Funding to 40% Level." While not
disagreeing in principle that it would be desirable to increase
the level of Federal funding, the five-fold increase called for
by ACIR is simply not realistic in light of current budget
realities. Moreover, as noted above, the obligations imposed on
States and local school systems under IDEA are rooted in the
Equal Protection Clause of the Fourteenth Amendment; IDEA was


30

IMPORTANT TO NOTE THAT THE RULE ON THE IMMIGRATION BILL EXPRESSLY
INDICATED THAT IT WAS NOT WAIVING ANY MANDATES POINTS OF ORDER
AGAINST CONSIDERATION OF THE BILL, NOR DID IT EXPLICITLY WAIVE
THE MANDATES MOTION TO STRIKE, WHICH APPLIES ONLY TO
INTERGOVERNMENTAL MANDATES. EVEN IF THE RULE HAD WAIVED THE
POINTS OF ORDER AND THE COMMITTEE HAD FAILED TO DO ITS JOB OR
THERE WERE PUBLIC SECTOR UNFUNDED MANDATES IN THE BILL, A MEMBER
COULD STILL GET A RECORDED VOTE ON THE MANDATES ISSUE BY RAISING
A POINT OF ORDER AGAINST THE RULE. SO THERE IS A LOT OF
PROTECTION FOR STATE AND LOCAL GOVERNMENT IN THE EVENT THAT
COMMITTEES FAIL TO DO THEIR JOBS PROPERLY. BUT THE GOOD NEWS IS
THAT COMMITTEES UNDERSTAND THE REQUIREMENTS OF THIS NEW LAW AND
ARE COMPLYING WITH THEM.

DESPITE THESE EARLY SUCCESSES, WE ARE CONTINUING TO WORK
AGGRESSIVELY WITH COMMITTEES, CBO AND STATE AND LOCAL GOVERNMENT
REPRESENTATIVES TO ENSURE THE LAW‘S PROPER IMPLEMENTATION. CBO
REPORTS THAT THEY HAVE PROVIDED A TOTAL OF 26 STATE AND LOCAL
GOVERNMENT ESTIMATES SINCE THE MANDATE PROVISIONS TOOK EFFECT ON
JANUARY 1, 1996, THAT 5 BILLS CONTAINED PUBLIC SECTOR MANDATES,
AND THAT NONE OF THESE 5 HAD MANDATES ABOVE THE $50 MILLION
THRESHOLD. CBO ALSO REPORTS THAT CALLS FROM MEMBERS AND
COMMITTEES INDICATE THAT, IN MANY CASES, THE MANDATES ISSUES ARE
BEING ADDRESSED BEFORE INTRODUCTION OF A BILL AND BEFORE MARK UP
IN COMMITTEE. THIS IS EXPRESSLY HOW WE HOPED THE PROCESS WOULD
WORK.

WE HAVE ALSO BEEN WORKING WITH THE HOUSE PARLIAMENTARIAN’S


89

3

recommendations call for dismantling vital worker protections
that, for the most part, are now national in scope, the
Administration cannot support them. Our elected representatives
determined long ago that certain minimum employment standards had
to be observed in the working relationship between employers and
their employees in order to eliminate conditions detrimental to
the health, efficiency, and general well-being of workers and the
economy. Just like the people of this Nation are entitled to be
protected from having to drink unsafe water or breathe toxic air,
every working man and woman should be entitled to basic minimum
protections in the workplace -- the right to a safe and healthful
working environment; to be paid at least a minimum wage; to not
have to work excessively long work hours; to have our children
protected from oppressive child labor; to be able to take job-
protected, unpaid family and medical leave in times of temporary
family and medical crises; and to not have local wages undermined
by procurement requirements that favor low bidders when the
Federal government invests its vast purchasing power in local
economies in the form of Federal assistance to build important
local construction projects.

Mr. Chairman, in addition to strongly opposing these
recommendations in their current form, we also question the
validity of the method, the criteria and many of the assumptions
the Commission used in arriving at them. On March 1, Secretary
of Labor Reich wrote to the ACIR setting forth our concerns and
objections regarding its preliminary report. I ask that a copy
of his letter be included in the record of this hearing.

If I may, I would like to proceed by first summarizing our
major concerns and objections regarding the ACIR preliminary
draft report and its findings. Then I will address each of the
ACIR proposals relating to statutes within the purview of the
Department.

MAJOR DOL CONCERNS AND OBJECTIONS

As stated by the ACIR, the purpose of its preliminary draft
report was to propose "...changes in federal policies to improve
intergovernmental relations while maintaining a commitment to
national interests" (emphasis added). This stated purpose
reflects the guidance of Congress in adopting the Unfunded
Mandates Reform Act. That guidance is that the Commission
actively consider the impact of its recommendations on American
workers, and on the objectives and responsibilities of the
various levels of government (Federal, State, local and tribal).
Thus, the Commission was to recommend changes in federal policies
in a way that would enhance intergovernmental relations while
maintaining a commitment to vital national interests.

In the Department's view, the ACIR draft report does not
achieve its stated purpose nor does it follow the Congressional


84

Mr. Suays. Thank you, Ms. Metzenbaum.

Bernard Anderson, we welcome your testimony.

Mr. ANDERSON. Thank you very much, Mr. Chairman.

I am pleased to appear here this morning, representing the De-
partment of Labor in discussing the preliminary draft report of the
ACIR and the Department of Labor’s implementation of Title II
under the Unfunded Mandates Reform Act. I will briefly summa-
rize the report. We submitted a statement for the record.

Mr. SHays. Thank you, sir.

Mr. ANDERSON. Let me say, at the outset, that the Department
has made it a policy to consult widely and often with State, local,
and tribal officials in discussing any regulations and matters that
significantly impact their Government. The Department also in-
cludes them in our outreach, our education, our compliance assist-
ance efforts. And our policy and practice, in fact, predate the Un-
funded Mandates Reform Act and were based, in part, on President
Clinton’s Executive Order 12875, on strengthening the intergovern-
mental relationship.

The Department of Labor has now established a formal process
to ensure appropriate consultation and compliance with Title II.
That is, if there is a notice of proposed rulemaking that is expected
to contain a significant Federal intergovernmental mandate that
exceeds the $100-million threshold, a formal consultation process
will be followed to be sure that State, local, and tribal officials have
an opportunity to make their views known and that we will take
into account those views as we move forward with the rulemaking
process.

There is a cost-benefit analysis required. The statement of how
that cost-benefit analysis will be conducted will be part of the pre-
amble to the NPRM. There are three steps in the process that will
be followed. The first, of course, is to solicit comments from inter-
ested government officials. And where small government entities
are affected, we will include a special emphasis on getting the
views of such entities.

The second step in the process is to consider the comments pro-
vided to us by State and local officials, to have feedback, to have
a discussion on those comments; and, finally, to provide compliance
assistance and education on the final rule.

So while the department supports and has made real efforts to
reduce regulatory burdens on State, local, and tribal governments,
it does not believe these efforts should come at the expense of
broad, fundamental, national labor standards protections to which
all workers should be entitled.

We have serious concerns about the ACIR preliminary draft rec-
ommendations on programs of the Department of Labor because
they run counter to a national commitment to protect the wages
and working conditions of American workers.

In the preliminary draft report, the ACIR recommended repeal of
the coverage of State and Yocal workers under the Fair Labor
Standards Act, the Family and Medical Leave Act, and the Occupa-
tional Safety and Health Act. ACIR also recommended exempting
State and local construction projects below $1 million, or where the
Federal assistance is less than half the project’s total funding, from
the requirements of the Davis-Bacon and related acts.


12

Mr. Suays. I thank the gentleman for his fine statement and his
gracious words. I thank, also, Mr. Towns for yielding to him.

Mr. Towns, you have the floor.

Mr. Towns. Thank you very much, Mr. Chairman.

I would like to commend you for calling this hearing and for your
leadership, because this issue is very important to our friends in
State and local government. The Unfunded Mandates Reform Act
is an important piece of legislation which enjoys wide bipartisan
support, and rightfully so.

Its primary goal is to change the way we often do business in the
House and Senate, by requiring a full discussion and even a vote
whenever legislation is being considered by either body contains an
unfunded Federal mandate. Its intent is full disclosure. Members
must be made aware of unfunded mandates included in bills and
given an opportunity to debate and object to the mandate by rais-
ing a newly created point of order.

The Unfunded Mandates Reform Act took effect in the House on
January 1, and we now have a little bit of experience to see how
it is working. Unfortunately, the House leadership has ignored the
act when its requirements have been inconvenient. Let me give you
a few examples of that.

Mr. SHays. Not too many.

Mr. Towns. I don’t want to be accused of rhetoric. I want to just
sort of give you some specific examples. Just a few, Mr. Chairman.

Mr. SHays. Just a few.

Mr. Towns. When the House considered the telecommunications
conference report, the rule waived all points of order, even though
the bill included a number of unfunded mandates on local govern-
ments. When the House debated the farm bill, the rule blocked any
motions to strike unfunded mandates. When the House considered
the conference report on the Foreign Relations Authorization Act,
the rule waived all points of order, including those against un-
funded Federal mandates.

The purpose of the Unfunded Mandates Reform Act is to allow
all Members an opportunity to challenge a provision in any bill.
That includes an unfunded mandate. That is why the act specifi-
cally says that “It shall not be in order to consider any rule that
waives these points of order.”

My colleagues on the other side may respond that any Member
can always challenge the rule itself.

Mr. SHays. Would we have said it like that?

Mr. Towns. Almost. But as we all know, a procedural challenge
is very difficult for the minority to win. Instead, what the House
should insist on is that all Members’ rights be preserved to chal-
lenge unfunded mandates on every bill, when they exist.

Let me quickly return to the report by the Advisory Commission
on Intergovernmental Relations, which was required by the act.
The report targets 14 Federal mandates for repeal, modification, or
revision, including the Family Medical Leave Act, the Fair Labor
Standards Act, and the Occupational Safety and Health Act.

We should be very, very cautious before rushing to implement
these recommendations. These statutes address important public
policy concerns. Ending the application to State and local govern-


54

‘The Honorable William F. Winter
Page 2

public entities. Following precedent developed unde:
Bs the Rebabilitecion act Of"1973 (section sos) wnich prohib:
bavis of disabiiity by recipienrs ot
poet te estate and local
*aiscegtton in determining bow
‘ion. cost is

accessible
appropriately Considered in Getermining what the ADA requires and
whather compliance deadlines apply.

One example of! the inherent of poxtbilt ry, in the ADA is the
implementation 8 requirement the installation of curb
raups. The ADA Sequires ‘public Bette 3 to dnstall curb rampe to
broviee access 3. cee ete sidewalke if it is necass:

rovide

program access: Af 4¢ can be accemplighed cbose
neurring widue fiiancial and adninistretive Durdene.

yesuirenent a6 noe news it nas applied £2 public soeitian, gubgect
te section 50¢ since 1977. In 191
ADR ation extended chip Tequirenent to eb public cetities ast
subject co section 50. The zegulation eat ga Samuery 1995 1995
as the compliance otadiine for Tnetaliacion Sf
ary modifications Tobie bot be
undue financial burdens, those

modifications vould uot be required to be corpleced within this
time period. Since that tine, in response to concerns expressed
by nenbors of Congress and overs, the rEnene as proposed
farther extensions of time for compliance. The proves
extension of the compliance doadiines for the installacion of
curb raaps demonstretes that the ADA, in its present form, is
being implemented ine way that pernite etatc and local

neider leeal coomomic seelities bn saking ADA

qoveramante to
Gaterminations

‘The Administration shares the ACIR’» commitment to achieving
affective inplonentacion of the law without imposing excessive
eonts on etate and local tampayezs. We beiieva, howavez, nhao
the epecific recommendations ACIR bas made with respect to the
ADA will not be effective in enwsur:

ing
with disabilities are protected. 7o assist dn refining the
RGIR recomendations. the  Minindnereeden vit

comments ACR report during the public comment
period. 1 209k focuara te working with ou in the future on thie
reent

ely.

‘Janet Reno


171

‘The Honorable Christopher Shays
March 26, 1996

page 3

ent. Having drafted a Preliminary
ee ets et acungle caret ict
the comments and views of individuals and organized groups. The Commission inserted a notice
in the Federal Register of the availability of its Preliminary Report and to date has distributed
2200 of these documents without cost. The Commission announced in the Federal Register plans
for a public hearing on the report. Originally scheduled for March 8, the hearing was
subsequently rescheduled and held March 26, 1996. A public comment period of three months
‘was instituted and to date over 300 written comments have been received. The Commission
conducted a Conference on March 6-7, 1996 to give additional opportunities to experts on
various matters under consideration to discuss draft findings, conclusions and recommendations
contained in the Preliminary Report.

Thope that this clarification will be helpful to Members of the Committee in correcting some of
the misunderstandings relative to the Advisory Commission’s work on unfunded mandates.

Sincerely,

E. Davis
Executive Director


96

10

has made it a policy and practice to consult with state, local
and tribal officials in promulgating regulations that would have
a significant impact on their governments. This encompasses
those that impose a "Federal intergovernmental mandate." In
compliance with Title II, DOL has established a formal process to
ensure this result.

When a Notice of Proposed Rulemaking (NPRM) is developed,
the responsible program agency will evaluate the potential
impact, if any, on state, local and tribal governments. If the
NPRM is expected to contain a significant federal
intergovernmental mandate (i.e., a mandate that meets the $100
million threshold), a formal consultation process will be
followed to ensure that state, local, and tribal government
officials are involved in the rulemaking. In addition, the
required cost/benefit analysis will be conducted and a summary
shared with appropriate State, local or tribal officials.
Finally, the cost/benefit analysis, the specific consultation
plan used, and the concerns and comments of the government
officials will be summarized and made available in the preamble
to the NPRM.

DOL's consultation process involves three steps. The first
step is notice to and solicitation of comments from interested
government officials. DOL maintains an appropriate list of
state, local and tribal government contacts that can be used to
solicit comments. This list includes the following: lists of
towns, cities, counties, states and tribes known to be affected;
contacts developed by DOL regional offices; representatives of
state, local, and tribal governments; known functional
counterparts to DOL agencies at the state and local level; public
sector labor unions; and interested parties provided by
Congressional sponsors of enabling legislation.

The program agency may use one or more vehicles to solicit
comments on the regulations. Among the vehicles that may be used
are inquiries and notices in the Federal Register; general
interest or specialized publications; the DOL Internet homepage;
and structured meetings, roundtables, seminars, workshops, and
hearings.

The second step in the process is to analyze comments
received and provide feedback. The program agency will analyze
comments and provide feedback through written responses in the
NPRM preamble. Additional feedback may be provided through such
devices as individual correspondence, follow-up meetings and
seminars, and the Internet.

The final step in the process involves providing compliance
assistance and education on the final rule. The program agency
will take one or more of the following steps to help educate and
assist state, local and tribal governments: send compliance


185

sufficiently contrary to local interests, they may elect to decline a federal
grant.

Thus, federal laws such as the “Davis-Bacon Related Acts” that
condition receipt of federal financial assistance upon including federal
prevailing wage requirements in state and local governments’ construction
contracts encourage, rather than “mandate,” state and local regulation.
This is an important distinction that Congress apparently understood when
it expressly excluded provisions in federal laws and regulations that impose
enforceable duties on state and local governments as a condition of federal
assistance from the definition of a “federal mandate” in the Congressional
Budget and Impoundment Control Act of 1974, as amended by Section
101 (a) of the Unfunded Mandates Reform Act of 1995.

Accordingly, it is submitted that the Commission is without authority
to make any recommendation to Congress and the President concerning the
“Davis-Bacon Related Acts.”

Aside from the fact that the Commission's recommendations concemn-

ing the Davis-Bacon Related Acts are beyond the scope of its mandate from

=14-


170

The Honorable Christopher Shays
March 26, 1996

page 2

Mandate Definition and Mandate Exclusions. Title III of the Act, which specifies ACIR’s
responsibilities, defines the term “federal mandate” as “any provision in statute or regulation or
spon Stat, loa, otal governments

Federal program [emphasis added)” This broad definition 1s not considered in conflict with
Section 4, Exchusions of the Act, because the exclusions relate only to “any provision in a bill,
joint resolution, amendment, motion, or conference report before Congress and any provision in a
proposed or final regulation.” The exclusions quite clearly were meant to cover proposed laws
and regulations under Titles I and II of the Act and not to ACIR’s reviews of already passed and
effective laws.

‘The Preliminary Nature of the Report. The Preliminary Report was published by direction of the
‘Commission in order to elicit public comment. It was and is intended to be a preliminary report
that is, a draft, a work in progress. After Commission Members consider all of the information
and analysis provided to them—inctuding all of the public comments received—the Commission
-will draft a final report for submission to the President and Congress.

. The Preliminary Report reflects a series of concerns expressed by state
and local government officials about problems they have experienced in complying with federal
mandates. The Unfunded Mandates Reform Act of 1995 specifically directed ACIR to review the
impact of federal mandates on these governments. Much of the information received in the early
stages of the Commission's work, and contained in the Commission’s Preliminary Report, reflects
reports from these governments. It is our hope that by exposing these findings to public attention,
we can elicit helpful suggestions on ways they might best be addressed.

Limitations in Preliminary Report. I want to point out that the Preliminary Report prepared by
ACIR covers only some of the subjects the Commission was directed by Congress to study. It is
not intended to cover all of the matters included in Title II of the Unfunded Mandates Reform
Act, and indeed, there are topics contained in Title III on which ACIR will be unable to report
because there were inadequate federal funds committed to complete the studies. For example, the
study of state mandates, an analysis of impacts on the private sector and a study of
methodological issues involved in measuring direct and indirect costs and benefits are yet to be
carried out because of the lack of funds. Also, because of the lack of funds, the Commission’s
original workplan relative to matters contained in the Preliminary Report had to be drastically cut
back. Our original workplan called for extensive original fact-finding and extensive consultation
with affected individuals and groups. We also planned to conduct extensive public field hearings
around the country. None of this was possible because of the lack of funds.


xt)

We are also continuing to work hard to strengthen communications with states, localities,
and tribes. In addition to the regular interactions all of our Regions have with the states, each
Region has also designated a top manager or staff member in the Regional Administrator's office
to work with each state, Each of our Regions has established a local government desk to field
calls from government officials and keep them from being “bounced” around by helping callers
find the right person who can respond to their questions. EPA has also designated a small
community coordinator in each Region, and our Regional tribal offices have been significantly
strengthened as well.

At the national level, the Agency established a Local Government Advisory Committee
and the Small Town Task Force, each chartered under the Federal Advisory Committee Act
(FACA), as well as a Tribal Operations Committee. These groups meet periodically with EPA
officials to help us understand the environmental challenges facing local governments, anticipate
local issues, and devise smarter ways to protect the environment. EPA senior managers also meet
regularly with the governors, state legislative leadership, mayors, county officials; state
environmental, health and agricultural commissioners; and other state and local elected and
appointed officials,

IL Unfunded Mandates Reform Act — Implementation of Title IT
Title TI of the Unfunded Mandates Reform Act of 1995 called on federal agencies to

assess the impacts of agency regulatory actions and to establish a process for meaningful
consultation with state, local, and tribal governments. EPA is proud of the progress it has made
in implementing the President's 1993 Executive Order on Building Intergovernmental Partnerships
as well as Title Il of the Act.

Even prior to the issuance of the Executive Order, the Agency had begun to take
significant steps to strengthen the Agency's long-standing efforts to involve officials from other
levels of government in the development of regulations that will affect them. Following the


DONALD M. PAYNE

WASHINGTON OFFICI
01H Distaicr, New Jensey

1244 Raraumn House Ones Bones
‘Waste, OE 0618-910
"aon as se

coomprvz owen yp
SoA aS caster omces
Scene viewer
wosmmcunen Congress of the United States Essent
‘omar oxranaon, Bouse of Representatives seers
seco vem Washington, WE 20515-3010 sx hon oron me
en es --Statement-- “silat
cononssouigaceeaucs The Honorable Donald M. Payne
Hearing

Government Oversight and Reform Subcommittee on
Human Resources and Intergovernmental Relations

Friday, March 22, 1996

Mr. Chairman, T want to begin by commending you on your
leadership in holding this very important hearing this morning
Moreover, I appreciate this opportunity to offer my input on the
Unfunded Mandates Report given by the Advisory Commission on
Intergovernmental Relations

I wish to express why I did not approve the ACIR preliminary
report, entitled "The Role of Federal Mandates in
Intergovernmental Relations". To begin with, this document
recommended drastic reductions in state and local governments’
responsibilities with respect to many of our nation’s most
important environmental, workplace, health, and civil rights
laws.

The role of the Commission is to smooth bumps in the
intergovernmental system, identify the problems and build a
consensus on app:.opriate remedies. Although this report is
presented as the balanced recommendations of a bipartisan,
nonpolitical panel, the ACIR report is the representation of one
perspective, for which the goals are to scale back or eliminate
many of our most significant public protections

I have problems with several of the reconmendations that are
outlined in the preliminary report, both procedurally and
substantively. First, the report is based on an oxtreme
ideological agenda to dismantle federal protections. The
recommendations mirror many of the ideas in the “Contract with
America". The same proposals were rejected by the Congress and
the American people last year.



181

The Davis-Bacon Related Acts

Section 101(a) of the Unfunded Mandates Reform Act of 1995, which
added Section 421(5)(A)(i) to the Congressional Budget and Impoundment
Control Act of 1974, 2 U.S.C. § 658, defines “federal intergovernmental
mandates” to mean “any provision in legislation, statute, or regulation
that--would impose an enforceable duty upon State, local, or tribal
governments.” In addition, Section 421(7)(A)(i) of the Act defines “federal
private sector mandates” to mean “any provision in legislation, statute, or
regulation that~would impose an enforceable duty upon the private sector.”
Significantly, the definition of both “federal intergovernmental mandates”
and “private sector mandates” excludes any provision in legislation, statute,
or regulation that would impose an enforceable duty on a state, local, or
tribal government as a condition of federal assistance, or is a condition or
requirement for participation in a voluntary discretionary aid program.
Furthermore, Section 421(6) of the Congressional Budget and Impound-
ment Control Act of 1974, as amended by Section 101 (a) of the Unfunded

Mandates Reform Act of 1995, defines “federal mandate “to mean a federal

-10-


48

‘The consultation processes that have been established in light of these general lessons are quite
varied. As our report discusses, some agencies ~ like the Departments of Defense and State ~ do
not generally issue regulations with intergovernmental effects. Even these agencies, however,
have committed to consultations when developing rules or considering policies or programs that
involve other levels of government.

Several other agencies — notably, the Environmental Protection Agency and the Departments of
Education and Labor — issue many rules with intergovernmental effects and have done a superb
job in setting up effective avenues of communication with State, local, and tribal governments.
These are outlined in detail in Chapter 1 of our report.

‘The report demonstrates that the Administration's commitment to involve State, local, and tribal
governments as early as possible goes beyond rules covered by the Act. We take seriously our
responsibility to consult with other levels of government on all rules and significant policy or
program decisions that may affect them. Our report includes a myriad of examples where agency
activities benefitted from hearing the views of their intergovernmental partners, and incorporating
those views into their decision making.

The report also shows that these processes are not just paper-driven exercises, Two rules in the
last year met Title II’s $100 million expenditure threshold for State, local, and tribal governments.
Both were promulgated by the Environmental Protection Agency. Chapter 2 of the report
contains a lengthy description of the consultative processes undertaken by the agency for these
rules, and, most importantly, demonstrates agency ascertainment of concerns and the many
changes made to accommodate those concerns.

‘The EPA experiences discussed in our report illustrate what the Unfunded Mandates Reform Act
is all about. Everyone should recognize that regulations have provided important benefits for
health, safety and the environment. At the same time, we must hear the concerns of our
intergovernmental partners, react to those concerns, and incorporate them into the analyses that

-6-


117

that came close to meeting that threshold in either the Department
of Education or Labor?

Mr. ANDERSON. We would have to provide that information for
OSHA. In the areas of employment standards administration, there
have been no regulations that even approach $100 million.

Mr. Suays. Thank you. Mr. Fattah, thank you for your patience.

Mr. FaTtaH. Thank you, Mr. Chairman.

I do want to make note that, as relates to this report, part of the
requirement was also for the ACIR to look at State mandates and
their impacts on local governments. Both the chairman and you
were helpful in having that amendment added, which I sponsored.
The report mentions nothing about what is, at least where I come
from, the principal concern of local government, which are State
mandates. We had Congressman Talent testify about group homes.
I know a little bit about group homes, and 99 percent of the regula-
tions emanate from State government.

So, along with my other criticisms of this report and comments
about it, I wanted to mention that.

I have heard all of you testify that the repeals and the rec-
ommendations that have been put in this preliminary document
raise a great deal of concern to you in your various departments.
T’'m having a lot of difficulty with the decisions of this study group.
They say, for instance, that family and medical leave is not a na-
tional priority, yet it passed the Congress with a bipartisan major-
ity, and it was signed by the President. I’m not sure how, in the
wisdom of the group here, they determined that this is not a na-
tional priority.

Now, Congressman Payne earlier tried to talk about some of the
procedural problems, and I want to put in the record, it’s my un-
derstanding that only 7 of some 30 members of the ACIR were
there when this matter was voted on, that there was not a great
deal of consultation with people on this report. So it’s helpful to
hear your views, as it relates to your various departments, about
it.

This is an important law, and it is obvious that the magnitude
of its impact on the Federal Government is a little less than what
may have been touted originally, since there have not been that
many regulations that have the threshold impact. It’s still an im-
portant issue, and we need to deal with it. But this report raises
a great deal of concern about the directions of some people involved
in the process.

Dr. Anderson, is there any reason, in your view, that people who
are employed by State and local government should not be covered
by the protections provided by the Fair Labor Standards Act?

Mr. IDERSON. I can’t think of any reason, Mr. Fattah. In fact,
you know, when you really look at this carefully, with respect to
our national interest in having policies that protect American
workers, from the worker’s point of view, it makes little difference
as to whether they are employed by General Electric or General
Shalikashvili. A job is a job, and the working conditions, and the
terms and conditions of that work are the same. The identity of the
employer really does not make a difference.

Tn fact, you can go even beyond that and say that State and local
government—in fact, even the Federal Government—should be a


Office of the Attorney General
Woshingten, B.C enssa

Fevruary 8, 1996

The Honorable William ¥. Winter
Chairman

0.3. Advimery Commission

on Intergovernmental Relations
800 K Street, N.W.

Suite 450, South Building
Washington, D.C. 20575

Dear Governor Winter:

I am writing to respond to the recommendations with respect
to the Americans with Digsb: Act oF 355 (eDA) that were
Feoevtly sublighed for pubide commest by tl adv:
Ebusisetoh gn intergoversneatal Relations (Aci); “These
Feconmenda;ioas are apparently based on the sigaiticanc
misperception that che ADA impoces Sguirencote on
Rtate apd local governments wader int, exible Gekdlines.

Ths ACIR prelizinary report was Semced pursuant to title ZZT
of the Unt Mandates Reform Act of 1995, Pub, b. iot-4, 109
Stat. 48, vhich requires ACIR to conduct a study on the effect ot
Federal mandates on etate and local governnents, and to report to
the President an¢ to the Congress. However, the Unfunded
Mandates Act exprassiy provides that "the act shall not apply to
aby Federal regulation that establishes oz exfurses any statutory
pignee that prohipt ¢iecriminarion vn the basis of -
disability. | Degpite this statutory restriction, the Actin report
recommends signizicant changes in the ADA and ite inpienencing
regulations af they apply to state and lecel governments.
ACIR commendably recoenizes the ADA’s vital rele in
meeting this tation’s obiigation to encure that citirens With
Gisobilitiee are noe exeiudec from the wainstream of American
Lite. Mowever, AEIS-@ preliminary repert recomends significant
hangea in ADA’ implementation. I am yea that these
focomnandetione, if inpignented, vould seriou BLY
nation’s effert ce meet ite obligations to people with
disabilities.

Dpfortunacely, sa noted, the ACIR report relige on the
signiticane misperception thit the ADA imposes expensive
lpeal governeante under inflesible
che ADA te Both Fienible and Feaponsble
The statute wae carefully grafted to protecr the sight of people
with disabilities to participate dn conmmity activities vise
Te'the same times avelaing the iupesition of undue burdens



138

Overall, our nation has a $50 billion special education system that is built upon
the IDEA mandate. There are major areas where this highly regulated program
can be strengthened without diminishing appropriate services for children; but
for 20 years, Congress has resisted. Currently, the program is being
reauthorized, but with only modest efforts to save school systems what we
believe are billions of dollars in costs that they should not bear.

For example, the law, coupled with unintended court interpretations, have set up
a legal process that both: 1) unduly enriches attorneys through legal
gamesmanship and draws funds from educational programs; and 2) results in
school district decision-making that is based on avoidance of costly legal process
rather than appropriate education programming. Additionally, the law works to
relieve private insurance companies of their responsibilities to provide certain
health benefits that are required under IDEA’s individual educational planning
process. These are only two examples. The list of specific mandated costs is

extensive, raising the question, “What is really necessary and at what level?”

In addition to mandated activities and costs, there is the separate question of the
cost in administering and complying with the paper "rk requirements of this
very complicated and highly process-oriented law. vith 5.2 million children
expected to be enrolled in special education programs next year, every additional
hour of process and paperwork required by the law can cost school systems as
much as $200 million in man-hours alone. Further, the law has worked to
authorize expenses for children and their families that could not have been
intended, and would be viewed as inappropriate by taxpayers— either because

of their nature or “cadillac” level of service.


49

inform our decision making so that costs to all those affected by the rule — and especially to State,
local, and tribal governments — are minimized while the benefits to all are maximized.

1 appreciate the opportunity to appear here today before you, and to unveil our report. I look
forward to any comments you may have, and am happy to answer any questions at this time.


18

a cooperative agreement with the National Governors’ Association to provide a forum for

discussing state issues on this project.

Other Intergovernmental Consultation Highlights

Following are examples of EPA's other intergovernmental consultation efforts. The

summary highlights a few actions that respond directly to concerns and issues raised by state,
local, and tribal governments,

o

EPA established a wet weather advisory committee, with representatives from all

levels of government, including small governments, to develop the Phase IT

stormwater program.

‘The information and recommendations resulting from the Ozone Transport Assessment
Group (OTAG) are likely to be used by EPA and/or states in future rule development,
OTAG was established by the Environmental Council of the States (ECOS), the national
organization comprised of the State environmental commissioners, to develop
recommendations concerning the need for regional/national control strategies to reduce
transported ozone and facilitate attainment of the ozone standard process.

‘After extensive consultation and active participation of states, EPA decided to rely on
existing performance-based standards and a tailored combination of guidance,

education, and outreach to address Class V underground injection wells.

EPA's final enforcement policy on incentives for self-evaluation was developed through an
extensive 18-month public process in which EPA met with and took over 200 comments
from state, public interest, and industry stakeholders regarding how the Agency could best
increase incentives for self-discovery, seif education, and self-disclosure of violations of
environmental requirements. .

In response to issues being raised within the Agency, by a wide range of interested
parties, and by Congress, EPA has initiated an extensive reassessment of its drinking water
program in consultation with program stakeholders, including state, local, and tribal
officials. The Agency is committed to a redirection of its drinking water program to focus
‘on the most serious health risks.


88

2

regulations and holding regular meetings with its State Plan
partners through the Occupational Safety and Health State
Plan Association.

* The Mine Safety and Health Administration (MSHA) has
ongoing working relationships with state mining agencies,
and mining industry and labor representatives. MSHA
actively seeks input to proposed standards and regulations
from these interests, and involves them in other outreach
efforts. For example, MSHA held a conference for all state
mining agencies to enhance cooperation and improve Federal
and state coordination. The conference was attended by
representatives from 40 states and the Navajo Nation.

* The Employment Standards Administration's (ESA) Wage and
Hour Division has regular consultations and outreach
involving state and local governments in its administration
of the Fair Labor Standards Act (FLSA) and the Family and
Medical Leave Act (FMLA) as these laws regulate the
employment practices of these governmental entities.

Mr. Chairman, while the Department supports and has made
real efforts to reduce regulatory burdens on state, local and
tribal governments, it does not believe these should come at the
expense of broad, fundamental national labor protections to which
all workers should be entitled. Having said that, let me turn
now to the ACIR's preliminary draft report and its
recommendations regarding statutes within the purview of the
Department.

ACIR Report and Preliminary Recommendations

The ACIR selected fourteen Federal mandates for analysis.
Four of the statutes selected for review are under the purview of
the Department of Labor -- the FLSA, the FMLA, the Davis-Bacon
Related Acts (DBRA) and the Occupational Safety and Health Act
{OSH Act). The first three of these are administered and
enforced by ESA. The OSH Act is the responsibility of the
Department's OSHA.

In its preliminary report, the ACIR recommended repeal of
coverage of state and local workers under FLSA, FMLA and the OSH
Act. ACIR also recommended an exemption from the requirements of
DBRA for state and local construction projects below $1 million
or for projects where the Federal assistance constitutes less
than half of the project’s total funding.

