I said write them a letter and say that is absolutely a gross misrepresentation of where we are at.

I mean, they either don't acknowledge it at all, or if they do acknowledge it, they put something like that in it.

Chairman THOMPSON. That doesn't necessarily answer the federalism issue, anyway. I mean, one part of it.

Mr. DORSO. But, agencies propose rules all the time that affect us, either fiscally and/or legally. The DOJ on the ADA thing, I mean, I think ADA is fine, there are a lot of great things about it, but when you get to mental health issues and community health care, we have got a lot of issues to work through with that. And they just write a rule that is supposed to fit everything. Well, I can tell you, what fits Baltimore doesn't fit Williston, North Dakota, when you get to that issue. But they seem to think it is, and they just send it out, and we are supposed to all of a sudden comply. If we don't comply, there is reason for somebody to bring a lawsuit against the State. And there is no way for us

Chairman THOMPSON. But not against them.

Mr. DORSO. No, they don't sue the Department of Justice. They

sue us.

So then I have got the Attorney General calling me and saying what are you going to do about it, and that is just another instance that's in here.

Like I say, in conclusion, Mr. Chairman, I know that you have been active in this, and I know Senator Voinovich from his days as governor has been active in this. I was in Ohio when we originally started talking about this, what, 4 or 5 years ago, Senator?

Mr. Chairman, I will tell you I feel so strongly about this I got up at 4 o'clock this morning to come down here. I am going home tonight. But I feel this is a cornerstone of our democracy, and I know that you believe that and Senator Voinovich believes it. We are totally in support of what you are doing here. If we can be helpful in this regard, I know this is not probably the final product, and it has to work its way through.

I certainly think there has to be some safeguards built into it. I heard the judicial review question. I am not sure that we want everybody to sue every agency if they do not like it. But, still, if we do not have some kind of judicial review, at least reserved to maybe the State and some political subdivisions. I do not know what it will mean if it is not in there because, as you have pointed out, the agencies do not seem to care anyway. At this point, an Executive Order does not do anything.

So I think the point of order question, I do not understand that. That is not the way we operate in the legislature in North Dakota. You have to be the judge of whether that is important to you, whether it could be an effective tool or not. I do not know. But if it is effective, and you can get it, as was said by the governor, I guess that is something that you will have to weigh out.

I think the most important part of this is is that you are making the effort to get this done. And just the dialogue of making that effort is important. But passage of it would be great. I think it is something we can build upon. I think there is an experience curve here that would be great for the States, and I certainly want to

Chairman THOMPSON. Thank you very much. We really appreciate your taking the trouble to come down here.

Mayor Fekete.

TESTIMONY OF ALEXANDER G. FEKETE,1 MAYOR, PEMBROKE PINES, FLORIDA, ON BEHALF OF THE NATIONAL LEAGUE OF CITIES

Mayor FEKETE. Thank you, Mr. Chairman. Good afternoon. And, Senator Voinovich, my name, as you stated, is Alex Fekete. I tell people it rhymes with spaghetti.

Not only am I mayor of Pembroke Pines, but I am also the vice chairman of the Finance Administration and Intergovernmental Relations Committee of the National League of Cities. I am pleased to be here this afternoon to testify before you with my colleagues on what we believe is ground-breaking Federal legislation, the Federalism Accountability Act of 1999, S. 1214. This bill embraces and preserves the Chair's principle of federalism and promotes a new Federal-State-local partnership with respect to the implementation of certain programs.

I thank the Committee for having this hearing today. I would also especially like to thank the Chairman, Senator Thompson, and his colleague, Senator Levin, for their leadership, and Senator Voinovich, for working with the members of the "Big Seven" State and local government organizations to craft this bill. At the same time, I would like to recognize and thank the bill's cosponsors for their leadership, which will help pass this legislation.

The National League of Cities is the oldest and largest organization representing the Nation's cities, towns and their elected officials. NLC represents 135,000 mayors and council members from municipalities across the country.

