Source: Based on information in Congressional Budget Office, The Economic and Budget Outlook: An Update (August 1985) and Reducing the Deficit: Spending and Revenue Options (March 1986).

Three categories-entitlements, net interest, and national defense-have grown steadily and substantially between 1975 and 1985. Two of those categories are clearly exempt from the item veto: entitlements and net interest. Of the third category, national defense, it has been suggested that the current administration would not exercise the item veto vigorously.

Nondefense discretionary spending is the only category of federal spending on which the item veto would be used vigorously. Nondefense discretionary is the one category that has been substantially reduced between 1975 and 1985.

State and local governments, unlike the federal government, spend most of their funds on education, highways, parks and recreation and other nondefense discretionary programs. The item veto may be an effective instrument for control of state and local spending but federal spending, largely composed of mandatory spending programs, is ill-suited for the item veto.

Mandating itemization

Federal appropriation bills are typically not itemized in the detail needed to make the item veto effective. The traditional form of appropriation bills might be modified, of course, to make the item veto more effective. Some state constitutions require the legislature to consider detailed appropriations so that items are available to the governor to be vetoed.17 The Louisiana constitution, for example, directs the legislature to pass an "itemized" appropriation bill showing "a budgetary schedule of distinct fiscal units.” 18 Article V, § 16 of the Illinois constitution requires the legislature to appropriate in "distinct items and sections" and to "specify the object and purpose of each item." State statutes also limit the form of appropriation bills. Section 13338 of the California Government Code, as amended by Chapter 1284 of the Statutes of 1978, requires that appropriation bills follow the organization of the governor's budget, separately presenting each item from the governor's budget.

Even without explicit constitutional or statutory direction, the courts have called for sufficient itemization in state appropriation measures to allow the governor effective use of the item veto. Recognizing that lump sum appropriations would limit opportunities for a governor to exercise the item veto, a New York court, in 1939, said that the "spirit" of the state constitution providing for an item veto was "against lump sum apropriations and in favor of appropriations showing the items of expenditure." 19 An Arizona court ruled that the legislature could not provide lump sums in an appropriation bill and then direct how the sums were to be expended in a separate authorization measure not subject to the item veto.20 Courts have recently held that state legislatures cannot blunt a governor's item veto by "subtle drafting" of appropriations lan

17 For texts of state constitutional provisions prohibiting legislation in appropriation bills and prohibiting special or local legislation, see Appendices C-4 and C-5.

18 La. Const. art 3, § 16(C).

19 People v. Tremaine, 281 N.Y. 1, 7 (1939). 20 Fairfield v. Foster, 25 Ariz. 146 (1923).

21

guage nor abridge the governor's authority by the manner in which they package appropriations.22

If Congress were to grant the President authority to veto items, Congress might consider requiring a certain level of itemization in appropriation measures.

Executive discretion and the degree of itemization

It may not be wise, however, to mandate that Congress itemize individual projects and activities in appropriation bills. The structure of appropriation bills has evolved over many years.?

23

The first Congress appropriated lump sums, often relying on information external to the Act, such as administration estimates, to specify how the money was to be allocated. Section 1 of an act 24 making appropriations for the general government for 1790, for example, provided a total of $155,537.72 for the Department of War. SECTION 1. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That there be appropriated for the service of the year one thousand seven hundred and ninety, to be paid out of the monies arising from the duties on imports and tonnage, the following sums, to wit: A sum not exceeding one hundred and forty-one thousand, four hundred and ninety-two dollars, and seventy-three cents, for defraying the expenses of the civil list, as estimated by the Secretary of the Treasury, in the statement annexed to his report made to the House of Representatives on the ninth day of January last, including therein the contingencies of the several executive offices which are hereby authorized and granted; and also, a sum not exceeding one hundred and fifty-five thousand, five hundred and thirty-seven dollars, and seventy-two cents, for defraying the expenses of the department of war; and the farther sum of ninety-six thousand, nine hundred and seventy-nine dollars, and seventy-two cents, for paying the pensions which may become due to the invalids, as estimated in the statements accompanying the aforesaid report

Congress enacted lump-sum appropriations more than seventy years before the item veto was discussed in any American constitutional convention. Debate about the proper specificity of federal appropriations, line-item versus lump-sum, is as old as the nation and precedes any thought of an item veto. Rhetorically at least, the Jeffersonian Republicans and the Federalists disagreed sharply on the need for specificity.25 In 1801, President Jefferson urged the Congress to appropriate "specific sums to every specific purpose susceptible of definition." 26 The Federalists, on the other hand, wanted the Congress to provide more discretion for the executive. Hamilton, therefore, promptly denounced Jefferson's recommendation saying that nothing was "more wild or of more inconvenient tend27 Later in his term, Jefferson himself recognized the impracticality of detailed, itemized appropriations. 28

ency.

21 State ex rel. Sego v. Kirkpatrick, 86 N.M. 359, 364 (1974).

22 State ex rel. Martin v. Zimmerman, 289 N.W. 662 (Wisc. 1940); Green v. Rawls, 120 So.2d 10 (Fla. 1960); The Florida court, in Green v. Rawls, said that the legislature had drafted an appropriation bill so that there were items within items. The court ruled that this form could not be used because it abrogates the Governor's veto authority. Eight years after this decision, Florida amended its constitution to prohibit the Governor from vetoing qualifications or restrictions without also vetoing the appropriation to which it relates.