Initially, I would like to emphasize that the basic theme of
the ACIR preliminary recommendations affecting programs of the
Department of Labor run counter to a national commitment and our
mission to protect the wages and working conditions of the
working men and women of this country. Because the


43

STATEMENT OF SALLY KATZEN
ADMINISTRATOR
OFFICE OF INFORMATION AND REGULATORY AFFAIRS
OFFICE OF MANAGEMENT AND BUDGET
BEFORE THE
SUBCOMMITTEE ON HUMAN RESOURCES AND INTERGOVERNMENTAL
AFFAIRS
COMMITTEE ON GOVERNMENTAL REFORM AND OVERSIGHT
UNITED STATES HOUSE OF REPRESENTATIVES

March 22, 1996

‘Good morning Mr. Chairman and Members of the Committee,

1 am Sally Katzen, the Administrator of the Office of Information and Regulatory Affairs within
the Office of Management and Budget. OKA has specified statutory responsibilities and is
charged under various Executive Orders with the task of coordinating and reviewing Executive
Branch regulatory policy matters.

T appreciate the opportunity to testify on unfunded Federal mandates on this, the first anniversary
of the signing of the Unfunded Mandates Reform Act of 1995. This is » very important piece of
legislation for the Administration, and one which President Clinton has enthusiastically supported.
‘The Unfunded Mandates Reform Act was a milestone that addressed deep-feit legitimate concerns
of State, local, and tribal governments sbout the difficulty of complying with Federal unfunded
mandates.


129

simplified to reduce paperwork. New rules should be pilot tested.
Unnecessary complexity and confusion should be eliminated through agency
coordination.

States offer many examples of programs that work. Virginia, for
example, has several that could serve as models. In addition to compiling a
catalog of mandates, assessing existing mandates, and conducting annual
fiscal impact analyses of proposed new state mandates, our state has
enacted a relief measure that allows the Governor to declare a one-year
suspension of a state mandate for any locality that demonstrates fiscal stress
which can be alleviated by such a moratorium. This is an example of local
flexibility which Congress could emulate. In addition, Virginia's legislature
has just designated the Virginia ACIR as a forum for any locality seeking to
challenge a mandate assessment or a fiscal note. Congress could consider
providing a similar forum, perhaps the U. S. ACIR. Surely, other models
abound.

In closing, let me say that states and localities are grateful for the
progress that has been made, and we are mindful that much more can be
done. As you contemplate intergovernmental options, bear in mind that, as
partners, we can work together to make government better for all of us.


113

Can you tell us how you feel the agencies are interpreting the
“inconsistent with law” exemption, and might it be interpreted too
broadly? In other words, might it be used as sort of an umbrella
to avoid having to really do the kind of analysis that you need to
do to identify the “least costly, most effective” alternative?

Ms. KATZEN. I think there is generally strong good faith in the
interpretation of the legal mandates. One or two of the instances—
in fact, I think two of the five involve EPA, RCRA instances. One
was a final rule and one was a proposal. And in both instances
they said quite clearly, “The law is making us do it.”

We also, at the same time, sent up to the Hill what we called
the “RCRA rifle shot” to change the provision of the law that was
causing this distortion, and it was passed unanimously by the
House, through Corrections Day. This was a change of the law, not
a change of a regulation. It was passed unanimously by the Senate.

And I think it’s on its way to the President where I know that
he—well, he has indicated his intention to sign it. So that will
change the legal—I hate to say I know something is going to hap-
Pen. since Tm under oath, I can only tell you what my knowledge
is of this.

But I believe that this is the kind of example where they have
identified a legal barrier to doing something that they wanted to
do and, at the same time, have provided the recommendations to
the Congress to ease that situation.

Mr. CLINGER. Just one quick final question. Do you review the
request for a waiver and don’t accept it just at face value?

Ms. KATZEN. Oh, yes, we do.

Mr. CLINGER. In other words, that they are really justified in
claiming that waiver.

Ms. KaTZEN. Yes, sir.

Mr. CLINGER. OK. Thank you.

Mr. Chairman, thank you. I think my time has expired.

Mr. Suays. Mr. Towns.

Mr. Towns. Thank you very much, Mr. Chairman.

Ms. Studley, in April of last year, GAO released a report entitled,
“School Facilities: America’s Schools Not Designed Or Equipped
For The 21st Century.” GAO found that schools with 50 percent or
more minority population were more likely to have unsatisfactory
environmental conditions such as lighting, physical security, less
likely to have technology elements, and went on to talk about, even
if they got equipment, the wiring would not be sufficient. Basically,
what it said was that those that are behind will stay behind and
will not have an opportunity to catch up.

Without Federal education mandates, how can we address in-
equities such as these? Let me just give you a list of things. What
are the likely results of eliminating a Federal presence in edu-
cation altogether? Are we likely to see a greater burden on metro-
politan areas? Would there be additional impacts on disadvantaged
children?

You can answer in any order you like.

Ms. STUDLEY. Certainly, luced Federal participation in this
partnership would have all of those serious effects. We have cal-
culated, for a number of districts and States, precisely what those


122

Ms. HEUMANN. Basically, I think it goes without saying that we
believe that parents have an individual right to be able to litigate
when there are egregious problems. But I would also like to say
that, in the reauthorization of the IDEA that the administration
proposed last June, which is currently before your committee, we
have placed in the proposal mediation. And it’s our belief, if medi-
ation were required by all the States, that the issue of litigation
would also be substantially reduced.

Mr. PayNE. Thank you. Also, I was just going to ask, what do
you think, with the Clean Water Act, if the Federal Government
got out of it and returned it to the States, where do you see clean
air and clean water going?

Ms. METZENBAUM. Well, I think there’s a track record you can
look at here. For years, we had a voluntary approach with drinking
water. Prior to 1974, public health standards were voluntary, and
we had significant noncompliance. With the passage of the drinking
water law, we have significantly upgraded quality of water for peo-
ple to drink. The same is true with clean water. The States are
asking us to help in negotiating cross-boundary issues. The same
with clean air.

I think that if some of the recommendations in the preliminary
report were passed, not only the Federal Government, but espe-
cially the State and local governments would have significant dif-
ficulties doing what they need to do to provide environmental pro-
tection. They have wanted the Federal role there, and that’s why
we think we need to take a scalpel to fix what’s really broken and
not fix problems that don’t exist, that are just apocryphal.

Mr. PayNE. Just mend it; don’t end it. Right? Thank you.

Mr. Souber. The hearing stands in recess.

[Recess.]

Mr. Davis [presiding]. We are ready for our next panel. Before
us we have the Hon. Vincent F. Callahan; Michael Resnick, the ex-
ecutive director of the National School Boards Association; and
George Balog, chairman of the Urban Forum.

You know it is the policy of this committee to swear in all wit-
nesses. I would ask you to raise your hands.

[Witnesses sworn.]

Mr. Davis. Please be seated. I note for the record that the wit-
nesses answered in the affirmative.

This is a real pleasure.

I’m sorry. Mr. Saunders, do you want to stand up and do this?

(Witness sworn.]

Mr. Davis. Let me start. The first person I will recognize is Vince
Callahan, who is a member of the Appropriations Committee in the
Virginia House of Delegates.

And it’s great, Vince, to see you here.

As you know, I cut my teeth in politics working on Vince Cal-
lahan campaigns in Fairfax County, when I was in high school and
later in college. So he has been like a patron saint to those of us
who have risen through the Republican ranks in Fairfax. We are
very pleased to have you here today.


127

2

The Unfunded Mandates Reform Act was also the catalyst for the new
Cost Estimation Unit of the CBO, which has established networks of state
and local officials and other experts throughout the country to collect data
about the costs of federal mandates. The Virginia ACIR helped identify sixty
such individuals in our state who have agreed to participate in the CBO's
networks and are standing by. Getting accurate data about the costs of
mandates—including long-term costs, opportunity costs, and hidden
costs—is critical for relieving the burdens that mandates impose.

Other signs of progress at the federal level include a new willingness
on the part of Congress to reassess existing mandates. This new attitude
‘was manifested by the recent repeal of two mandates: the 55-mile-an-hour
speed limit; and the recycled crumb rubber requirement in highway
construction.

‘The EPA's new participatory approach to rule-making and proposed
changes to allow more local flexibility in implementing environmental
mandates are also steps in the right direction. And, Congressman Shays,
your proposed Local Empowerment and Flexibility Act promises further
help. The application of the Fair Labor Standards Act to Congressional
personnel is also a significant achievement.

However, mandates still cause concern. An onerous new reporting
requirement was incorporated into HR 3019, the continuing resolution
passed earlier this month. The Unfunded Mandates Reform Act does not
address such conditional mandates, only direct ones. Nor does it apply to
discretionary mandates, to mandates already in existence, or to those
mandates that have been exempted. Though we are optimistic, the full
effect of this new law remains to be seen. The only federal agency that


151

“As a preliminary matter, the Department cannot accept the Commission's assertion
that a voluntary program constitutes a mandate. It is not a mandate because the
only state and local government workplaces covered by OSHA are located in states
where the state legislature has voluntarily agreed to participate."

Indeed, 27 states have not chosen to cover public employees under OSHA,

Other criteria ACIR used in its analysis also argue that OSHA should not even be
included in this discussion of mandates First, the Commission was directed by Congress
to focus on laws that involved substanual expenditures for state and local governments
The ACIR reported no information to suggest that OSHA compliance is a financial burden
for states. In fact, federal grants can fund up to 50 percent of the administrative costs for
those states that choose to cover public sector workers

Moreover, extending OSHA coverage to state and local employees may actually save
money. A recent study by Ruttenberg and Associates found that expanding OSHA coverage
to all public employees would, in fact, save state and local governments as least $600
million annually.

Second, the Commission was instructed to focus on laws that “abridge the historic
powers of state and local government without a clear showing of national need.” ‘The
ational need for safety and health in the workplace was established by Congress when it
passed this law in 1971. Nevertheless, there can be no abridgement of state and local
powers under OSHA because state and local participation is voluntary.

Third, ACIR was to look at laws that “impose requirements that are difficult or
impossible to implement." Other than a few anecdotal accounts, this report offers no
compelling empirical evidence that OSHA standards are difficult or impossible to
administer. It seems likely that they are neither since states could simply choose not to
participate in OSHA rather than struggling with difficult or impossible requirements.

Finally, ACIR was to focus on laws that were the subject of widespread complaints.
‘As with many other recommendations in the report, this seems to have been the governing
criterion. Here again, however, the voluntary nature of OSHA coverage suggests states that
do complain have a simple remedy available to them.

‘The overriding reality is that public employees have dangerous jobs. We are nurses
and public health workers, fire fighters, sanitation workers, corrections officers,
construction workers, hazardous waste technicians and the like. Public employees suffer
3.5 times the number of work-related deaths as private sector workers and 25 percent

National statistics bear this out. According to the National Safety Council, the 1993
national average fatality rate for all industries was 8/100,000 workers while the rate for
government workers was 11/100,000. The rate for manufacturing was only 4/100,000.
Given these statistics, how can anyone argue that public employees should be denied the
workplace protections provided to someone with the same job in the private sector?

Family and Medical Leave Act (FMLA)

Finally, the ACIR has recommended that Congress repeal coverage for state and local
government employees under the Family and Medical Leave Act without cver hearing
workers tell their real-life stories of how their lives would have been destroyed if this law
were not available to them. My comments focus instead on erroneous assumptions ACIR
made in adopting this recommendation in the first place.

4


155

the Asbestos Act put a great deal of burden upon the city of Balti-
More, and other acts.

Mr. SAUNDERS. Let me say this: We see firsthand, our union, the
difficulties, the fiscal difficulties that exist at the State and local
government level, whether it’s through smaller wage increases or
no wage increases, or layoffs, or ways in which we’ve got to look
at controlling health care costs.

We honestly believe that there is a responsibility by the Federal
Government to provide funds for some of these mandates. But
there is also a policy issue, and that policy issue is that regardless
of how these programs are funded, some are very, very important
programs that need to be dealt with. And you can’t lose sight, or
you just can’t review or take a look at what the fiscal implications
are, you’ve got to look at the policy implications also.

Mr. CALLAHAN. Mr. Chairman.

Mr. Davis. Yes. Sure. Vince.

Mr. CALLAHAN. Let me make a comment that might interest you,
coming from Fairfax County, like myself. Some information I have
here: In 1993, a National Association of Counties study of 12 Fed-
eral mandates projected that, between 1994 and 1998, the costs as-
sociated with these mandates, for Fairfax County, would reach
$295 million. This is coming right out of our property taxes.

Mr. Davis. Vince, let me just ask a question, too, looking at it
from the State legislative level. Many times the States have given
unfunded mandates to counties and cities. What are doing at the
State level? For example, in Virginia, I know there has been an ef-
fort to try to recognize that and to cut back on the mandates com-
ing from the Commonwealth.

Mr. CALLAHAN. There’s been a concerted effort, I'd say in the
past half dozen years, to address this problem, mainly because of
the complaints we get. But I always say, there is a significant dif-
ference between a State mandating something to a Jocality and the
Federal Government mandating something to a State. Localities
are creatures of State government. The Federal Government is a
creature of State government also, and not the other way around.

With that said, we are identifying, as a matter of public policy
and law now, the costs associated with mandates going to localities,
and this is all being coordinated. Anytime we have any type of leg-
islation that would affect the pocketbooks of localities, we have to
have a fiscal impact statement along with it. This doesn’t mean
we're not going to unfunded mandates. It’s still going on, unfortu-
nately, but not to the extent we used to do it.

Mr. Davis. Well, it’s good to see that in the Virginia House of
Delegates, which is the longest running democratically elected in-
stitution in the free world—1619?

Mr. CALLAHAN. July 29, 1619, to be exact.

Mr. Davis. There we go. The House of Burgesses came into
being. Thank you.

I am going to now recognize the ranking Democratic member of
the subcommittee, Mr. Towns.

Mr. Towns. Thank you very much.

Let me begin by saying that I understood what you were saying,
Mr. Callahan, but there’s also another side to it, that when you get
involved in mandates and you pass them down to States, States


CONTENTS

Hearing held on March 22, 1996 ..
Statement of:

Callahan, Hon. Vincent F., Jr., member, Virginia House of Delegates;
Michael A. Resnick, senior associate executive director, National School
Boards Association; George G. Balog, chairman, Urban Forum, Amer-
ican Public Works Association; and Lee Saunders, assistant’ to the
president, American Federation of State, County, and Municipal Em-
ployees ..

Katzen, Sally, Administrator, Office of Information and Regulatory Af
fairs, Office of Management and Budget; Shelley H. Metzenbaum, Asso-
ciate Administrator, Office of Regional Operations and State/Local Re-
lations, Environmental, Protection Agency; Bernard E. Anderson, As.
sistant Secretary for Employment Standards, Department of Labor,
and Jamienne 8. Studley, Deputy General Counsel, Department of
Education, accompanied by Judith Heumann, Assistant Secretary for
Special Education and Rehabilitative Services

Talent, Hon. James M., a Representative in
of Missouri; and Hon. Rob Portman, a Representative in Congress
from the State of Ohio ve

Letters, statements, etc., subm: 8:

‘Anderson, Bernard’'E., Assistant Secretary for Employment Standards,
Department of Labor, prepared statement of ..

Balog, George G., chairman, Urban Forum, American Public
ciation, prepared statement of .

Callahan, Hon. Vincent F., Jr., member, Virginia House of Delegates,
prepared statement o!

Clinger, Hon. William F., Jr. a Representative in Congress from th
State of Pennsylvania, prepared statement of ..... a

Green, Hon. Gene, a Representative in Congress from the State of Texas,
prepared statement of ..

Katzen, Sally, Administrator, Office of Information and Regulatory Af
fairs, Office of Management and Budget, prepared statement of

Metzenbaum, Shelley H., Associate Administrator, Office of Regional Op-
erations and State/Local Relations, Environmental Protection Agency,
prepared statement of ..

Morella, Constance A., a Representative in Congress from the
Maryland, prepared statement of

Payne, Hon. Donald M., a Represe
of New Jersey, prepared statement of

Portman, Hon. Rob, a Representative
Ohio, prepared statement of ..

Resnick, Michael A., senior associa
Boards Association, prepared statement of . Co

Saunders, Lee, assistant to the president, American Federation of State,
County, and Municipal Employees, prepared statement of .. .

Shays, Hon, Christopher, a Representative in Congress from the State
of Connecticut, prepared statement of .. "

Studley, Jamienne S., Deputy General Counsel, Department of Education,
prepared statement of ... ae

e

(mm)

Page
1

123

40
20

87
141
126

161
43

70
1
36
27
132
149

101


145

dollars. Providing federal funds to achieve national goals was an acceptable trade-off for
states and local governments at that time.

‘However, as the federal budget crisis has worsened, the funds flowing to local
governments have decreased, but the number of problems Congress is trying to resolve
have not. As Congress and the federal government work to provide leadership on a host
of important national issues without the federal dollars to back it up, someone ends up
paying the price. And while in many cases local governments support the purpose of the
legislation, by the time the rules reach us, we are forced to respond to the rules, rather
than the problem. As a result, local governments must divert their limited resources to
areas which may satisfy the rules, but may not provide the best and most efficient way to
solve the problem.

In summary, we as Public Works professionals ask for the opportunity to help shape the
way in which states and local governments comply with federal mandates. We can bring
to the table the expertise and the experience to get the job done. We know first hand the
problems we will face, and we think we can offer some innovative solutions. We are
asking for the opportunity to work cooperatively at all government levels so that we may
achieve the best solutions possible for our citizens.

Thank you for the opportunity to present our views today and I would be happy to answer
any questions. J also offer the resources of my agency and my colleagues throughout the
Country to help the Subcommittee seek reasonable solutions to the issues raised here
today.


106

administrators, representing the widest possible spectrum of
views.

The Department has not created a special new process for inter-
governmental consultation, because existing outreach has proven
effective and satisfies Title II.

With respect to small governments, the Department supplements the
regular notice and comment regulatory process with special
efforts to advise them of potential requirements and to solicit
their recommendations. We do this through meetings across the
nation, visits to grantees, technical assistance, and other forms
of outreach. In particular, the Department’s Office of
Intergovernmental and Interagency Affairs works with small
governments through regular meetings with such organizations as
the National School Boards Association, the National Association
of Counties, and the National Association of Towns and Townships.

Improving the ACIR Draft Report

Mr. Chairman, we were very disappointed by the ACIR’s draft
report for reasons you have already heard discussed, and in
particular with its treatment of IDEA. 1 will summarize briefly
the principal causes of our concern.

(1) It was inappropriate to include IDEA in the draft report
because it enforces the Constitutional rights of individuals with
disabilities through the establishment of statutory rights that
bar discrimination against such individuals. The Unfunded
Mandates Act itself recognizes that such rights are to be given a
preferred status. Through IDEA, millions of students with
disabilities have been helped to become fully participating
members of our society; before IDEA, approximately one million
children with disabilities were totally excluded from the public

6


66

4

The ACIR report acknowledges that several of the concems with the OSH Act rest on _
misperceptions or a lack of information. For example, the report notes that even in some
states that have not volunteered to participate in the Federal Occupational and Safety
Administration’s program, there is a belief that OSH Act requirements are mandatory. It is
difficult to imagine how this makes the case for repeal of the Act. Similarly, the report
charges that the credibility of safety and health programs under the Act is seriously
compromised by the “perceived” rigidity, complexity and burdensomeness of the
regulations, and a focus on punishment rather than compliance assistance. On the
contrary, in recognition of the unique characteristics of public employers, OSHA has
encouraged flexibility in State plans by 1) encouraging states to develop alternate standards
that provide equivalent protection when circumstances differ from the private sector; 2)
allowing States to use administrative actions instead of monetary penalties to compel
compliance; 3) permitting agency self-inspection under certain conditions. In addition,
OSHA provides a great deal of assistance to states that volunteer to participate, and
contrary to the ACIR report, punishment is not a focal point of enforcement, since OSHA
has no jurisdiction over public workplaces. In fact, an atmosphere of cooperation pervades
the Federal/State relationship under the OSH Act, as typified by a Memorandum of

Understanding between OSHA and various stzte regulators to address areas of mutual
interest.

Finally, the report suggests that Federal agencies are free from meeting OSH Act
requirements, and state and Jocal governments should have the same options. Once again,
this premise is incorrect. All Federal agencies must comply with OSHA standards, as the
recent debate on extending OSI4 Act protections to Congressional employees recognized.

Davis- Bacon Related Acts (DBRA)

The report recommends an exemption for projects below one million dollars ot for which
the Federal grant or other assistance is less than 50 percent of total funding.

‘The Federal government spends substantial funds to assist state and local governments with

local public construction projects through grants and other financial assistance. DBRA
prevailing wage requirements, attached to this assistance, ensure that the Federal
governments’s vast purchasing power does not depress local wage levels or disrupt local
economies. However, DOL cannot accept the view of the Commission that DBRA
fequirements impose an unfunded Intergovemmental mandate. The provisions apply by
virtue of voluntary participation in these Federal assistance programs.

‘The ACIR report suggests that the DBRA automatically increase public construction costs
because certain low-wage construction contractors may pay lower than prevailing wages.
‘This flawed reasoning ignores any comparative differences in productivity from different
wage levels and work experience, and that fact that the shoddy construction practices that
‘aften accompany substandard wages almost inevitably result in increased repair and


52

1 am also concemed about the process for seeking public comment on the staff draft. 1
urge you to ensure full public participation in the Commission's deliberations. I understand
the ACIR is sponsoring & March 6-7 Conference on Federal mandates and Is charging an
adiaission fcc. In my opinion, charging a fee in this context is inappropriate since it creates

4 barrier to full public partciparian. I strongly endorse an accessible public mecting to seek
comment on ACIR's activities.

‘As you know, the Clinton Administration has worked hard to strengthen the
intergovemmental parmership and to address state and local government concerns about
unfunded mandares. The President signed Executive Order 12875 during his first year in
office to ensure that new regulations do not place undue burdens on states and communities.
In March of 1995, ke mgned the Unfunded Mandates Reform Act In addition, the
Administration has proposed or supported modifying a number of Federal lows to ease the
public sector's compliance burden. Further, in implementing Federal laws, the
Administration bas sought to provide state ard local governments with enhanced technical

assistance and to help them take full advuntage of the flexibility that already exists in many
Federal statutes.

‘T have additional serious concems about many of the draft report's recommendations
not mentioned in this lees. Attached are comments prepared by Federal agencies and
departments on the draft report. Federal agencies will also be forwarding comments to you

and the Commission directly, 1 urge you to give their comments full consideration as the
Commission redrafts the report

Sincerely,

Marcia Hale
Assistant to the President and Director for
Intergovernmental Affai

Attachments:

cc:


173

local governments routinely argue that the Federal Government has imposed
at an accelerating rate expensive federal requirements on state and municipal
governments without appropriating sufficient funds for implementation,
thereby diverting their limited fiscal and administrative resources and
interfering with their ability to respond to their own constituents’ concerns.
This opposition captured the attention of the United States Congress which
passed the Unfunded Mandates Reform Act of 1995, Public Law No. 104-4,
109 Stat. 48, early last year.

Section 101(a) of the Act, which adds Section 425(a) to the
Congressional Budget and Impoundment Control Act of 1974, 2 U.S.C. §
658d, establishes a point-of-order rule of legislative procedure that provides
“jt shall not be in order in the Senate (of) the House of Representatives to
consider... Any bill, joint resolution, amendment, motion, or conference
report that would increase the direct costs of Federal intergovernmental
mandates” in an amount equaling or exceeding $50 million per year, unless
the bill embraces one or more of several specified mechanisms to ensure that

Congress either (a) appropriates sufficient funds to pay the state, local, or


101

STATEMENT OF JAMIENNE S. STUDLEY
DEPUTY GENERAL COUNSEL FOR REGULATIONS AND LEGISLATION
U.S. DEPARTMENT OF EDUCATION

BEFORE THE
SUBCOMMITTEE ON HUMAN RESOURCES AND INTERGOVERNMENTAL RELATIONS
COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT
UNITED STATES HOUSE OF REPRESENTATIVES

MARCH 22, 1996

Mr. Chairman and Members of the Subcommittee:

Thank you for the opportunity to highlight the Department of
Education's extensive state-local-federal partnerships and
consultation, and to comment on the ACIR staff draft report. I
am honored to introduce our distinguished Assistant Secretary for
Special Education and Rehabilitative Services, Judith Heumann.

Enhancing the Nation’s Education Partnership

American education has always been a partnership. State, local,
and tribal governments and community school boards are
responsible for almost all education decisionmaking and funding.
The federal government provides leadership, seed money for
innovation and coordination, and critical funding for national
priorities, including education of disadvantaged and disabled
children, job training, teacher training, technology, and access
to higher education. The federal government provides assistance
and leadership; it does not “regulate” the nation's educational
system.

Guided by three dedicated education leaders and former governors,
President Clinton, Secretary Riley, and Deputy Secretary Kunin,
our commitment to genuine partnership with state and local
governments is stronger than ever. And thanks to innovative


26

this act was the important first step, but I now look forward to con-
tinuing to work with the committee and this subcommittee to make
good on our commitment, Mr. Chairman, to State and local govern-
ments.

Thank you for having me.

[The prepared statement of Hon. Rob Portman follows:]


22

Mr. SHays. Thank you very much for coming. Mr. Portman.

Mr. Payne. I do have a quick question.

Mr. Suays. That’s fine. Definitely. Mr. Payne, let me first wel-
come you to this committee. I understand you are, obviously, a
Member of Congress, and a very distinguished one, also on ACIR.
Also, I welcome Mr. Chrysler and Mr. Davis, as well.

Mr. Payne. I just have a quick question. I am a member of the
ACIR, and I do have some concerns about the procedural issues
surrounding the report. For example, there was not a quorum
present when this report was approved. It has been said that ACIR
members were not sure what it was they were voting on, the actual
recommendations or the publishing of some ideas in the Federal
Register for comment, and that ACIR had not released the actual
votes of the commission.

In other words, how official was the meeting where this report
was finalized?

Mr. TALENT. Well, Mr. Portman may want to address that.

Mr. Towns. Will the gentleman yield?

Mr. Payne. Yes.

Mr. Towns. We are not dismissing the panel; Mr. Talent is just
leaving. Mr. Portman has not testified, and Mr. Condit has not tes-
tified. So maybe we could just hold it.

Mr. SHays. With all due respect to both, neither, at the time,
were on—Mr. Talent was not on the committee, and Mr. Portman,
after 6 months trying to get on, finally got on after they put the
report through.

Mr. TALENT. I will say this, Mr. Chairman.

Mr. Suays. Is this out of knowledge or with knowledge?

Mr. TALENT. Well, just from the context of the people we’ve been
talking to who are trying to build homes and take care of kids and
get jobs in the neighborhoods, this is a problem, and they need to
have something done about it. We have to observe the process and
make sure everybody gets a hearing, but I’m just very glad you’re
moving forward with it, because we have a very practical problem
that everybody recognizes, and we need to hammer out everybody’s
problems, which are all legitimate, and then move forward.

I thank you for the opportunity.

Mr. SHAYS. I thank you.

Mr. Payne, we’re going to have to get an answer to some very
important questions, Your question is extremely important, and
this committee, during the course of the day, will get an answer
on that question.

Mr. Portman, you have the burden of being bipartisan, holding
up Mr. Condit, who evidently is at the White House on a budget
meeting. So we welcome your testimony and appreciate very much
your work. You are one of the fathers of this legislation, working
on a bipartisan basis, and it’s it to have you here.

Mr. PorRTMAN. Thank you, Mr. Chairman. I am happy to take on
that burden, although I do think Mr. Condit is on his way.

I want to thank you for holding this hearing and say it’s great
to be back in my subcommittee room. This was the first sub-
committee on which I served in the U.S. Congress, and this sub-
committee and this room really was the genesis of the Unfunded
Mandates Reform Act of 1995. I am pleased to be now serving with


105

The partnerships 1 have been describing depend on early, open,
and extensive communication among partners. To that end, Title
II of the Act requires agencies to develop effective processes to
ensure that State, local, and tribal government officials can
provide meaningful and timely input on significant Federal
intergovernmental mandates, as well as to educate and provide
notice to small governments regarding regulatory requirements
that significantly or uniquely affect them.

I am proud to say that the Department has an impressive record of
successfully communicating and sharing the development of policy
with affected persons, organizations, institutions, and
government s--including school systems--regarding the full range
of the Department's endeavors. We work with our partners to
develop and get comment on legislative proposals, regulatory
reforms, research priorities, program administration, non-
regulatory guidance, and technical assistance.

For example, the Department recently convened more than a
dozen workshops across the country with tribal
representatives and others to discuss programs, and their
regulations, under the Elementary and Secondary Education
Act of 1965 that affect American Indians.

The Department regularly convenes and attends meetings all
over the country for student financial aid administrators,
many of whom are State officials, to solicit suggestions for
reducing burden while increasing accountability. In fact,
these discussions have led to a series of recent regulatory

reinventions.

Most relevant to today’s topic, in developing the

Administration proposal to reform and reauthorize the
Individuals With Disabilities Education Act (IDEA), we
consulted with more than 3,000 parents, educators, and

5


162

The Act also required the Advisory Commission
on Intergovernmental Relations (ACIR) to study issues
involving the calculation of costs and benefits related to
unfunded mandates; conduct a study of the impact of
existing mandates on intergovernmental relations; and
monitor and evaluate the implementation of the Act.

The report that is before us this morning does not
fulfill the bill’s requirements. Instead of providing an
even handed discussion of costs and benefits of local
mandates, the ACIR published a one-sided, partisan
attack on laws which lie at the core of worker
protection and workplace fairness: the Fair Labor
Standards Act, the Individuals With Disabilities
Education Act, the Occupational Health and Safety Act

and the Davis-Bacon Act.


165

If the Federal Government provided $20 billion a year to education,
it was high year.

So there is no comparison between what our Government spends
to so-called “provide for the common defense,” and how little it does
spend to “promote the general welfare,” in particular, in the whole
area of education. So having said that, though, the reality is that
there will not, certainly, be more Federal Government dollars com-
ing from Washington down to States and counties and localities.

But because the funds are not there, I cannot justify that States
can be recused from providing adequate education to children. So
I just wonder how can then an individual be guaranteed the 14th
amendment, equal protection under the law? I mean, you are pro-
tected. if you have a handicap or not have a handicap, you are sup-
posed to be treated the same. How do you justify it? What will hap-
pen then to youngsters who need some special help?

Mr. RESNICK. That’s a very good question, Mr. Payne. Clearly, as
you point out, there is a constitutional right that is guaranteed to
children with disabilities to have an appropriate education. That’s
to be distinguished, though, from the process for how to ensure
that that right is appropriately implemented.

When the special ed laws were enacted 20 years ago, it was done
prospectively, not necessarily being able to know exactly how it
would play out. Since then a whole field of expertise has developed
around special education. There are personnel in school systems
who are deeply committed to special education regardless of the
Federal protection. School board members, like others in the com-
munity, very frequently are parents of children in special edu-
cation.

We have had a whole body of case law that has interpreted the
original mandate. Quite frankly, we believe the time has really
come to take a look at the direction that that has taken. For exam-
ple, we face onerous lawyering fees, in a process that is not even
available in other areas of civil rights protection, that simply do not
result in fair play, in terms of bringing an issue to due process as
much as provide a vehicle for attorneys to collect fees against
school systems.

We find that it’s very typical for a due process hearing to cost
$10,000. That’s twice the cost of educating a child or the cost of
educating two children for an entire year in regular education. We
have proposed to the Congress that there are alternatives to the li-
tigious process that we have, that we think will be better, in sub-
stantive terms, for the education of children, and less expensive, in
terms of legal cost to the school system and to the taxpayer.

There are a variety of provisions in this legislation that we've
recommended to the Congress, that’s now going through the reau-
thorization process, that begin to get at those kinds of issues.

I think what’s really important in looking at special education is
that we have 5.8 million children who are in special education. So
if you have a general regulation that will result in one man-hour
of time, that applies to all of those children, in terms of administra-
tion, that’s $200 million for school systems.

And the question I think really to be put is, what are the real
priorities and needs inside of this program, in order to guarantee
that there’s a free, appropriate, public education to all children. It’s


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169

ADVISORY COMMISSION
ON INTERGOVERNMENTAL RELATIONS

March 26, 1996

‘The Honorable Christopher Shays, Chairman

Subcommittee on Human Resources and Intergovernmental Relations
‘Committee on Government Reform and Oversight

United States House of Representatives

B-372 Raybum House Office Building

‘Washington, DC 20515

Dear Representative Shays:

Since the Advisory Commission on Intergovernmental Relations released a
Preliminary Report titled The Role of Federal Mandates in
Imergovernmental Relations, there has been a great deal of
misunderstanding of the process that the Commission went through in the
preparation and adoption of this report, as well as on what this report
represents. I would like to clarify for Members of the Committee the
following points.