Whatever their size, all cities are facing significant Federal preemption threats to historic and traditional local fiscal, land use and zoning authority. Whatever their size, all cities and all Americans will benefit from legislation such as S. 1214. S. 1214 is important legislation because it permits cities to govern for the benefit of all of their residents.

To illustrate the need for this legislation, I want to bring to the Committee's attention a recent article in the Washington Post, which reports on a poll taken by Peter Hart and Robert Teeter. The poll results shows a general alienation of the people from their government. According to this poll, 54 percent of American people do not feel that they have a government body that is envisioned by President Clinton and his "of, by and for the people." People today tend to think of government as the government not our govern

ment.

We need to work together to change this perspective, and S. 1214 is the best and most definitive way to do that. The Washington Post article, additionally, notes that people feel more connected to their State and local governments than the Federal Government. S. 1214 would help connect Congress with the success of State and local governments by checking preemption by a Federal Government the citizens feel distant from. At the same time, S. 1214 is

1 The prepared statement of Mayor Fekete appears in the Appendix on page 340.

a springboard to a government that is ultimately more responsive to the people because it creates the partnership between all levels of government, Federal, State and local.

The pervasive and imminent threat of preemption by the Federal Government and the low level of participation by local government in creation of Federal laws and rules, which impact them mostly, is why S. 1214 is needed.

Let me clarify that it is not the intent of NLC to undermine the supremacy clause of the Constitution. In fact, I think everyone in the room today acknowledges that there are times when Federal law should trump State law-when there is a direct conflict between Federal and State law or when it is Congress's express intent to preempt State law.

During the 1960's, for example, the Nation needed the Federal Government to move forward with civil rights legislation that would ensure the equal treatment of all Americans under our Constitution. The problem, however, is not with our dual form of government, as it was established by the Framers of the Constitution, our concern is focused on the frequency of Federal preemption of State and local laws.

Moreover, there seems to be a lack of sensitivity on the part of Federal Government with regard to local government and a preemptive impact of Federal legislation and regulations on local government. It is the National League of Cities' highest priority to put a meaningful check on this preemptive of State and local authority. Allow me to cite a few actions the Federal legislation has taken just in the last few months.

First and foremost, recent legislation signed into law last October impedes States' and local governments' ability to tax sales and services over the Internet in the same manner as all other sales and services are taxed, despite the fact that no such limitation would apply to the Federal Government.

There is also legislation being voted on today by the House of Representatives called the Religious Liberty Protection Act of 1999, which is a massive preemption of State and local zoning and land use laws. This bill, if enacted into law, would chill a city's ability to uniformly apply neutral zoning laws to an entire community by exempting religious-based land use like churches, synagogues and

mosques.

Local zoning and land use laws also face severe preemption in the area of takings law, with the reintroduction of takings legislation in the House and the Senate, which would allow developers to pursue takings claims in Federal court without first exhausting their State judicial procedures.

Current law preempts municipal authority over the siting of group homes and preempts a municipality from applying zoning, environmental, health and safety standards to railroads. There is no question that the most significant impacts of these preemptions will be felt at home in our Nation's cities and towns through the erosion of local tax bases and through the inability to enforce local ordinances enacted for the benefit of all who live in our community. The time to revitalize our federalist form of government is now. The Supreme Court has spoken of the need to recognize that free

ments, Federal and State, and that State and local governments are joint participants with the Federal Government in our Federal system.

Members of the Committee, sometimes a more regional or local approach to governing is needed, and sometimes the needs of the people are better met at local level through the enactment, application and preservation of local laws. The Federalism Accountability Act would help to restore some balance between Federal, State and local governments.

