March 23, 2020

G. Edward DeSeve, Fellow, National Academy of Public Administration and Executive in Residence, Brookings Executive Education.

The Many Forms of Federalism

Under the 10^th Amendment of the Constitution, “[t]he powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.”

That profound statement raises many questions. What powers does the Constitution delegate to the federal government? What does the Constitution forbid the States to do? If the federal government does not have a certain power, does it devolve to State governments—or to individuals and communities?

These questions are challenging, so it is unsurprising that the relationship between states and their subsidiary local governments has been the subject of ongoing discussions over the entire history of the republic.

Stimulus Yesterday and Today

Today we are about to see a new “stimulus bill” introduced to counteract what appears to be a coming recession. Both Republicans in the Senate and Democrats in the House must endorse this bill in order to get it to the president’s desk.

The primary federal effort in response to the last recession was the American Recovery and Reinvestment Act (ARRA), which was introduced in the House of Representatives on January 26, 2009 and passed on February 16, 2009. The Act passed in the House without Republican support, while only three Republicans voted to support it in the Senate. This underscores how hard achieving bipartisan consensus can be today, even in times that demand national mobilization.

The lack of bipartisan support at the federal level set the stage for partisan rancor in execution. State governors from both parties, however, had been particularly active in helping to draft the bill. This resulted in one of the primary objectives of the bill being:

“(5) To stabilize State and local government budgets, in order to minimize and avoid reductions in essential services and counterproductive state and local tax increases.”

The total amount of funding that went to states under ARRA was about $300 billion—most as an additional federal share for Medicaid allowing states to avoid cutting their budgets or increasing taxes. Additional funding for infrastructure, education, energy and environmental programs created jobs within states and bolstered tax revenue.

There were three stages to state participation in ARRA. The first was working to advocate for provisions of the Act and for the Act as a whole. The Obama Administration credited state support as extremely helpful in obtaining passage of the bill. The second stage was working with various federal agencies and the White House to put in place agreements to receive funding. Most ARRA programs, particularly at the state level, involved the provision of funding for existing programs, such as the Federal-Aid Highway program, with which the states and federal agencies were familiar. This facilitated the use of existing regulations and funding methods to get funds out quickly.

The third stage was the active and comprehensive participation by states in oversight and implementation. Working closely with the White House, particularly Vice President Biden’s office, each state and territory designated a “Single Responsible Individual” (SRI) who became part of a direct communication chain from the Obama Administration (White House and agencies). This allowed a simple direct mechanism for the federal government to contact states with information, concerns and solutions to issues. In addition, the Vice President continually reached out to governors in a series of meetings and conference calls designed to discuss problems that the states had and offer advice about where additional effort was needed. The network of SRIs and calls from the Vice President created a close bond even in cases where the state administration was of a different political party. The Vice President’s management of the program was an important key to its success.

States were extremely helpful in assuring that grantees’ quarterly reporting to the Recovery and Transparency Board took place in a timely way. States also worked with their local governments to stress the importance of this reporting and helped avoid instances of misuse.

Federalism in Time of Virus

Will a similar model of federalism be in effect in the current bill? We don’t know yet but the immediate past is not reassuring.

The creation and implementation of ARRA was the result of a coalition that included state governments as very active participants. When localities asked why the states had done so well under the terms of the bill, the White House responded that they had been active in providing input and support early and often. Similarly, states worked closely in implementation with federal agencies and the White House. Clearly, there was self-interest involved but the level of coordination, especially at the top, was seen as unprecedented.

Beyond meeting the objectives of the Act, the partnership between the states and the federal government helped to assure program integrity. In its January 2014 report, the Government Accountability Office said, “GAO is not making any recommendations in this report.” Given the high level of waste, fraud, and abuse[1] that was projected for ARRA, the cooperation between states and other grantees proved a well-documented means of preventing misuse of funds.

Today we are in a very different place. One observer referred to the lack of coordination from the top as resulting in “fifty whirling dervishes” creating chaos and dysfunction.

Toward Agile Federalism

The idea of “Agile Government” is in its infancy. The National Academy of Public Administration (the Academy) has established an Agile Government Center (AGC) to determine if it is possible to develop principles similar to those used in Agile Software Development[2] to improve the management, as some corporate and governmental entities have already done, of government programs around the world.