Development and Adoption of Preliminary Report. Following enactment
of the Unfunded Mandates Reform Act of 1995 in March 1995, four
meetings of the Commission were held in Washington, DC during 1995.
‘Over the course of those meetings, an extensive workplan was adopted,
criteria were adopted for selecting mandates to be studied and evaluating
those mandates, specific mandates to be examined closely were chosen, and
‘optional recommendations for consideration by the Commission were
discussed. A draft Preliminary Report was circulated to the Commission
for review and action prior to the December 19, 1995 meeting. At the
December 19 meeting, Commission members present requested a series of
changes in the draft. However, because a quorum of the Commission was
not present, a decision was made to ballot Members of the Commission on
the draft as amended by those Members who were present at the meeting.
Following the meeting, a revised draft Preliminary Report was sent to each
‘Commission member with a ballot requesting a vote to approve or
disapprove issuance of the revised Preliminary Report for public review
and comment. By a vote of 15 to 3 with 7 Members not voting (there was
‘one vacancy at the time), the issuance of the Preliminary Report was
approved for public review and comment.


34

to continue to improve, in terms of the understanding of the legis-
lation, because I think that the meat is actually there. So I look
forward to working with you.

Mr. Fatrau. Mr. Chairman.

Mr. Suays. Yes. Mr. Fattah.

Mr. FaTTau. Just to clarify the record.

Mr. Suays. Sure.

Mr. FaTTau. And I understand. I think we’re headed in a slightly
different direction. But in the hearing memorandum for today’s
hearing, which emanated from the majority, it indicated that we
were going to be looking at this report, and particularly examin-
ing—on page 2 of that memo—what the impact of the findings and
recommendations were of this report. So that’s why my question
was about the report.

Mr. SHAys. Very valid.

Mr. Fatrau. At this point, I don’t see anyone on the schedule.

Mr. SHays. Let me just say that panel three will focus more on
that issue, but we don’t have a specific representative from ACIR
on it.

Mr. Fatrau. And I appreciate that. I just didn’t want to be mis-
understood. There’s page after page of this memorandum about
this hearing that says that we’re going to be dealing with this re-

port.

Mr. SHays. Very valid. Very valid. Mr. Fattah, that’s a very valid
point.

Mr. Fatrau. Thank you.

Mr. SHays. And the mistake is mine. But I just want, first, to
acknowledge, one, that the memorandum did say that; and, second,
to say that we will have ample opportunity to go through that re-
port in depth once it is finalized.

Mr. FaTTAuH. I didn’t want my question to seem out of context.

Mr. SuHays. It was definitely in context.

Mr. Fartau. I was following the written words of the chairman.

Mr. SHays. OK. Well said.

Mr. Towns. And we also knew you were on ACIR.

Mr. Suays. For 2 weeks.

I do need to say we have got to get moving with our next panel
here, and I apologize to the panels that have been waiting.

I would like to come to the front desk our second panel—and re-
main standing because we will be swearing you in—Sally Katzen,
Administrator, Office of Information and Regulatory Affairs, Office
of Management and Budget; Shelley Metzenbaum, Associate Ad-
ministrator, Office of Regional Operations and State and Local Re-
lations, Environmental Protection Agency; Bernard Anderson, As-
sistant Secretary, Employment Standards, Department of Labor;
and Jamienne Studley, Deputy General Counsel, Department of
Education.

I welcome all of you there. If you would raise your right hands.

{Witnesses sworn.]

Mr. Suays. For the record, all four have acknowledged in the af-
firmative.

Mr. Payne. Mr. Chairman.

Mr. Suays. Yes, sir.


15

(3) make recommendations to the President and the
Congress regarding--

(A) allowing flexibility for State, local, and
tribal govemments in complying with specific
Federal mandates for which terms of compliance are
unnecessarily rigid or complex;

(B) reconciling any 2 or more Federal mandates
which impose contradictory or inconsistent require-
ments;

(C) terminating Federal mandates which are
duplicative, obsolete, or lacking in practical utility;

(D) suspending, on a temporary basis, Federal
mandates which are not vital to public health and
safety and which compound the fiscal difficulties of
State, local, and wibal governments, including
recommendations for triggering such suspension;

(E) consolidating or simplifying Federal man-
dates, or the planning or reporting requirements of
such mandates, in order to reduce duplication and
facilitate compliance by State, local, and tribal
governments with those mandates;

(F) establishing common Federal definitions or
standards to be used by State, local, and tribal
governments in complying with Federal mandates
that use different definitions or standards for the
same terms or principles; and


115

in applying the various regulations and the standards that OSHA
is responsible for.

Mr. Towns. Thank you very much.

Mr. Chairman, I see the red light is on. I yield back.

Thank you very much, all of you, for your testimony.

Mr. Suays. The gentleman can have more time, if you want. Are
you all set?

Mr. Towns. No. I’m OK.

Mr. Suays. OK. Thank you.

Let me just try to understand. First off, it wouldn’t be the policy
of this committee and certainly not this chairman, in the first year
of an implementation of anything as dramatic as this, to throw
stones at either the administration or, in fact, Congress, on how we
implement it, and even, candidly, ACIR, until we kind of sort it
through.

I make the assumption that all of us are trying to make this sys-
tem work. I mean, I take the President at his word that he was
eager and proud to sign this legislation. What troubles me, and you
can help sort it out, is that, in 3,000-plus regulations, there were
only 16 that seemed to trigger that $100 million threshold. Maybe
you could give me a sense—and I will throw this out, and I can
hear poth, particularly Department of Education and Department
of or.

No regulation triggered that $100-million threshold. EPA had
nine. My understanding is that 9 of the 16 were EPA, Department
of Transportation was 3, HHS was 3. I was surprised, at HHS,
there were only three. And one was DOE, Department of Energy,
not Department of Education.

So my question is, help me understand how it turned out to only
be 16? And then, if the two officials from those departments had
none, if you would tell me which regulations came close that didn’t
quite meet the standard?

Ms. KaTzEN. Mr. Chairman, the number of regulations that are
issued are often misleading by a long shot, because it covers a
whole host of things, from setting the course for the America’s Cup,
to Med fly quarantines of the peach crop in California, to changing
the locks on the St. Lawrence Seaway. So 3,000 proposed and final
regulations, most of them are either routine, administrative, or
whatever.

We have found that roughly—in 1994, I think shy of 200 regula-
tions hit the threshold for our Executive order review, which de-
fines a significant regulation as a regulation that has an economic
effect of $100 million or more, or a serious on-budget effect.
bi Mr. Suays. Is that related to an Executive order or the mandate

Lf

Ms. KaTzEN. No, that’s related to our Executive Order 12866.

Mr. Suays. Which it parallels?

Ms. KaTzEN. Which is not quite parallel, and that’s the reason
for the difference. We define a significant regulation as something
posing a novel legal issue—it may not have any dollar impact—as
being inconsistent. If EPA and OSHA are both promulgating a reg-
ulation dealing with asbestos, even if neither one comes close to
$100 million, they will nonetheless be reviewed by my office, be-


136

advocates the repeal of this outdated federal mandate so that scarce taxpayer

dollars can be used to repair or upgrade 20 percent more school facilities.
B, Occupational Safety and Health Act (OSHA)

NSBA opposes any effort to extend OSHA coverage to federal, state, and local
public employees. Earlier this month, this unfunded federal mandate was added
in the Senate Labor and Human Resources Committee mark-up of the OSHA.
reform act; and this amendment will be the first real test of the Unfunded
‘Mandates Reform Act when the bill reaches the Senate floor. In 1992, the Texas
Association of School Boards estimated that it would cost more than $10 million
to implement only selected OSHA regulations in Texas public school districts.
This is just one state’s estimate of the onerous cost burdens this unnecessary and
duplicative federal mandate would impose. Few argue that OSHA coverage
would improve the safety in schools, while creating a duplicative structure.

C. Environmental Mandates

NSBA has advocated the use of risk assessment and cost-benefit analysis before
environmental mandates are enacted. These processes would help ensure that

any federally mandated abatement of an environmental hazard is necessary and
cost-effective. Yet there has been great resistance to this approach, in part, we

believe, because the federal government does net bear an adequate share of the
financial responsibility.

Asbestos abatement, which has cost the country’s schools at least $10 billion, is

‘one example where accurate risk assessment can produce substantial savings.

Federal laws governing asbestos removal treat harmless asbestos the same as

dangerous asbestos. Scientists now recognize the harmless variety as accounting
“5.


17

government objectives and responsibilities, and their impact on the
competitive balance between State, local, and tribal governments, and the
private sector and consider views of and the impact on working men and
women on those same matters.” However, the Commission's authority to
make recommendations to the President and the Congress is expressly
limited to the areas set forth in Section 302(a)(3) of the Act.

Thus, Section 302(a)(3)(C) of the Act only authorizes the Commission
to recommend to the President and the Congress termination of “Federal
mandates which are duplicative, obsolete, or lacking in practical utility.”

THE COMMISSION HAS EXCEEDED ITS MANDATE.

The Fair Labor Standards Act, the Family and
Medical Leave Act, and the Occupational Safety and Health Act

Notwithstanding this narrow authorization, the Commission's
Preliminary Report recommends repeal of the provisions of the Fair Labor
Standards Act, the Family and Medical Leave Act, and the Occupational
Safety and Health Act that extend their respective requirements to state
and local governments, not because it found that such requirements are

“duplicative, obsolete, or lacking in practical utility,” but rather because the

-6-


58

rights of citizens with disabilities on the availability
Federal grants to stato and local governments.

The ADA is emphatically not ‘one size fits all" legiclsrion.
ke noted above, the ADA =equlations provide considerable
flexibility te'srate and local governmerts in determining how to
best inploment the law. Rather then imposing infiexipie
substantive requixemente, the title IZ regulation requires state
and local governments to conduct a self-evaluation (to identity
Problems and facilitate the process of establishing coupliaace
goals) and to develop a transition plan chat evtablishes @
Schedule for attaining these goate. Svery item in the transition
pian, including its completion datw, is subject to the caveat
that it ds not required if dt constitutes a fundamental
Qlteration or results in an undue burden. ‘Therefore, the
compliance deadlines ere inherertly flexible. in addition, the
Department of Justice is now proposing to amend the title IT

re

gziation to clarify the compliance deadlines applicable to the
ingteilatien ef curb zempe.

Thaan raquixemanta ampower anata and lena’ govarnmente and

make it posrible for each community to eraate a plan and a

echedule for reaching the gosle of the ALA that take into account
¢ needs of that conmunity and the resources svaiiable

4) ACIR Recommendation: A single Federal enforcenen!

t and
aceistance agency should be designated to coordinate enforcement
and teaknice] assistance.

This racosmencation is apparently based on the mispliced
concer thst Federal enforcement of the ADA is uncoordina‘.ed and
divided ameng too many departments and agencies of the
govarnrent. The development and implenentation of tho AvA
enforcement policies appaicable te most unite of state and local
goversment ig, in fact, limited to two Federal agencies: the
Equal Employment Cpportunity Commizsion (EEOC), which is
responsible fez impicmenting the ADA’s prohibition on employment
discrimination, and the Depsrtment of Justice, which ic alraacy
responsible fer coordinating the implementation and cnforcement
of ali title IZ requirements exeept for the roquiremsnts that
appiy only to public traneportatzon providers, wnich fall within
the juriediction of the Department of Transportation. ADA
lawsuits tiled by the Federal governnant thar involve state or
Tocal governments will be filed only by the Department of
Justice.

The preliminary revort correctly notes that eight Federal
acencics have been assigned an enforcement role under title II of
the ADA. Mcwever, the report fails to note that the enforcement
cuthority of Ehese agencies under title I is limiead to the
ability to invastigete complaints of discrimination and to

“1.


112

Mr. Suays. I thank you. That’s one of the primary benefits of a
preliminary report is that it allows people to comment.

Before we have a vote, I would like to give our chairman of the
full committee an opportunity to question the panel; also, our rank-
ing member. With that, Mr. Chairman.

Mr. CLINGER. Thank you very much, Mr. Chairman.

I thank all of our panelists for very good testimony. I think it has
been very helpful to us on this first anniversary of the passage of
this landmark piece of legislation.

Ms. Katzen, you indicated that because of furloughs and so
forth—and I can certainly appreciate that—that there was some
delay in getting the thing off the ground. Given the fairly brief pe-
riod now that we've had the act in place, how would you assess
agencies’ compliance with the requirement that they submit to you
their plans and proposals? Is there uniformity in that? Do you find
that some are more willing to be cooperative and others are
dragged kicking and screaming to comply with the provisions, or
have you found it to be pretty uniform?

Ms. KaTZEN. I think it’s quite varied, but not because of a reti-
cence or hostility on the part of any agencies. I think it’s really be-
cause of their different mandates and their different missions. And
I would break it into two parts.

There are the consultative plans that they were supposed to set
up, and we had set much of that in motion with Executive Order
12875. And there it really depends on how many regulations are
issued. Some of the departments were quite skeletal, but they also
never issue regulations that have an intergovernmental impact,
like the Department of Defense or Department of State. Some of
the others are quite detailed and elaborate.

On the analysis part, again, it will be more of a function of the
expertise within the departments and the agencies and the amount
of work they have done. DOT and EPA are among the strongest
agencies in doing the kind of analysis that we are looking for, in
terms of costs and benefits. Some of theirs are more susceptible to
quantification, but then there are a whole variety that are not.

Some of the other agencies are less experienced. Last year—or I
guess it was the last Congress—created an Office of Risk Assess-
ment at the Department of Agriculture, in part because there was
not the same level of expertise. That is dramatically changing, and
we are beginning to see, in many instances, substantially improved
analyses.

Whether it’s a function of our own Executive Order 12866 on reg-
ulation, generally, or the Unfunded Mandates Act, specifically, or
the two operating in conjunction, I’m gratified that we are seeing,
I think, a substantial improvement in the work the agencies are
doing.

Mr. CLINGER. OK. The mandates law requires agencies to select
the “least costly, least burdensome, or most cost-effective alter-
native in the rulemaking process, unless it would be,” and the law
says, “inconsistent with law.” With regard to a number of rules ad-
dressed in your report, this “inconsistent with law” exemption was
invoked, and a more costly rule was promulgated because of the in-
voking of the “inconsistent with law” exception.


16

issuance of the President’s Executive Order on Regulatory Planning and Review, EPA revised
the Agency's internal process for development of regulations in June 1994. A primary goal of the
new process is to ensure adequate participation by key stakeholders in the rule development
process, with special emphasis given to involving the state, local, and tribal governments that will
ultimately be responsible for implementing the rules. Guidance materials and training courses for
EPA rule-writers include sections on educating and involving officials from other levels of
government in the development process. EPA has stepped up efforts to disseminate regulatory
information to state, local, and tribal officials and is workmg to ensure that we communicate
requirements in language that is understandable to those who are responsible for implementation
The Agency is also working with its various advisory committees as well associations of state,
local, and tribal officials to develop the networks and mechanisms needed to foster more effective

involvement.

Consult Mandates Reform Act ~~
During 1995, the Agency published only four proposed or final rules that fell under the
written statement requirements of Title II of the Unfunded Mandates Reform Act -- that is, rules
“Which may result in the expenditure by state, local, and tribal governments, in the aggregate, or
by the private sector, of $100 million or more in any one year." For each of these rules, EPA
engaged in extensive intergovernmental consultation:
-- Acid Rain Program: NOx Emission Reduction (Direct Final Rule);
-- New Source Performance Standards and Emission Guidelines: Municipal Waste
Combusters (Final Rule);
-- Effluent Guidelines, Pretreatment Standards, and New Source Performance Standards
Metal Products and Metal Machinery (Proposed Rule); and
-- Federal Standards and NESHAPS for Marine Tank Vessel Loading Operations (Final
Rule),
In ll these instances, the Agency made use of a range of consultation mechanisms in obtaining
input on rulemakings from state, local and tribal governments. As required by Section 203 of
Title II, the Agency has also developed an interim Small Government Agency Plan to supplement


28

THE UNFUNDED MANDATES LAW. IN ITS FIRST THREE TEST CASES -- THE
TELECO BILL, THE FARM BILL AND THE IMMIGRATION BILL -- THE LAW
PASSED THE TEST. LET ME ELABORATE.

A NUMBER OF PROVISIONS IN THE COMMUNICATIONS ACT CONFERENCE
REPORT INTERFERED WITH THE ABILITY OF LOCAL GOVERNMENTS TO
CONTROL WHAT HAVE BEEN HISTORICALLY LOCALLY CONTROLLED PUBLIC
RIGHTS OF WAY. LANGUAGE IN THE ORIGINAL CONFERENCE REPORT, FOR
EXAMPLE, ARGUABLY PRECLUDED THE ABILITY OF LOCAL JURISDICTIONS TO
CONTROL THE USE OF PUBLIC PROPERTY BY CABLE COMPANIES AND RECEIVE
APPROPRIATE COMPENSATION EVEN THOUGH THE INTENDED USE EXCEEDED
THE TERMS OF THE ORIGINAL FRANCHISE AGREEMENT.

WE WERE PREPARED TO RAISE THE MANDATES POINT OF ORDER ON THE
HOUSE FLOOR AND TO GARNER THE NECESSARY SUPPORT AGAINST THESE
PUBLIC SECTOR MANDATES, WITH THE LEVERAGE THAT THE UNFUNDED
MANDATES LAW GAVE US, WE WERE ABLE TO WORK WITH THE COMMERCE
COMMITTEE AND LEADERSHIP SO THAT THESE MANDATES WERE REMOVED
BEFORE THE BILL REACHED THE FLOOR. THIS IS EXACTLY HOW WE HOPE
THE LAW WILL BE CARRIED OUT IN THE FUTURE -- THAT COMMITTEES WILL
WORK COOPERATIVELY WITH STATE AND LOCAL GOVERNMENTS AND
PROPONENTS OF MANDATE REFORM AHEAD OF TIME TO ADDRESS MANDATE
ISSUES.

LET ME SAY THAT ALTHOUGH THERE WAS NO OBLIGATION TECHNICALLY
TO GET A CBO ESTIMATE ON THE CONFERENCE REPORT, THERE IS
HORTATORY LANGUAGE IN THE BILL THAT EXPRESSLY ADDRESSES THE
UNUSUAL CASE WHERE THE HOUSE AND SENATE PASS BILLS WITHOUT

MANDATES BUT THE CONFERENCE REPORT INCLUDES NEW MANDATES. IN


94

8

with the OSH Act rest on misperceptions or a lack of information.
For example, the report notes that even in some states that have
not volunteered to participate in Federal OSHA's program, there
is a belief that OSH Act requirements are mandatory. It is
difficult to imagine how this makes the case for repeal of the
provisions extending OSH Act coverage to public employees in
participating states. Similarly, the report charges that the
credibility of safety and health programs under the Act is
seriously compromised by the “perceived” rigidity, complexity and
burdensomeness of the regulations, and a focus on punishment
rather than compliance assistance. On the contrary, in
recognition of the unique characteristics of public employers,
OSHA has encouraged flexibility in state plans by 1) encouraging
states to develop alternate standards that provide equivalent
protection when circumstances differ from the private sector; 2)
allowing states to use administrative actions instead of monetary
penalties to compel compliance; and 3) permitting agency self-
inspection under certain conditions. In addition, OSHA provides
a great deal of assistance to states that volunteer to
participate, and contrary to the ACIR report, punishment is not a
focal point of enforcement, since OSHA has no jurisdiction over
public workplaces. In fact, an atmosphere of cooperation
pervades the Federal/State relationship under the OSH Act, as
typified by a Memorandum of Understanding between OSHA and
various state regulators to address areas of mutual interest.

Finally, the report suggests that Federal agencies are free
from meeting OSH Act requirements, and state and local
governments should have the same options. Once again, this
premise is incorrect. All Federal agencies must comply with OSHA
standards, as the recent debate on extending OSH Act protections
to Congressional employees recognized.

Davis~Bacon Related Acts

The ACIR report recommends an exemption for projects below
one million dollars or for which the Federal grant or other
assistance is less than 50 percent of total funding.

The Federal government invests substantial funds to assist
state and local governments with local public construction
projects through grants and other financial assistance. DBRA
prevailing wage requirements, attached to this assistance, ensure
that the federal government's vast purchasing power does not
depress local wage levels or disadvantage local contractors.
However, DOL does not agree that DBRA requirements impose an
unfunded intergovernmental mandate. The provisions apply by
virtue of a state or local government's voluntary choice to
participate in these Federal assistance programs.

The ACIR draft report suggests that the DBRA automatically
increase public construction costs because certain low-wage


2
local governments and the private sector. And while some have used the point
of order, or threat of it, for rhetorical purposes, I do not feel it has been abused.
J believe the point of order has gotten States and localities a seat at the table,
and made all of us in Congress think twice before passing costly new mandates

on to our State and local partners and the private sector.

I also want to recognize the fine work of the Congressional Budget
Office in fulfilling their critical responsibilities under the Act. CBO has done
an outstanding job turning complex cost estimates around in short order, which

has been key to the successful implementation of the law.

While I am very pleased with the implementation of Title I, I am less
enthusiastic about the effectiveness of Title II, which applies to federal
agencies. For rules estimated to cost State and local governments or the
private sector 100 million dollars or more per year, agencies must prepare a

written statement identifying the costs and benefits of mandates in the rule.

A report from the Office of Management and Budget, to be released
today, indicates that 16 of these statements have been written to date - not an
especially high number. That means one of two things: either agencies are not
promulgating many costly new rules, or they are ignoring the law. I sincerely
hope it is the former. OMB is also directed by the law to share these
statements periodically with the Congressional Budget Office, and they finally


71

other Agency consultation activities in determining whether regulatory requirements under

consideration might significantly or uniquely affect small governments

Actions Under Development.

EPA is currently camying out extensive intergovernmental consultation efforts on several
other rules and policies that may be of particular interest to state, local, and tribal governments,
including some that will not fall within the written statement criteria defined by UMRA.

‘Among rules of interest to local governments are proposed revisions to the lead and
copper drinking water rule that will provide regulatory relief to many communities, as well as the
microbial and disinfection by-product monitoring rule that have benefitted from a regulatory
negotiation process. State and tribal officials serve on the EPA work group developing an
important rule expected to have a large economic impact — the pulp and paper cluster rule. State,
local, and tribal governments are also represented on regulatory negotiation advisory committees
and policy dialogue groups such as: Urban Wet Weather Flow (water), wood furniture (air), and
hazardous waste manifests (waste). Representatives from a range of interests, including state and
local government officials, are working on the Common Sense Initiative to improve environmental
regulations and develop comprehensive strategies for environmental improvement in six pilot
industries: automobile manufacturing, computers and electronics, iron and steel, metal finishing,
petroleum refining, and printing.

EPA continues an active consultation process in developing regulations to implement the

1991 Pesticides and Ground Water Strategy, itself the result of extensive consultations. The
process includes representatives of other federal agencies, state agricultural, health, and
environmental agencies; tribal organizations; industry; farmers; and ground-water users, As a first
step towards establishing a one-stop reporting system for certain environmental data, EPA is
working to develop a consolidated reporting system for key facility information, Because this Key
Identifiers Initiative raises many issues which may require a joint federaV/state resolution, EPA has
sought the active participation of several state, local, and tribal governments; EPA is also funding


V. Conclusion

The Clinton Administration and EPA are committed to building a strong
intergovernmental partnership, demonstrated by the progress we have already made. We are
reforming our relationship with states, local governments. and tribes to one that is more
cooperative and collaborative in nature, reinventing regulations so that they make more common
sense, and providing more flexibility to our intergovemnmental partners so they can tailor
environmental protection efforts to their own needs and conditions.

Our goal is to forge an intergovernmental partnership that focuses on improved
environmental results. We want to allow for and encourage flexible and innovative approaches to
achieving environmental improvements and protecting public health while still ensuring
accountability. Finally, we want to do this in a way that more fully engage our citizens. We look
forward to working with Congress as we continue in this important endeavor. Thank you.


5

Mr, Suays. I want to thank our colleague here now, Mr. Talent,
and I also want to particularly thank the coauthors of this legisla-
tion, Mr. Portman and Mr. Condit, for their bipartisan work on
mandate reform. And we all owe an obvious debt of gratitude to
Chairman Clinger for his outstanding work.

I will say that again.

Mr. CLINGER. What an entrance.

Mr. Suays. And we all owe an obvious debt of gratitude to Chair-
man Clinger for his outstanding work in marshaling this bill
through the legislative process.

Under Title II of the Mandates Act, the executive branch also
must conduct an explicit analysis of proposed and final rules to
quantify the costs and benefits of mandates and identify the most
cost-effective, least burdensome regulatory approach. Departments
and agencies are required to consult with State and local govern-
ments, and the Office of Management and Budget is directed to col-
lect those regulatory statements and forward them, periodically, to
the Congressional Budget Office (CBO). OMB is also required to
submit a written report detailing compliance by each agency during
the preceding year. That report is being released today. It details
efforts by the executive departments to establish intergovernmental
consultation procedures and review proposed rules for mandates.
According to the report, only 16 rules met the act’s threshold for
a detailed cost/benefit analysis and review. That’s just 16 out of
more than 3,000 proposed or final rules published in the Federal
Register since March 22, 1995, exactly 1 year ago. I hope that
means the act has resulted in less costly regulatory mandates, not
less realistic cost/benefit estimates in order to avoid the $100-mil-
lion threshold.

Moreover, I am concerned that OMB compliance with the re-

juirement to share these analyses with Congress appears minimal.

‘hat reporting is required “periodically.” In the first year of the
Mandates Act, that period was 1 full year. Before Tuesday, not one
of the required statements had been forwarded to CBO. Then all
16 arrived at once, just in time to be included in the report. I hope
future compliance will be more periodic and less episodic.

The report also discloses that “agencies have begun considering,
but have not yet developed,” the pilot programs to reduce reporting
and compliance requirements on small governments, as required by
section 207 of the act. This requirement “remains a priority during
the coming year,” according to the report. I would prefer a firm
commitment that next year’s report will not say the same thing,
but will reflect actual compliance with this important aspect of the

Ww.

We also asked today’s witnesses to comment on the preliminary
ACIR report on the role of existing mandates, a report also re-
quired by the act. The findings and recommendations in that report
have already drawn considerable comment and criticism from those
who evaluate the benefits and burdens of mandates differently. We
welcome that diversity of views because, having mandated the re-

rt, this Congress will have to decide what action to take on the
final ACIR recommendations. That process can only be enhanced
by the contributions of all our witnesses today, and we sincerely
welcome each and every one of them.


ill

Page 3 - Honorable William Winter

“Federalizing" the enforcement function, of necessity involving
intrusive investigations and Federal versus State litigation,
would promote intergovernmental harmony and cooperation.

(D) As a practical matter, because the rights conferred on
disabled students and their parents by IDEA are rooted in the
non-discriminatory principles of other Federal laws that may be
enforced through a private right of action (e.g., section 504 of

@ Rehabilitation Act of 1973 and the Equal Protection Clause of
the Fourteenth Amendment), it is unlikely that such parents and
students would be kept out of the Federal courts merely by
removing IDEA’s cause of action.

Another weakness of the draft staff report is that it does not
recognize that reform of IDEA is a major priority of this
Department, consistent vith our mission of promoting education of
high quality for all children, and that reform is well under way.
Following extensive consultation with over 3,000 parents,
educators, and administrators, representing the widest possible
spectrum of views, the Administration presented its legislative
proposal for the reform and reauthorization of IDEA to Congress
on June 30, 1995. With an overall goal of improving educational
results for children with disabilities, that proposal anticipated
several concerns raised by ACIR and incorporates numerous
suggestions for reducing burden. Among the basic objectives of
our reform proposal are reducing administrative burden and
Paperwork for State and local school systems and promoting the
resolution of disagreements between parents and schools through
mediation rather than litigation.

In closing, let me point out that the benefits of IDEA to America
have been significant. ‘Through IDEA programs, millions of
students with disabilities have been helped to become fully
participating, working members of our society rather than be
dependent on public funds. Before the IDEA, some one million
children with disabilities were totally excluded from the public
school system, and another four million did not receive
appropriate educational services to enable them to have full
equality of opportunity. Since 1976, the number of disabled
children served has increased by 44 percent.

I appreciate this opportunity to express my deep concerns about
the discussion and recommendations pertaining to IDEA in the
draft staff report. I regret that, for the reasons described
above, I consider the inclusion of IDEA in the report, as well as
the draft proposed recommendations, to be unacceptable.

Yours sincerely,

Sek

Richard W. Riley


81

A fundamental problem with the report is that it fails to examine why federal laws and
specific provisions of those laws were enacted. For example, the ACIR preliminary report fails to
discuss how the 1990 Amendments to the Clean Air Act were enacted in response to broad public.
concem that America had not yet achieved the benefits of clean air. The framework for the
nation’s clean air effort was developed under the 1970 and 1977 versions of the Act. Although
considerable progress toward cleaner air had been made under this framework, the 1990
‘Amendments were enacted because twenty years of efforts and commitments had not brought
America clean air. The ACIR's draft write-up on the Clean Air Act (CAA) is correct in stating
that some of the Act's requirements have become increasingly detailed and specific over time.
However, it fails to note that the Congress was clear that its reason for adding the specific
requirements was years of frustration with the lack of progress in cleaning up air on the part of
both the federal Environmental Protection Agency and state and local governments. Further, the
preliminary report fails to note state and local support for the 1990 CAA Amendments.

Another problem with the report is its failure to consider the beneficial aspects of
mandates. In its own criteria for analysis, the Commission agreed to look at the "beneficial
effects" of each mandate, although it would not try to “calculate benefits or weight benefits
against costs." Unfortunately, this staff draft directs little attention to the beneficial effects of
federal mandates. If only costs are presented with a minimum description or assessment of
benefits, any debate about what improvements are needed is skewed and biased. The revised
report should include a more balanced presentation. That is essential to formulating constructive
discussion and "next steps.”

The report also fails to acknowledge the progress we at EPA and at other federal agencies
have made in the past few years to reform our programs, as I have just described to you. While
UMRA Title III charges ACIR to make recommendations for "allowing flexibility," the report
does not address agency progress or models to increase flexibility. It does not do credit to the
substantial progress that has been made by officials at all levels of government who are working
together to reduce the burden of mandates as they previously existed. Problems that have been or

12


188

federally-assisted construction projects tend to be relatively modest
compared to federal construction projects such as dams, national defense
projects, and federal buildings. Consequently, adoption of a $1 million
threshold in the “Davis-Bacon Related Acts” would virtually eliminate
application of Davis-Bacon prevailing wage requirements to federally-
assisted construction projects.

Moreover, most of the other federally-assisted construction projects
not exempted by the $1 million threshold would most certainly be excluded
from coverage by the Commission's second recommendation that such
projects should be exempt unless at least 50 percent of their costs are funded
by federal assistance.

Many federal-aid programs are not designed to finance more than 50
percent of the cost of construction, but are intended to be used by state
and/or local governments as leverage to obtain the bulk of the financing from
private or public sources such as banks and bond issues. Furthermore,
creation of such a coverage standard is an open invitation to wholesale

avoidance of federal prevailing wage requirements because the “total costs

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107

school system, and another four million did not receive
appropriate educational services.

(2) Reform of IDEA is a major priority of the Department,
and well under way. Yet the draft report does not even refer to
the Department's wide consultation with parents, educators, and
administrators that led up to the reform proposal, which was
presented to Congress on June 30, 1995. Our reform proposal
would reduce administrative burden and paperwork for State and
local school systems, so they can focus their energies on
improving educational results for children with disabilities. In
some important respects, we anticipated, and indeed went
beyond, the recommendations in the draft report. For example, the
reform proposal would call for school systems to offer impartial
mediation services to parents who are unhappy with the
educational services provided to their children, which would
significantly reduce the number of disputes that might otherwise
lead to costly formal proceedings.

(3) We are adamantly opposed to the recommendation that any
court challenge based on IDEA be brought by a State or Federal
agency, not by parents themselves. Depriving parents of these
rights is fundamentally inconsistent with the intent of the law
to create individual rights in parents and students. Denying
parents’ right of action would substantially undermine IDEA
enforcement nation-wide. At the same time, as the ACIR’s own
statistics demonstrate, IDEA does not generate a disproportionate
amount of litigation (on average, slightly more than one reported
case in the Federal courts for each State in 1994). Nevertheless,
further “Federalizing" enforcement -- requiring intrusive Federal
investigations and Federal versus State litigation -- could
hardly promote greater intergovernmental harmony and cooperation.

