Clinton v. City of New York

RESPONDENT: City of New York
LOCATION: The White House

DOCKET NO.: 97-1374
DECIDED BY: Rehnquist Court (1986-2005)

CITATION: 524 US 417 (1998)
ARGUED: Apr 27, 1998
DECIDED: Jun 25, 1998

Charles J. Cooper - Argued the cause for the appellee City of New York
Louis R. Cohen - Argued the cause for the appellee Snake River Potato Growers
Louis R. Cohen - for Snake River Potato Growers
Seth P. Waxman - Argued the cause for the appellants

Facts of the case

This case consolidates two separate challenges to the constitutionality of two cancellations, made by President William J. Clinton, under the Line Item Veto Act ("Act"). In the first, the City of New York, two hospital associations, a hospital, and two health care unions, challenged the President's cancellation of a provision in the Balanced Budget Act of 1997 which relinquished the Federal Government's ability to recoup nearly $2.6 billion in taxes levied against Medicaid providers by the State of New York. In the second, the Snake River farmer's cooperative and one of its individual members challenged the President's cancellation of a provision of the Taxpayer Relief Act of 1997. The provision permitted some food refiners and processors to defer recognition of their capital gains in exchange for selling their stock to eligible farmers' cooperatives. After a district court held the Act unconstitutional, the Supreme Court granted certiorari on expedited appeal.


Did the President's ability to selectively cancel individual portions of bills, under the Line Item Veto Act, violate the Presentment Clause of Article I?

Media for Clinton v. City of New York

Audio Transcription for Oral Argument - April 27, 1998 in Clinton v. City of New York

William H. Rehnquist:

We'll hear argument now in Number 97-1374, William J. Clinton v. The City of New York.

General Waxman.

Seth P. Waxman:

Mr. Chief Justice, and may it please the Court:

Constitutional principles of separation of powers govern both the standing and merits issues of the case.

With respect to standing, this Court recognized last term in Raines v. Byrd that the Article III inquiry is especially rigorous when plaintiffs challenge the allocation of constitutional power, yet here, in the New York case, the State, which is not even a party, has not been denied a single dollar in medicaid reimbursement and the Secretary of HHS has not even determined that it should.

In Snake River, the plaintiffs include no entity whose taxes could possibly be affected by the challenged cancellation and they have not shown that the cancellation interfered with any transaction from which they likely would have benefited.

On the merits, the President's cancellations violated neither Article I nor the separation of powers.

The Presentment Clause was fully satisfied when the President signed the Balanced Budget and Taxpayer Relief Acts making them laws.

When the President subsequently cancelled sections 4722(c) and 968, he was not returning portions of the presented bills while signing other portions into law.

He was implementing a limited discretionary authority to execute the law as it had been enacted by Congress.

Cancellations under the Line Item Veto Act do not prevent Congress from making whatever laws it wants.

Congress could readily have exempted sections 4722 (c) and 968 from the President's authority.

It chose not to do so and, indeed, it identified section 968 in the Taxpayer Relief Act as an item subject to cancellation.

Anthony M. Kennedy:

Is this more constitutionally defensible than what we might call a pure line item veto in which he--

Seth P. Waxman:

It is.

Anthony M. Kennedy:

--In which he can veto the minute that... before the bill ever becomes law, and is the reason for that because for a moment in time, at least, there's a little law?

Seth P. Waxman:


Anthony M. Kennedy:

Or a big law?

Seth P. Waxman:


The critical reason is the point I just identified, which is in a true line item veto, which everybody understands is unconstitutional, the Congress does not retain control to determine which spending or tax items the President can't cancel.

If the President has the authority... and this is critical.

If the President has the authority to cancel a provision before it becomes a law, under the Presentment Clause he can cancel a designated tax or spending item and then sign the law and Congress has thereby deprived itself of the opportunity to create the law.

Here, the President signs the law and it becomes a law under the Presentment Clause, and when he does so, if the law contains a designated cancellable item, Congress has made a law telling the President that, subject to certain determinations and certain considerations, and certain certifications, you have a single, binary choice.

You can either spend the money as provided, or you can spend it for deficit reduction by putting that money into a lockbox, and in that manner the President is executing the law that Congress has enacted, not vetoing an item or repealing a provision that Congress has enacted.

It's no different, I sus... I suggest, for Article I purposes, than if, instead of enacting the Line Item Veto Act, Congress had simply decided to put in as section 1 of every spending and taxing bill that it enacts what is now section 961 of the Line Item Veto Act.

It says, we have the following spending and taxing provisions, but subject to these articulable principles and these constraints, the President may decide, if he signs this law, not to do certain things.

Anthony M. Kennedy:

Well, so far as the locked box is concerned, this bill is the same as a line item veto.

I mean, it's in a locked box that's going to contribute to reducing the deficit.

So that's not a distinction between the two.

Seth P. Waxman:

Well, I think the... I think it's... the lockbox feature of this, which is the feature that gives the President a single binary choice, tends to make this much less of a delegation problem under separation of powers than might otherwise exist, because in contradistinction to cases in which the Court has upheld, for example, delegation of authority to the FCC or the SEC to essentially create an entire code of conduct for the securities industry, the Line Item Veto Act is not... and in this respect I think it's unique and uniquely constrained.