I

106TH CONGRESS

1ST SESSION H. R. 2245

To ensure the liberties of the people by promoting federalism, to protect

the reserved powers of the States, to impose accountability for Federal

preemption of State and local laws, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JUNE 16, 1999

Mr. MCINTOSH (for himself, Mr. MORAN of Virginia, Mr. PORTMAN, Ms.

MCCARTHY of Missouri, Mr. CASTLE, Mr. CONDIT, and Mr. DAVIS of

Virginia) introduced the following bill; which was referred to the Committee on Government Reform, and in addition to the Committees on

Rules, and the Judiciary, for a period to be subsequently determined by

the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To ensure the liberties of the people by promoting federalism,

to protect the reserved powers of the States, to impose

accountability for Federal preemption of State and local

laws, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Federalism Act of

5 1999’’.
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1 SEC. 2. FINDINGS.

2 The Congress finds the following:

3 (1) The Constitution created a strong Federal

4 system, reserving to the States all powers not ex5 pressly delegated to the Federal Government.

6 (2) Preemptive statutes and regulations have at

7 times been an appropriate exercise of Federal pow8 ers, and at other times have been an inappropriate

9 infringement on State and local government author10 ity.

11 (3) On numerous occasions, the Congress has

12 enacted statutes and Federal agencies have promul13 gated rules that expressly preempt State and local

14 government authority and describe the scope of the

15 preemption.

16 (4) In addition to statutes and rules that ex17 pressly preempt State and local government author18 ity, many other statutes and rules that lack an ex19 press statement by the Congress or Federal agencies

20 of their intent to preempt and a clear description of

21 the scope of the preemption have been construed to

22 preempt State and local government authority.

23 (5) In the past, the lack of clear congressional

24 intent regarding preemption has resulted in too

25 much discretion for Federal agencies and uncer26 tainty for State and local governments, leaving the
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1 presence or scope of preemption to be litigated and

2 determined by the Federal judiciary, producing re3 sults sometimes contrary to or beyond the intent of

4 the Congress.

5 (6) State and local governments are full part6 ners in all Federal programs administered by those

7 governments.

8 SEC. 3. PURPOSES.

9 The purposes of this Act are the following:

10 (1) To promote and preserve the integrity and

11 effectiveness of our federalist system of government.

12 (2) To set forth principles governing the inter13 pretation of congressional intent regarding preemp14 tion of State and local government authority by Fed15 eral laws and rules.

16 (3) To recognize the partnership between the

17 Federal Government and State and local govern18 ments in the implementation of certain Federal pro19 grams.

20 (4) To establish a reporting requirement to

21 monitor the incidence of Federal statutory, regu22 latory, and judicial preemption.

23 SEC. 4. DEFINITIONS.

24 In this Act:
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1 (1) DEFINITIONS IN 5 U.S.C. 551.—The defini2 tions under section 551 of title 5, United States

3 Code, shall apply.

4 (2) BILL.—The term ‘‘bill’’ includes a joint res5 olution.

6 (3) DIRECTOR.—The term ‘‘Director’’ means

7 the Director of the Congressional Budget Office.

8 (4) LOCAL GOVERNMENT.—The term ‘‘local

9 government’’ means a county, city, town, borough,

10 township, village, school district, special district, or

11 other political subdivision of a State.

12 (5) PUBLIC OFFICIALS.—The term ‘‘public

13 officials’’—

14 (A) means elected officials of State and

15 local governments; and

16 (B) includes the following national organi17 zations that represent such officials:

18 (i) The National Governors’ Associa19 tion.

20 (ii) The National Conference of State

21 Legislatures.

22 (iii) The Council of State Govern23 ments.