I am attaching to my statement, for the record, Secretary Riley’s
letter to Governor Winter, Chairman of the ACIR, detailing our

7


92

6

amended the FLSA in 1985 and gave special accommodations to state
and local governments by providing for compensatory time off in
lieu of overtime pay, special rules for the use of volunteers,
and a delay in implementing compliance obligations to allow for a
transition period. The ACIR report notes that DOL has provided
assistance to state and local governments with respect to their
FLSA obligations, and acknowledges that DOL has worked with state
and local governments to recognize the unique issues that arise
in the public sector context. Despite DOL’s efforts, concern
with FLSA can be traced to an inability on the part of state and
local governments to adequately monitor their compliance
obligations and a persistent misunderstanding on their part of
the requirements of the Act. These are not reasons for denying
workers basic minimum rights, but for strengthening the
Department's ability to work with state and local governments,
rather than dismantling it by repealing coverage of the public
sector.

Family and Medical Leave Act

The ACIR report recommends repeal of FMLA’S coverage of state and
local government employees.

Like the FLSA, the FMLA provides a fundamental safeguard to
American workers. It guarantees that workers can take job-
protected unpaid leave for specified family and medical reasons.
,Phe report provides no substantive justification for repealing
that safeguard with respect to public workers.

The draft report not only overstates the costs of
compliance, but also ignores the substantial benefits achieved by
family and medical leave policies, including improved worker
productivity and morale, reduced employee turnover, and greater
labor-management stability. In fact, available data show that
the costs of hiring and training new employees far outstrip the
costs of granting temporary leave for family or medical reasons.
These data are documented in GAO and Congressional Committee
reports prior to enactment of the FMLA. In addition, in 1995,
the bipartisan Commission on Leave conducted a nationally
representative random sample survey of private sector worksites.
The survey found that the vast majority of covered worksites
reported either no or small cost increases incurred in the
implementation of the FMLA. We have seen no evidence to suggest
that the results are any different in the public sector.

Because some state or local government leave policies that
were in effect before FMLA was enacted in 1993 were at variance
with FMLA's requirements, ACIR received complaints of
inflexibility under Federal law. First, I would note that the
FMLA grants some flexibility for state and local governments in
that no state or local government family leave provision need be
changed if it provides more generous rights than the Federal law


180

of exempting state and local governments from federal laws of otherwise
general applicability is certainly not unprecedented, nor uncommon.
Perhaps Congress narrowly limited the Commission's authority to
recommend repeal of provisions in federal laws that extend their application
to state and local governments because it understands the weight and the
deference that recommendations by the Commission will have on public
opinion and the federal political process, and does not wish unduly to slant
debate concerning the propriety of extending federal statutory requirements
of general applicability to state and local governments except when they “are
duplicative, obsolete, or lacking in practical utility.” Accordingly, it is
submitted that the Commission's recommendations regarding the Fair Labor
Standards Act, the Family and Medical Leave Act, and the Occupational
Safety and Health Act should be withdrawn inasmuch as they exceed the
scope of authority delegated to it by Congress to recommend repeal of

provisions of federal statutes.


183

including painting and decorating, of public buildings or public works of the
United States or the District of Columbia.” Davis-Bacon Act, as amended,
40 U.S.C. § 276a(a). Consequently, the Davis-Bacon Act does not apply to
public works construction in which the Federal Government is not a direct
party, but rather provides aid such as grants, matching funds, loan
guarantees, and other financial assistance for the construction of public
buildings and public works by state and local governments.

Nonetheless, Congress has chosen to include Davis-Bacon prevailing
wage requirements in a variety of legislation creating federal-aid programs,
such as the the U.S. Housing Act of 1937, that encourage state and local
governments to undertake public construction activities. Today, there are
more than 60 federal statutes that require all contracts and subcontracts for
federally-assisted construction of public buildings or public works to include
a requirement that all laborers and mechanics employed on the job must be
paid not less than the wages and fringe benefits determined by the Secretary
of Labor pursuant to the Davis-Bacon Act to be prevailing in the same

locality. These statutes, most of which are listed in 29 C.F.R. § 5.1 of the

-12-


60

The Federal government hes mountec an unprecedentéd ezair
to provido technical tance shout the ADA and is activel}
Oppe=tunities te expand this effort. Bach of the
ncies thot hac an ADA policy-making rose has
dan extcnsive technical assistance program Co provide
covered entities with intormation about how to comply with the

Technical assistance is developed through Federal grant
Programs undar which private entitica develop specialised
Raterigie targezed to specific wudicnecs. Through s Department
bf Tustice qxant, celected ADA Technica) Asistance materials
have keen distributed co 15,000 tibrazies notionwide. The
Depactnent of Sducation has funded a regional nctwork of ten
Digability and Business Technical Assisteace Centora that provide
ADA infurmation ard guidance te cevered entities. ia addition,
the Departmanl of Justice is considering a proposal to catablish
an ADA clearinghouse cf technical areistance materials.



56

ACIR concern:

‘the ADA creates problems for etate and icbs2

ef expensive retrofiteing and sezvice
delivery requirements,

The ADA does not requixe expansive rerrofiteing or impoos
wxywusive service delivery requizenenta. Ae A result
«extencive negotiations that accompanied the passage of the soe
she Act includes a numer of provisions designed to ensure o fair
and balanced arproach to the implementation or che Act, dncluding
the cost of implerentation. The statute includen specific
limitations that recognize the need to strike e balance between
the right of individuals with disabilities to partindpete ir
public activities and the legitimate financial en¢ operational
concerns of state and Loca: governmexts.

The ADA dons not require ‘expensive retrofitting. Title IT
of the ADA prohibits discrimination on the basis of disenility by
gente and local governnente, bur ir does not erascrine rigid
Fequirnments to achieve that objective. vhe ADA requires erate
sad lueal governments to provide ‘program access." This means
that they are requized to make their programs and activities. not
2x3.

ting building, accessible to qualified individuals with
Sisabstaties.

Program access provides etate and lscal governzente with the
gpportunity to be creative ‘and flexible in their response to che
Ast. mple, @ Service cuscomarily provided in an
tnagcessiDie lonation ean bu mved to an accessible space when a
Person With a mobility inpairment needs access to that service.
Por existing faciliciss, Physical chanyes are only required when
it ig not possible to provide program access in any other way.

In addicion, the 472 Adas not impos: expensive sorvice
€elivery requirements. Although stales and ocalities will
undoubtedly incur costs in implenentiue =he ADA, statc and looal
governmont& are navar required to teks any action that would
Feoult in a "fundamental sIreration in the rature of @ program,

servios, or activity" oz in "undue financial and administrative
burdens."

‘The ALA requires that new buil: js aud facilities, and
tions t> exieting buildings and facilities, be built to be
bie. ‘Thio sen ixemant recognizes that it ie

tc and least expr tive fi £0 busid in access from the stert.

a
on

2) ACER Comcera: The ADA statutory language is confusing and
ambiguous.

‘The ADA is based on the femiliar language and requivemants
of Section S64 of the Rehabilitation Act of ‘To03. as amanded,
ehich prabibits disability-based discriminatiua by recipients of



18

qe
The legislation that was signed a year ago today struck an
important balance between ensuring that states and localities are not
unduly burdened with unfunded mandates and that public health and
environmental standards are not compromised. I hope that today’s

hearing sheds light on exactly how we are striking this balance.


AT

OMB Report

Today is not only the first anniversary of the Act. Not coincidentally, it is the date specified in the
legislation for our report to Congress on agency compliance with Title II of the Act, called for by
Section 208,

This report has given us the opportunity to review Administration activities since passage of the
‘Act. As the report sets forth, agencies have given serious thought to, and established real
processes for, intergovernmental consultation involving both unfunded mandates as defined by the
‘Act and issues affecting State, local, and tribal goveruments generally. These consultation
processes built on Director Riviin’s September 21, 1995, guidance to agencies called for by
Section 204 of Title II, which discussed several general themes that agencies should consider as
they engage in discussions with their intergovernmental partners.

+ intergovernmental consultations should take place as early as possible, beginning before
issuance of « proposed rule and continuing through the final rule stage, and should be
integrated explicitly into the rulemaking process,

. agencies should consult with a wide variety of State, local, and tribal officials.

+ the scope of consultation will necessarily vary with the cost and significance of the
mandate being considered — effective consultation, however, requires significant and
‘sustained attention from all who participate, as well as a degree of trust to allow for frank
discussion, focus on key priorities, and clear and unambiguous communication; and

. agencies should seek out State, local, and tribal views on costs, benefits, risks, and

alternative methods of compliance, as well as whether the Federal rule will harmonize with
and not duplicate similar laws in other levels of government.

-5-


51

worker protection, and civil rights laws. These analyses fail to consider the views of or
effects on working men and women ay directed by Congress,

For exemple, the preliminary staff draft recommends that Congress repeal the Family
and Medical Leave Act's (PMLA) applicability to state and local governments. The Clinton
Administration opposes this recommendation. The draft report asserts that the FMLA has
“creeted unfunded costs related to extending medical insurance coverage to employess while
‘on leave, to temporary hiring of replacement workers, and to additions! waining and personnel
counseling activities...” The report cites no supporting evidence for this claim, however.
Further, the report does not acknowledge the substantial benefits to employers, families, and
individuals of implementing FMLA requirements. In addition, the Administretion strongly
opposes the recommendations that would wesken other labor protections including pruposed
changes to OSHA, the Fair Labor Standards Act and Davis-Becon-related acts

‘The preliminary staff draft also recommends several generic modifications to Federa!
lews without carefully considering the consequences of such changes. For example, the draft
report proposes eliminating citizens’ rights to sue state and loca! governments to enforce
Federal mendstes. The Administration strongly opposes this broad-sweaping change. Again,
the recommendasicn is based on a wnsideretion of costs but not of benefits, The draft report
sumply asserts that citizen suits create “budgetary unceruwinties and substantial lege) costs”
for state and local governments. The draft report does not docunent ot quantify these costs,
or discuss the constructive role citizen suits have played in screngthening enforcement of civil
rights, environmental, and other Federal statutes.

‘The draft report's proposed changes to specific environmental laws sre similarly
disconcerting. The preliminary staff draft recommends -- again without adequate justification
~ Substantially wexkening Federal environmental statutes. For example, the draft report
recommends eliminating financial aid penalties for states that fail to meet Federal air quality
standards where such stetes are making a good faith efforts to comply. The Administration
opposes this proposal. As the draft report itself notes, most states did not adequately cantrof
‘air pollution until scrong Federal standards and enforcement mechanisms were put in place.
‘Now thet sanctions are mandatory, slates, with a few exceptions, are mccting compliance
deadlines, elthough sanctions have almost never been applied.

Another particular concem is the report's recommendations with respect to civil rights
laws for people with disabilities — specifically, the Americans with Disabilities Act (ADA)
and the Individuals with Disabilities Education Act (IDEA). The Administration opposes the
draft report's recommendations with respect to these Isws. Since thc Unfunded Mandates
Reform Act does not apply to civil rights statutes, it is inappropriate for ACTR to recommend
charges to these laws. The drafl report's recommendations to eliminste a private right of
‘action and to reduce sate and local governments’ compliance obligations under these statutes
would set back our efforts to guarantee equal tights for citizens with disabilities. I would
note that both of these laws allow Federal agencies to emphasize education and voluntary
comphance as much as possible, and that this Administration has taken a cooperative and
fiexible epprosch in implementing the ADA and IDEA.


80

regulated community 20 million reporting burden hours annually. Second, EPA will create a one-
stop reporting system for the collection of routine emissions data. Third, EPA is moving forward
aggressively to enable firms to report environmental data electronically rather than with hard
copy Finally, EPA is taking steps to cut in half the reporting frequency of regularly scheduled
reports. Many of these changes will reduce the paperwork and reporting burdens of state, local,

and tribal governments

EPA also understands that some of the problems faced by our intergovernmental partners
are founded in the underlying legislative authority for our programs and regulations. Therefore,
this Administration has also proposed legislative changes when we believe they are necessary to
accomplish more effective and common sense environmental protection.

IV. ACIR's Preliminary Report — Title HI of the Unfunded Mandates Reform Act

Title HI] of the Unfunded Mandates Reform Act charges the Advisory Committee on
Intergovernmental Relations (ACIR) with investigating and reviewing the role of federal mandates
on intergovernmental relations. ACIR was also charged with making recommendations to the
President and the Congress for improving the operation of mandates -- looking at such issues.as
flexibility, duplication, obsolescence, and the absence of practical utility.

EPA has serious concems about the content and recommendations of the preliminary draft
ACIR report on The Role of Federal Mandates on Intergovernmental Relations. Many of these
concerns were expressed by panelists at the recent conference sponsored by the ACIR. As
think you know, the ACIR will also be holding a public hearing on the preliminary report on
Tuesday, March 26, where, as the representative of Administrator Carol Browner, | expect to join
the other commissioners to hear public comment on the draft report. It is my expectation that
EPA will be able to work with ACIR staff and the other Commissioners to revise the report to
respond more directly to the charge set forth in the UMRA, and to present a more informed and
balanced report of the role of federal mandates in intergovernmental relations


142

reviewed in the ACIR Preliminary Report that have a direct bearing on Public Works
activities.

Frankly, we were delighted when President Clinton signed into law the Unfunded
Mandates Act of 1995. As Public Works professionals, we care about the health, welfare
and safety of our citizens: it is our responsibility to carry out the programs and activities
that support these fundamental needs.

Having said that, however, we are left with the pressing questions: how and when will
this Act be implemented?

My own city of Baltimore has a population of under 700,000. We have a budget of $2
billion. We not only provide services to our citizens, but to the metropolitan area as well.
We are the focal point in the region for entertainment, cultural events, and centers of
business. But at the end of the day, people return to the suburbs, taking their taxable
income with them,

In short, we are a poor subdivision

In order for Baltimore to comply with the requirements of the Asbestos Hazards
Emergency Response Act (AHERA), we would have to spend $700 million, nearly half of
the city’s budget. Obviously, we are not fiscally able to spend such a sum. In the
interim, we spend on the average, $2 million annually to repair and contain areas of
asbestos in our public buildings.

Baltimore has over 2,000 miles of highway infrastructure to maintain. While we are
fortunate to receive $15 million in ISTEA funds, this amount does not begin to meet our
needs. As a result, we have had to delay or put off entirely the timely repair of our
bridges.

The cost to retrofit our waste-to-energy plant to comply with more stringent stack
emissions is in the neighborhood of $50 million. The health benefits to be gained by such
an expenditure are not clear to us.

In Baltimore, where our proximity to Chesapeake Bay raised the stakes of water pollution
removal beyond the federal goal of secondary treatment, we were successful in capturing.
half a billion dollars in federal and state grants to achieve state-of-the-art advanced
wastewater treatment.

Wastewater grants are no more, having been displaced with state revolving loan funds.
While local governments have taken advantage of the lower interest rates connected with
these state loans, we are carrying the costs to build these facilities. Surprisingly, the
greatest impact of these facilities on user rates are not the staggering capital costs, but the
increased energy and chemical costs to perform wastewater treatment to such high


135

This Congress needs to review existing mandates and set priorities so school districts
can continue to focus on their main mission—the education of our children for the
global economy of the 21st century. Congress has made an excellent beginning in
passing the Unfunded Mandates Reform Act to stop the flow of future mandates. The
Advisory Commission on Intergovernmental Relations (ACIR) also has begun the
thoughtful process of examining the impact of existing mandates, and NSBA commends
the commissioners for their report.

IV. EXAMPLES OF MANDATES ON SCHOOLS

At this point, I would like to turn to several of the specific unfunded mandates that
school districts face to help define the scope and magnitude of this important issue.

Contrary to popular belief—with the exception of the Individuals with Disabilities
Education Act (IDEA)—most federal mandates on school systems are imposed by
agencies other than the U.S. Department of Education. Consistent with ACIR’s finding
regarding local government generally, the Davis-Bacon Act, the Occupational Safety
and Health Act, the Fair Labor Standards Act, drug and alcohol testing of commercial
drivers, the Clean Air Act, and the Safe Drinking Water Act, are examples.

A. Davis-Bacon Act

The repeal of the Davis-Bacon Act would permit school districts across the
country to repair or replace aging school buildings at a much faster pace than is
currently being done because scarce tax dollars would go farther in school
construction projects. NSBA found, in a 1995 survey of school board members,
that more than 60 percent of those who responded said federal and state Davis-
Bacon laws had increased the cost of a recent construction project. More than
half of the respondents said the increase was as much as 20 percent. NSBA

“4


13

ments is not something that should be done without serious exam-
ination and much debate.

Let me thank you again, Mr. Chairman, for having this hearing.
I would also like to thank my friend, Bob Portman, of course, and
Representatives Condit and Talent for coming to testify, and to say
that without the work and help of Bob Portman, of course, and
Gary Condit, we would not have gotten this far. So I would like to
say to you, Mr. Portman, and of course Mr. Condit, and now Mr.
Talent, that I really appreciate your work and your efforts. Let us
not slip back. Let us continue to move forward in an open, demo-
cratic way.

T yield back, Mr. Chairman.

Mr. SuHays. I thank the gentleman. Mrs. Morella, welcome.

Mrs. MoRELLA. Thank you, Mr. Chairman. I want to thank you
for holding this hearing to examine the implementation of the Un-
funded Mandates Reform Act of 1995.

The President signed the bill into law exactly 1 year ago today,
and it is important that we ensure that it is working as we in-
tended it to work. Today’s witnesses will provide us with additional
insight into how many of the agencies are implementing the Un-
funded Mandates Reform Act and how State and local governments
and community organizations have been impacted.

The legislation, as we know, was passed with overwhelming bi-
partisan support, because we recognized that State and local gov-
ernments have long been asked to assume an overwhelming burden
of Federal mandates. Although the Congress and the administra-
tion have failed to agree on how to balance the budget, that legisla-
tion aims to end the practice of asking States and localities to pick
up the increasing cost of Federal programs.

I do, however, have some concerns with how the Unfunded Man-
dates Reform Act is being implemented. Title III of the act requires
the Advisory Commission on Intergovernmental Relations, ACIR,
to recommend improvements after studying 200 existing mandates.
The ACIR report specifically recommends the repeal or modifica-
tion of 14 mandates, including mandates that have already been in
place, to ensure public health, safety, and well-being.

During the debate on the House floor, I pointed out that we must
take great care to avoid going too far in the other direction. We
must not reverse critical public health and environmental laws in
our effort to slow the practice of unfunded mandates. There are, at
times, compelling national needs which will require Federal inter-
vention.

Mr. Chairman, I am a strong supporter, as you know, of the
Family and Medical Leave Act. The ACIR recommends that provi-
sions in this law be repealed for State and local governments. I
would ask today’s witnesses to explain why they think this is nec-
essary. After years of work, the Congress passed legislation to
allow American families to take care of family emergencies and
childbirth without risking their economic self-sufficiency.

Before that Family and Medical Leave Act was passed, we were
the only industrialized Nation in the world that didn’t have a fam-
ily and medical leave policy. Workers were forced to choose be-
tween their families and their jobs. Employers without family leave


137

for 95 percent of the asbestos used in the United States—especially in the area of
school construction. Yet, schools have spent too many of their scarce education
dollars on federal asbestos abatement that was not needed. Yet, Congress has
not been willing to reexamine the specifics of its mandate, again we believe,
because it has no financial incentive to do so.

A second unfunded environmental mandate that was nearly imposed on school
districts during the last Congress was a mandate on all schools in EPA-
determined, high-priority areas to test for radon. Despite convincing evidence
that no health hazards were posed in schools, Congress was prepared to impose
a mandate, and at a standard that substantially exceeded international levels and
substantial costs to school systems. Again, the federal legislation would have
been easy to enact because there was not financial responsibility for those who
would prefer to “err” on the side of doing more than what the evidence
indicated was needed.

. Individuals with Disabilities Education Act

Finally, ACIR identifies the Individuals with Disabilities Education Act (IDEA) as
one of the major unfunded federal mandates. NSBA agrees that this is one of our
most expensive, under-funded mandates. At the same time, we supported the
law when it was enacted, and still fully support its goal of providing an
appropriate education for all children with disabilities.

However, our support for this goal was not matched by the federal commitment
to funding its own mandate. When Congress originally passed the law, it
pledged to pay 40 percent of the annual cost of the special-education mandate.
Instead, the federal government pays only seven percent, leaving school districts
to pay almost $30 billion in additional costs from local and state resources.

-6-


US. Deparemant of Justice
3) Civil Rights Diviston
[Ore of On Aen Amery Genet etegen 26 aes
The Role

Yederal Mandates
4a Intergovarnmental Relations
A Preliminary A
January, 1996

AMERICANS WITH DISARILITIES ACT (ADA)

The U.3. Advisory Committes on intergove
(ACIR) has published a preliminary report pi
ef the Unfunded nardates Reform Act Of 1995. vnich requires ACTR
to study the effect of Federal wancates on state and
governments aad to recenmend changes. Although the
Randot a Pct expressiy provides that ‘the Act shall not appiy to

ral reguiation that establishes or enforces any storurory
rigets that prohibiz discrimination on the bagiz ot . . .
Cisebility," the Anaricans with Disabilities Act (ADA) and ite
amplemencing regulations ere eddreesed ia this report.

Summary: DOJ Reapense to ACI? Report

The report expressly xecoqnizeo that the ADA mandate ia

be national policy goale justify its use; however,
dgicant modifications in the implementation and
enforcement Act. Those roconmendations are
significant Slepetceptions ef the ADA requiremencs.
its ioplenenting regulations and this Administration’ s
enforcement policios already address ACIR’s concerns.

The ACIR’s assertion that the ADA is “one size fita ali"

Jogislation* replete vith ‘rigid requiramenta” einply mienex the

mark. The ACIR report file to recognize the inherent
flexipilicy cf the ADA and ite dmplementing regula! tions. art
exemple, states and localities are only required to prov:

“program access” rather then total retrofit of all cheiiities:
states and localities may use the law's “undue Cinuncial or
administrative burden" defense in complying with the program
cess and effective communicariont rement: 5 defensi
also provides states and localities atsonal tlexibilicy i
meeting compliance deadlinca.

ental Relations
Purssant to title IIT

The ACIR's wisperceptions ana specific recommendations are
dsecussea below. 7


2

problem that is emotional, hot, and highly visible. Often this has
meant Passing a Federal law that imposes costs and requirements
on State and local governments without their consent and without
regard for their ability to comply.”

That is no longer the case. Congress now has to identify, quan-
tify, and explicitly acknowledge the impact of new laws on inter-
governmental partners. Three of our colleagues will testify today on
the impact of the Mandates Act on specific legislation. Their perse-
verance helped pass the Mandates Act, and their vigilance is help-
ing to ensure it works. We welcome their Participation.

‘he prepared statement of Hon. Christopher Shays follows:]


174

tribal governments' total direct implementation costs, or else (b) considers
reducing or suspending the proposed mandates to ensure that they are
effective only to the extent funding is provided. Thus, Congress, through
this Act, imposed on itself a set of internal procedural barriers designed to
decrease the likelihood that it would impose costly and unfunded regulatory
burdens on state, local, and tribal governments.
WHAT IS THE COMMISSION'S MANDATE?
Section 302(a) of the Unfunded Mandates Reform Act of 1995, 2
U.S.C. § 1552, provides:
In General.--The Advisory Commission on Inter-
governmental Relations shall in accordance with this
section--
(1) investigate and review the role of Federal
mandates in intergovernmental relations and their impact
on State, local, tribal, and Federal government objectives
and responsibilities, and their impact on the competitive
balance between State, local, and tribal governments, and
the private sector and consider views of and the impact on

working men and women on those same matters,

(2) investigate and review the role of unfunded State
mandates imposed on local governments;


163

Also, the report does not discuss Congressional
implementation of the Act, which when you get down
to it, is the only way the law will work. It has to be
implemented. Nevertheless, several House rules have
been devised by the Rules Committee to circumvent the
requirements of the law. I wish the ACIR would have
taken more time to touch on these matters in the report

and I hope we can do so today.


72

on the work that achieves real environmental results as contrasted with process-oriented activities

whose relationship to environmental improvement is less direct.

In response, EPA began working with our governmental partners to create tools to
address the problems they identified -~ tools that will allow for and encourage flexibility and local

innovation while continuing to achieve greater environmental results

One of the best examples of our new approach is the Ni ronmental Performance
Partnership System (NEPPS). We kicked off this approach last May at a meeting with all fifty

state environmental commissioners. The new system is designed to focus resources on the most
important environmental problems The traditional way of negotiating annual state environmental
program grants begins with EPA telling the states what the national and regional priorities are for
federal funding, states have had limited opportunity to negotiate to use the funds to meet their
own priorities. Under the performance partnership approach, we ask each state to start with its
‘own assessment of the environmental challenges and opportunities in the state and to present the
state's strategy for meeting its environmental objectives. These assessments and strategies are the
basis for negotiating environmental performance agreements with EPA. Other key features of the
new system are reductions in unnecessary oversight and reporting, increased use of environmental
indicators as a measure of program performance, and improved environmental information to the
public. Today, not even a year later, five states have already signed Environmental Performance
Partnership Agreements, and about two dozen more are actively pursuing performance
partnerships for FY 97. .

Our goal through environmental performance partnerships is to focus more resources on.
improving the environment and less on process-oriented activities. Our goal is also to engage the
public more effectively in the environmental decision-making process by providing citizens with
better environmental information and understanding. We also want to enhance accountability —
to each other, to Congress, to the citizens we serve.


2

HONORABLE ROB PORTMAN
SUBCOMMITTEE ON HUMAN RESOURCES AND INTERGOVERNMENTAL RELATIONS
MARCH 22, 1996

‘THANK YOU MR, CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE. IT
IS A GREAT PLEASURE FOR ME TO TESTIFY IN FRONT OF A SUBCOMMITTEE
ON WHICH I SERVED AND TO DISCUSS AN ISSUE ON WHICH ALL OF US ON
THIS SUBCOMMITTEE HAVE WORKED SO CLOSELY TOGETHER. I WANT TO
PARTICULARLY THANK YOU, MR. CHAIRMAN, MY COLLEAGUE ON ACIR, FOR
YOUR VIGILANCE ON THE MANDATE FRONT.

ON THIS ANNIVERSARY OF THE SIGNING OF THE UNFUNDED MANDATES
REFORM ACT OF 1995, I WOULD LIKE TO MAKE A FEW POINTS ABOUT OUR
EFFORTS TO IMPLEMENT IT.

AS YOU KNOW, TITLE I OF THE ACT WAS DESIGNED TO ENSURE THAT
CONGRESS WOULD NOT IMPOSE ANY FUTURE MANDATE WITHOUT 1) A CBO
ESTIMATE OF THE COSTS OF INTERGOVERNMENTAL AND PRIVATE SECTOR
MANDATES; 2) INFORMATION ON HOW AND WHETHER TO FUND
INTERGOVERNMENTAL MANDATES; AND 3) RECORDED VOTES ON WHETHER TO
IMPOSE AN UNFUNDED OR PARTIALLY FUNDED MANDATE AT ALL. IN ORDER
TO ENSURE THAT THESE REQUIREMENTS WERE MET, WE INCLUDED POINTS OR
ORDER NOT ONLY AGAINST CONSIDERATION OF BILLS WITH UNFUNDED
INTERGOVERNMENTAL MANDATES, BUT ALSO AGAINST ANY RULE WAIVING
SUCH POINTS OF ORDER.

WE/VE BEEN WORKING OVER THE PAST YEAR WITH THE CONGRESSIONAL
BUDGET OFFICE, REPRESENTATIVES OF STATE AND LOCAL GOVERNMENTS AND

MORE RECENTLY WITH COMMITTEE STAFF TO ENSURE FULL COMPLIANCE WITH


70

Statement of
Dr. Shelley H. Metzeabaum
Associate Administrator for Regional Operations, State and Local Relations
U.S. Environmental Protection Agency
before the
Subcommittee on Human Resources and Intergovernmental Relations
of the
Committee on Government Reform and Oversight
U.S. House of Representatives
March 22, 1996

‘Mr. Chairman, I appreciate the opportunity to appear before you here today to discuss the
efforts of the U.S. Environmental Protection Agency (EPA) to implement Title II of the Unfunded
Mandates Reform Act (UMRA) of 1995, the preliminary draft report of the Advisory Committee
on Intergovernmental Relations (ACIR), and more generally, EPA’s work to build partnerships
and reinvent regulations with state, local, and tribal governments.

Over the past three years, the Clinton Administration has made an aggressive effort to
work closely with state, local, and tribal governments. At EPA, this effort is guided by the
unprecedented number of the Agency's top leadership who have experience as state and/or local
officials -- including the Administrator and Deputy Administrator, We recognize that each level
of government has a vital role to play in protecting public health and the environment, and our
success depends upon each governmental entity doing what it does best in carrying out this shared
responsibility.

Because of our commitment, EPA has worked very hard to implement both the letter and
spitit of the President's Executive Order on Strengthening Intergovernmental Partnerships and on
Regulatory Planning and Review, as well as the implementation of Title II of the Unfunded
Mandates Reform, Act, the one-year anniversary of which we are marking today. At the same
time, we have been undergoing a fundamental shift in approach designed to take better advantage
of the collective talents and abilities of both the public and private sectors in providing


146

Mr. Davis. Thank you very much.

Mr. Saunders.

Mr. SAUNDERS. Just for the record, Mr. Chairman, those folks
that are filling the potholes and picking up the trash in the city
of Baltimore are members of Local 44 of AFSCME, so I want to
make that clear.

Mr. Davis. I’m glad we have some agreement, at least.

Mr. SAUNDERS. My name is Lee Saunders, and I am an assistant
to the president of AFSCME, Mr. Gerald McEntee. We represent
1.3 million State and local governments and health care workers
across the United States. We are pleased to offer comments on the
unfunded mandates and particularly on the Advisory Commission
on Intergovernmental Relations report, “The Role of Federal Man-
dates,” which was required to be prepared under the act.

Now, AFSCME is a member of a broad-based coalition called,
“Citizens for Sensible Safeguards,” which strongly opposes the pre-
liminary ACIR report. The coalition has issued its own report,
“Shirking Responsibility,” which lays out in detail the various rea-
sons why this coalition of over 150 organizations opposes the ACIR
report. We have included with our written statement a copy of this
important report.

I will be primarily focusing my testimony on three labor protec-
tions that currently cover State and local government employees,
the Fair Labor Standards Act, the Occupational Safety and Health
Act, and the Family and Medical Leave Act, that the ACIR believes
should be repealed. If the recommendations put forth by ACIR are
enacted into law, every one of the millions of State and local gov-
ernment workers would be adversely affected.

The ACIR’s recommendations directly contradict recent acts by
Congress. After widespread criticism that Congress failed to give
its employees the same labor and civil rights protections that it had
long ago extended to private sector and State and local government
workers, the House and Senate, in near unanimous votes, approved
the Congressional Accountability Act last year. It is, therefore, pro-
foundly troubling that the ACIR recommends stripping State and
local employees of the very labor protections that Congress just
mandated on itself.

As an employer, no level of government is justified in treating its
employees differently from all other workers in the country. Indeed,
government should be a model employer, not a delinquent one. All
workers are entitled to be treated equitably and fairly, whether
they are in the private sector or the public sector.

I think that it is noteworthy that the ACIR never reached out to
State and local government employees or their representatives for
their input, comment, or recommendations. Everybody has been
hearing the terminology, “redesigning government,” “reinventing
government,” “participation by employees at the work site.” This
was not done in this process.

Until now, this has made for a very one-sided investigation and
debate. For a report which was required by Federal law to deter-
mine the financial burden of unfunded Federal mandates, it is
most disturbing that there is no cost data or cost-benefit analyses
of any of the worker protections it recommends for repeal.


63

DEPARTMENT OF LABOR CONCERNS RELATIVE TO THE DRAFT REPORT
OF THE ACIR

The Department of Labor(DOL) objects not only to the specific findings of this-report but
also to the method, the criteria and the assumptions the Commission used in making its
recommend-dations. The following is a summary of major concerns:

1. The ACIR frequently ignored its own Criteria for Review, which direct the Commission
to take into account the positive attributes of mandates, the rationale for their adoption,
and the impact of each on working men and women. The report contains no discussion of
Congressional Intent in covering state and local workers under these statutes and litte
consideration is given to haw workers might be affected if these protections were taken
‘away from them.

There is aiso very llttle recognition of the benefits these laws accord state and local
government employees = or their employers. in many cases, the report analyzes these
basic labor standards as though the only factor to be considered was their effect on state
and local government budgets. The rights and protections of workers are treated as though
they are merely another yearly “expense.”

2. The ACIR's Criteria ignores the directive of the Unfunded Mandates Act to recommend
“terminating ’Federal mandates only where they are “duplicative, obsolete or lacking in
practical utility." Under the Act, “concem’ by state and local governments was not to be
the basis for recommending termination of a mandate. The Federal Labor Standards Act
(FLSA), Federal and Medical Leave Act (FMLA), Davis Bacon Related Acts (DBRA) and the
Occupational Safety and Health Act(OSH Act) are certainly not obsolete — the mere fact
that DOL continues finding violations proves their continued relevance and utility. Nor
are these statutes duplicative — there are no comparable Federal taws and where
corresponding state !aws do exist, they are often weaker or tess inclusive.

