Intergovernmental Relations in Transition

Reflections and Directions

Carl W. Stenberg, David K. Hamilton, Carl W. Stenberg, David K. Hamilton

• Publisher: Routledge
• Year: 2018
• ISBN:
  9781351182140
• Edition: 1
• Topic: Politik & Internationale Beziehungen
• Subtopic: Öffentlichsarbeit & Verwaltung

The field of intergovernmental relations has changed substantially over the past five decades. It maintains a critical and evolving role in the US federal system as well as in public policy and administration. Building upon the legacy of Deil S.Wright's scholarship, this collection of essays by distinguished scholars, emerging thought leaders, and experienced practitioners chronicles and analyzes some of the tensions and pressures that have contributed to the current state of intergovernmental relations and management.

Although rarely commanding media attention by name, intergovernmental relations is being elevated in the public discourse through policy issues dominating the headlines. Many of these intergovernmental issues are addressed in this book, including health insurance exchanges under the now-threatened Affordable Care Act, and the roles of the federal, state, and local governments in food safety, energy, and climate change.Contributors interpret and assess the impacts of these and other issues on the future directions of intergovernmental relations and management. This book will serve as an ideal text for courses on intergovernmental relations and federalism, and will be of interest to government practitioners and civic and nonprofit organization leaders involved in public policy and management.

1
Introduction: Intergovernmental Relations in Transition

David K. Hamilton and Carl W. Stenberg

During the 1960s and 1970s, intergovernmental relations (IGR) was an exciting area for research and practice. There was substantial interest in the field with studies from the U.S. Advisory Commission on Intergovernmental Relations (ACIR) and research by noted academics such as Deil Wright, Daniel Elazar, Martha Derthick, and Morton Grodzins contributing scholarship to broaden and deepen understanding of the field. With the advent of the Great Society in the 1960s, the federal government assumed a leadership role in IGR practice through domestic policy initiatives, grants-in-aid, and regulations. The federal government forged direct relations with local governments during this period at an unprecedented scale. States were increasingly left out of the loop as local leaders were building direct relationships with federal funding and regulatory agencies.

Particularly significant was the work of intergovernmental institutions in Washington DC during this time. As a symbol of the growing importance of the field, Congress established and funded the Advisory Commission on Intergovernmental Relations in 1959 to conduct research and make recommendations on intergovernmental issues as well as to identify emerging trends and friction points. Although a miniscule organization by Washington standards, the ACIR, with its professional research staff, dedicated public official members, and access to thought and practice leaders, quickly became the preeminent bipartisan, independent organization for the study and understanding of IGR. By the 1980s about half of the states had established an ACIR-type body. This was a halcyon time, undoubtedly a golden age for IGR research.

Decline of Intergovernmental Relations

A major transition in the field occurred when the Reagan Administration sought to extricate the federal government from its leadership role in IGR by cutting or capping many intergovernmental programs, cancelling others, and devolving still others to the states. Nevertheless, overall the number of grant programs and the amount of aid continued to grow thanks to Congress. Yet, other important transitions were under way as the recipients of federal aid shifted from places to people, regulatory federalism, preemptions, and unfunded mandates exploded, and relationships between the levels of government became more coercive and less cooperative. During this period, the states became more involved in executive and legislative capacity-building, strengthening state-local relationships, and serving as “laboratories of democracy.”

Symbolically, the ACIR was defunded in 1996 as part of a cost-cutting move by Congress. Neither the Clinton Administration nor the “Big 7” Public Interest Groups representing state and local governments in Washington, DC (e.g. National Governors Association, National Conference of State Legislatures, Council of State Governments, National Association of Counties, National League of Cities, United States Conference of Mayors, International City/County Management Association) mounted a strong defense of the Commission (McDowell 1997). Some of the federal government’s institutional capacity for understanding and monitoring IGR was also dismantled. This deinstitutionalization included eliminating the grant management unit in the Office of Management and Budget, downplaying the policy role of the White House Office of Intergovernmental Affairs, and weakening the influence of the federalism subcommittees of Congress.

Until recently, because of these and other transitions, the IGR field languished from its previous prominence. There was little political interest in IGR and no national organization other than the U.S. Government Accountability Office (GAO) with the bipartisan status of the former ACIR to keep federalism, intergovernmental relations, and intergovernmental management before political leaders and the public. Efforts to recreate the ACIR proved futile (Stenberg 2011: 174–176). The “Big 7” Public Interest Groups lost much of their influence in shaping intergovernmental policy and programs as they were increasingly treated as just one of many special interest groups by members of Congress and federal administrators. Federalism considerations were rarely raised on the political radar screen in debates over issues such as tax reform, program management improvement, and regulatory policy implementation.

