In recent years, state and local governments have been on the march, decrying unfunded mandates and demanding an equal seat at the tables where national policy is forged. Their crusade is both an understandable and predictable reaction to truly breathtaking federal forays into areas that once were the exclusive province of the states, as well as the infuriating reality that federal aid to implement programs has declined steadily over the last two decades. Unfortunately, however, as in any crusade, the rhetoric of the moment has obscured the reasons why Congress acted to expand federal power, running the real risk that unrestricted devolution will return us to the proverbial "square one"of efforts to solve our most intractable national problems.

From what I can tell from the testimony you have received thusfar, the motivation for the legislation now before you is state and local government opposition to federal preemption in such areas as revenue (e.g., taxes on usage of the Internct), medical records privacy, and the modernization of financial services.' I am not an expert on these issues, and will not presume to address the nature and scope of the devolution that is appropriate to resolve them. What is clear is that the principles that should guide you in those contexts have little if any application to the issues posed by the centralized health and safety regulation that has so improved the quality of our lives.

Take, for example, environmental protection, the unacknowledged poster child of the unfunded mandates movement' and a superb example of the painstaking debate over how to sort responsibility in a compound republic. What ideas should guide congressional decisions on "dividing the job" among the three levels of government in that area?

When EPA was created in 1970, Congress could only have guessed at the complexity of the new agency's mission. As our understanding of that mission deepens, economies of scale in accomplishing the scientific and technical research essential to meaningful health and safety regulation are the most compelling reason for centralized regulation and against unrestricted devolution.

A recent EPA report found that there is no toxicity information available for 43 percent of the 2,863 organic chemicals bought and sold in amounts above one million pounds every year in

? See, eg, Testimony of Raymond C. Scheppach, Executive Director, National Governors' Association, before the Committee on Government Reform, Subcommittee on National Economic Growth, Natural Resources, and Regulatory Affairs, U.S. House of Representatives, June 30, 1999.

'During the floor debate on the Unfunded Mandates Reform Act of 1996, environmental mandates were invoked to justify the legislation about two-thirds of the time. However, UMRA was never portrayed as an environmental measure by either its proponents or the media.

this country, and that a full set of basic toxicity information is available for only seven percent.* Our ignorance regarding the risks posed by these common pollutants is shocking, not least because we have the physical ability to conduct the scientific inquiries necessary to develop this information, but have not made such research a priority.

Another dimension of the information deficit that undermines environmental policy is our ignorance concerning the actual state of the ambient environment. As documented extensively by former EPA Chief of Staff Michael Vandenbergh, the fragmented and inconclusive efforts we have made to characterize these conditions undermines further progress in cleaning up and preventing pollution.❜

Finally, we lack the technology we need to mitigate environmental risks. Our multi-billion effort to clean up toxic waste sites has foundered on the horns of this dilemma." If we know how to neutralize the old dumps and other pieces of contaminated land that mar the landscape, we could revitalize the inner city, prevent urban sprawl, and spur economic development in the areas that need it most.

All three of these data gaps cripple EPA's efforts to establish priorities, assess risk, and get results. Closing them is a task that deserves resources only the national government can provide, and it would be pointlessly inefficient to duplicate such efforts in each of the 50 states. Further, incentives to develop new technology are far more easily provided by a national market for pollution control, prevention, and remediation than the inconsistent and unpredictable economics

* EPA Analysis of Test Data Availability for HPV Chemicals, 22 Chemical Reg. Rep. 261 (1998).

" Michael P. Vandenbergh, An Alternative to Ready, Fire, Aim: A New Framework to Link Environmental Targets to Environmental Law, 85 KY. L. J. 803 (1996-97).

"For a discussion of the technical difficulties that have plagued the Superfund program, see, Rena I. Steinzor & Linda E. Greer, In Defense of the Superfund Liability System: Matching the Diagnosis and the Cure, 27 ENVTL. L. REP. 10,286, 10,287-289 (1997).

'The two best discussions of the implications of the dearth of data for environmental quality are reports issued by EPA in an effort to reexamine national environmental priorities. The first, an analysis by its career staff of the environmental problems that should be on the Agency's regulatory agenda, was published in 1987. U.S. EPA, UNFINISHED BUSINESS: A COMPARATIVE ASSESSMENT OF ENVIRONMENTAL PROBLEMS (1987). The second, a review by EPA's Science Advisory Board of the first report, contained its own recommendations for the Agency's future direction. U.S. EPA, REDUCING RISK: SETTING PRIORITIES AND STRATEGIES FOR

of 50 smaller jurisdictions.

Federal regulation of environmental problems is also necessary to address the effects of pollution that crosses state lines, or so-called "transboundary" pollution. Only the most diehard federalist would disagree that if industry within one state can manage to export most of its pollution to another state, the source state is unlikely to impose effective controls and the receiving state lacks the leverage to protect itself. The transboundary rationale applies in any situation where pollution is transported across state lines via the ambient air or interconnecting natural geology such as rivers or aquifers.

Finally, the national government must play a role in assuring uniform, minimum standards of protection that give every American a chance to have good health. Conservative commentators have called environmental protection a "luxury good," affordable in flush times, expendable in tough times, and presumably out of reach for poor people no matter what the state of the economy. While only a small minority of Americans would agree with this assessment, the unrestricted devolution of fundamental regulatory decisions to the state and local level could well make it a reality. Principles of equity and equal protection demand the establishment of baseline national standards so that Americans are not exposed to fundamentally unequal levels of environmental risk.