3. Many of the concems used as justification for examining DOL's programs have no
bearing on the unique characteristics of state, local, or tribal governments — in fact, they
are the same type of concems attributed to some employers in the private sector.

4. The ACIR's assumption that collective bargaining agreements can substitute for Federal
standards is undermined by the fact that only 40 percent of state and local government
workers are represented by a labor union and guaranteed collective bargaining rights.

5. Finally, the special role of public employers is ignored - one would expect these
governmental entities to be model employers setting examples for their private sector
counterparts. In fact, the Congressional Accountability Act recently applied the FLSA,
FMLA and other labor laws to Congress to provide those workers the same protections as
the private sector counterparts.



20

STATEMENTS OF HON. JAMES M. TALENT, A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF MISSOURI; AND HON.

ROB PORTMAN, A REPRESENTATIVE IN CONGRESS FROM
THE STATE OF OHIO

Mr. TALENT. Again, I want to thank you for letting me be here
on relatively short notice, and all the subcommittee members for
including me in the distinguished company with Mr. Portman and
Mr. Condit, who have both done such outstanding work in this
area.

T also just want to tell you, as a Member, how much I appreciate
the fact that this subcommittee is following up on the bill and on
the report. I think it’s a vastly important area and certainly one
in which my local municipalities are very concerned, and an area
where I think we can move forward together and maybe capitalize
on a consensus, a new kind of governing consensus that we devel-
oped last year.

I wanted to flag the subcommittee, really, to a very related area
in which I and Mr. Watts have been working, in which the whole
question of regulatory flexibility is also very important, and in
which municipalities and local governments are involved, but it’s
not directly that, and that is the whole question of empowerment.

Now, I know some of the members of the subcommittee have
been working on this in other contexts, as well, but in many of the
distressed neighborhoods, most of them urban, around the country,
where we know they are dealing with very, very difficult problems
and pathologies, like crime, unemployment, very high welfare de-
pendency, and the rest of it, the good news is that there are hun-
dreds—around the country—there are hundreds of neighborhood
groups and associations that are working very hard to rebuild
those neighborhoods. They are like embers just beneath the ashes,
if you will, of those neighborhoods.

Mr. Watts and I have been visiting with a lot of those neighbor-
hood group leaders, asking them what we can do, on the Federal
level, to really help them in bringing renewal, and jobs, and home
ownership, and better education, and more secure homes back into
their neighborhoods. And one of the things that they consistently
mentioned to us was the need to have some kind of flexibility with
regard to Government regulations, and indeed at all levels, local,
State, and Federal regulations.

They said, often the unintended consequence of these regulations
was to inhibit them in what they were trying to do, and in ways
that didn’t achieve what the goals of the regulations were, as well.
And they mentioned a number of them on a Federal level.

I think you are all concerned with the so-called “Brownfields ef-
fect” of a number of the environmental regulations, where it has
the effect of rendering a whole lot of land in these areas just unus-
able for economic purposes. So you get neither jobs nor the prop-
erty cleaned up, environmentally. In fact, it just gets frozen, and
that can undermine the ability of neighborhoods to bring in eco-
nomic development and to start jobs in those neighborhoods.

Another one that has been mentioned to me is Davis-Bacon,
which, when you are a neighborhood group that’s dealing on a
shoestring, and maybe you get some access to some public funds in
order to rehab some houses in the neighborhood, the unintended


37

2

The recommendations lack or ignore empirical data to support its
conclusions. For example, the ACIR report ignore scientific
research from the Family Leave Commission about costs of
implementing the Family and Medical Leave Act (FMLA). Such
research showed, among other things, that 89% of employers
experienced only a small increase or no increase at all in
administrative costs to comply with the law. The ACIR offers no
other facts or statistics to support its recommendation that
state and local covernment be exempted form the FMLA. Virtually
every recommendation has the same problems as the one on FMLA.

The report's recommendations would create a patchwork
infrastructure, erecting and retaining current protections for
some, while dismantling them for others. Just when Congress
subjected itself to the same federal laws that ayply to other
Americans, the ACIR would now exempt state and local governments
from critically important laws. One very telling example would
be the ACIR recommendation to exempt state and local governments
from the Fair Labor Standards Act. If this recommendation were
adopted, workers in publicly owned and operated hospitals could
be denied the same workplace protections, including minimum wage
and overtime restrictions, enjoyed by similar workers in private
hospitals.

The report does not present responsible alternatives that gives
state and local governments flexibility in implementing federal
standards. In fact, the report does not acknowledge the enormous
flexibility already granted state and local governments. For
example, under the Clean Air Act, the EPA has already relaxed a
number of requirements, such as installing new methods for
testing automobiie exhaust systems in the most polluted cities
and requiring car pooling. Under the Americans With Disabilities
Act, state and local authorities are not required to take certain
actions if they would produce undue financial or administrative
burdens -- and courts have enforced such flexibility.

Even when the report’s recommendations do not call for outright
repeal of the law, its proposed modifications would have a
devastating impact. The report recommends dropping key
enforcement provisions of the Clean Air Act, important testing
and treatment requirements in the Safe Drinking Water Act, and
unhindered federal authority to designate new species under the
Endangered Species Act. These are just examples of a broader,
and damaging, deregulatory agenda.


157

of the local community. The financial wealth doesn’t exist. If Con-
gress mandates on school districts to construct more and better
buildings, where are they going to get the money?

To the extent that the taxpayers don’t vote for bond issues, which
is their choice—keeping in mind that 75 percent of all households
do not have children currently attending the schools, then we sim-
ply can’t do the construction. We’re not like—and I’m not suggest-
ing on private industry—but we can’t simply raise our prices and
pass them along to our customers.

In some States, as I alluded to before, there are constraints on
the amount of money that school districts can raise, even if the citi-
zens want them to, because of constitutional limitations and State
law, which raises very important questions of federalism. We be-
lieve that Congress should take a look at the needs of school con-
struction in urban areas and certain rural areas of this country,
recognize that it’s a national need, and then put forward the fund-
ing to help us do it.

t’s not going to happen by mandates. I don’t think you can man-
date the construction of a $25-million high school, or a $40-million
high school, and expect that the school system is going to be able
to raise that money to do that job, if it’s in an impoverished area.

Mr. Towns. Well, we aren’t talking about standards. I mean, you
know, that’s another issue. Let me just say this. I agree with you,
we can’t just sort of flip this off very lightly, because I think there
are a lot of thi that we're dealing with here. When I look at
trade deficits with countries, and I think that sometimes the rea-
son we have a trade deficit is because of the fact that we have an
educational deficit. And I think that we need to address these
things.

I think the question is, how do we get there? I just have some
concerns when you have 50 States just running out there doing ba-
sically whatever they want to do when they want to do it. I think
that becomes a real problem for me. I’m trying to agree with you,
in terms of the fact that we need to do it, need to get there, but
T'm not sure how we get there without a mandate of some sort.

Mr. RESNICK. I think it’s a question of, again, looking at a part-
nership among three levels of government, recognizing what each
level of government can do best, and also recognizing the limita-
tions by the happenstance of geography and wealth in certain local
communities. Ultimately, it’s a matter of what priority do we hold
for the education of the children of this country.

If three levels of government enter into a partnership to recog-
nize that the have-nots, particularly, need to have their educational
standard raised and raised beyond the level that a local community
can afford, then the resources have to come from somewhere else.
It's simply not going to come by mandating it on that local level
of government. And it’s our hope that, as the Congress looks for-
ward to the 21st century, that we can enjoy a higher level of prior-
ity for education that’s targeted where the greatest needs are.

Mr. Towns, Thank you very much. I appreciate your comments.
Thank you all for your testimony.

On that note, I'see the red light is on, I yield back, Mr. Chair-
man.

Mr. Davis. Thank you very much.


57

Federoi financial astistence. including srate and local
governments. Title II merely xtends chia prohibition to stite
nd lccal prograns that do not vece:ve redaral funds.

Therefore, state and local governments have had over twenty
years to become familior with terme such ws “reasonable
Hecommodasion" and undue herdehip" ana couxte have had &
similarly losg period te develop cess law uzder rhe Act. The
only "novel" term used in the ADA ie "readily achievable" aud
‘SNAL Camm Spplise only to certain private entities covered by
title III of the ADA. %t does not apply to atate and local
governments (which ase cevared by titi ITZ).

‘The purpose of using these familiar terma wag CO ensure that
state and local gevwsnmeate retained the flextpisicy required to
enabie cach entity to develop its own method of complying with
the ADA, in Jigke of ite unique circumstances in a changing
environment.

ACIR corractly notes that etate end looal governments have a

better underssanding of their specific accel sibicizy problens and

how to address them. It recommends modifying the to change

ats ord tian from “rigid requirements toward a focus on goals
end goal attainment schedulee.*

The ADA appropriately focuses cn the brond goal of

iminating disabiiicy-based discrimination. by empicying
some of the concepts criticized by ACIR, it does pretiocty hat.
For example. the purpose of the ‘undue burden” defen
allew each government to decide whel actions to teks ight of
the resources availebie for use in tue funding ond operation of a
service, program, oF activity.

However, there is an inconsistency between ACIR’ s
xeconmendation that the ADA be moaified Lo pronibit the
zmpesition of strict and rigid requirements and its critisism of
the provisions of the ADA Taat aiready give eteto end local |
governmencs the Elexibe: dity to adapt te changing local
gondilions. ACIR should look again at the tems it previously
found objectionable in Suape of the rick history of state and
local governmental (Practices, agency interpretulions, and
judicial decision

3) ASTR Recommendation: Pederal funding for ADA compliance
Should be increased or the ADA sold be modified to silew
@XG local goverements te meee ADA substantive soquirenanes tna
compliance deadlines in @ manner that recognizes their technical
and budget coustraiates.

The ADA ig = civil rightw sratute. As such, it has been
expressly exerpted by Congress fron thie ‘unfunded mandate:
review ‘because it ‘e simply not acceptable to conditica the civil

3.


23

the chairman on ACIR; however, as Mr. Payne was just told, we
were not part of ACIR until a couple of weeks ago, so we're not
part of that report.

Just looking at the witness list, perhaps there will be others
along the way who will be more qualified to respond to some of the
questions.

Mr. Chairman, I do want to acknowledge a couple of the people
in the room, if I might. First, of course, would be Ed Towns. Then
Chairman Towns held hearings on the Unfunded Mandates Reform
Act; in fact, a markup, at a time when it was not as popular as
it is now. I want to acknowledge that and thank him again for his
willingness to move the legislation forward in the last Congress.

Tom Davis I see has now left, but another sponsor of the legisla-
tion who added a lot last year.

Finally, Bill Clinger. A lot of people are perhaps fathers and
mothers and other relatives to this legislation, but it wouldn’t have
happened without Chairman Clinger’s active involvement. As rank-
ing member last year, as Ed Towns will remember, Bill Clinger
came to the subcommittee hearings and focused on the issue in an
unprecedented way, perhaps, for a ranking member in an ex officio
status, and then gave a lot of us younger Members opportunities,
which we appreciate, to move this forward. Finally, as chairman of
the committee, he managed to put this bill through and managed
it on the floor.

So we will miss you very much, and we have appreciated all the
work you have put into this. We are going to continue to seek your
counsel even after your departure from this Congress and this com-
mittee.

This is a very important process, I think. Again, I want to thank
the chairman for doing this, because this is an opportunity for us
not only to talk about the bill but how it is being implemented. And
it is, as Mrs. Morella said, the anniversary of the act, which makes
it all the more important that we see how we are doing.

As Chairman Clinger has mentioned, Title I of the act was de-
signed to ensure that Congress would not impose any future man-
dates without three things happening: one, a Congressional Budget
Office estimate of the cost of intergovernmental and private sector
mandates; two, information on how and whether to fund intergov-
ernmental mandates; and three, a recorded vote on whether to im-
pose an unfunded or a partially funded mandate at all.

In order to ensure that these requirements were met, just to clar-
ity, we did include points of order, not only against consideration
of bills with unfunded intergovernmental mandates, but we also
took the extraordinary step of allowing a point of order against any
rule waiving such point of order, as Mr. Towns has mentioned ear-
ier.

A working group which includes members of this subcommittee
and full committee, Mr. Condit and myself, have been working dili-
gently over the past year with the Congressional Bu t Office,
with representatives of State and local governments, and more re-
cently with committee staff and the Rules Committee to ensure
compliance with the unfunded mandates law.

I would agree with Chairman Clinger that in the test cases so
far—and I would list three of them: the Teleco bill, the farm bill,


144

within one year of receiving a request. This would take away discretion from local
agencies to match their limited resources with installations that will do the most public
good. If the individual request takes precedence and consumes all available street
maintenance resources, the larger public access to facilities and programs may suffer. We
would support keeping the decision as to allocation of resources at the local level

In the environmental area, local governments are concerned that efforts to evaluate
whether or not additional regulatory actions must be taken often hinge on risk/benefit
analyses. We need to take a hard look at the way in which risk/benefit analyses are
conducted | While we recognize and appreciate the value for performing risk/benefit
analyses, local governments are concerned about the length of time it takes to produce
these analyses, the red tape which may result and the nagging question of whether they
solve the real problem. If we are to commit our limited resources toward mandates, we
all must be comfortable that our expenditures will yield meaningful results for the health
and welfare of our citizens and the environment.

The Safe Drinking Water Act highlighted the frustrations local governments feel in
attempting to comply with federal rules and regulations, We are concerned about how
and on what basis new rules will be set.

Public reaction to specific community drinking water problems has understandably raised
questions about what substances may be present in the nation’s drinking water, and how
dangerous these substances may be. Cryptosporidium outbreaks and alarm over trace
amounts of pesticides are just two recent issues making front page news.

But just sounding the alarm is not enough. Water supplies, large and small, could be
facing some potentially expensive capital costs, as well as some very sophisticated
facilities and monitoring requirements. Large water systems may be able to shoulder
these burdens to some extent, but small water treatment plants may not have the ability to
finance such systems, and may not have the expertise on board to keep up with
operational and monitoring compliance

There has to be a relationship established between clear public health risks, and the cost to
protect the public from these health risks. Our ability to detect minute amounts of
pollutants is not necessarily equal to our ability to successfully remove or reduce the trace
amounts, to afford the cost to do so, or to even understand the benefits to be gained by
such efforts.

We must be confident that any costs to be incurred in complying with new drinking water
standards, or any other pollution standards set by the federal government, are soundly
based, will bear real results, and will maintain public confidence that we are protecting
their interests.

We in the Public Works arena recognize the authority of the federal government to set and
enforce national goals. In years past, national priorities were accompanied by federal


90

4

guidance. In fact, if adopted, the report's recommendations on
labor standards would seriously erode intergovernmental relations
and irrevocably harm this country's commitment to American
workers by endangering their right to a safe and healthful
workplace, to minimum wage and overtime pay, and to the job
security provided by family and medical leave policies. If the
recommendations in the report were implemented, state and local
government workers would become second class citizens -- deemed
unworthy of the same basic protections as their neighbors,
friends, and family who work in the private sector, for Federal
agencies, and now for the Congress.

DOL's major concerns with the report as drafted for comment
include:

* The ACIR frequently ignored its own Criteria for Review,
which direct the Commission to take into account the
positive attributes and effects of these important laws, the
rationale for their adoption, and their impact on working
men and women. The report contains no discussion of
Congressional intent in covering state and local government
workers under the labor standards statutes, and little
consideration is given to how workers might be affected if
these protections were taken away from them.

There is also very little recognition of the benefits these
laws accord state and local government employees -- or their
employers. Generally, the report analyzes these basic labor
standards as though the only factor to be considered was
their effect on state and local government budgets. The
rights and protections of workers are treated as though they
are merely another yearly "expense."

* The ACIR's Criteria ignore the directive of the Unfunded
Mandates Reform Act to recommend "terminating Federal
mandates" only where they are "duplicative, obsolete or
lacking in practical utility." Under the Act, “concern” by
state and local governments was not to be the basis for
recommending termination of a mandate. The FLSA, FMLA, DBRA
and the OSH Act are certainly not obsolete.

In addition, when a mandate was found to affect a government
program that directly competes with a comparable private
sector activity, the ACIR was directed to consider the
effects of the mandate and recommendations on both the
government and private sector. The ACIR did not.

* The ACIR's assumption that collective bargaining
agreements can substitute for Federal standards is
undermined by the fact that only 40 percent of state and
local government workers are represented by a labor union
and guaranteed collective bargaining rights. (Some


172

TESTIMONY OF ROBERT A. GEORGINE, PRESIDENT,
BUILDING AND CONSTRUCTION TRADES DEPARTMENT, AFL-CIO
Before the
COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT
HUMAN RESOURCES AND INTERGOVERNMENTAL
RELATIONS SUBCOMMITTEE
UNITED STATES HOUSE OF REPRESENTATIVES

HEARING ON IMPLEMENTATION OF
THE UNFUNDED MANDATES REFORM LAW

Mr. Chairman and Members of the Committee:

My name is Robert Georgine. I am President of the Building and
Construction Trades Department, AFL-CIO.

I am appearing today on behalf of the approximately four million
members of the 15 national and international unions affiliated with the
Building and Construction Trades Department to comment on the
preliminary report issued by the Advisory Commission on Intergovernmental
Relations entitled The Role of Federal Mandates in Intergovernmental Relations.

In recent years, Congress has been accused of resorting more and more

to what are now referred to as “unfunded mandates.” Officers of state and


Background

From the inception of this Administration, the President has worked hard on issues involving the
relationship between the Federal government and State, local, and tribal governments. He
believes strongly that government cannot serve people unless there is cooperation — a real
partnership — among all the levels of government, The difficulty of complying with Federal
mandates without additional Federal resources is something that the President experienced first
hand as Governor of Arkansas, and it is an issue that he sought to address in one of the first
Executive Orders that he signed. Specifically, on October 26, 1993, the President signed
Executive Order No. 12875, instructing Federal agencies to:

+ refrain from imposing nonstatutory mandates unless 1) funds are provided by the Federal
Government, or 2) the agency demonstrates to the Office of Management and Budget
(OMB) that it has consulted with State, local, and tribal representatives, heard their
cconcems, accommodated them to the extent possible, and explained why they could not
accommodate any remaining concerns; and

+ develop an effective process of meaningful and timely communication with State, local,
and tribal officials when developing regulatory proposals that contain significant
nonstatutory unfunded mandates.

While Agency compliance with Executive Order 12875 led to significant improvements in how
agencies developed regulations having an intergovernmental impact, it could only affect non-
statutory unfunded mandates. Yet, a number of ~ indeed most ~ mandates result from laws
under which the agencies have little, if any, discretion, This led to the strong bipartisan support
for the Unfunded Mandates Reform Act.

Title I of this Act addresses the legislative branch, and the processes that it should follow before
enactment of any statutory unfunded mandates. Title I went into effect this past October, and it is

-2-


85

Because these recommendations call for dismantling vital worker
protections that, for the most part, are now national in scope, the
administration cannot support such recommendations. Just like the
people of this Nation are entitled to be protected from having to
drink unsafe water or to breath toxic air, every working man and
woman should be entitled to basic minimum protections in the
workplace.

ACIR’s stated purpose in this preliminary draft report was to
propose “changes in Federal policies to improve intergovernmental
relations while maintaining a commitment to national interests.”
We do not believe the ACIR report achieves that stated purpose.

The report’s recommendations on labor standards, if adopted,
would seriously erode intergovernmental relations and irrevocably
harm this Nation’s commitment to American workers by endanger-
ing their right to a safe and healthy workplace, to minimum wage
and overtime pay, and to the job security provided by family and
medical leave policies.

The ACIR’s criteria for review directed the commission to take
into account the positive attributes and effects of these important
laws, the rationale for their adoption, and their impact on working
men and women if these protections were taken away. Yet the
ACIR report does not address these important elements. There is
very little recognition of the benefits these laws accord State and
local government employees or their employers.

The Unfunded Mandates Reform Act directed ACIR to rec-
ommend “terminating Federal mandates only where they are dupli-
cative, obsolete, or lacking in practical utility.” So the FLSA, the
FMLA, the Davis-Bacon, and the OSHA Act are certainly not obso-
lete. The ACIR suggestion that collective bargaining agreements
can substitute for Federal standards is unrealistic, because fewer
than 40 percent of all State and local government employees are
covered by collective bargaining agreements.

Finally, the special role of public employers is ignored. These
governmental entities should be model employers, setting examples
for their private sector counterparts.

Mr. Chairman, my prepared statement includes many details,
recommending specific concerns and objections that we have to the
recommendations. I would ask that the subcommittee give full con-
sideration to our views.

Let me conclude by reiterating the Department’s strong support
for the Unfunded Mandates Reform Act and for the value of con-
sulting early and often with State, local, and tribal governments on
issues that may affect them. The Department’s recent activities
demonstrate our commitment to this goal.

At the same time, we oppose the four ACIR preliminary draft
proposals on statutes that fall within the purview of the Depart-
ment of Labor. These proposals, if enacted into law, would under-
mine essential workplace protections for employees of State and
local governments as well as many employees working on federally
assisted State and local construction projects. I hope the commis-
sion will revise its final report in light of the Department of Labor
and other concerns as they affect State and local government work-
ers,


176

(G)(i) the mitigation of negative impacts on the
private sector that may result from relieving State,
local, and tribal governments from Federal mandates
(if and to the extent that such negative impacts exist
on the private sector); and

(ii) the feasibility of applying relief
from Federal mandates in the same manner
and to the same extent to private sector
entities as such relief is applied to State, local,
and tribal governments; and

(4) identify and consider in each recommendation
made under paragraph (3),to the extent practicable--

(A) the specific Federal mandates to which the
recommendation applies, including requirements of
the departments, agencies, and other entities of the
Federal Government that State, local, and tribal
governments utilize metric systems of measurement;
and

(B) any negative impact on the private sector
that may result from implementation of the
recommendation.
(Emphasis added.)
It is clear that the Commission is authorized by Section 302(a)(1) of

the Act to “investigate and review the role of Federal mandates in inter-

governmental relations and their impact on State, local, tribal, and Federal


62

Thank you for your consideration of our views.
the comments and concerns Taleed here will easist che’
completing its work.

Sincerely,

Enclosure


86

This concludes my statement. I would be happy to answer ques-
tions that you might have and other members of the committee.
[The prepared statement of Mr. Anderson follows:]


121

weapon ban, and I need to be on the floor during the debate on the
repeal of the assault weapon ban. So Mr. Towns is going to help
out and then Mr. Davis. I apologize to the third panel.

I’m sorry, Mr. Green.

Mr. GREEN. Thank you, Mr. Chairman. Before we have to run
and vote and finish the panel, I would like to just ask one brief
question of Mr. Anderson.

Mr. Anderson, I know in your testimony you talked about Davis-
Bacon, and in the next panel we will have a member from the
School Board Association talk about Davis-Bacon requirements. It’s
my understanding—and I served 20 years in the legislature, so I
understand about mandates that I got tired of from Washington—
but under Federal Davis-Bacon laws, a school district wouldn’t
have to comply with that unless they received Federal funding; is
that correct?

Mr. ANDERSON. That’s correct.

Mr. GREEN. So a lot of the Davis-Bacon requirements probably
go from what we call in Texas “prevailing wage laws” that were
passed by the individual legislatures.

Mr. ANDERSON. Yes. By those States, yes.

Mr. GREEN. OK. So the testimony we're going to hear in a few
minutes by the School Board Association, or anyone else, is that
the Davis-Bacon requirements only flow if that school is being built
by some Federal funding.

Mr. ANDERSON. If that school is being constructed with Federal
funds or with some contribution of Federal funds, yes.

Mr. GREEN. OK. Thank you, Mr. Chairman. I’m going to run and
vote, and I’ll be back for the third panel. .

Mr. SouDER [presiding]. 1 want to thank the panel for putting up
with questions, and if we have additional written questions, and
working together with us, because it’s the start of this type of ana-
lyzing; it’s not the end.

The committee stands in recess.

Mr. PAYNE. Mr. Chairman.

Mr. SoupDER. May I have your attention. I wasn’t paying close
enough attention. The committee is reconvened for questions from
Mr. Payne. Sorry.

Me PaYNE. Well, I'll be very brief, because I have no other
choice.

Let me just ask, on the whole question of education, the Individ-
uals With Disabilities Education Act, one of the recommendations
is that the individual will be unable to bring a lawsuit, only the
State or the Federal agency. What likely impact do you see on the
education of children with disabilities and their parents if the indi-
vidual right of action of the individual is taken away?

Ms. STUDLEY. We are very concerned that this would select out
one particular constitutional right in our country and deprive par-
ents and children of that right, selectively, when all other constitu-
tional rights can be pursued in the Federal courts by individuals
themselves. But let me introduce, again, Assistant Secretary Judith
Heumann, who is certainly the expert in this area.

Mr. SOUDER. We need to do a quick swearing in of all witnesses
at the hearing.

(Witness sworn.]


124

_ Other signs of progress on the Federal level include a new will-
ingness on the part of Congress to reassess existing mandates. This
new attitude was manifested by the recent repeal of two mandates:
the 55-mile-per-hour speed limit and the recycled crumb rubber re-
quirements in highway construction.

The EPA’s new participatory approach to rulemaking and pro-
posed changes to allow more local flexibility in implementing envi-
ronmental mandates are also steps in the right direction. And your
proposed Local Empowerment and Flexibility Act promises further

elp. The application of the Fair Labor Standards Act to congres-
sional personnel is also a significant achievement.

However, mandates still cause concern. An onerous new report-
ing requirement was incorporated into H.R. 3019, the continuing
resolution passed earlier this month. The Unfunded Mandates Re-
form Act does not address such conditional mandates, only direct
ones, nor does it apply to discretionary mandates, mandates al-
ready in existence, or to those mandates that have been exempted.
Though we are optimistic, the full effect of this new law remains
to be seen.

The only Federal agency that currently serves as a resource to
help States and localities with intergovernmental issues, the highly
respected U.S. ACIR, is slated for termination by the end of this
year. States and local governments need more relief. In some cases,
it can be provided through specific manageable changes.

I do not dispute that important national interests, such as pro-
tecting endangered species, ensuring safe drinking water, and con-
trolling air and water pollution, can justify mandatory Federal
standards. But our commitment to national goals should not under-
mine intergovernmental relations. A balanced Federal-State-local
approach to these issues, a partnership, will be more effective than
imposed, rigid, intrusive, prescriptions.

Because service delivery is local, the benefits of consulting State
and local representatives before creating a mandate are apparent.
Those directly affected can identify alternative, less costly tech-
nologies, multijurisdictional approaches, or other win-win solutions.

Besides more consultation, let me suggest other changes Con-
gress might consider. Mandated Federal programs should empha-
size performance goals but should not dictate specific procedures.
States and localities should be encouraged to achieve results in the
manner they think best. Incentives should be built in. Federal
standards should be based not only on benefits but also on cost.
From that perspective, a completely risk-free environment may not
be feasible. Therefore, the highest priorities, the most serious
threats, should be addressed first.

The Federal Government should offer resources such as scientific
data and technical support to help strengthen governments at a
State and local level. Statutes and regulations should be clearly
written to reduce the exposure of States and localities, especially
smaller ones, to the risk of litigation. Rules should be simplified to
reduce paperwork. New rules should be pilot-tested. Unnecessary
complexity and confusion should be eliminated through agency co-
ordination.

States offer many examples of programs that work. Virginia has
several that could serve as models. In addition to compiling a cata-


31

OFFICE WITH RESPECT TO SOME OF THE NOVEL PROCEDURES THAT THE
MANDATES LAW CREATED TO ACHIEVE OUR PUBLIC POLICY GOALS. IN OUR
VIEW, NO TECHNICAL CORRECTIONS ARE MERITED NOW, BUT WE WILL
CONTINUE TO MONITOR HOW WELL THESE PROVISIONS ARE WORKING.

WITH RESPECT TO THE OTHER TITLES OF THE MANDATES ACT, LET ME
JUST SAY THAT I LOOK FORWARD TO REVIEWING THE ANNUAL STATEMENT ON
AGENCY COMPLIANCE WITH THE MANDATE REQUIREMENTS -~ THIS IS A
VITAL PART OF THE EFFORT TO REDUCE THE BURDEN OF MANDATES. AND,
FINALLY, AS A NEW MEMBER OF ACIR, I LOOK FORWARD TO WORKING WITH
YOU, MR. CHAIRMAN, ON THE IMPORTANT TASK OF REVIEWING EXISTING

MANDATES.


156

can have the option, sometimes, to pass them through without
doing too much. When it gets down to the end, somebody has got
to have some revenue. So there’s that part of it, too. Otherwise, I
agree with your comment, but I just wanted to add that.

Let me just sort of move on to say that, Mr. Saunders, I listened
to your comments very carefully and also read your testimony. You
noted that there was no attempt, I think you said, by the commis-
sion to obtain the input of State and local government employees,
that no employees were actually talked to. Let me just sort of make
certain. Did you make an attempt or did your organization make
an attempt to have your views represented in the ACIR? If so,
what was the response, if you did?

Mr. SAUNDERS. Our position is very public, as far as supporting
these issues that the ACIR dealt with. Our lobbyists attempted to
deal, on various occasions, in putting those in writing and dealing
with the concerns, and sitting down as equals to talk about the is-
sues and the problems that this report or these recommendations
were sing to bring to us. We did not have that opportunity.

And let me go a step further and say that there is a public hear-
ing that’s supposed to take place, and the ACIR scheduled this
hearing as a conference, which was a conference which participants
would have to pay to get in to provide that public testimony. There
was such an outcry to that, that that plan was changed, and now
there is a session, and I believe it’s next Tuesday, where there, in
fact, is going to be public testimony.

But at one time they were planning a conference where you had
to pay to get in to provide testimony. That, to us, does not seem
fair; it doesn’t seem equitable. We think that we have some good
things to say about these issues, and the employees and the em-
ployee organizations, and those groups that are concerned about
the recommendations coming out of ACIR had no opportunity to
provide input.

Mr. Towns. Thank you very much for your comments.

Let me just sort of go to you, Mr. Resnick. I listened to your com-
ments, too. In April 1995, in the GAO report entitled, “School Fa-
cilities: America’s Schools Not Designed or Equipped for the 21st
Century,” it was determined that schools with 50 percent or more
minority Populations were more likely to have unsatisfactory envi-
ronmental conditions, such as lighting, physical security, and less
likely to have technology elements, wiring, they went on to say, in
terms of inadequacies in that area.

Without Federal education mandates, how can we address in-
equities such as these?

Mr. RESNICK. Well, this is a very serious question that you're
asking. I don’t mean to be flip in my response, but with some of
the mandates, they impede our ability to get the job done. The
problem that we face—and I’m sure you're familiar with Jonathan
Kozol’s work, “Savage Inequality,” containing heart-rending stories
of urban school districts that we’re familiar with, in which the con-
ditions in which students have to learn are just deplorable. You
wouldn’t want to work there; why would you expect a child to be
able to learn in those environments?

We just simply can’t continuously, though, place mandates on the
schools and expect the money to be generated inside the tax base


179

National Labor Relations Act, the Labor-Management Reporting and
Disclosure Act, the Employee Retirement Income Security Act and the
Sherman Anti-Trust Act, to name a few, contain express or implied
exemptions for state and local governments.

These and other federal laws and regulations of general applicability
that exempt state and local governments from coverage reflect the effective-
ness of the procedural safeguards inherent in the structure of the federal
political process. On the other hand, state and local governments have been
able to direct a substantial proportion of federal revenues into their own
treasuries in the form of general and program-specific grants-in-aid and other
forms of federal financial assistance. As a matter of fact, according to the
Commission's own figures, such federal funds account for about one-fifth of
state and local government expenditures.

Thus, while state and local governments have been able to obtain a
substantial share of federal revenues, they have also been successful in

exempting themselves from a wide variety of federal mandates. The merits


7

sector $100 million or more per year, agencies must prepare a writ-
ten statement identifying the costs and benefits of the mandates in
the rule.

A report from the Office of Management and Budget to be re-
leased today indicates that 16 of these statements have been writ-
ten to date, not an especially high number. That means one of two
things: Either agencies are not promulgating many costly new
rules—that would be our hope—or they are ignoring the law. I cer-
tainly hope that it is the former. OMB is also directed by law to
share these statements periodically with the Congressional Budget
Office, and they finally did so just 2 days ago.

My hope is that the administration will comply with the Un-
funded Mandates Reform Act in letter and in spirit. I look forward
to Administrator Katzen’s testimony on Title II this morning.

The Advisory Commission on Intergovernmental Relations is
working to finalize its recommendations with regard to existing
mandates, which is required under Title III of the Unfunded Man-
dates Reform Act, and a title in which I have a particular interest.
I know the preliminary report met with some controversy. This is
probably unavoidable when one considers that most of the man-
dates addressed in the preliminary report have very sizable con-
stituencies and laudable goals.

The fact remains, however, that these same mandates are the
most expensive for State and local governments to implement.
Therefore, I think it is appropriate to explore alternatives, and I
hope that can be discussed during our hearing this morning.