24 (iv) The United States Conference of

25 Mayors.
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1 (v) The National League of Cities.

2 (vi) The National Association of

3 Counties.

4 (vii) The International City/County

5 Management Association.

6 (6) STATE.—The term ‘‘State’’—

7 (A) means a State of the United States

8 and an agency or instrumentality of a State;

9 (B) includes—

10 (i) the District of Columbia and any

11 territory of the United States, and an

12 agency or instrumentality of the District of

13 Columbia or such territory; and

14 (ii) any tribal government and an

15 agency or instrumentality of such govern16 ment; and

17 (C) does not include a local government of

18 a State.

19 (7) TRIBAL GOVERNMENT.—The term ‘‘tribal

20 government’’ means an Indian tribe as that term is

21 defined under section 4(e) of the Indian Self-Deter22 mination and Education Assistance Act (25 U.S.C.

23 450b(e)).
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1 SEC. 5. DEFERENCE TO STATE MANAGEMENT PRACTICES.

2 (a) EXPENDITURE AND ACCOUNTING OF FEDERAL

3 FUNDS.—A State shall expend and account for covered

4 Federal grant funds in accordance with requirements and

5 procedures under the laws of the State governing State

6 expenditure of and accounting for State funds, subject to

7 any requirement that expressly applies under any other

8 Federal statute.

9 (b) USE, MANAGEMENT, AND DISPOSAL OF PER10 SONAL PROPERTY ACQUIRED WITH FEDERAL FUNDS.—

11 A State shall use, manage, and dispose of personal prop12 erty acquired with covered Federal grant funds in accord13 ance with requirements and procedures under the laws of

14 the State governing State use, management, and disposal

15 of personal property acquired with State funds, subject to

16 any requirement that expressly applies under any other

17 Federal statute.

18 (c) PROCUREMENT WITH FEDERAL FUNDS.—In pro19 curing any personal property or service with covered Fed20 eral grant funds, a State shall follow the same require21 ments and procedures that apply under the laws of the

22 State governing State procurement with State funds, sub23 ject to any requirement that expressly applies under any

24 other Federal statute.

25 (d) DEFINITIONS.—In this section:
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1 (1) COVERED FEDERAL GRANT FUNDS DE2 FINED.—The term ‘‘covered Federal grant funds’’

3 means amounts provided as Federal financial assist4 ance, other than assistance under a grant program

5 to which the Grants Management Common Rule (53

6 F.R. 8034) does not apply on the date of the enact7 ment of this Act.

8 (2) PERSONAL PROPERTY.—The term ‘‘‘per9 sonal property’’ means property other than real

10 property.

11 SEC. 6. PERFORMANCE MEASURES.

12 Section 1115 of title 31, United States Code, is

13 amended by adding at the end the following:

14 ‘‘(g) The head of an agency may not include in any

15 performance plan under this section any agency activity

16 that is a State-administered Federal grant program, un17 less the performance measures for the activity are deter18 mined in cooperation with public officials.’’.

19 SEC. 7. REQUIREMENTS FOR AGENCY RULEMAKING.

20 (a) NOTICE AND CONSULTATION WITH POTEN21 TIALLY AFFECTED STATE AND LOCAL GOVERNMENTS.—

22 Not later than the date of publication of an advance notice

23 of proposed rulemaking for a rule promulgated by an

24 agency, or the equivalent date if such notice is not pub25 lished, the head of the agency shall notify and consult with
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1 public officials who may potentially be affected by the rule

2 for the purpose of identifying any preemption of State or

3 local government authority that may result from issuance

4 of the rule.

5 (b) IDENTIFICATION OF PREEMPTION AND FED6 ERALISM IMPACTS.—

7 (1) IN GENERAL.—The head of an agency

8 shall—

9 (A) publish with each proposed rule issued

10 by the agency a proposed federalism impact as11 sessment under paragraph (2);

12 (B) publish with each interim final rule

13 issued by the agency a proposed federalism im14 pact assessment under paragraph (2); and

15 (C) publish with each final rule issued by

16 the agency a final federalism impact assessment

17 under paragraph (2).