23 For a compilation of documents that shows the evolution, see Fred Wilbur Powell, Control of Federal Expenditures: A Documentary History, 1775-1894 (1939).

24 1 Stat. 104 (March 26, 1790).

25 Louis Fisher, President and Congress 110-112 (1972) and Louis Fisher, Presidential Spending Power 60-61 (1975). Fisher shows that the differences were little more than rhetorical.

26 Richardson, I Messages and Papers 317 (December 8, 1801).

27 Alexander Hamilton, VII Works 256-257.

28 Jefferson remarked that "too minute a specification has its evil as well as a too general one." IV Writings of Thomas Jefferson 529-30.

Current appropriations are also lump sums, reflecting efforts to accommodate the need for executive discretion within the framework of legislative responsibility for the purse. 29 Federal appropriation bills are not more narrowly itemized, in part, so that executive agencies retain sufficient flexibility to manage their programs.30 To demand that appropriation bills include detailed allocations in order to make the item veto more effective may cost more in executive discretion than it is worth.

The Taft Commission in 1912 and the Hoover Commission in 1949 and 1950 promoted lump-sum appropriations. 31 As a result of the 1949 Hoover Commission recommendations, for example, more than 200 appropriation items were removed from the fiscal year 1951 budget.32 The public commissions concluded that broad appropriation categories would produce greater efficiency in government. It is said that when Congress makes detailed, itemized appropriations, it usurps the function of program managers, and the Government is deprived of the judgment and initiative of those administrators working most closely with the programs. The amount of detail Congress employs in appropriation bills changes, of course, with the circumstances. Under crisis conditions, when the country is at war or in economic depression, Congress generally recognizes that the President must have broad authority to respond to the exigencies of the moment. At those times, appropriations tend to be even less detailed than usual.33 When trust between the executive and legislative branches is abused, appropriations are more itemized. Even then, the itemization is broader and less detailed than in state appropriations.

An example of a recent item veto by the governor of New York illustrates how itemization in an appropriation bill may frustrate and inhibit executive flexibility. One item in the fiscal year 1985 appropriations for state operations in New York provides funds for the State Energy Office.34 The provision includes an itemized subschedule; certain amounts are earmarked for the Energy Office to make reports to the legislature.

STATE ENERGY OFFICE

For services and expenses related to examination of economic and energy supply effects of the operation or nonoperation of nuclear generating facilities and other current energy issues provided that final reports are delivered in a timely manner to the temporary president of the senate and the speaker of the assembly or their designees; and provided, further, that their designees shall receive copies of working papers, including computer runs, as they shall reasonably require, in accordance with the following sub-schedule:

29 Lucius Wilmerding, Jr., The Spending Power: A History of the Efforts of Congress to Control Expenditures (1943).

30 Louis Fisher, Presidential Spending Power 59-74 (1975).

31 The recommendations of the Taft Commission are found in H. Doc. 854, 62nd Cong., 2nd Sess. (1912). The Hoover Commission recommendations can be found in Commission on Organization of the Executive Branch of Government, Budgeting and Accounting (1949, 1950).

32 S. Doc. 11, 87th Cong., 1st Sess., (1961)

33 Here are some examples. A Civil War Act (12 Stat. 344) provided $76 million to be allocated "as the exigencies of the servie may require. . . . In 1898, on the eve of the Spanish-American War, Congress passed an act (30 Stat. 274) providing $50 million "for the national defense, and for each and every purpose connected therewith, to be expended at the discretion of the President." The Emergency Relief Appropriation Act of 1935 provided $4.9 billion to be used "in the discretion and under the direction of the President." See Louis Fisher, Presidential Spending FUNC 61-63 (1975).

34 New York Senate Bill 7231-A, adopted January 17, 1984, p. 88.

The legislature initiated the call for specific reports and earmarked the funds. The Governor's budget submission had included only one lump sum for the Energy Office. When the bill came to the Governor to be signed, the Governor vetoed the entire itemized subschedule, on the ground that it constituted "an undesirable statutory limitation on the management of the State Energy Office's analytic work." 35

TO THE SENATE: I hereby transmit, pursuant to the provisions of Section 7 of Article IV and Section 4 of Article VII of the Constitution, a statement of items objected to and not approved, contained in Senate Bill Number 7231-A entitled:

AN ACT making appropriations for the support of government

(Chapter 50) STATE OPERATIONS BUDGET)

LINE VETO

Page 88, line 7 beginning with "provided" through "sub-total" in line 23, inclusive NOT APPROVED

STATE ENERGY OFFICE

Provided that final reports are delivered in a timely manner to the temporary president of the senate and the speaker of the assembly or their designees; and provided, further, that their designees shall receive copies of working papers, including computer runs, as they shall reasonably require, in accordance with the following sub-schedule:

The implementation of an energy agenda in the upcoming months will depend in large part upon analytical work which must be performed by the State Energy Office. At the same time, because of the changing background of Federal and State regulatory actions, economic conditions, fuel price fluctuations, and other factors, the management of this analytical effort must be flexible. The sub-schedule which I am disapproving is an undesirable statutory limitation on the management of this work. Ratepayers throughout the State must look to State government for an informed leadership in the resolution of the current energy problems. These limitations will only operate to limit the State's ability to bring to bear the maximum in benefits from its already limited resources.

35 Governor's Veto Message (April 11, 1984).