I would like to note for the record that the final ACIR report,
which we expect next month, must include some discussion of how
ACIR’s recommendations would affect mandates on the private sec-
tor. This is a requirement of the law but is lacking from the pre-
liminary report and I hope it will be addressed in the final report.

I have new hope for the final report, however, because ACIR’s
two newest members are you, Mr. Chairman, and Mr. Portman.
ACIR I know will benefit greatly from your expertise and your com-
mitment to relieving the burden of mandates on States and local-
ities.

So, Mr. Chairman, I want to thank you for your continued excel-
lent and outstanding leadership on the mandates issues, and I look
forward to the testimony. Thank you again for holding this hear-
ing. I thank Mr. Towns again for yielding to me.

[The prepared statement of Hon. William F. Clinger, Jr., follows:]


139

Again, while NSBA fully supports the goals of the law, we fault the Congress for
both not living up to its financial commitment, and, as a result, not having the
incentive to make cost-benefit decisions about its mandate. As a result, IDEA is
unnecessarily preempting school districts from making the best expenditures of
its funds for children in both regular and special education.

v. CONCLUSION

The Unfunded Mandates Reform Act of 1995 is first and important step to stopping
the flow of unfunded federal mandates that occur in every facet of school district
business. Congress must be ever vigilant to ensure that any new federal mandates are
accompanied by adequate funding; and more important, federal mandates are
evaluated in terms of the existing mandates on schools. Now Congress has the
opportunity to begin examining current federal mandates both for their relative priority
and scope to ensuring that school districts can devote their financial resources to their
mission for public education. The taxpayers who complain about the quality of public
schools are finally learning that members of Congress must be held accountable for the
votes that spend education’s scarce dollars. The very children Congress seeks to help
are the ones who are hurt most by unfunded mandates. NSBA asks you to always to
remember, “Is this how your local constituents want you to spend their taxpayer

money?”

Again, thank you for the opportunity to testify before your committee.


147

The ACIR was charged with identifying those mandates which
are duplicative, obsolete, or lacking in practical utility. But, as we
all know, in the case of these labor protections, there are no com-
parable Federal laws, and where corresponding State laws do exist,
they are often weak or inconclusive.

The ACIR has recommended repealing those provisions of FLSA
extending coverage to State and local government employees, in-
cluding the minimum wage, the 40-hour work week, and requiring
comp. time or overtime pay for hours worked over 40. No such rec-
ommendation is made for employees with exactly the same jobs
who work in the private sector. Now, is it fair to extend FLSA pro-
tections to some trash collectors and not to others, or to some cor-
rections officers and not to others, or to some hospital workers and
not to others?

There is little reason to believe that State and local governments
will automatically adopt provisions similar to current Federal law
if current coverage under FLSA is repealed. Twenty-three States
and the District of Columbia currently lack a minimum wage law
applicable to State and local government employees or have one
that sets the wage lower than the Federal minimum wage. Thirty-
two States plus the District of Columbia lack overtime provisions
in their laws applicable to State and local government workers.

Moreover, the commission’s argument that public employee
unions have the ability to negotiate these protections lacks credible
supporting evidence. Nearly two-thirds of State and local govern-
ment workers do not belong to labor unions, and nearly 5.5 million
lack collective bargaining rights altogether. As a matter of fact, in
24 States, there is no collective bargaining legislation which en-
ables us, as employee representatives, to sit down as equals and
negotiate over wages and benefits and working conditions.

Now, ACIR’s recommendation that coverage under the Occupa-
tional Safety and Health Act should be eliminated for State and
local government workers should also be rejected. OSHA—and let
me stress this—OSHA is a voluntary program in the public sector.
It is not a mandate, because the only State and local government
workplaces covered by OSHA are located in States where the State
legislature has voluntarily agreed to participate. Indeed, 27 States
have not chosen to cover public employees under OSHA.

Additionally, the ACIR used invalid criteria on which to base its
OSHA recommendation. Where is the financial analysis? Where is
the cost impact?

Finally, let me just briefly touch on the Family and Medical
Leave Act. The ACIR has recommended that Congress repeal cov-
erage for State and local government employees under the FMLA,
without ever hearing workers tell their real-life stories of how their
lives have changed. Again, I must point out that ACIR has failed
to do its homework. Where is the financial data to back their find-
ings? We don’t see it.

On the contrary, the DOL’s bipartisan commission on leave re-
ported that just the opposite occurred in the private sector. We find
it difficult, if not impossible, to accept that the experience in the
public sector is so dramatically different, especially since State and
local governments offered more extensive family and medical leave
than the private sector, prior to FMLA’s enactment.


153

Mr. Davis. Thank you very much.

Let me start the questioning, then I will go to Mr. Towns.

We had a tough vote this week on the immigration bill, in terms
of public school systems that currently have to, under law—some
would say constitutionally, others would say Federal law—educate
the children or, in many cases, illegal immigrants—not the chil-
dren, illegal immigrants altogether.

It was a tough vote for me, because I don’t know what else you
do with them once they are here. You turn them loose, they get
into gangs, everything else. But it’s a huge mandate to come from
the Federal Government and a job of policing the borders that
ought to be the Federal Government’s. So we wrestled with that.

It passed the House by a fairly substantial margin. In the end,
I decided, along with the majority of my colleagues, that the man-
dated function of this—we should not bar illegal immigrants from
being educated, but not mandate from the Federal Government
that local funds be used for that. But it’s one of many tough trade-
offs that you have when you take away a Federal guarantee and
send it down to States and localities that may act in a different
way.

Any thoughts on that particular aspect or in general about losing
some of the guarantees you have when the Federal Government
gives them up and sends it down to the States and localities?

Mr. RESNICK. Well, I think you certainly point to an important
issue that is particularly sensitive in the five or six States across
this country that have a very high impact of immigration, both
legal and illegal. Of course, the Supreme Court, in the case of
Plyler v. Doe, decided for us that the public schools have to educate
the children involved.

Our association does make a distinction between what our na-
tional immigration policy is, and what we do with children who
come into this country under that policy. And we believe that, par-
ticularly with the requirements of Plyler v. Doe, that they should
be educated.

The question, then, is that, as a result of the immigration policy
that the country pursues, what is the role of the Federal Govern-
ment to help us fund the aftermath of its policy? Further, what
should be the administrative requirements that are involved? We
are concerned that there have been provisions put forth in the Con-
gress that would result in significant recordkeeping and book-

eeping on the part of school districts, and in their other programs
to decide which students are here legally and illegally.

_ But, in terms of the larger point, Me Davis, from our perspec-
tive, the Supreme Court certainly has required that school dis-
tricts, using local tax dollars, educate immigrant children, both
legal and illegal. The incidence of the districts where they attend
school is only by happenstance. Therefore, if this requirement is a
matter of national policy, certainly the Federal Government has an
interest, if not an obligation, to help support us, so that the edu-
cation of all children in those communities can be retained at the
highest levels possible.

Mr. Davis. There was an amendment offered in the Rules Com-
mittee that would have sent Federal money with the Federal re-
quirement, and we weren't able to get that to the floor. That’s prob-


46

ACIR issued a preliminary staff draft for public review and comment on January 5, 1996. We
taised serious concerns with ACIR’s staff draft report in a March 1 letter from Marcia Hile,
Assistant to the President for Intergovernmental Affairs to Governor Winter, the Commission’s
Chairman (I am attaching a copy of this letter to my testimony). Given Congress’ decision to
terminate the Commission this year, as well as the limited amount of funding to carry out the
study and proceed to shut down, it is not surprising that ACIR’s staff draft report did not meet
the ambitious Congressional charge.

In the Administration’s letter, we noted that the staff draft did not address the legislative request
in a number of ways, including:

* it does not develop a sufficient conceptual framework for consideration of unfunded
mandates;

+ itedoes not address how State mandates affect local governments;

+ itdoes not address how we should measure the costs and benefits of mandates, and

* it fails to consider the positive impact on working men and women of federal mandates.

In addition, we noted it provides only cursory and often misleading analyses of 14 Federal health,
safety, environmental, and labor laws. Several Federal agencies that implement those laws
submitted letters directly to ACIR. My colleagues on the panel will discuss the specific statutes

‘We understand that ACIR received other critical constructive comments, and will likely receive
more at a public hearing next week. The Administration looks forward to working with ACIR
staff to produce a revised report for Commission consideration, which we expect will reflect these
‘important comments and concerns.


6

With that, I would like to call on the ranking member of this
committee, Mr. Towns.

Mr. Towns. Thank you very much, Mr. Chairman. I would be
prepared to yield to the chairman of the full committee.

r. SHAYS. I appreciate that. Thank you.

Mr. CLINGER. Thank you very much, Mr. Towns. It’s not nec-
essary, but I’m appreciative.

Mr. Says. You know, he hasn’t finished his statement. Every
time he likes to point out that he’s ranking member now, but next
year.

Mr. Towns. That's right.

Mr. Suays. So he wants to give us our chance while we have it.

Mr. Towns. And I want the protocol to be followed.

Mr. CLINGER. The precedent is being established; right.

Well, thank you very much, Mr. Chairman. As you said, 1 year
ago today, I do remember standing in the Rose Garden for the sign-
ing of the Unfunded Mandates Reform Act, a bill with very broad
bipartisan support and a very key piece of the Contract with Amer-
ica. It was, for me, a very proud day. And despite the dire pre-
dictions of those opposed to the legislation, the sky has not fallen;
indeed, I think Americans are better off, and Congress is better in-
formed, as a result of this law.

Testifying before us this morning are a number of our colleagues,
without whom the Unfunded Mandates Reform Act would never
have been a reality. Certainly, Representative Rob Portman of Ohio
and Representative Gary Condit of California were very instrumen-
tal in that. We are also going to be pleased to have Congressman
Talent from Missouri testifying before us this morning. All have
been interested in this legislation and have been as instrumental
in the act’s implementation as they were in its passage. And I am
very eager to hear their thoughts, suggestions, and criticisms this
morning.

I can tell you, from my perspective, the law works. The few test
cases we have had since Title I took effect in January bear that
out. Congress is more sensitive than ever before to the impact of
legislation on State and local governments and the private sector.
I think it has had an influence across the board. We see much clos-
er attention being paid to the drafting of legislation, to ensure that
unfunded mandates are not included.

While some have used the point of order, or a threat of it, for
rhetorical purposes, I don’t feel it has been abused at this stage of
the game. I believe the point of order has gotten State and local-
ities a seat at the table and made all of us in Congress think twice
before passing costly new mandates on to our State and local part-
ners and on to the private sector.

l also want to recognize the fine work of the Congressional Budg-
et Office in fulfilling their critical responsibilities under the act.
CBO has done an outstanding job turning complex cost estimates
around in short order, which has been key to the successfully im-
plementation of the law.

So, Mr. Chairman, while I am very pleased with the implementa-
tion of Title I, I have to say I am less than enthusiastic about the
effectiveness of Title II, which applies to Federal agencies. For
rules estimated to cost State and local governments or the private


40

Mr. Payne. Thank you very much.

Mr. Suays. We thank you, again, panel, for your patience. We
will go in the order in which I called you.

So Ms. Katzen, welcome. You can summarize your testimony; you
can read it. We're going to try to stay within the 5-minute testi-
mony time for each witness. Your summary is welcome. However,
if you want to proceed, feel free.

STATEMENTS OF SALLY KATZEN, ADMINISTRATOR, OFFICE OF
INFORMATION AND REGULATORY AFFAIRS, OFFICE OF MAN-
AGEMENT AND BUDGET; SHELLEY H. METZENBAUM, ASSOCI-
ATE ADMINISTRATOR, OFFICE OF REGIONAL OPERATIONS
AND STATE/LOCAL RELATIONS, ENVIRONMENTAL PROTEC-
TION AGENCY; BERNARD E. ANDERSON, ASSISTANT SEC-
RETARY FOR EMPLOYMENT STANDARDS, DEPARTMENT OF
LABOR; AND JAMIENNE S. STUDLEY, DEPUTY GENERAL
COUNSEL, DEPARTMENT OF EDUCATION, ACCOMPANIED BY
JUDITH HEUMANN, ASSISTANT SECRETARY FOR SPECIAL
EDUCATION AND REHABILITATIVE SERVICES

Ms. Katzen. Thank you very much. Good morning, Mr. Chair-
man and members of the subcommittee.

The Office of Information and Regulatory Affairs at OMB, which
I head, is charged, under various Executive orders, with the task
of coordinating and reviewing executive branch regulatory policy
matters. I therefore thank you for extending us an opportunity to
testify this morning on this issue.

I also want to join those before me who have commended you for
holding this hearing. The Unfunded Mandates Act is one which
President Clinton has enthusiastically supported. It addresses a
real issue: the ability of State, local, and tribal governments to
shoulder increasing Federal mandates with static or diminishing
revenues and resources. And it attacks this problem, I think, in an
enlightened and effective way.

Today, the first anniversary of the signing of the Unfunded Man-
dates Act—and it was indeed a sunny and somewhat warmer day
last year at this time in the Rose Garden—is a most appropriate
occasion to review the record and events to date. There are two I
would like to address.

As you mentioned, today is the day specified in the statute for
production of the OMB report on agency compliance with Title IL
of the legislation. We met the due date. We submitted copies of
that report to all addressees this morning, with advance copies to
the committee staff, and I attached a copy to my written testimony
that was submitted for this morning.

Our report shows that executive branch agencies have given very
serious thought to and established real processes for consultation
with their intergovernmental partners. The processes that are es-
tablished for such consultation are varied, depending on the dif-
ferent missions of the agencies and their different constituents.

Some agencies, like the Department of Defense and the Depart-
ment of State, do not generally issue regulations with intergovern-
mental effects, and their processes are fairly simple and straight-
forward. Other agencies, including the Environmental Protection
Agency and the Departments of Labor and Education, representa-


120

administration believes that there are productive, constructive
ways to work with State and local governments.

I would point out that, with respect to the ACIR report, they are
attacking laws that were passed with bipartisan support by both
Democratic and Republican Members of Congress, signed by both
Democratic and Republican Presidents over the years.

They reflect, I had thought, a national consensus that certain
conditions, certain rights were appropriate at the Federal level.
Whether they should be imposed with command-and-control rather
than flexibility, whether there is only a one-size-fits-all, or harmo-
nization are very legitimate questions.

But I think what some of the panel members were reacting to—
and I'll let them speak for themselves in this regard—was to sort
of almost dismissedly say, “These statutes impose mandates. We’re
not going to look at the benefits. We just see the costs, and we
want to walk away from them,” was an attitude that we thought
was not in keeping with the kind of consultative, harmonizing,
intergovernmental partnership that has, I think, characterized this
administration.

Ms. METZENBAUM. Mr. Chairman, may I try and answer that?

Mr. SHays. Yes. We’re going to try to end with your panel, and
we have about 11 minutes left. So if you can give a quick response.

Ms. METZENBAUM. I just wanted, Congressman, to respond to
your question that we think the Federal Government knows more
or knows better, and I don’t think that’s our view at all. I think
that, in our work with State and local governments, the effort has
been to figure out which governmental party ought to do what. And
the real issue is, there is a role for the Federal Government.

As we look at the history of our laws, for example, the Safe
Drinking Water and Clean Air Acts, you will find not only biparti-
san support for passage of these laws but also State and local gov-
ernment supporting the passage of the laws. So it’s really a rec-
ognition that sometimes you need a Federal role. That doesn't
mean that the Federal Government knows better, but rather that
all of the parties need to work together. The Federal Government
needs to do something, and States need to do something, and locals
and tribes need to do things.

Mr. SHAYS. Do you want to make a last comment?

Mr. SouDER. I just want to make a brief comment. I agree that
particularly when things cross State lines—environment, in par-
ticular, may run into that, others—there are certain interests
where the Government has a compelling interest.

But I do not agree with the premise that—and I didn’t accuse
people of not being friendly in the relations or trying to do that—
what I said was that when one side has the power and has the de-
termination of whether a waiver occurs, whether or not, you still
have an implied superiority/inferiority relationship that implies the
one doesn’t.

That’s all.

Mr. SHays. What we're going to try to do is, Mr. Green, we're
going to have you proceed, as a member of the committee, then
allow Mr. Payne to finish up.

And I just want to say, at this time, I will miss the third panel.
I am taking control of the floor time against repeal of the assault


19

Mr. SHays. Thank you, Mrs. Morella. At this time I would call
on Mr. Fattah.

Mr. FatTaH. Thank you, Mr. Chairman. I am anxious to hear the
testimony, so I will be brief in my opening remarks.

I am fascinated by the notions that have come forward in this
report, that we would create a second class of citizenship, in terms
of protections provided by the Federal Government for workers at
the State and local level, that we would repeal a whole host of pro-
tections that the National Government has put in place.

Nonetheless, I will retreat from any longer statement and look
forward to the testimony that will come forward. Thank you.

Mr. SHays. I thank the gentleman. With this in mind, I would
ask unanimous consent that all members of the subcommittee be
permitted to place an opening statement in the record and that the
record remain open for 3 days for that purpose. Without objection,
so ordered.

I would also ask unanimous consent that our witnesses be per-
mitted to include their written statements in the record. Without
objection, so ordered.

Before I call on you, Mr. Talent, I am just going to read the para-
graph written by President Clinton when he signed the mandates
bill. I think it is quite a significant statement. He said, “Today we
are making history. We are working to find the right balance for
the 21st century. We are recognizing that the pendulum had swung
too far and that we have had to rely on the initiative, the creativ-
ity, the determination, and the decisionmaking of the people at the
State and local level to carry out much of the load for America as
we move into the 21st century.

“This bill will help keep the American dream alive and help to
keep our country strong. Every Member of Congress here who
voted for it, and everyone who is not here, deserves the thanks of
the American people.” And then he said, “I am honored to sign this
bill.” I think that says a lot.

With that, Mr. Talent, I welcome you. You are the first to come
to this hearing, and I welcome your testimony.

Mr. TALENT. I thank you Mr. Chairman, and I thank the mem-
bers of the subcommittee. Thank you especially, Mr. Chairman, for
allowing me to appear here on short notice.

Mr. Suays. Mr. Talent, I regret to say that I have forgotten to
do something very important—we swear in all our witnesses. We
have Cabinet officials who come in, and we swear them in. I need
to swear both of our witnesses in.

Mr. TALENT. No problem whatsoever.

Mr. Says. If you don’t mind, if you would both stand and raise
your right hands.

(Witnesses sworn.]

Mr. Suays. Thank you. For the record, both have acknowledged
in the affirmative, and I thank you for that. Sorry to have inter-
rupted you.

Mr. TALENT. No problem, Mr. Chairman.


14

policies also paid a price in terms of lost productivity and expensive
retraining costs. Do we really want to go back? I think not.

The ACIR also recommends that provisions of the Fair Labor
Standards Act and Occupational Safety and Health Act covering
State and local employees be repealed. I would like to better under-
stand what effects this would have on the workplace and on our
State employees.

other recommendation that several mandates be revised in-
cludes three important environmental regulations: the Safe Drink-
ing Water Act, the Endangered Species Act, and the Clean Air Act.
These environmental laws were enacted to protect the public
health. I hope that during today’s hearing we will hear more about
how they would be revised to ensure that we don’t reverse the im-
portant progress that we have made in cleaning up our environ-
ment.

The legislation that was signed a year ago today struck an im-
portant balance between ensuring that States and localities are not
unduly burdened with unfunded mandates and that public health
and environmental standards are not compromised. I look forward
to today’s hearing shedding light on exactly how we are striking
this balance. I also look forward to our witnesses, and especially
our first panel of our colleagues who worked hard on this issue.

Thank you, Mr. Chairman.

{The prepared statement of Constance A. Morella follows:]


(ove MuNDRED FOURTH CONGRESS

Congress of the United States

House of Representatives

COMMITTEE ON GOVERNMENT REFORM ANO OVERSIGHT
2157 Ravouan House Orrice BunoIna

Wastineaton, OC 20515-6143
‘SUBCOMMITTEE ON HUMAN RESOURCES
'ANO INTERGOVERNMENTAL RELATIONS
‘Choatooher Shaya, Connecticut
‘Chaerman

oom 8-372 Rayburn Buldng
‘Washington, D.C. 20515
“Tet 202 225.2548
Fax: 202 225-2982

Statement of Rep. Christopher Shays
March 22, 1996,

On March 4, 1801, in his first inaugural address, Thomas Jefferson called for “the support
of the State governments in all their rights, as the most competent administrators for our
domestic concems.” On March 22, 1995, President Clinton joined this Congress in our
commitment to respect the rights and the competence of our sovereign state partners by signing.
the Unfunded Mandates Reform Act ("Mandates Act” or “Act”). Today, exactly one year later,
‘we examine the extent 10 which implementation of the Mandates Act has answered Jefferson's
call

The debate over unfunded mandates involves both constitutional principles and fiscal
realities. 11 is a debate about ends justifying means, and the need to acknowledge and respect
‘whose means are spent to reach national ends,

In the past, it was enough to declare a problem national and mandate a solution. The
fiscal implications of federal laws and regulations on state and local governments were seldom
‘an explicit part of the debate. As the Advisory Commission on Intergovernmental Relations
{ACIR) observes in their preliminary report on existing mandates, “the Washington tendency
thas been to treat as a national issue any problem that is emotional, hot and highly visible. Often
this has meant passing a federal law that imposes costs and requirements on state and local
government without their consent and without regard for the ability to comply.”

That is no longer the case. Congress now has to identify, quantify and explicitly
acknowledge the impact of new laws on our intergovernmental partners. Three of our colleagues
will testify today on the impact of the Mandates Act on specific legislation. Their perseverance
helped pass the Mandates Act and their vigilance is helping to ensure it works. We welcome
their participation. I particularly want to thank the co-authors of this legislation, Mr. Portman
and Mr. Condit, for their bi-partisan work on mandate reform. And we all owe a debt of
gratitude to Chairman Clinger for his outstanding work in marshaling this bill through the
legislative process.


132

Michael A. Resnick
Senior Associate Executive Director
National School Boards Association

I. INTRODUCTION

Iam Michael Resnick, Senior Associate Executive Director of the National School
Boards Association. NSBA represents the 95,000 local school board members who are
responsible for governing the nation’s local public school districts. I am pleased to be
here with the members of Congress who have worked so hard to bring and sustain
congressional focus on the problems created by unfunded federal mandates. NSBA
specifically would like to acknowledge the work of Senator Kempthorne and
Congressman Portman to achieve passage of the Unfunded Mandates Reform Act. And
now, NSBA appreciates the opportunity to testify one year later on an issue of such
great importance to every school board actoss the country.

I. INTEREST OF LOCAL SCHOOL BOARD MEMBERS

As locally elected and appointed government officials, school board members are
uniquely positioned to address federal legislative programs from the standpoint of
public education, without consideration to their personal or professional interests. The
vast majority of school board members are not paid for their service. Rather, they give
their time because they care about the education of their own children and the children
in their community. The education, health, and safety of those children is a very real
concem for these community leaders. They want to ensure that the children in their
community get the very best education that can be provided. Unfortunately, unfunded
federal mandates all too often preempt local ingenuity and the fiscal resources those

community leaders need for the education of their community's children.

sa.


110

Page 2 - Honorable William Winter

enacted in 1975, and signed by President Ford, to assist the
States and school systems to meet their basic Constitutional
obligations. Accordingly, it is neither realistic nor
appropriate to link, as the draft staff report does, compliance
with IDEA requirements to dramatic funding increases.

(2) "Relieve States From Administrative Mandates." As
described below, many of the provisions of the Administration’s
proposal to reform and reauthorize IDEA are designed to. reduce
burden and paperwork at the school, school district, and State
level and redirect those energies into improving educational
outcomes for disabled children. These provisions are already the
subject of considerable Congressional interest.

(3) "Require Alternative Dispute Resolution Practices." The
Administration's proposal vould require States to offer impartial
mediation to parents as a no-cost optional means of settling
disputes between them and the school district regarding services
provided to their disabled child. We considered, and rejected as
impractical, requiring parents to avail themselves of mediation,
based in part on the comments of State administrators with
experience in the operation of mediation systems.

(4) "No Private Right of Action." I am strongly opposed to
ACIR’s fourth recommendation, to require that any court challenge
based on IDEA be brought by State or Federal agencies, not
parents. My opposition is based on the following considerations:

(A) Depriving parents and students of the ability to
vindicate their rights under IDEA in court, if necessary, is
fundamentally inconsistent with the intent of the law to create
individual rights in those parents and students, and would call
into question the nature of the "rights" created.

(B) While one of the objectives of the Administration’s
proposal is to promote means of settling disputes between parents
and school systems without using litigation, the amount of
litigation spawned by IDEA is not disproportionate. IDEA serves
each year approximately 5.4 million disabled children in
proximately 16,000 school districts across the country, and
according to ACIR’s study, there were 61 reported cases in the
Federal courts under IDEA in calendar year 1994--on average,
slightly more than one in each State.

(C) Without correspondingly large increases in funding for
Federal enforcement staff (e.g., investigators, resolution
experts, and litigators)--an unlikely result in today’s climate,
and not called for by the draft staff report--IDEA enforcement
would be substantially undermined. Even if additional Federal
resources were available, it is hard to see how further


69

set forth in statutes. We have responded to that by adopting a new
policy that allows jurisdictions with populations under 2,500 to ne-
gotiate alternative, enforceable compliance agreements with their
States to adjust the schedules for compliance without worrying
about EPA sanctions.

If you would like any additional information about these and
some of our other partnership projects, we would be glad to provide
it.

Sally has just described some of our efforts to implement the Un-
funded Mandates Reform Act, so I will not go into much additional
detail. I will say we are very proud of the progress we have made
in implementing the President’s Executive order on strengthenin;
intergovernmental partnership as well as the act. We have worke:
to implement not only the letter, but, as Congressman Clinger said,
the spirit of the law. We are firmly committed to that.

Finally, let me turn my attention to the ACIR report. EPA has
serious concerns about the content and recommendations of the
preliminary report. A fundamental problem with the report is that
it fails to examine why Federal laws and specific provisions of
those laws were enacted, to really look at the role of Federal man-
dates in the intergovernmental process.

Another problem with the report is its failure to consider the
beneficial aspects of Federal laws. If only costs are presented and
a minimum description of the benefits of a mandate are described,
any debate will inevitably be skewed.

The report also fails to acknowledge the progress that EPA and
other Federal agencies have made in the past few years to bring
common-sense reinvention to the way we run our programs. Title
III of the Unfunded Mandates Reform Act charges ACIR to make
recommendations for allowing flexibility, but the report makes no
attempt to look at our models that we have been developing over
the last 2 years to see whether or not there are some lessons there.

Finally, we have specific concerns about specific environmental
issues and proposals in the report; specifically, the proposals to
withdraw citizen rights, to relax water pollution control standards,
to eliminate Federal authority for drinking water, and to limit Fed-
eral tools for air pollution compliance.

We support the role of the ACIR. We look forward to working
with you, Mr. Chairman, on the Commission to try and revise this
report and come up with a much more balanced, informative prod-
uct.

Thank you.

(The prepared statement of Ms. Metzenbaum follows:]


24

and the immigration bill—I think the law has passed the test. Let
me elaborate.

A number of provisions in the Telecommunications Act con-
ference report interfered with the ability of local governments to
control what historically have been locally controlled public rights-
of-way. Working with the Conference of Mayors, the National
League of Cities, and others, we learned that language in the origi-
nal conference report, for example, arguably precluded the ability
of local jurisdictions to control the use of public property by cable
companies and receive appropriate compensation, even though the
intended use exceeded the original terms of the original franchise
agreement.

‘We were prepared to raise a point of order on the floor of the
House, an intergovernmental mandate point of order, and to garner
the necessary support against these mandates. With that leverage
that the Unfunded Mandates law gave us, we were able to work
with the Commerce Committee and leadership so that these man-
dates were removed before the bill reached the floor.

This, I think, is exactly how we hoped the law would be carried
out. And I hope it will be carried out in the future that committees
will work cooperatively with State and local governments and pro-
ponents of mandate reform ahead of time to address mandate is-
sues. So I think it did work.

Let me say that although there was no obligation, technically, to
get a CBO estimate on the conference report, there is hortatory
language in the bill that expressly addresses the unusual case,
which was the case in the Teleco bill, where the House and Senate
passed bills without mandates, but where the conference report in-
cludes new mandates.

In such a case, we hope and expect that the conference commit-
tees will continue to make every effort to work with the CBO, in
advance, to obtain an estimate. It is in the interest of the commit-
tees to do this, frankly, since they do run the risk of a Member
raising a point of order or a motion to strike on the floor with re-
spect to any mandates in a conference report.

In the second test case, the farm bill, let me just briefly say that
I think the mandates bill worked again. The Agriculture Commit-
tee complied with the act by including a CBO cost estimate for both
the public and private sector mandates. In this case there were no
public sector mandates, at least none that exceeded the thresholds
in the mandate law, but there were very significant private sector
mandates, including the most costly mandate that would have re-
quired higher fluid milk standards.

Among other things, the Solomon-Dooley amendment, in effect,
stripped these private sector mandates from the farm bill. As those
in this room will remember, the proponents of this amendment,
that is, the Solomon-Dooley amendment, used a CBO estimate and,
therefore, this act to make their case. As you know, this amend-
ment ultimately passed the House by a significant margin.

Finally, in its most recent test case, which would be the immigra-
tion bill which just came up, I think the mandates law worked
again. CBO did its analysis of the public and private sector man-
dates contained in the Bill, and the committee report included a
preliminary CBO estimate. The committee also had the final CBO


143

standards. Those costs will continue to be borne by our customers, and will continue to
grow without federal help.

And our plight is not unique:

The Billings, Montana Public Works Department estimates that mandates cost them $1.3
million per year out of a total departmental budget of $23 million. While Billings might
choose to carry out these programs for itself, the $1.3 million represents funds over which
it has no discretion, no opportunity to choose priorities as a community. For fiscal year
1995, Billings will spend almost $43,000 in salary and benefits on staff just to keep track
of environmental compliance rules and regulations.

Local governments are at the bottom rung of the ladder, the mandates stop here. I would
be hard pressed to find a town, city or state in this Country that is not faced with strong
fiscal constraints. We know that the federal government cannot find the money to fund all
of these mandates. So where are the points in this federal, state and local government
partnership equation that progress can be made?

We believe there must be room to work cooperatively with the federal government, a
willingness on their part to let solutions be identified at the state and local level. We need
that kind of flexibility if we ever expect to realize the intent behind these federal mandates.

Local governments need the flexibility to pursue solutions which prove successful for a.
variety of very site specific conditions. We need the time to develop, test and evaluate
the success of these real solutions in the real environment, not the laboratory.

The Americans with Disabilities Act of 1990 is a fairly new mandate, and one for which
the true costs to comply have yet to be fully understood by local governments. While the
legislation states broad goals of accessibility and accommodation for disabled persons, the
extent to which local governments must go to achieve those broad goals are not clear.

For some of our older cities, retrofitting buildings and accommodations is expensive, and
the limited solutions to comply may not meet the expectations of the disabled or satisfy
federal requirements. Since federal funds are not available, some accommodations must
be made on the part of the federal government to recognize the technical and fiscal
limitations local governments have in complying with this law, and work with us to
identify how best to spend our limited resources to achieve meaningful results for our
disabled citizens.

The costs involved in complying with provisions of ADA and other federal mandates are
often beyond the financial ability of local governments. Attempts to comply with some of
the provisions of ADA force local government to abandon or delay other worthwhile
objectives that also might further federal goals as the competition for local infrastructure
dollars intensifies . For example, under a proposed rule recently promulgated by the
Justice Department, sidewalk curb ramps would have to be installed at private residences


10

3
did just 2 days ago. My hope is that the Administration will comply with the
Unfunded Mandates Reform Act in letter and in spirit, and I look forward to

Administrator Katzen’s testimony on Title II this morning.

The Advisory Commission on Intergovernmental Relations is working
to finalize its recommendations with regard to existing mandates, which is
required under Title III of the Unfunded Mandates Reform Act. [ know the
preliminary report met with some controversy. This is probably unavoidable
when one considers that most of the mandates addressed in the preliminary
report have sizable constituencies and laudable goals. The fact remains,
however, that these same mandates are the most expensive for State and local
governments to implement. Therefore, I think it is appropriate to explore

alternatives.

I would like to note for the record that the final ACIR report, which we
expect next month, must include some discussion of how ACIR’s
recommendations would affect mandates on the private sector. This is a
requirement of the law, but is lacking from the preliminary report. I have new
hope for the final report, however, because ACIR’s two newest members are
you, Mr, Chairman, and Mr. Portman, ACIR will benefit greatly from your
expertise and your commitment to relieving the burden of mandates on States

and localities.