As part of the research around the development of the AGC, the Academy will work with states and federal agencies to see if the lessons learned in ARRA can be used to inform a new kind of Agile Federalism. We expect that, by better defining missions, relationships, and results, we can improve outcomes for many programs across a wide state-federal spectrum.

One of the first efforts of the Agile Government Center will be to identify current instances of “agility” in federal/state and local relationships that can be shared across all levels of government. There are many examples of agility in intra-governmental activities. Two are summarized below.

Reducing Veterans’ Homelessness- A Collaboration Across Federal Agencies and with Local Housing Authorities

The Veteran’s Administration and the Department of Housing and Urban Development used an interagency memorandum to create the “HUD-VA Supportive Housing Program” (HUD-VASH). This program is described by the agencies as follows:

HUD-Veterans Affairs Supportive Housing (HUD-VASH) program combines Housing Choice Voucher (HCV) rental assistance for homeless Veterans with case management and clinical services provided by the Department of Veterans Affairs (VA). VA provides these services for participating Veterans at VA medical centers (VAMCs) and community-based outreach clinics.[3]

Since its inception in 2008, HUD-VASH has provided more than 97,500 housing vouchers through more than 300 Public Housing Authorities (PHAs).

The National Wildfire Coordinating Council

The National Wildfire Coordinating Group (NWCG) was established in 1976 through a Memorandum of Understanding between the Department of Agriculture and the Department of the Interior. The memorandum defined the function and purpose of NWCG as follows:

“To establish an operational group designed to coordinate programs of the participating agencies so as to avoid wasteful duplication and to provide a means of constructively working together. Its goal is to provide more effective execution of each agency’s fire management program. The Group provides a formalized system to agree upon standards of training, equipment, aircraft, suppression priorities, and other operational areas. Agreed upon policies, standards, and procedures are implemented directly through regular agency channels.” [4]

The “regular agency channels” include the National Interagency Fire Center and its National Interagency Coordination Center (NICC) and the National Multi-Agency Coordinating Group (NMAC).

When NIFC/NICC resources are exhausted, the National Multi-Agency Coordinating group (NMAC) becomes the coordination point for additional resources and is tasked with reallocating resources across agencies as a part of national wildland fire operations management, priority setting, and resource allocation through multi-agency coordination. This coordination occurs across Geographic Areas and across the member agencies.[5]

Can Federalism be Agile?

Based on the three disparate examples above, my answer is yes. There are five factors that can enable federalism to be agile

• Mutual respect among the parties. Too often relationships between the federal government and the state and local governments are jaundiced from the start, with a sense at the federal level that states and localities are trying to game the system, and are not sophisticated enough to set their own regulatory agendas. At the state and local level, federal regulations can be seen as obstacles to program execution that is beneficial to the public. Instead, the right starting point is the recognition that a partnership exists and both parties should be included from the beginning in design of programs and implementation of policies.
• Clarity of mission. When each of the parties shares a jointly developed statement of the mission of the programs to be implemented, they can focus on achieving common objectives. The American Recovery and Reinvestment Act had five objectives clearly spelled out in the legislation that created it. These ranged from creating and saving jobs to assuring that states were not forced to raise taxes or cut services. The clarity of these objectives allowed both the federal government and its state and local partners to move quickly and surely to implement the intent of the law.
• Managed networks. I have written previously about the nature of Managed Networks[6]. These differ from social networks in that they have the kind of common mission discussed above. Additionally they have the following elements: trust, a networked structure, good governance, access to authority, resources and leadership. Invoking a managed network ties together the interests and actions of multiple parties toward the common mission such as in the wildfire case described above.

• Technology. Electronic communications, geocoding and mapping, use of social networks, and continuous web based reporting are all examples of technology that can bind agile networks together and allow the public to observe progress, and even the process, as it unfolds.
• Engaged leaders. There is no substitute for involvement of senior leaders in Agile Government efforts. In the Recovery Act this leadership was provided by the President and the Vice President.

Conclusion

The next recession, when it comes, can draw upon lessons learned in the “Great Recession” and new techniques of “Agile Federalism” that focus on accomplishing the mission of helping those most harmed by the recession, creating and saving jobs and improving the functioning of he economy generally. The aphorism, “Luck favors the prepared” is an apt description of what needs to be done and quickly.