18 (2) FEDERALISM IMPACT ASSESSMENT.—A pro19 posed or final federalism impact assessment under

20 this subsection shall include with respect to the pro21 posed, interim final, or final rule concerned an iden22 tification of—

23 (A) any provision of the rule that is a pre24 emption of State or local government authority;
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1 (B) the constitutional basis for each such

2 preemption;

3 (C) any provision of statute under which

4 the rule is issued that is an express preemption

5 of State or local government authority, and any

6 provision of any other statute that expressly

7 states that the Congress intended such preemp8 tion;

9 (D) any provision of the rule that estab10 lishes a condition for receipt of grant funds

11 that is not related to the purpose of the grant

12 program under which the funds are provided;

13 (E) any other provision of the rule that

14 impacts State or local governments, including

15 any provision that constitutes a Federal inter16 governmental mandate (as that term is defined

17 in section 421 of the Congressional Budget and

18 Impoundment Control Act of 1974);

19 (F) any regulatory alternatives considered

20 by the agency;

21 (G) the estimated costs that will be in22 curred by state and local governments as a re23 sult of issuance of the rule; and
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1 (H) the extent of the agency’s consulta2 tions with public officials who may potentially

3 be affected by the rule.

4 (c) PUBLICATION.—The head of an agency shall in5 clude, in a separately identified part of the preamble to

6 each proposed rule, interim final rule, and final rule pub7 lished by the agency in the Federal Register, a summary

8 of the proposed or final (as applicable) federalism impact

9 assessment prepared under this section.

10 SEC. 8. LEGISLATIVE REQUIREMENTS.

11 (a) IN GENERAL.—The report accompanying any bill

12 of a public character reported from a committee of the

13 Senate or House of Representatives, or the joint explana14 tory statement accompanying a conference report on any

15 such bill, shall include a statement that—

16 (1) identifies each section of the bill or con17 ference report that constitutes an express preemp18 tion of State or local government authority, or as19 serts that the bill does not contain any such section;

20 and

21 (2) describes the constitutional basis for any

22 such preemption;

23 (3) sets forth the reasons for each such preemp24 tion; and
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1 (4) includes the federalism impact assessment

2 by the Director under subsection (b).

3 (b) FEDERALISM IMPACT ASSESSMENT BY CONGRES4 SIONAL BUDGET OFFICE.—

5 (1) PROVISION OF BILL OR CONFERENCE RE6 PORT TO DIRECTOR.—When a committee of the Sen7 ate or the House of Representatives orders reported

8 a bill of a public character, and before a conference

9 committee files a conference report thereon, the

10 committee or conference committee shall promptly

11 provide the bill to the Director and shall identify to

12 the Director each section of the bill that constitutes

13 a preemption of State or local government authority.

14 (2) FEDERALISM IMPACT ASSESSMENT.—(A)

15 For each bill of a public character reported by any

16 committee of the Senate or the House of Represent17 atives, and for each conference report thereon, the

18 Director shall prepare and submit to the committee

19 or conference committee a federalism impact assess20 ment that describes the preemptive impact of the bill

21 or conference report thereon on State and local gov22 ernments, including the estimated costs that would

23 be incurred by State and local governments as a re24 sult of its enactment.
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1 (B) In the case of a bill or conference report

2 that authorizes a Federal grant program, the fed3 eralism impact assessment shall also identify any

4 provision that establishes a condition for receipt of

5 funds under the program that is not related to the

6 purposes of the program.

7 (c) ABSENCE OF COMMITTEE REPORT OR STATE8 MENT OF MANAGERS.—In the absence of a committee re9 port or joint explanatory statement in accordance with

10 subsection (a) accompanying a bill or conference report

11 thereon, respectively, the committee or conference com12 mittee shall report to the Senate and the House of Rep13 resentatives a statement described in subsection (a) before

14 consideration of the bill or conference report.