141

American Public Works Association
1301 Pennsylvania Ave. NW, Suite 501

Washington, DC 20004
Phone (202) 393-2792 fax (202) 737-9153

STATEMENT OF GEORGE G. BALOG, CHAIR
URBAN AFFAIRS COMMITTEE
OF THE
AMERICAN PUBLIC WORKS ASSOCIATION

BEFORE THE SUBCOMMITTEE ON
HUMAN RESOURCES AND INTERGOVERNMENTAL RELATIONS,
HOUSE COMMITTEE ON GOVERNMENT REFORM & OVERSIGHT

Friday, March 22, 1996

Chairman Shays and Distinguished Members of the Subcommittee on Human Resources
and Intergovernmental Relations:

My name is George G. Balog, and I am Director of the Baltimore City Department of
Public Works, one of the largest Public Works Departments in the Country. I am here
today in my capacity as Chair of the American Public Works Association’s (APWA)
Urban Forum. The APWA is the largest full-service membership organization of the
nation’s municipal public works professionals. Our 25,000 members help maintain the
nation’s infrastructure. Our members have the responsibility of using limited public
resources to ensure that the roads and bridges we use every day are maintained and safe.
We ensure that the water you drink is clean and safe, the trash and recyclables collected,
the landfills maintained -- the often invisible services that keep our cities, counties and
towns running safely and smoothly.

As chair of APWA’s Urban Forum, I have had the pleasure of meeting with my
counterparts in other urban centers around the Country. It will come as no surprise to
this Committee that unfunded federal mandates are the number one concer of these
Public Works professionals. I am pleased to appear before this Subcommittee today to
share some of those concerns with you.

Ihave read the Preliminary US Advisory Commission on Intergovernmental Relations
(ACIR) Report on the Role of Federal Mandates in Intergovernmental Relations (January,
1995). State and local governments have identified more than 200 separate mandates to
which they are subject. These mandates are contained in close to 170 federal laws that
govern a wide range of state and local activities. The ACIR identified in their Preliminary
Report 3,500 federal court decisions involving more than 100 federal laws that impact
state and local governments. _I will be limiting my remarks to some of the federal laws.


184

Secretary of Labor's regulations, are euphemistically referred to as the
“Davis-Bacon Related Acts.”

Neither the Davis-Bacon Act nor any of the “Davis-Bacon Related
Acts” is a law of general applicability like the Fair Labor Standards Act, for
example, that is based on the Commerce Clause in the Tenth Amendment
of the U.S. Constitution. Instead, Congress is authorized to condition
receipt of federal financial assistance to construct public buildings and public
works upon compliance by state and local governments with the directive in
“Davis-Bacon Related Acts” to include prevailing wage requirements in
contracts and subcontracts for their construction pursuant to its power
under the Spending Clause in Article I, § 8, of the U.S. Constitution.
Significantly, unlike laws of general applicability, federal laws such as the
“Davis-Bacon Related Acts,” that condition receipt of federal financial
assistance on compliance with federal policy choices, permit the residents of
the recipient State or locality to decide whether or not it will comply with

that policy. If the citizens of the State or locality view the federal policy as

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29

SUCH A CASE, WE HOPE AND EXPECT THAT THE CONFERENCE COMMITTEES
WILL MAKE EVERY EFFORT TO WORK WITH CBO IN ADVANCE TO OBTAIN AN
ESTIMATE. IT/S IN THE INTEREST OF THE COMMITTEES TO DO THIS,
SINCE THEY RUN THE RISK OF A MEMBER RAISING A POINT OF ORDER OR A
MOTION TO STRIKE ON THE FLOOR WITH RESPECT TO THE MANDATES IN THE
CONFERENCE REPORT.

IN ITS SECOND TEST CASE -- THE FARM BILL
BILL WORKED AGAIN. THE AGRICULTURE COMMITTEE COMPLIED WITH THE
ACT BY INCLUDING THE CBO COST ESTIMATES FOR BOTH THE PUBLIC AND

THE MANDATES

PRIVATE SECTOR MANDATES. IN THIS CASE, THERE WERE NO PUBLIC
SECTOR MANDATES THAT EXCEEDED THE THRESHOLDS IN THE MANDATES LAW,
BUT THERE WERE VERY SIGNIFICANT PRIVATE SECTOR MANDATES,
INCLUDING THE MOST COSTLY MANDATE THAT WOULD HAVE REQUIRED HIGHER
FLUID MILK STANDARDS. THE SOLOMON-DOOLEY AMENDMENT STRIPPED
THESE MANDATES FROM THE FARM BILL. THE PROPONENTS OF THIS
AMENDMENT USED THE CBO ESTIMATE TO MAKE THEIR CASE. AS YOU KNOW,
THIS AMENDMENT ULTIMATELY PASSED THE HOUSE.

FINALLY, IN ITS MOST RECENT TEST CASE -- THE IMMIGRATION
BILL -- THE MANDATES LAW WORKED AGAIN. CBO DID ITS ANALYSIS OF
THE PUBLIC AND PRIVATE SECTOR MANDATES CONTAINED IN THE BILL AND
THE COMMITTEE REPORT INCLUDED THE PRELIMINARY CBO ESTIMATE. THE
COMMITTEE ALSO HAD THE FINAL CBO ESTIMATE PUBLISHED IN THE
CONGRESSIONAL RECORD PRIOR TO CONSIDERATION OF THE BILL AS IS
REQUIRED UNDER THE MANDATES LAW. THERE WERE NO INTERGOVERNMENTAL
MANDATES THAT IN THE AGGREGATE EXCEEDED THE $50 MILLION THRESHOLD

AND PRIVATE SECTOR MANDATES WERE FULLY DISCLOSED. IT IS ALSO


166

different than what the legislation originally envisioned when it
was enacted 20 years ago.

Mr. Payne. I agree, which is why there’s an alternative dispute
resolution process like mediation incorporated into the administra-
tion IDEA proposal.

Mr. RESNICK. But they don’t require medication, and that’s the
problem. The lawyers will then be involved in mediation. They will
either choose to do it or not do it. From our perspective, mediation
should be required, and the attorney should not be present in the
process at all, so that it can be engaged as an education process,
not as a litigious process.

Mr. Payne. But it’s left up to the States, right, to determine who
can participate, the presence of lawyers and all that? In other
words, it’s at that level now. It’s not specifically stated.

Mr. RESNICK. We're not entirely sure yet where the legislation is
going to land. The administration’s proposal is one thing—our con-
cern is not directly with the administration’s proposal; it is in fix-
ing the problems in the legislation.

Mr. PAYNE. Well, it looks as though my time has expired.

Mr. Davis. If you want to take another minute, we can do that,
because there’s nobody else here. I’m going to recess the meeting,
if you would like.

Mr. Payne. Yes. Just on the whole question of, for example, some
of the mandates that—the Family and Medical Leave Act, which
was talked about as being an unfunded mandate, when you looked
into the legislation, once again, you find that there was very little
cost.

We even see the outcry for the Americans With Disabilities Act,
the whole question of ramps at public facilities. The average ramp
costs $50. You had a whole hue and cry about “I can’t afford it.”
And it said, when that legislation was passed, “If feasible.”

After studies showing between $50 and $75 to provide an incline
inte a public facility, you would think that the cost of this man-
date--even for buses, if they are not retrofitted. But, as you know,
Greyhound was totally opposed to the ADA. We were just talking
about new buses being built, that certain numbers have lifts. And
once they were built into the building of the bus, the cost was very
minimal.

But you had the hue and cry and knock down and drag out battle
opposing ADA, when, when it was all said and done, the costs of
many of these—a fellow even argued about depressing the curbs.
Well, if you’re going to put in a curb—it didn’t say go around cut-
ting curbs down, but if you’re putting in a new curb, just simply
have an indentation so a wheelchair could pass.

In other words, I think opponents to things mandated by the
Federal Government just overreacted to every little mandate. You
know, Socrates said, “The government which governs less is best.”
But that was a long time ago. And the reason that the government
got involved in State and local activities is because of the local gov-
ernments not moving toward things like clean water and clean air.

As a matter of fact, States that were good State citizens, that
had, for example, double sewage treatment for their waste water,
are actually penalized because, unless the Federal Government


186

Congress, they are unsupported by fact or reason. The Commission
explained its rationale for these recommendations as follows:
State, local, and tribal governments should be able to

manage their construction project costs without Davis-

Bacon pre-conditions when the major share of the project

is being funded by the state or local government. Besides

potentially increasing costs, Davis-Bacon requirements

impose extensive reporting and recordkeeping that may be

especially burdensome for small projects, and may make it

difficult for small local businesses to compete.

The Role of Federal Mandates in Intergovernmental Relations at 15.

Therefore, the Commission has recommended that each “Davis-Bacon
Related Act” should be amended to exempt otherwise covered federally-
assisted construction projects that costs less than $1 million dollar, or less
than 50 percent of the total costs of which are federally funded.

However, the recommendations in the Commission's preliminary
report lack any quantitative support. Instead, the underlying basis for its
recommendations are the “concerns” expressed by state, tribal, and local

governments that relate to criticisms about the administration of the “Davis-

Bacon Related Acts” rather than how these federal requirements impact on

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98

Mr. Suays. Thank you.

We are probably going to have a vote around 11:30. Jamienne
Studley, you have now an opportunity to give your testimony.

Ms. STUDLEY. Thank you, Mr. Chairman, and members of the
subcommittee.

I am pleased to be here to highlight the Department of Edu-
cation’s extensive State-local-Federal partnerships and consultation
activities, and to comment on the ACIR staff draft report. I am
honored, also, to be here with our distinguished Assistant Sec-
retary for Special Education and Rehabilitative Services, Judith
Heumann.

American education has always been a partnership. State, local,
and tribal governments and community school boards are respon-
sible for almost all education decisionmaking and funding. The
Federal Government provides leadership, seed money for innova-
tion and coordination, and critical funding for national priorities in
education, including the education of disadvantaged and disabled
children, job training, teacher training, technology, and access to
higher education. The Federal Government provides assistance and
leadership; it does not regulate the Nation's educational system.

Guided by three dedicated education leaders and former Gov-
ernors, President Clinton, Secretary Riley, and Deputy Secretary
Kunin, our commitment to genuine partnership with State and
local governments is stronger than ever. And thanks to innovative
education reform laws passed with bipartisan support, Goals 2000,
the Improving America’s Schools Act, and Schools-to-Work Oppor-
tunities, the Department has a statutory foundation built around
flexibility and partnership with States and localities.

The Clinton administration has focused the Federal role in ele-
mentary and secondary education on supporting States’ efforts to
establish challenging academic standards, with State-designed as-
sessments, and accountability geared to those standards. In 48
States and 10,000 schools, Goals 2000 funds are being used to de-
velop and implement those academic standards. No new regula-
tions were issued to carry out Goals 2000, and the application form
for States is only four pages long, to allow maximum flexibility.

As a result of the Improving America’s Schools Act, States and
schools have more independence and less red tape than ever before
to decide how best to use Federal funds. Most dramatically, schools
that enroll at least 50 percent low-income students may combine
most of their Federal education funds with their own State and
local resources to support school-wide improvements without the
burden of separate tracking and other recordkeeping requirements.

Finally, in that triumvirate, the School-to-Work Opportunities
Act, also implemented without any new regulations, launched a
powerful set of partnerships that add business and community or-
ganizations to the State-local-Federal team, to improve skills train-
ing and promote effective transitions from school to work.

One oF the clearest indicators of true partnerships is trust. The
President’s regulatory reinvention initiative asks all agencies to in-
crease flexibility, reduce regulations and, in general, to base our re-
lationships with our partners and customers on trust. If actions
speak louder than words, the Department of Education’s actions in
this area speak loudly indeed.


140

Mr. Davis. Thank you very much.

Mr. Balog.

Mr. BaLoc. Thank you, Mr. Davis and the other members of the
subcommittee.

I come here today in a dual role. I come here as chairman of the
American Public Works Association’s Urban Forum. We represent
25,000 members. In fact, we are the largest full service member-
ship organization of public works officials. Also, I am the director
of public works for Baltimore City. Baltimore City’s Public Works
Department is one of the largest in the United States. We have 27
functions, 6,000 employees, and a budget of $500 million. And we
do fix potholes.

Public works officials do a lot of things. We're like the city under-
neath the city. We have the water pipes, we pick up the trash, and
we take care of landfills, and all these things that I think are es-
sential. We met in Texas this spring, and it was unanimous among
all the public works officials of the large cities that unfunded Fed-
eral mandates was our biggest concern. We looked at the ACIR re-
port of January, and the thing that impressed us the most about
the report was the 200 mandates that are in that report. These
mandates affect all the cities, just like Baltimore.

We are a poor subdivision. Our growth is less than 1 percent a
year. We have a budget of $2 billion. But if we complied with the
Asbestos Act, we would have to spend $700 million. That’s half our
budget. We have 2,000 miles of highways and several hundred
bridges to take care of. We get $15 million of ISTEA money a year,
but we need $1 billion. We have an example of a waste-to-energy
plant that we have to put a stack on, just a little job that costs $50
million. This affects our real estate tax.

In the last 20 years, we were fortunate enough to get $500 mil-
lion of the Water Pollution Act of 1972. All that money is spent.
We've done great things. We have reduced pollutants that go to the
Chesapeake Bay from 80 percent to 95 percent removal. But we are
worried about where we are going to go from here.

When the President signed the Unfunded Mandates Act in
March last year, we were pretty optimistic, but we were realistic
enough to know that all the mandates weren’t going to go away.
And we really focused on a cost-benefit analysis, but that seems
like a black box to us. What is it going to do to us? It was encour-
aging to hear the different departments testify in panel two, and
I truly believe they are going to be reasonable. But we are looking
for some kind of assurance that the fiscal constraints won’t out-
weigh the benefits derived from the mandates.

We are not against a better environment. We are not against
helping the disabled. We are not against having working and living
space better. We are not against good drinking water. But we are
just uncertain as to where we are going to go. And we sort of
looked at a book that is on the best sellers’ list now called, “The
Death of Common Sense,” and we think the answer sort of lies
there in that book. We just don’t want to spend money that we
don’t have unless there is a true, clear, and realistic benefit.

Thank you.

[The prepared statement of Mr. Balog follows:]


91

5

government employees work for small towns and are unlikely
to be represented by a labor union, while others cannot
bargain collectively.) ' Thus, it is a somewhat hollow
suggestion to replace universal minimum labor standards
protections based on the expectation that other forces will
guarantee basic worker rights to employees of state and
local governments.

+ Finally, the special role of public employers is ignored
~- these governmental entities should be model employers
setting examples for their private sector counterparts. In
fact, the recently enacted Congressional Accountability Act
applied the FLSA, FMLA and other labor laws to Congress to
provide those workers the protections as employees of
other employers.

I would now like to turn to our specific comments on the
ACIR's preliminary draft recommendations relating to statutes
within the purview of DOL.

FOUR DOL-RELATED ACIR PROPOSALS

Fair Labor Standards Act

The ACIR report recommends repeal of FLSA’s coverage of state and
local government workers.

By guaranteeing a minimum wage and overtime premium pay when
an individual works more than 40 hours a week, the FLSA
establishes minimum labor standards below which no one should be
required to work. There is no reason to deny public servants
these fundamental protections and thereby make them second class
citizens. In recent years, the provision of public services such
as nursing care, transportation, sanitation, water and sewer
service has increasingly been done by both public and private
entities, and in these instances, the Act simply ensures that
every employee, regardless of his or her employer, is entitled to
minimum protections in the employment relationship. Allowing
state and local governments to pay less than the minimum wage and
to avoid paying premium pay for overtime is unfair to the public
workers and could place private employers that observe fair labor
standards at a competitive disadvantage.

While not even mentioned in the draft report, Congress

According to the i

i (Public
Employee Department, AFL-CIO, 1995, p. 1.), more than half (twenty-
seven) of the states have failed to pass comprehensive public
sector labor relations laws extending collective bargaining to all
public employees at state and local levels.



u

4

Mr. Chairman, I want to thank you for your continued leadership on the
mandates issue. I look forward to the testimony and | thank you again for
holding this hearing.


9

a

materials to the list of commenters and other participants in
meetings and workshops; provide notices of availability of
materials on the Internet or from program offices and DOL's
Office of Public Affairs through mass media, press releases, and
the like; and hold seminars or workshops, and send DOL experts to
business and labor meetings and conferences.

When the Department promulgates rules that would
significantly or uniquely affect small governments, it will use a
consultation process similar to that described above, with an
emphasis on developing input from small government entities.

CONCLUSION

I would like to conclude by reiterating the Department's
strong support for the Unfunded Mandates Reform Act, and for the
value of consulting early and significantly with State, local,
and tribal governments on issues that may affect them. The
Department's recent activities demonstrate our commitment in this
area. At the same time, we oppose the four ACIR preliminary
draft proposals pertaining to statutes within the purview of DOL.
These proposals, if enacted into law, would undermine essential
workplace protections for employees of state and local
governments, as well as many employees working on Federally-
assisted state and local construction projects.

Mr. Chairman, in his March 1 letter to the ACIR, Secretary
Reich strongly urged the Commission to specifically review its
draft recommendations with those dedicated public servants whose
employment would undergo profound changes by virtue of the
report's recommendations. Hopefully their interests will be
represented at next week's ACIR hearing. And I also hope the
Commission will revise its final report in light of the concerns
expressed there and in other public comments.

This concludes my prepared statement. 1 would be glad to
respond to any questions you or the members of the Subcommittee
may have.


187

the state and local governments in a way that Congress intended the
Commission to address.

According to the Staff Working Paper attached to the Commission's
preliminary report as Appendix A at A-40, “[rJaising the dollar threshold
that defines applicable contracts would reduce the number of state and local
contracts subject to Davis-Bacon while assuring that major contracts for
publicly funded construction projects still contain basic Davis-Bacon
protections.” This is a gross understatement.

The Congressional Budget Office has estimated that an increase in the
threshold for application of the Davis-Bacon Act to federal construction
contracts, that is those in which the Federal Government is a party, to $1
million would exempt 90 percent of all such contracts and 27 percent of the
total dollar volume of federal construction contracts. Although comparable
figures concerning the effect of raising the threshold for application of Davis-
Bacon prevailing wage requirements to federally-assisted construction
contracts is not available, it is fair to say that the impact would be as

dramatic, if not more so, inasmuch as the magnitude and cost of most

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102

education reform laws passed with bipartisan support -- Goals
2000, Improving America’s Schools Act, and School-to-Work
Opportunities -- the Department has a statutory foundation built
around flexibility and partnership with states and localities.

Let me provide some examples of how the Department of Education
is working, in the words of the Unfunded Mandates Act, whose
anniversary we mark today, “to strengthen the partnership between
the Federal Government and State, local and tribal governments.”

The Clinton Administration has focused the federal role in
elementary and secondary education on supporting state efforts to
establish challenging academic standards, with state assessments
and accountability geared to those standards. In forty-eight
states and 10,000 schools, Goals 2000 funds are being used to
develop and implement those academic standards. No new
regulations were issued to carry out Goals 2000, to allow maximum
flexibility at the state and local levels.

As a result of the Improving America’s Schools Act, states and
schools have more independence, and less red tape, than ever
before to decide how best to use federal funds. Most
dramatically, schools that enroll at least 50% low-income
students may combine most of their federal education funds with
state and local resources to support schoolwide improvements,
without the burden of separately tracking federal dollars and
other recordkeeping requirements.

The School-to-Work Opportunities Act, also implemented without
any new regulations, launched a powerful set of partnerships that
add businesses and community organizations to the state-local-
federal team to improve skills training and promote effective
transitions from school to work. Fifty states have School-to-
Work planning grants to develop a comprehensive state plan.
Twenty-seven states and 67 local communities are already
implementing their partnership programs, consulting with business


118

model for our society with respect to the terms and conditions and
opportunities for working men and women. The public sector
should set the standard, in many ways, for positive and helpful and
supportive working conditions for people.

Mr. Fatran. Let me follow this up a little bit, because I’m new
to the Congress, but I have taken note of a great deal.

Mr. SHays. You can only use that one term, then you're part of
the problem.

Mr. Fatrau. There’s been a lot of criticism about the fact that,
for a long period of time, the Congress exempted itself and its em-
ployees from these protections. And we've corrected that through
the Accountability Act, so we’re all covered now. Now we want to
create a situation where State and local governments would be sub-
jected to this type of criticism, where they would, alongside their
private sector workers, not be obligated to meet these.

Would it make any sense for us to pass this uneven application
of Federal law on to State and local government?

Mr. ANDERSON. No, I can’t think of any sense that it would
make. In fact, it would diminish the standard of living for many,
many workers in this country. It is for that reason that we cer-
tainly cannot support that recommendation.

Mr. Fattau. All right. Well, thank you. I know that, in some
quarters, people have wanted to criticize public employees in a
great deal of ways. I can just imagine, if this report were to become
the law of the land, we would be adding to the kind of cynicism
that from some quarters has emanated about the government.

So I’m just concerned about it. I’m sorry, again, that I can’t vent
my concerns appropriately, since there’s no one here who is defend-
ing this preliminary report that has been issued.

So thank you.

Mr. SuHays. Mr. Fattah, I understand why your expectation was
what it was to come here. I will just promise the gentleman that
we will have a specific hearing on this report. It is a report to Con-
gress, and Congress can put it on the shelf and let it get dust, or
we can take action on it. So the gentleman’s authority, as a Mem-
ber of Congress, will be very active in terms of how he responds
to that report.

Mr. Green.

Mr. GREEN. Thank you, Mr. Chairman.

Mr. Suays. Oh, I’m sorry. I apologize. Mr. Souder.

Mr. GREEN. Mr. Souder. That’s right.

Mr. Suays. Excuse me. It’s Mr. Souder’s turn. I was looking to
my right.

Mr. GREEN. Well, you found him.

Mr. SOUDER. I’ll try to reinforce that judgment.

I have a couple of concerns in looking at the testimony and hear-
ing what you said. I think that I want to give credit where credit
is due, even though that’s hard sometimes for me to do with the
administration, but I believe you have made efforts to reduce regu-
lations, reduce Federal overhead, that that’s been going on in most
departments. I think we’ve helped push that, but I think that the
President, as a Governor, was committed to a lot of that, too. So
I understand that.


fami : f

The report recommends repeal of FMLA’s coverage of statue and local government
employees.

Like the FLSA, the FMLA provides a fundamental safeguard to American workers. It
guarantees that workers can take job protected unpaid leave for specified family and
medical reasons. The report provides no substantive justification for repealing that
safeguard with respect to public workers. The report not only the overstates the costs of
compliance, but also ignores the substantial benefits achieved by the FMLA, including
improved worker productivity and morale, reduced employee turnover, and greater labor-
management stability. In fact, available data show that the costs of hiring and training new
employees far outstrip the costs of granting temporary leave for family or medical reasons.
In addition, the bipartisan Commission on Leave created under the FMLA released two
studies in October 1995. The study of employers in the private sector -evealed that over
an 18-month period, 90 % of participating firms reported little or no costs associated with
administration, hiring, and training, and continuation of benefits required under the statute,
and 85% reported no noticeable effect on employee tumover, absence or productivity.
There is no evidence to suggest that the results are any different in the public sector.

‘Occupational Safety and Health Act (OSH Act
The report recommends repeal of all state coverage.

As a preliminary matter, the Department cannot accept the Commiszion’s assertion that a

Program constitutes a mandate. It is not a mandate because the only state and
local government workplaces covered by OSH are located in states where the state
legislature has voluntarily agreed to participate.

In any event, we believe-and many states agree- that repeal of the OSH Act with respect
to public workers could endanger the health and safety of thousands of workers who
perform some of the Nation’s most dangerous jobs — firefighting, hazardous waste cleanup,
maintenance and sanitation work. Indeed, according to the American Federation of State,
County and Municipal Employees, almost 200 of their members were killed on the job
between 1983 and 1993. Public workers deserve the same protections accorded to
America’s private sector employees.

As with other DOL-related recommendations, the report fails to acknowledge the
substantial benefits that accrue from the Act. These benefits are not limited to the health
and safety protections for the affected worker; but inciude public employers, who
‘experience reduced worker compensation costs, higher employee productivity, and
reduced liability and insurance costs; and the general public who benefit from a reduction
in the exposure to dangerous conditions in public buildings and other facilities.


val

environmental and public health protection. Our strategy of building more effective partnerships,
streamlining excess requirements, and fostering creative solutions to environmental problems is

reflected in our legislative proposals and regulatory reinvention efforts

Today, I would like to begin by highlighting some of the general ways EPA has tried to
implement one of the main purposes of the Unfunded Mandates Reform Act of 1995 -- "to
strengthen the partnership between the Federal Government and State, local, and tribal
governments.” Then, I will turn my attention to the steps we have taken to implement Title II of
the Act and to address some of the specific concerns we have heard from our intergovernmental
partners about existing laws and regulations. Finally, I will address our key concerns with the
findings and recommendations in ACIR's preliminary report on The Role of Federal Mandates in

Intergovernmental Relations.

I. Building the Intergovernmental Partnership

‘Over the past several years, EPA has been undergoing a fundamental reinvention in the
way we do business -- away from traditional command-and-control to more flexible, community-
based approaches. We are committed to working with people in their places, in their
communities, and in their regions to craft environmental protection strategies -- from the bottom

up, not just from the top down,

We have actively engaged in dialogues with our partners in state, local, and tribal
governments so that we can better understand the problems they face as well as the possibilities
that exist for more effective and efficient solutions. Some of the key themes we have heard from
state, local, and tribal officials are that they want more flexible approaches to environmental
protection, not "one size fits all." They want better communication and information exchange
among all levels of government so that they know what is expected of them and can learn from
the experiences of others. These officials especially want to be included in the process of
designing the regulations and policies they must implement. Finally, they want to focus attention


16

I do, however, have some concerns with how the Unfunded
Mandate Reform Act is being implemented. Title III of the Act
requires the Advisory Commission on Intergovernmental Relations
(ACIR) to recommend improvements after studying 200 existing
mandates. The ACIR report specifically recommends the repeal or
modification of 14 mandates, including mandates that weve are already
in place to ensure public health, safety and well-being. During the
debate on the House Floor, I pointed out that we must take great care
to avoid going too far in the other direction. We must not reverse
critical public health and environmental laws in our effort to slow the
practice of unfunded mandates. There are, at times, compelling

national needs which will require federal intervention.

Mr. Chairman, I am a strong supporter of the Family and Medical
Leave Act. The ACIR recommends that provisions in this law be
repealed for state and local governments, and I would ask today’s
witnesses to explain why they think this is necessary. After years of
work, the Congress passed legislation to allow American families to

take care of family emergencies and childbirth without risking their


160

particular situation, but they are hampered by Federal mandates,
and perhaps incur greater expenses unnecessarily because of that.

Second comes the question, when you look at the totality of all
of these attractive mandates, what is the sum total of their cost?
So even some of the mandates that may be regarded as less oner-
ous, individually, are a part of a total package.

And I think what would be helpful is if the Congress did take
a look at the full range of mandates and determine, not just the
mandate itself, but the level of regulation inside the mandate, and
whether circumstances have changed to the point that mandates
that may have been on the books for many years just simply don’t
require the same level of attention today as they may have some

ears ay

¥ P. GREEN. Mr. Chairman, I know my time is up. I agree, and
thats why I think the last 3 years, on reauthorization of Elemen-
tary and Secondary Education Goals 2000, you have not seen some
of the requirements that may have been passed if that act would
have been passed 10 years ago. So I think there’s sensitivity to
that.

Thank you, Mr. Chairman.
[The prepared statement of Hon. Gene Green follows:]


99

The Department has eliminated 79 percent of the regulations af-
fecting its elementary and secondary programs. Where regulations
are essential, such as when they are required by Congress or are
necessary to promote educational quality or avoid abuses, the de-
partment’s principles for regulating require us to do so as flexibly
and with as little burden as possible.

But even with fewer and more flexible rules, sometimes the best
way to advance our partnerships with States and localities is to
waive Federal requirements that may make sense, generally, but
that interfere with a specific State or district strategy.

Goals 2000, School-to-Work, and the Improving America’s
Schools Act gave the Secretary of Education unprecedented author-
ity to provide those waivers for many statutory and regulatory re-
quirements, and we are using that authority boldly. Close to 100
waivers have already been granted to State and local partners in
the last year.

The most dramatic example of the Department’s new flexibility
is the Education Flexibility Partnership Demonstration Program,
or Ed-Flex, established under Goals 2000. The Secretary has given
six State education agencies the authority to waive Federal statu-
tory and regulatory requirements, to remove barriers to effective
teaching and learning. Kansas, Massachusetts, Ohio, Oregon,
Texas, and Vermont have been appointed as Ed-Flex States, joining
us in a unique partnership.

course, our partnerships go well beyond the statutory and reg-
ulatory and characterize all aspects of the Department’s operations.
I have provided some examples in my testimony.

With respect to Title I] of the Unfunded Mandates Act, we recog-
nize that the partnerships I have been describing depend on early,
open, and extensive communication among partners. I am proud
that Education has an impressive record of successfully commu-
nicating and sharing the development of policy with affected per-
sons, organizations, institutions, and governments, including school
system,

For example, we recently convened more than a dozen workshops
across the country, with tribal representatives and others, to dis-
cuss programs and regulations under the Elementary and Second-
ary Act that affect American Indians. Most relevant for today’s con-
versation, in developing the administration proposal to reform and
reauthorize the Individuals With Disabilities Education Act, IDEA,
we consulted with more than 3,000 parents, educators, and admin-
istrators, representing a wide spectrum of viewpoints.

We have not created a special new process for intergovernmental
consultation because our existing outreach has proven effective and
satisfies Title II. With respect to small governments, also men-
tioned under the act, we have made special efforts to advise them
of Potential requirements and to solicit their recommendations.

ir. Chairman, we were disappointed by the ACIR’s draft report
and, in particular, with its treatment of IDEA. First, it was inap-
propriate to include IDEA in the draft report, because it enforces
the constitutional rights of individuals with disabilities through the
establishment of statutory rights that bar discrimination. The Un-
funded Mandates Act itself recognizes that such constitutional
rights are to be given a preferred status.


21

consequence of this can be to make it much more difficult for you
to accomplish that.

Another problem with that is, if you have local minority contrac-
tors who are not operating with a lot of capitalization and they
have to try and compete on these jobs, they just can’t carry the
kind of payroll necessary to do that.

A lot of Federal social programs, in the way they are adminis-
tered, are biased against these neighborhood groups, because they
don’t have a lot of Ph.D.s, and Masters of Social Work working for
them, so they often get credentialized out of the program.

The Fair Tabor Standards Act is a problem for nonprofit group
homes, for example, that take care of abused kids. The various
overtime and recordkeeping provisions can make it very difficult
when you have your surrogate parents there, and they have to be
there the whole time, then they have to keep track of all the
records and try and decide which shift they are working on, and
what happens if they get up in the middle of the night because one
of the children starts crying.

So the point that they made, over and over again, to us is that
we need a mechanism for building some flexibility into how these
various mandates and regulations are administered.

We have been discussing, in the context of our bill, Mr. Chair-
man, something I’m very pleased to note is very similar to your
Community Empowerment Board, some kind of an agency where
groups or local governments that are doing what we all want them
to do can come with a case and make sure that they have it heard,
that they are not just sort of tossed off or ignored by the regulators
who are pursuing their mission in a very narrow-minded way.

That is what you are trying to do with this legislation. It is what
we are trying to do in a different context. And I just wanted to con-
gratulate you, urge you to keep moving forward with it. We are all
cognizant of the fact that these goals are very important, that they
should not, for any reason, be sacrificed, but that we can also be
sensitive to other very important things that we want to happen
in these communities.

I would just say, in closing, Mr. Chairman, to me it’s a question
of respect. In other words, the Federal Government, we can recog-
nize that these goals are vital. Without adopting a mind set that
unless State and local governments and neighborhood associations,
full of dedicated people, are minutely watched, somehow they are
going to conspire all the time to avoid doing what all decent Ameri-
cans want to have happen.

I think your legislation and what you are working on here is a
recognition that we should not adopt that mind set. I am grateful
to be here to testify and to just, again, flag the subcommittee on
what we are trying to do in a related context.

Thank you, Mr. Chairman.

Mr. Suays. I thank the gentleman. I understand you need to get
on your way.

Mr. TALENT. Yes, I do.

Mr. Suays. Does any member of the committee have a question
of Mr. Talent, or should we proceed with Mr. Portman? Mr. Towns.

Mr. Towns. Thank you for coming.

Mr. TALENT. I thank you.


50

‘THE WHITE HOUSE
WASHINGTON

March 1, 1996

The Honorable William F. Winter
Chairman

USS. Advisory Commission on
AImte:governmental Relations

800 K Street, KW

Suite 450, South Building

‘Washington, DC 20575

Dear Governor Winter:

Tam writing 0 exprese my deep concerns about the preliminary staff draft of the
Advisery Commission on Intergovernmental Relations (ACIR) Report: The Role of Federal
Mandaies in Intergovernmenual Relations. The draft report fails to respond to key questions
‘the Congress posed to ACIR, and instead focuses on policy issues well outside of ACIR
Congressional mandate sr ares of expertise. In addition, the draft report discusses the costs
of mandates largely without examining their benefits. As a member of the Commission, I
oppose many of the specifi: recommendations in the report, and would like to work with you
and other members of ACIR to develop a more balanced report of the Commission's work.