The need for baseline standards is particularly acute given the unequal distribution of environmental problems in society. The disproportionate effects of pollution on low income, minority communities is increasingly well-documented. If determining the level of protection became the sole province of such communities, gross discrepancies between the exposures tolerated by poor and minority Americans and those tolerated by the middle and upper class would increase. Not only do low income communities lack the resources to devise effective regulation, they are considerably more vulnerable to threats that they must choose between jobs and protecting the environment. They are also overloaded with other social problems that compete for resources and the attention of the body politic.

Of course, none of these principles mean that the federal government can or should do the

* See e.g., P.J. O'ROURKE, ALL THE TROUBLE IN The World 201 (1994):

Neither is a "clean environment" a political right of humans. Rights must be free.... You
have the right to bear arms. You don't have the right to take a gun without paying for it.
Pollution control is not free.... The environment turns out to be the "luxury good" that
Cato Institute's Jerry Taylor said it was.

'See e.g., Richard Lazarus, Pursuing "Environmental Justice": The Distributional Effects of Environmental Protection, 87 Nw. U. L. REV. 787 (1993).

job alone. Federal regulations should only impose requirements that make sense in the context of specific local conditions. Even where federal regulatory mandates are justified, state and local governments should have adequate flexibility to implement them in the most cost-effective manner. Rigid edicts handed down from Washington hamstring state and local officials who are already under pressure to resolve a lengthening list of difficult social problems with an everdiminishing public fisc.

In some instances, the best way to address the issue of local implementation is for the federal government not to regulate. In others, a national standard is necessary, but the regulations should include a workable, accessible system for granting waivers or exceptions. In all instances, the federal government should refrain from micromanaging local implementation to the point where money is wasted on expensive technologies or other compliance methods. But there simply is no way to accomplish all of these important reforms quickly and efficiently without considering the details of EPA's authorizing statutes and the rulemakings they require.

The Unforeseen Consequences of S. 1214

Will the legislation now before you help or hinder the renegotiation of environmental policy that all agree is necessary in the immediate future? The problem is that it is very difficult to tell.

At one level, S. 1214 is a straightforward recitation of the way the federal government – including agencies and departments responsible for safeguarding the public health - should behave. Of course Congress and the Executive Branch should be careful about preempting long-standing and wise state and local laws. Of course federal officials should consult with representatives of state and local governments about the creation and implementation of federal programs.

Yet if this is all the sponsors have in mind, there are other, more effective ways for Congress to use its considerable power to change the way agencies, departments, and even your own committees behave. You have considerable clout in the oversight process, you hold the purse strings, and you have the authority to amend specific statutes to change the way they affect local governments, starting with the provisions that have motivated the legislation now before you.

The apparent determination of the sponsors to make legislate common sense and make it legally binding and the legislation's vagueness on the methods available to enforce it suggest, however, that it is designed to achieve more than persuading the Executive Branch to be more respectful towards the states. I am going to assume, therefore, that the legislation's sponsors are committed to a new process, one that is binding on agencies and departments, one that changes the way they do their daily business, and one that is enforceable by aggrieved state and local governments. There are several crucial implications that flow from this interpretation of the legislation's intent.

First and foremost, the legislation's central terminology is vague, and susceptible to so many different interpretations that it could provoke years of time-consuming litigation of questionable value to the achievement of its ultimate goals.

For example, consider the requirement in section 5 that conference reports include "an explicit statement on the extent to which the bill or joint resolution preempts State or local government law, ordinance, or regulation and, if so, an explanation of the reasons for such preemption." Does the statement need to identify with precision each and every affected law, or will a mere description of the categories of laws potentially effected suffice? If the legislation intends a precise list, how many additional resources will be necessary to perform such an arduous task? What if the conference committee makes a mistake during the rush of other business that is so typical of such efforts? Is the law invalid?

As another example, consider section 6(a), which sets forth the truly remarkable statement that once the legislation is enacted, any law passed after that date will not preempt any state or local government law, ordinance, or regulation unless the statute "explicitly states" that "preemption is intended" or there is a "direct conflict" between the federal and state or local law. Once again, how explicit must these statements be? How "direct" must the conflict be? If industry can comply with both the federal and the state or local requirement, but doing so will cost significantly more, will the state or local law stand? Such are the perils of one-size-fits-all devolution.

Finally, section 7 of the legislation requires that agencies like EPA “notify, consult with, and provide an opportunity for meaningful participation by public officials of governments that may potentially be affected by the rule." The federalism officers of the various agencies and departments must "identify cach proposed, interim final, and final rule having a federalism impact" and prepare an assessment that the relevant "agency head must consider" in "all decisions" involved in "promulgating, implementing, and interpreting" the rule.

This language applies to each and every rule at all stages of development. According to GAO experts, this broad brush would cover about 7,820 rules, in contrast to the Unfunded Mandates Reform Act, which targeted the 30-50 "economically significant" rules that agencies produce annually.10 In EPA's case, this additional workload could well prove the straw that breaks the already sagging camel's back. The Agency is now functioning with a budget that is a mere 15

10 Rules are sorted into five different categories: (1) economically significant; (2) significant; (3) substantive; (4) administrative; and (5) routine/frequent. The last category – routine/frequent - covers approximately 5,291 rules annually at all stages of development. For further information, contact Curtis Copeland, Assistant Director, Federal Management Issues, GAO at (202) 512-8101.