Let me turn to S. 1214. This bill provides cities nationwide with a viable means of alleviating many of the problems associated with Federal preemption of local laws. S. 1214 represents one of the most important efforts to fundamentally rethink the nature and relationship of our Federal system and to expand the partnership of elected government officials. S. 1214 contains several good tools for creating this new idea of federalism, which are beneficial to cities. Section 4 of the bill defines a public official as including the representative organization of State and local elected officials, those being the national associations of the Big Seven, State and local government organizations. This inclusion is vital to providing cohesiveness to the consultation provision of the bill. It will make it easier to get State and local input from these national associations who can best represent the views of a cross section of their respective membership. It streamlines and simplifies the consultation process for all involved.

Section 5 of the bill requires Senate and House Committees, including Conference Committees, to include a statement with each Committee or conference report on a bill or joint resolution that details the preemptive impact of the legislation, gives the reasons for this preemption and explains how State or local authority will be maintained following the passage of legislation.

Where there is no Committee or conference report, there must be a written statement by the Committee or conference that details the level of preemption. This section is critical to local governments. So often it is the case that a bill passed has severe consequences on our Nation's cities because it preempts State and local law. One such example is the Internet Tax Freedom Act of 1998. Without a Committee or conference report or statement to explain the preemption and the reasons behind it, it is impossible for local governments to know whether such impacts were even considered by Congress. Under this section of the act, local government is assured of such deliberation.

Another very positive and important aspect of this bill is contained in the Rules of Construction. It clarifies instances of Federal preemption by requiring that the intent to preempt be expressly stated in the statute or rule or permitting preemption when there is a direct conflict between a Federal, State and a statute of local law. This section should not be interpreted as a prohibition. To the contrary, this bill recognizes that at times preemption is appropriate.

What this section attempts to do, however, is minimize instances where the intent to preempt is not clear, thus avoiding expensive and adversarial litigation by limiting a court's ability to find that

an implied preemption exists. It, again, makes the Federal Government accountable for what it does, as you stated, Mr. Thompson. This section also creates a presumption against preemption of State and local law and permits cities to govern by requiring that any ambiguity in the act be construed towards preserving State and local authority. These rules of construction, therefore, are of vital importance to cities.

Section 7 of the bill spells out several important requirements to ensure that State and local public officials participate in the Federal agencies' rulemaking process in an early and meaningful way. This section directs the heads of Federal agencies who are responsible for implementing this act to appoint a federalism officer within each agency. The officer would execute the provisions of this act and serve as a liaison to State and local officials and their representatives, thereby providing cities with a definable person who is a point of contact in the rulemaking process.

Section 7 additionally requires that agency heads give notice to and consult with State and local elected officials and their representative national organizations early in the rulemaking process and prior to publication of a Notice of Proposed Rulemaking when that rule might interfere with or intrude upon historic and traditional rights and responsibilities of State and local governments.

This provision of the bill requires Federal agencies to stop, look, listen and think before they leap into the arena of preemption. It further provides cities with a much-needed voice in their rulemaking process especially when those rules would have a direct and potentially debilitating impact on our Nation's cities. Most importantly, it is an opportunity for local elected officials to work more closely with Federal agencies earlier in the rulemaking proc

ess.

This section of the bill furthermore calls for a federalism assessment to accompany each proposed, interim final, and final rule in the Federal Register and each rule review submitted to the Office of Management and Budget, when those rules could affect State and local authority. The federalism assessment would detail, analyze and attempt to justify the extent of the preemption of State or local authority. The assessment would describe the extent to which State or local authority would be preserved after the rule's enactment. It would additionally communicate the agency's efforts to minimize the impact on State and local governments and to consult with public officials, including the concerns of those officials and the extent to which those concerns have been satisfied. Agency heads would have to consider these assessments when promulgating, implementing and interpreting the relevant rules.

Last, but certainly not least, Section 9 of the bill provides cities with an overall check on the Federal Government's preemption activities. It requires the Director of the Office of Management and Budget to submit to the director of the Congressional Budget Office information describing each provision of interim final rules and final rules issued during the preceding calendar years that preempts State and local government authority. CBO must then submit to the Congress a report on preemption through Federal statutes, rules or court decisions and legislation reported out of Com