As you know, Title III of the Unfunded Mandates Reform Act of 1995 directs ACIR
to. (1) “review the role of Fedaral mandates in intergovernmental relations and their impact
‘on State, local, tribal, and Federal government objectives and responsibilities, and their impact
on the competitive balance between State, local, and tnbal governments, and the private sector
and consider views of and the impact on working men and Women on those same matters,”
(2) investigate the role of unfunded State mandates on local govemments, (3) make
recommendations in seven different general ureas, including providing flexibility and
reconciling inconsistent mandates; and (4) identify specific mandates that should be
addressed in each of these areas. Congress also instructed the ACIR to examine meaturement
and definitional issues involved in calculating total costs and benefits of Federal mandates,

‘The preliminary siaff draft report does not adequately reflect this Congressional
charge. Unfortunately, the draft report focuses on the requirements of specific statutes
without establishing a sufficient framework for their consideration. The report doss little to
further consensus on fundamental questions such as how statc mandates affect local
governments and how we should measure the costs and benefits of mandates. Instead, it
presents cursory and ofien misleading analyses of 14 Federal health, safety, environmental,


95

9

construction contractors may pay lower than prevailing wages.
This flawed reasoning ignores any comparative differences in
productivity from different wage levels and work experience, and
the fact that the shoddy construction practices that often
accompany substandard wages almost inevitably result in increased
xepair and maintenance costs. The report also ignores the fact
that the DBRA prevailing wage is based on “measures of central
tendency," and there will always be contractors who pay lower
than the prevailing wages in a community, This is no basis for
governmental spending to encourage or subsidize such practices.

ACIR claims that DBRA wage surveys are “voluntary and
sporadic," but fails to acknowledge significant regulatory
reforms undertaken to ensure that its wage determinations
accurately reflect wages paid in the local community. They also
claim a scarcity of data leads to importation of non-local rates.
When there is a lack of recent construction, DOL looks to the
surrounding area for wage data, not to “distant” areas as ACIR
charges. The report asserts that DBRA may reduce the hiring of
local persons with limited experience. In fact, regulatory
provisions also encourage apprenticeship and training of persons
with limited experience by allowing for exceptions to the
journey-level wage under approved training prograns.

The Administration’s Davis-Bacon reform bill in the last
Congress would have raised the DBRA threshold to $50,000 for
alteration and repair projects, and $100,000 for new construction
projects, in addition to reducing administrative burdens and
costs, DOL cannot concur in the report's proposal to limit DBRA
to projects of more than $1 million or which receive over 50 per
cent of their financing from Federal funds. These proposals
would eliminate prevailing wage protections for thousands of
workers under the guise of reform.

Similarly, we have serious concerns with the report's
recommendation to base coverage on the percentage of federal
finance provided to the construction project. DBRA coverage must
be established before the competitive bidding process begins.
ACIR's proposal would disrupt that process, and impose additional
burdens on state and local contracting agencies to determine if
DBRA applies. Thus the proposal would make the administration of
Davis-Bacon requirements more troublesome for states and local
governments.

Let me now move on to discuss DOL implementation of Title IT
of the Unfunded Mandates Reform Act.

DOL Implementation of Title II
The Department has not promulgated any proposed or final

rules this fiscal year that have been designated as federal
mandates under Title II. However, as I noted at the outset, DOL


33

in order to participate you had to pay the $400 in order to ask a
question.

There just seems to be some unclear questions. For example,
also, the information is inaccurate.

Mr. Suays. Mr. Payne, I’m wondering if you would ask the ques-
tions that you want us to get answered. They are very valid ques-
tions, but we're not really getting into that report today, though we
will, ultimately.

Mr. Payne. All right. Well, just one other one, the cost of the
Family and Medical Leave Act. You know, there was an assump-
tion that this is a very costly unfunded mandate. From what we
understand, it practically costs nothing to employers to move into
a family and medical leave, because they did nothing other than,
after 3 months, call the employee back, and all of the benefits just
continued on. So the Commission said that the Family and Medical
Leave Act was a very costly unfunded mandate, and therefore, local
governments and State governments should be exempted from it.
I question the validity of that.

0 I think that this report is full of inaccuracies. I know the gen-
tleman has to leave, but I’ll just stop at that point. And I appre-
ciate the opportunity, not being a member of the committee.

Mr. Suays. You honor our committee by your presence, and you
raise some valid points. One of the reasons why the committee de-
cided not to deal with this report first was, one, that it was a pre-
liminary report. And we felt that they would wait until the final
report is made. At that time, I can promise you that this committee
will be looking at whatever final recommendation is made in depth.

Given the controversy, I have some concern about being on this
committee. So I’m thinking of recommending Mr. Towns to take my
place.

Mr. Towns. That’s a great idea.

Mr. Payne. Well, if it had to be someone other than Mr. Towns,
on the other side, I’m glad it’s you.

Mr. Suays. I appreciate your saying that. Mr. Portman, we ap-
preciate your being here.

Mr. PorTMAN. Thank you, Mr. Chairman.

Mr. Suays. You have provided a nice balance to some other com-
ments that were made.

Mr. PorTMAN. May I just make one quick comment?

Mr. SHays. Yes.

Mr. PorTMAN. Since my colleague, Mr. Condit, has not returned
from downtown, just to say that he indeed is part of a team here
working with me. We've been partners in this from the start; we
will continue to be. I know he reviewed my testimony. I can’t say
that I spoke for him, but I think that he, too, would agree that the
act is being implemented properly but that we need to keep being
vigilant.

Mr. Suays. I understand how it works. When you're in the ma-
jority, it’s the Portman-Condit Bill; and when he’s in the majority,
it’s the Condit-Portman Bill.

Mr. PORTMAN. Right. Thank you.

Mr. Towns. Mr. Chairman, let me just also add that, first of all,
I really want to thank you for the work that you’ve done. I’m happy
to know you are now on ACIR. I look forward to working with you


168

But I very much appreciate your comments here today. I would
just note that I was in local government for 15 years before coming
here, and we always made a place for AFSCME at the table. Even
if we were doing things we disagreed on, we wanted to know what
the effect would be downstream, and they were very, very produc-
tive for us in that regard.

I just want to say that the one thing we were very frustrated
about in Federal Government out in Fairfax and the mandates
coming down is what I call the “law of unintended consequences,”
that you may put some new mandates on our education system out
there, but the end result was many times, yes, you would help that
child that was intended to be helped through the legislation in
Washington, but it forced local school boards to raise pupil-teacher
ratios and do other things with a limited amount of funds in other
areas.

You either have a belief that many of these decisions are best
made locally, with the local situation and people who serve on local
school boards, local PTAs who care about the local environments
and the particular concerns there, as opposed to sometimes the, I
think, very well-intentioned programs, but the one-size-fits-all
mentality that comes out of programs from Washington.

So we wrestle with this, and we recognize there are tradeoffs on
everything. Health, safety, local governments care about that, too,
but sometimes the Federal Government has to bring it together. So
I appreciate Mr. Payne’s remarks, and we're going to try to put it
all together. That’s why we're holding these hearings.

The record is open. By the way, you quoted Socrates as saying,
“The government that governs least governs best.” Jefferson, a
great Virginian, also said that. And I remember, just a few months
ago, hearing, “The era of big government is over.” That was by an-
other great statesman, in the State of the Union Address. So no
matter how you look at it, Socrates gets repeated from generation
to generation, in different ways.

The record will remain open. I thank our panels that have par-
ticipated today, and the members for participating, on behalf of
Chairman Shays. We will now adjourn the meeting.

{Whereupon, at 1:22 p.m., the subcommittee was adjourned.]

[The ACIR letter and prepared statement of Mr. Robert A.
Georgine follow:]


183

Ill. GENERAL PRINCIPLES REGARDING UNFUNDED FEDERAL MANDATES
AND THE SCHOOLS

Public education today has a difficult mission—to make sure that the public schools,
which educate 90 percent of the nation’s children, are ready to meet the challenges of a
global economy in the 21st century. School board members, who have the primary
responsibility for public education at the local level, must be even more vigilant to stay
focused on this mission because of many competing priorities on the schools, including
those from the federal government.

In addressing mandates, NSBA fully acknowledges that the federal government does
have an interest in regulating certain activities within the public school setting.
However at the same time, given our constitutional system of government, the federal
government should exercise restraint when it does regulate the public functions of state
and local government—including those of local school systems. Further, in areas of
legitimate federal interest, Congress must show self restraint in the scope of the
mandated costs involved, including the creation of duplicative administrative systems,
which for local school districts means time and money that otherwise could be
committed to the education of our nation’s children. Finally, and perhaps most
important to the purpose of today’s hearing, if Congress imposes a mandate on local
school systems, it should bear the financial cost. That is, if the mandate is truly in the
national interest, then Congress should be willing to pay for it.

For public education to succeed, there must be a collaborative partnership among the
three levels of government in approaching mandates. By contrast, under the current
practice, the federal government simply places unfunded mandates on local school
boards without taking into account the real consequences, either in terms of the
individual mandate or the sum total of all its mandates.


17

~3
economic self-sufficiency. Before the Family and Medical Leave Act
was passed, we were the only industrialized nation without a family
and medical leave policy. Workers were forced to choose between
their families and their jobs. Employers without family leave policies
also paid a price in terms of lost productivity and expensive retraining

costs. Do we really want to go back?

The ACIR also recommends that provisions of the Fair Labor
Standards Act and the Occupational Safety and Health Act covering
state and local employees ase repealed, and I would like to better
understand the effects this would have on the workplace and on our

state employees.

The ACIR also recommends that several mandates be revised,
including three important environmental regulations: The Safe
Drinking Water Act, the Endangered Species Act, and The Clean Air
Act. These environmental laws were enacted to protect the public
health; I hope that during today’s hearing we will hear more about
how they would be revised to ensure that we don’t reverse the

important progress that we have made in cleaning up our environment.


61

U.S. DEPARTMENT OF LABOR

SECRETARY OF LABOR
WASHINGTON, D.C.

MAR OI OSS

The Honorable Wiyiiam F. Winter 7

Advisory Commission on Intergovernmenta’
Relations

800 K Street, N.W,

Suite 450

Washington, D.C. 20575

Dear Governor Winti

The purpose of this letter is to epress the Department of
Labor's deep concern over the recommendations set forth in
Role of Feder) Mandates_in_Tatermavernmental Relations.

preliminary Graft the Bavisory Commission on
tergovernmental Re. ions (ACI - Qux comments on the draft's
specatie i ic iegisiative proposals me contained in the enclosed

issues are of particular concern to the

Sorezencon .
As stated, the purpose of this prelimi draft report was
to propose "...changes federal policies to rove

intergevermmental relations while maintaining s commitment to
national interests" (emphasis added). The report does not
achieve that ie. In fact, the t's recommendations on
labor st would | seriously erode ergovernmental relations
and irrevocably harm this country's commitment to American
workers by endangering their right fo safe and healthful
workplace, to minimum wage and overt: Pay. and to family and
medical leave in case of a serious overyine Pe 4iness or bi: ofa
child. If the recommendations in the report were implemented,
state and local government workers would become second class
citizens -- deemed unworthy of the same basic protections as
their neighbors, friends, and family who work the private
sector or for Federal agencies.

DOL is equally concerned that the ACIR has not taken into
count: ess'sS 5 geruceion upon adoption of the Unfunded
Nanaates Reform Act that the Commission actively consider the
impact of its Tecommendations on American workers, and that the
Commission formulate its recommended changes in Federal policies
to enhance intergoyerrmental relations with a view t
maintaining a commitment to vital national interests. We

WORKING FOR AMERICA'S WORKFORCE


130

Mr. Davis. Vince, thank you very much.

We will hear now from Michael Resnick.

Mr. RESNICK. Thank you, Mr. Davis.

My name is Michael Resnick, and I am pleased to testify on be-
half of the National School Boards Association on this, the first an-
niversary of the Unfunded Mandates Reform Act. NSBA was
pleased to work with the Congress to secure enactment of this im-
portant legislation.

Since then, Congress has not legislated any new unfunded man-
dates on school systems at the threshold level. Therefore, we can-
not report on how well the mechanisms of the law are working, al-
though, unfortunately, we may have that opportunity if a recent
Senate committee amendment to extend the mandate of the Occu-
pational Safety and Health Act to State and local government, in-
cluding school districts, survives the legislative process.

Following the important step that was taken last year to recog-
nize the cost of future mandates, the time now has come for Con-
gress to re-evaluate or modify its existing mandates. Many of these
have been set forth in the ACIR report. The Nation’s 16,000 local
school boards, 96 percent of whom are elected, spend upwards of
$300 billion per year to educate over 40 million schoolchildren in
80,000 school buildings, and employ 4.8 million personnel. There-
fore, any mandate on an enterprise this large will have a signifi-
cant impact on the use of public dollars to achieve our primary mis-
sion: education.

For school districts, unfunded mandates translate into a pre-
emptive use of scarce and regressive local property tax dollars to
fund Federal priorities, many of which are not related to the edu-
cation of children. As a matter of principle, we recognize that the
Federal Government has the right to regulate certain activities in
the school setting. Our concern stems largely from the lack of re-
straint when those mandates substantially interfere with the basic
education mission of school districts, either because of the degrees
of regulation and/or the costs involved.

Unfunded mandates are especially onerous, not just because of
their cost, but because Congress has no financial incentive to set
priorities, to engage in proper cost-benefit analyses, to consider the
overall impact of all its mandates, and to re-evaluate older man-
dates to determine whether they have stood the test of changed cir-
cumstances or new information.

Contrary to popular belief, with the exception of the Individuals
With Disabilities Education Act, school districts’ problems with
Federal mandates are not tied to activities within the Department
of Education but to mandates administered by other agencies, pri-
marily in the labor and environmental areas, such as the Davis-
Bacon Act, OSHA, the Fair Labor Standards Act, the Drug and Al-
cohol Testing Program for commercial drivers, the Clean Air Act,
and the Asbestos Hazard Emergency Response Act program.

We urge Congress to review these unfunded mandates to deter-
mine if they have stood the test of changed circumstances and new
information. For example, the repeal of the Davis-Bacon Act would
permit schools to address the multibillion-dollar cost of buildings in
ill repair. Today, too much of the work, estimated by the GAO to
be $112 billion, is not getting done because costs are unaffordable.


114

are. I would be happy to provide them for you and the other mem-
bers of the committee.

Because the Department’s role is to serve the particular prior-
ities—and your list, I think, was very similar to ours—disadvan-
taged children, disabled children, technology, and teacher training,
we provide often the glue that lets people make some headway in
those areas.

We cannot carry, as the Federal Government, the full burden of
facilities reconstruction, and so forth. But we do try, for example,
through the President’s recent technology initiatives, to right that
balance so that those discontinuities don’t get any worse than they
are, and indeed so that we can try and bring all schools up to a
level where children can achieve to high standards.

The budget cuts would have very serious effects, most particu-
larly in districts that are very dependent on Title I support for edu-
cation of disabled children. Similarly, with some of the other pro-
grams that you mentioned, we would slip further behind and those
disparities would become greater. I would be happy to provide more
specific detail, as the Secretary did recently before this committee.

But thank you for your concern. It’s a serious problem.

Mr. Towns. Right. Mr. Chairman, I would like to request that
that material become a part of the record.

Mr. SHAyS. Without objection, it will definitely be.

Mr. Towns. Ms. Metzenbaum, the ACIR recommends modifica-
tion to the Clean Air Act, the Clean Water Act, the Safe Drinking
Water Act, and the Endangered Species Act. In your opinion, can
these modifications be implemented without undermining the in-
tent of these laws?

Ms. METZENBAUM. Thank you for your question, Congressman.
The specific recommendations that are set forth in the ACIR pre-
liminary report give us great trouble. We have serious concerns
about being able to achieve the public health and environmental
protection goals that we think need to be achieved and that the
laws are currently achieving.

We recognize that there are some individual problems with spe-
cific provisions of the act, and have been working hard and aggres-
sively with State, local, and tribal governments to identify what
those are, to fix them administratively, wherever that is possible,
and in some cases where we need legislation, to work with them
in Congress to try and fix them legislatively.

However, the specific provisions set forth in the ACIR report are
very troubling to us, and we think they would cause serious harm.

Mr. Towns. Thank you.

I just have one more question, Mr. Chairman.

Thank you, Ms. Metzenbaum.

Mr. Anderson, how is OSHA a mandate? Isn’t it applicable only
in State and local workplaces which have agreed to be covered by
it? That’s my understanding.

Mr. ANDERSON. That’s correct. States can enter into agreements
with OSHA to cover their workplaces under the regulations and
the standards that are established by OSHA. But the OSHA Act
does not cover States and local communities. And I think there are
27 States that have entered into such agreements, and they work
closely with the national OSHA in monitoring the workplaces and


116

cause an action taken or proposed by one agency may be inconsist-
ent with another.

Now, we have found—as I say, for 1994, roughly 135 to 150 regu-
lations were viewed as significant.

Mr. SHAyS. Let me interrupt you there and just ask, what doesn’t
happen in this legislation, it’s not like when you modify a building
and you decide to get up into the ceilings, and you have asbestos,
then you've got to redo the whole thing. If you have a regulation
that amends a very comprehensive regulation, you just look at that
new regulation. You don’t say, “Well, this new regulation deals
with a whole host of other topic regulations dealing with’—do you
get the drift of my question?

Ms. KaTZEN. I do, indeed. The legislation is premised on the in-
cremental expenditures required by the additional regulation.

Mr. Suays. OK. Let me then just go, if I could—because my time
is running out.

Ms. KATZEN. The other thing that I have to add is, it’s not $100
million effect on the economy, or we would have the Persian Gulf
war syndrome and other kinds of things where we do have regula-
tions that have that effect. It’s $100 million in expenditures by ei-
ther State, local, and tribal governments or the private sector.
That’s definitional. That’s one of the reasons we had to sort
through which were covered and which weren't.

Mr. SHays. And that’s important. We fully realize that it’s one
thing for us to pass a law, and it’s quite another thing to see how
the law is implemented and impacts society.

Why don’t we go with you, Ms. Studley.

Ms. STUDLEY. The Department of Education’s regulations are vir-
tually all outside the definition of Federal intergovernmental man-
dates because we provide assistance. So the same goes for the $100
million. First of all, very, very few of our programs require that
level of expenditure, and, if they do, the money comes from us.

Mr. Suays. You basically are providing the money.

Ms. STUDLEY. If we say, “You need to do something,” we usu-
ally—we virtually always provide Federal money to make it pos-
sible. So we’re quite outside.

Mr. SHays. OK. Thank you. That’s helpful.

Mr. Anderson.

Mr. ANDERSON. Yes, Mr. Chairman. In the Department of Labor,
the statutes that would be of greatest interest here would be the
FLSA, the FMLA, and OSHA, and in the Fair Labor Standards Act
and Family Medical leave, there simply have not been any regula-
tions that would even approach the $100-million threshold.

I was just given information by OSHA. I don’t have responsibility
for OSHA; I’m in another box in the Department of Labor. But the
information that was just presented by one of the OSHA staff
members is that there have Been two final regulations since the be-
ginning of 1995, a modification to change the handling of a regula-
tion, another one in the logging area, and neither of these regula-
tions even approaches $100 million.

Mr. Suays. OK. I think you’ve answered the question. Thank you
very much.

Can I just ask, before recognizing Mr. Fattah, is there any one
that—and I don’t want a long answer—was there any regulation


Statement of Rep. Christopher Shays
March 22, 1996
Page 2

Under Title II of the Mandates Act. the evecutive branch too must conduct an explicit
analysis of proposed and final rules to quantify the costs and benefits of mandates and identify
the most cost-effective. least burdensome regulatory approach. Departments and agencies are
required to consult with state and local governments. and the Office of Management and Budget
is directed to collect those regulatory statements and forward them “periodically” to the
Congressional Budget Office (CBO). OMB is also required to submit a written report detailing
compliance by each agency during the preceding year.

That report is being released today. It details efforts by the executive departments to
establish intergovernmental consultation procedures and review proposed rules for mandates.
According to the report, only 16 rules met the Act's threshold for a detailed cost/benefit analy sis
and review. That's just 16 out of more than 3,000 proposed or final rules published in the
Eederal Register since March 22, 1995. { hope that means the Act has resulted in less costly
regulatory mandates. not less realistic cost/benefit estimates in order to avoid the $100 million
threshold.

Moreover, I am concerned that OMB compliance with the requirement to share these
analyses with Congress appears minimal. That reporting is required “periodically.” In the first
year of the Mandates Act, that period was one full year. Before Tuesday, not one of the required
Statements had been forwarded to CBO. Then all 16 arrived at once. just in time to be included
in the report. Thope future comptiance will be more periodic, and less episodic.

‘The report also discloses that “agencies have begun considering, but have not yet
developed” the pilot programs to reduce reporting and compliance requirements on small
governments, as required by Section 207 of the Act. This requirement “remains a priority
during the coming year,” according to the report. 1 would prefer a firm commitment that next
‘year's report will not say the same thing, but will reflect actual compliance with this important
aspect of the law.

We also asked today's witnesses to comment on the preliminary ACIR report on the role
of existing mandates; a report also required by the Act. The findings and recommendations in
that report have already drawn considerable comment, and criticism, from those who evaluate the
benefits and burdens of mandates differently. We welcome that diversity of views because,
having mandated the report, this Congress will have to decide what action to take on the final
ACIR recommendations. That process can only be enhanced by the contributions of all our
‘witnesses today, and we weleome them,


93

7

(including provisions in collective bargaining agreements). Some
state and local governments asserted that FMLA compromised their
collective bargaining negotiations with public employee unions.
But the Act provided added flexibility in that it especially
recognized employers with collective bargaining agreements by
granting an extension of the law's effective date to enable
collective bargaining on FMLA-related issues. In addition, the
Department prepared and distributed comparisons of state and
federal family and medical leave laws in an effort to assist
employers, including state and local governments, in states with
similar provisions in understanding their compliance obligations.
Fact sheets and compliance guides were also made available.
Despite the Department's efforts, once again, as with the ACIR's
recommendation on the FLSA, an apparent lack of familiarity with
the law becomes the basis for suggesting elimination of FMLA's
important protections for employees of state and local
governments. The available evidence does not support ACIR's
preliminary assertions and actually shows that there is little
real justification for denying state and local government
employees the protections of the FMLA.

Qccu, nal Safet:

The ACIR report recommends repeal of all state coverage.

As a preliminary matter, the Department does not agree with
the draft report's assertion that a voluntary program constitutes
a mandate. We do not consider it a mandate because the only
state and local government workplaces covered by the OSH Act are
located in the 25 states where the state legislature has
voluntarily agreed to participate.

In any event, we believe -~ and many states agree -- that
repeal of the OSH Act with respect to public workers could
endanger the health and safety of thousands of workers who
perform some of the Nation's most dangerous jobs -- firefighting,
hazardous waste cleanup, maintenance and sanitation work.

Indeed, according to the American Federation of State, County and
Municipal Employees, almost 200 of their members were killed on
the job between 1983 and 1993. Public workers deserve the same
protections accorded to America’s private sector employees.

As with other DOL-related recommendations, the report fails
to acknowledge the substantial benefits that accrue from the Act.
These benefits are not limited to the health and safety of the
affected workers; but include real benefits to public employers,
who experience reduced worker compensation costs, higher employee
productivity, and reduced liability and insurance costs, and to
the general public who benefit from a reduction in the exposure
to dangerous conditions in public buildings and other facilities.

The ACIR report acknowledges that several of the concerns


38

3

The Commission examined 14 out of more than 200 laws and
regulations called to its attention, and recommended that seven
be repealed and seven be retained "with modifications". The
report calls for exempting state and local governments from
having to comply with the Fair Labor Standards Act, the Family
and Medical Leave Act, Occupational Safety and Health Act, Drug
and Alcohol Testing of Commercial Drivers, Metric Conversion for
Plans and Specit> ations, Boren Amendment to Medicaid, Required
Use of Recycled tubber (which has already been repealed).

Additionally, the report recommends that the following laws
should be changed: the Clean Water Act, Individuals with
Disabilities Education Act, Americans with Disakilities Act, Safe
Drinking Water A, Endangered Species Act, Clea: Air Act, Davis
Bacon Related Acts. Many of these laws, targeted by the
preliminary report, provide some of the most fundamental
protections from discrimination and unsafe working conditions for
millions of Americans. Furthermore, they ensure that all members
of our society are afforded the same opportunities to life,
liberty, and the pursuit of happiness.

I don’t believe that anyone here wants to dismantle or eliminate
needed public protections that look out for our environment, our
health, and our safety. I do believe that we all want the same

thing -- an effective government, that is responsive to the needs
of all those it represents. Our governments -- federal, state,
and local -- were erected to provide representation and public

accountability for all citizens. When we assume the role of
representative l=adership, granted to us by the electorate, we
have a fiduciary responsibility to preserve and defend the basic
freedoms that are the foundation of this great nation.

However, when I 100k at the preliminary recommendations, outlined
in the report, I see the totality of the impact of disintegrating
these critical protections for the American people. As one of
the authors during the construction of the Americans with
Disabilities Act, I can attest to the importance of expanding
elemental civil rights protections to every American. As a
participant in the Civil Rights movement, I know from personal
experience that by containing the liberties of or barring access
for the one or the few, we restrict the infinite possibilities of
the human spirit for everyone, and that we, as a nation, cannot
survive, as much as one cannot survive without breathing clean
air and drinking uncontaminated water.

In that spirit, I cannot support the recommendations of the
report, "The Role of Federal Mandates in Intergovernmental
Relations". Thank you Mr. Chairman for allowing me to express my
views on this very important issue.


158

I notice the gentleman from New Jersey has joined us. Mr.
Payne, we welcome you.

I was going to recognize Mr. Green next—he was here—for any
questions he may have.

Mr. Payne. Sure.

Mr. Davis. A former member of the Texas Senate.

Mr. GREEN. Thank you, Mr. Chairman.

To Delegate Callahan, I served 20 years in the Texas legislature,
and I appreciate your comment about the Federal Government’s
creation of the 13 States, but at least the rest of us, other than the
18, had to get permission from Congress to join the Union. So, ad-
mittedly, the first 13 created the Federal Government; the rest of
us are here because of Congress.

Mr. CALLAHAN. We got in under the wire.

Mr. GREEN. That's right.

_Mr. Davis. It was just conditional permission. They are on proba-
tion still.

Mr. GREEN. When I left the Texas Senate, my good friend, the
Lieutenant Governor served in lots of capacities, Bob Bullock told
me—he sent me up here, after 20 years as a House member and
Senator, and said, “Cut out the Federal mandates.” And I looked
at him and I said—I had served 7 years in the Senate on the Edu-
cation Committee—and I said, “Bob, that’s what my local school
boards have been telling me for 7 years as a State senator, ‘Cut out
those mandates coming from the State capital to the local commu-
nity.’”

And I think that’s the frustration that I had, both as a Member
of the legislature and now in Congress, that the role of Government
is to mandate, it seems like, whether it be from the Fed to the
State, from the State to the city. In Texas, the State tells the city,
the county, and the school districts what to do. Ultimately, it’s the
individual who has to pay the bill, whether it be school property
taxes, Federal taxes, county levies, or State sales taxes.

I guess that’s the frustration that we have. We’re attacking man-
dates, and we're saying, “Well, who pays the bill?” And I think the
School Board Association has said that you need to have a partner-
ship. We have to work together. And I know that’s why I voted for
the mandate bill in 1995 was because of the need to get control on
that. But the same thing happens in State legislatures. Like I said,
I had school board members and city council members tell me the
same thing.

And I appreciate our witness from public works when he men-
tioned the death of common sense. I have the same frustration
dealing with the Federal Government, but I also had to try to get
constituents’ permission to put culverts in their ditches. Working
through the public works department in some of my local commu-
nities was almost as frustrating as getting someone ‘ial Security.
So I can see the frustration.

I guess what concerns me about the whole report is the notion
that all mandates are bad and one good example is the drug and
alcohol testing for commercial drivers. Now, granted, that was an
intrusion, I guess, on local government. A school bus driver or a
school delivery person had to do that. But then so would the other
commercial drivers on the road.


125

log of mandates, assessing existing mandates, and conducting an-
nual fiscal impact analyses of proposed new State mandates, our
State has enacted a relief measure that allows the Governor to de-
clare a 1-year Suspension of a State mandate for any locality that
demonstrates fiscal stress which can be alleviated by such a mora-
torium. This is an example of local flexibility which Congress could
emulate.

In addition, Virginia’s legislature has just designated the Vir-

inia ACIR as a forum for any locality seeking to challenge a man-

late assessment or a fiscal note. Congress should consider provid-
ing a similar forum, perhaps the U.S. ACIR. Surely, other models
abound.

In closing, let me say that States and localities are grateful for
the progress that has been made, and we are mindful that much
more can be done. As you contemplate intergovernmental options,
bear in mind that, as partners, we can work together to make gov-
ernment better for all of us.

Thank you.
(The prepared statement of Mr. Callahan follows:]


100

IDEA has already helped millions of students with disabilities
become fully participating members of our society. Before IDEA,
approximately 1 million children with disabilities were totally ex-
cluded from the public school system and another 4 million did not
receive appropriate services.

Reform of IDEA is a major priority of the Department and is well
underway. Yet the draft report did not even refer to our reauthor-
ization proposal or consultation. The proposal was presented to
Congress on June 30, 1995, and is moving well along in both
houses. Our proposal reduces administrative burden and paper-
work for State and localities, and, in particular, goes beyond the re-
port in several critical ways, including calling for impartial medi-
ation services to reduce the severity of disputes and to avoid formal
proceedings whenever possible,

We are adamantly opposed to the recommendation that any court
challenge be brou; ht By the Federal Government and not by par-
ents themselves. Depriving parents of these rights would be fun-
damentally inconsistent with the intent of the law to create indi-
vidual rights.

With your permission, I will attach Secretary Riley’s letter to
Governor Winter, the chair, to our testimony. I am pleased to re-
port that we, too, are having positive and constructive discussions
with the ACIR staff, and look forward to improvements. Thank

you.
[The prepared statement of Ms. Studley follows:]


Al

tives of which are with me today, do issue many rules that affect
State, local, and tribal governments, and they have done, in my
opinion, a superb job of setting up avenues of communication with
their representatives and intergovernmental partners. These are
set forth in detail in chapter 1.

What I want to emphasize this morning is that all agencies are
committed to consultations, not just on rules and regulations they
adopt, but on all programs and policies; all of the agency activities.
We should not be limiting our consultations to those things that
are required by law, the rules and regulations, but all of our activi-
ties. And that is what the agencies have done. There is a myriad
of examples in our report that speak to this issue.

It also shows that our processes are not simply paper-driven ex-
ercises. There were two rules in the last year that imposed State,
local, or tribal expenditures of $100 million or more. That’s the
threshold under Title II. Both were promulgated by the Environ-
mental Protection Agency. Chapter 2 of our report sets forth, in
loving detail, all the consultative processes that EPA engaged in.

Most significantly, it shows that the agency ascertained the con-
cerns and made changes to their proposals to accommodate those
concerns. That’s what the bill is all about. That’s what the act was
intended to do, and that’s what the agencies have been doing.

I would like to address two comments that were made in the
opening statement, although you may have questions on that, and
that is the reason for the delay in sending the materials to CBO.
The first such intergovernmental regulation was promulgated on
December 19, 1995. Regrettably, it was during one of the periods
of furlough. And there were a number of other reasons causing
delays in January and February. The second one has not yet is-
sued. It was cleared by OMB and was signed by the administrator.
It is due to be in the Federal Register sometime this week.

So I don’t think there has been an inordinate delay in sending
those to CBO. We were advised that they wanted the State, local,
and tribal government regulatory impact analyses less than the
private sector ones, and that was the reason for the delay. But we
take your words seriously, and we will make sure that we are non-
episodic but more regular in the future.

Mr. SHAYS. Quite a word, isn’t it?

Ms. KaTZEN. | thought it was good.

There is one other report that was called for by the statute, and
that is Title III's asking ACIR to consider a number of serious
questions. Now, as somebody who was involved tangentially in the
development of the legislation, it was clear to me that the task as-
signed to ACIR was a formidable one, indeed. They asked tough
questions, questions for which the answers were neither readily ap-
parent nor easily ascertainable.

Compounding this problem was the fact that Congress decided to
terminate ACIR and allocated $450,000 for the study and shut-
down costs, during which we had periods of various Government
furloughs, et cetera. So we were not wholly surprised, but we were,
frankly, disappointed when we saw the staff draft, because we felt
that there were serious gaps in what was attempted to be done.

And we sent a letter, which, again, I have attached to my testi-
mony, setting forth the administration’s position on the staff re-