15 SEC. 9. RULES OF CONSTRUCTION RELATING TO PREEMP16 TION.

17 (a) STATUTES.—No Federal statute enacted after the

18 effective date of this Act shall preempt, in whole or in

19 part, any State or local government law, ordinance, or reg20 ulation, unless the statute expressly states that such pre21 emption is intended or unless there is a direct conflict be22 tween such statute and a State or local law, ordinance,

23 or regulation so the two cannot be reconciled or consist24 ently stand together.
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1 (b) RULES.—No Federal rule issued after the effec2 tive date of this Act under any provision of law enacted

3 after that effective date shall preempt, in whole or in part,

4 any State or local government law, ordinance, or regula5 tion, unless the statute under which the rule is issued, or

6 another statute, expressly states that such preemption is

7 intended.

8 (c) FAVORABLE CONSTRUCTION.—Any ambiguity in

9 this Act, or in any other Federal rule issued or Federal

10 statute enacted after the date of the enactment of this

11 Act, shall be construed in favor of preserving the authority

12 of State and local governments.

13 SEC. 10. REPORTS ON PREEMPTION.

14 (a) OFFICE OF MANAGEMENT AND BUDGET INFOR15 MATION.—Promptly after the expiration of the second cal16 endar year beginning after the effective date of this Act,

17 and every 2 years thereafter, the Director of the Office

18 of Management and Budget shall submit to the Director

19 of the Congressional Budget Office information describing

20 each provision of interim final rules and final rules issued

21 during the preceding 2 calendar years that preempts State

22 or local government authority.

23 (b) CONGRESSIONAL RESEARCH SERVICE INFORMA24 TION.—Promptly after the expiration of the second cal25 endar year beginning after the effective date of this Act,
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1 and every 2 years thereafter, the Director of the Congres2 sional Research Service shall submit to the Director of the

3 Congressional Budget Office information describing Fed4 eral and State court decisions issued during the preceding

5 2 calendar years that preempt State or local government

6 authority.

7 (c) CONGRESSIONAL BUDGET OFFICE REPORT.—

8 (1) IN GENERAL.—Not later than the adjourn9 ment sine die of each Congress, the Director of the

10 Congressional Budget Office shall submit to the

11 Congress a report on the extent of preemption of

12 State and local government authority—

13 (A) by Federal laws enacted during the

14 previous session of Congress; and

15 (B) by judicial or agency interpretations of

16 Federal statutes issued during such session,

17 using—

18 (i) information regarding agency rules

19 submitted by the Office of Management

20 and Budget under subsection (a); and

21 (ii) information regarding Federal and

22 State court decisions submitted by the Di23 rector of the Congressional Research Serv24 ice under subsection (b).
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1 (2) CONTENT.—The report under paragraph

2 (1) shall contain—

3 (A) a cumulative list of Federal statutes

4 preempting, in whole or in part, State or local

5 powers;

6 (B) a summary of legislation enacted dur7 ing the previous session preempting, in whole or

8 in part, State or local government authority;

9 (C) a summary of rules of agencies pro10 mulgated during the previous session of Con11 gress preempting, in whole or in part, State or

12 local government authority; and

13 (D) a summary of Federal and State court

14 decisions issued during the previous session of

15 Congress preempting, in whole or in part, State

16 or local government authority.

17 (3) AVAILABILITY.—The Director shall make

18 the report under this subsection available to—

19 (A) each committee of the Congress;

20 (B) each Governor of a State;

21 (C) the presiding officer of each chamber

22 of the legislature of each State; and

23 (D) other public officials and the public

24 through publication in the Congressional

25 Record and on the Internet.
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1 SEC. 11. LIMITATION ON APPLICATION WITH RESPECT TO

2 PROHIBITIONS AGAINST DISCRIMINATION.

3 This Act shall not apply with respect to any section

4 of a bill, or any provision of a Federal regulation or stat5 ute, that establishes or enforces any statutory prohibition

6 against discrimination on the basis of race, color, religion,

7 sex, national origin, age, handicap, or disability.

8 SEC. 12. EFFECTIVE DATE.

9 This Act shall take effect 90 days after the date of

10 the enactment of this Act.

Æ