Members of Congress gain little or no political credit for being federalism champions, and few have followed in the IGR leadership footsteps of U.S. Senator Edmund S. Muskie (Maine) and Representative L.H. Fountain (North Carolina). Vertical and horizontal relations among governments are complex, difficult to understand, and hard to explain. Not surprisingly, the public and media have little comprehension of, interest in, or appreciation for IGR so the state of the federal system rarely becomes a campaign issue.

One example of the lack of political interest and support for significant intergovernmental change is the fate of proposals to “divide the job” or “sort out” functional responsibilities to reduce duplication and bolster efficiency and effectiveness. United States Senator (and former Tennessee Governor) Lamar Alexander (2013) and Alice Rivlin, founding director of the Congressional Budget Office and former Director of the Office and Management and Budget (1992), have called for a transfer of federal and state government responsibilities, building on recommendations put forward by the ACIR in the 1960s. Basically, the federal government would turn most of its programs in education, housing, highways, social services, economic development, and job training over to the states. States would carry out a “productivity agenda” to help revitalize the American economy through investments in education and infrastructure to increase productivity and raise income. Common shared taxes would give the states adequate revenues to carry out their new functional responsibilities and would reduce interstate competition and intrastate disparities. The federal government would retain responsibility for domestic programs requiring national uniformity like Social Security and health care.

In the early 1980s, President Reagan utilized the first part of the concept of sorting out responsibilities to propose devolving a number of federal programs to the states in what became known as New Federalism. Tax sharing to provide adequate revenues for the states to carry out the programs was not part of the President’s grand exchange. However, the federalization of Medicaid in return for the turnback of several domestic programs to states and localities was a bold stroke at rebalancing the federal system. But after receiving tepid or no support from members of Congress, governors and state legislators, and local elected officials, the proposal was abandoned. Politics and pragmatism trumped systematic sorting out of functional responsibilities. The failure of this initiative also signaled the lack of trust between the federal government and the states as well as between and among state and local governments, conditions that persist to this day.

Resurgence of Intergovernmental Relations

Recent developments signal a resurgence of interest in IGR. Through the establishment of the Department of Homeland Security, financial responses to the Great Recession, and enactment of high profile domestic legislation under both the Bush and the Obama Administrations—including the No Child Left Behind Act, the American Recovery and Reinvestment Act (ARRA), and the Affordable Care Act—the federal government has reasserted itself in the intergovernmental arena as a stimulator and standard-setter. This transition took place even though the federal government wallowed in massive debt and faced serious challenges in financing health care, retirement, defense, and other commitments.

Particularly noteworthy were the impacts of fiscal stresses caused by the Great Recession. The federal government’s $800 billion economic stimulus package helped reduce layoffs of teachers and police officers and provided increased unemployment benefits. ARRA also funded “shovel ready” public infrastructure projects through fund transfers to states and localities. During the recession, several states reduced their financial support to local governments, substituting federal dollars for their own dollars. This practice created financial problems when ARRA funds ended and local and state governments had to cope with less aid while still wrestling with slowly recovering tax revenues (Rubin 2015). News stories reported municipal bankruptcies and state and local government lay-offs of over 700,000 employees (Huffington Post 2012). The long-term viability of some local governments’ capacity to finance and manage services became problematic, and sluggish economic growth continues to be a concern at all levels.

The intergovernmental environment within which this federal expansion has occurred is much different than in the past. IGR has changed dramatically partly in response to the growth of “wicked” problems like health care, education, environmental sustainability, infrastructure, and job creation that do not respect traditional governmental boundaries. The concept of intergovernmental relations as vertical dealings between governments in the federal system no longer accurately defines the field. While the institutional, fiscal, and functional policy issues of the 1960s and 1970s are still relevant, IGR is increasingly recognized as including nongovernmental actors and horizontal as well as vertical relationships in more of a regional, collaborative, and networked governance environment (Rosenbaum, Glendening, Posner, and Conlan 2014). According to scholars and practitioners, evidence of the need for cross-boundary collaboration is everywhere.

The old way of conceptualizing IGR does not cover the range of intergovernmental responses to public policy and programs. Kettl (2015) argues that interweaving of functions, tools, and organizations has become the primary instrument of public action. The Affordable Care Act, for example, is a complex of federal standards and subsidies with insurance offered through private companies coordinated through federal and state exchanges with the actual health care provided through for-profit and nonprofit medical centers. The federal government’s response to the Ebola virus in 2014 came through federal standards, transmitted through state public health agencies, and administered through local governments and regional nonprofit health care facilities. Intergovernmental programs now often combine governmental and nongovernmental efforts to implement national policies and priorities and feature mandates and preemptions which may or may not be accompanied by federal funds.

The expansion of federal domestic involvement has also occurred in a highly partisan environment and in areas that were previously regarded as predominantly private and state regulated programs. The most recent example is health care. Expansion of the federal role in health care has been extremely contentious, which has made delivery of the program difficult. Supreme Court decisions, such as invalidating part of the Affordable Care Act dealing with mandated expansion of Medicaid coverage, have made implementation more complex. Political polarization of leaders at the national level and increasingly in state capitals does not allow for a serious bipartisan, pragmatic, and collaborative approach to the federalism issues facing America. The challenges are severe, and the institutional capacity to address them is almost nonexistent.

Implementation Challenges

Despite its resurgence, the federal government no longer unilaterally sets the domestic agenda or operates in a top-down environment where it establishes the regulations and the program parameters. States are pushing back against what some governors and legislators consider federal overreach and intrusions. Contrary to the view of many governors and legislators during the 1980s that the 10th Amendment to the U.S. Constitution was a “hollow shell,” as a result of Supreme Court interpretations of the Commerce Clause signaling a “green light” to Congress to expand its domestic program and regulatory activities, state leaders have reasserted the states’ key role in program design and implementation. They have sought to shape federal programs to better reflect their needs and priorities, resist federal mandates and preemptions, and even turn down federal funds. To increase flexibility and recognize their capacity and commitment, some states have been granted waivers in many instances from federal rules and regulations that determine how federal dollars are spent. Many IGR programs are initiated by the states or local governments, and federal agencies must negotiate with sub-national program implementers. States have also established programs that are in direct violation of federal policy and law, such as legalizing marijuana. Federal funds are still a major force, but increasingly more decision making and IGR initiatives in areas like gay marriage, minimum wages, environmental quality, education, and immigration are being generated by the states and local governments working with non-profit and for-profit program partners.

Relations between the states and local governments also changed during the Great Recession. Many states passed laws either providing greater flexibility to local governments or restricting their functional and fiscal authority. For example, California enacted legislation enabling cities to bargain with creditors short of bankruptcy, while Michigan and Rhode Island passed laws that gave the state authority to take control of local governments in the event of fiscal exigency and override or replace local officials with a state appointee (Rubin 2015). State-local relations are in flux and are gaining visibility. Municipal and county leaders are seeking to determine whether state officials are partners or adversaries, or both. The cover of the April 2016 issue of Governing magazine sent a powerful message: “We Interrupt This Program . . . Some states will step in to cut off local government actions any chance they get.” For example, a 2017 survey by the National League of Cities found that 42 states had imposed tax and expenditure limitations on localities. Additionally, 37 states had preempted local authority in ride sharing, 24 had done so with respect to the minimum wage, 17 states had preempted paid leave policy, and another 17 had taken such action on municipal broadband authority (Cigler et al. 2017: 3).

In summary, implementation of intergovernmental programs has always been complicated, involving multiple levels of governments and often nongovernmental actors. The IGR concept was designed to recognize that implementation of intergovernmental policies and programs was dependent on relationships between actors at different levels of government. The term “intergovernmental management” (IGM) has been used to underscore that effective implementation of programs requires skill in managing the various actors involved and navigating through complex intergovernmental and intersectoral relationships. The federal government’s response to Hurricanes Katrina and Sandy showed the vulnerability of intergovernmental programs in the face of natural disasters, especially the difficulty of coordinating rapid responses. Coordination and communication breakdowns, together with unrealistic time lines for deliverables, led to the botched roll-out of the Obamacare website by the Department of Health and Human Services and private contractors, and helped fuel the debate over the repeal and replacement of the ACA during the 2016 Presidential campaign and since the inauguration of President Donald Trump. These examples also reveal that politics is always a key factor in the implementation of intergovernmental policy and programs.

Trump Federalism?

The election of Donald Trump as the nation’s 45th President opened a new chapter in the evolution of intergovernmental relations and management. The President’s policy pronouncements and initiatives during his first 100 days in office sent shock waves across federal, state, and local governments. Some proposals, such as to spend $1 trillion on infrastructure improvements and to reinvent the Veterans Administration, were generally well-received. Particularly distressing to the “Big 7” organizations representing state and local officials in Washington, DC, however, were proposals in the administration’s 2018 federal budget to shift $54 billion in federal spending from domestic discretionary accounts to defense. Forecasts that, in view of the growth in the federal debt and record budget deficits, cutbacks in discretionary spending for grant-in-aid programs could be anticipated look very likely to occur. The initial congressional response to the massive proposed budget shift did not indicate a clear direction or prospects for consensus. Just as during the Reagan administration when the Congress had resisted and restored cutbacks, similar political, constituent, and interest group pressures could thwart Trump budget cutters and perpetuate the status quo.

The President’s initiatives to deregulate, defund, and devolve federal programs and agencies also have been a wake-up call to subnational units. Governors, legislators, and local elected leaders will likely confront tough choices, such as whether: (1) to agree to the trade-off of more discretion and flexibility in mo...