United States v. Basim Omar Sabri ( 2003 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
________________
No. 02-1561
________________
United States of America, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota.
Basim Omar Sabri, *
*
Appellee. *
________________
Submitted: June 14, 2002
Filed: April 7, 2003 (Corrected: 04/15/03)
________________
Before HANSEN,1 Chief Judge, BOWMAN and BYE, Circuit Judges.
________________
HANSEN, Circuit Judge.
The government appeals from an order of the district court dismissing an
indictment against Basim Omar Sabri. We reverse the judgment of the district court.
1
The Honorable David R. Hansen stepped down as Chief Judge of the United
States Court of Appeals for the Eighth Circuit at the close of business on March 31,
2003. He has been succeeded by the Honorable James B. Loken.
I.
The grand jury charged Sabri with three counts of bribery in violation of 18
U.S.C. § 666(a)(2).2 The indictment alleged the following facts. The City of
Minneapolis (hereinafter "City") received approximately $28.8 million in federal
funds during the calendar year beginning January 1, 2001. The Minneapolis
Community Development Agency (hereinafter "MCDA") is a City agency created to
fund housing and economic development programs within the City. MCDA received
2
The statute provides, in relevant part, that:
(a) Whoever, if the circumstance described in subsection (b) of this
section exists–
....
(2) corruptly gives, offers, or agrees to give anything of
value to any person, with intent to influence or reward an
agent of an organization or of a State, local or Indian
tribal government, or any agency thereof, in connection
with any business, transaction, or series of transactions
of such organization, government, or agency involving
anything of value of $5,000 or more;
shall be fined under this title, imprisoned not more than 10 years, or
both.
(b) The circumstance referred to in subsection (a) of this section is
that the organization, government, or agency receives, in any one year
period, benefits in excess of $10,000 under a Federal program
involving a grant, contract, subsidy, loan, guarantee, insurance, or
other form of Federal assistance.
18 U.S.C. § 666 (2000).
2
approximately $23 million in federal funds in the calendar year beginning January 1,
2001. The Minneapolis Neighborhood Revitalization Program (hereinafter "MNRP")
is an agency created by the City and other local government entities which provides
funding for the economic revitalization of City neighborhoods. MCDA wholly funds
MNRP.
Sabri is a Minneapolis developer and landlord. During the spring and summer
of 2001, Sabri was pursuing a commercial real estate project within the City's Eighth
Ward. From 1993 through July 2001, Brian Herron served on the City Council,
representing the Eighth Ward. He also served on the Board of Commissioners
overseeing MCDA's budget. The government alleged that Sabri gave Herron $5000
in an attempt to obtain Herron's assistance in receiving regulatory approval from the
City to commence the proposed real estate project; that Sabri offered Herron $10,000
to threaten the current property owners that the City would use its powers of eminent
domain to take their property if they did not sell to Sabri; and that Sabri offered to
give Herron $80,000 as a 10% kickback in return for his assisting Sabri to obtain
$800,000 in community economic development grants for the proposed real estate
project.
Sabri filed a motion to dismiss the indictment on the ground that § 666(a)(2)
was facially unconstitutional because it does not require the government to prove a
nexus between the offense conduct–the offering of a bribe–and the federal funds.
Without such a "jurisdictional hook," that is, a clause that purports to ensure that the
law applies only to activity that falls within the federal lawmaking power, Sabri
argued that the statute was outside Congress's legislative power. The district court
agreed with Sabri's arguments and granted his motion to dismiss the indictment.3 We
3
To the extent that the district court, relying on United States v. Lopez, 514
U.S. 549 (1995), concluded that § 666 contained no "'express jurisdictional element'
that confer[red] federal court jurisdiction over the offenses described in § 666,"
United States v. Sabri, 183 F. Supp. 2d 1145, 1154 (D. Minn. 2002), it erred. The
3
agree with the district court that as a matter of statutory construction the government
need not prove some nexus between the offense conduct and federal funds. We
respectfully disagree that the statute as construed is beyond Congress's power to
legislate.
II.
We first turn to the question of statutory construction: whether § 666 itself
requires that the government prove some connection between the offense conduct and
the expenditure or use of federal funds. We hold that § 666 contains no requirement
that the government prove some connection between the offense conduct and federal
funds beyond the express statutory requirement found in § 666(b) which requires
proof that the relevant organization, government, or agency received benefits under
a federal program in excess of $10,000 in any one-year period.
The Supreme Court addressed this question of statutory construction in part in
Salinas v. United States, 522 U.S. 52 (1997). Salinas, a deputy sheriff who had
accepted bribes in exchange for arranging "contact visits" between a federal prisoner
housed in the Hidalgo County jail and the prisoner's wife and girlfriend, argued that
"the Government must prove the bribe in some way affected federal funds, for
instance by diverting or misappropriating them" before the statute was violated. Id.
at 55. A unanimous Court rejected Salinas's argument, noting that the "enactment's
Lopez Court's use of the word "jurisdiction" referred to the power of the Congress to
enact legislation and not to the subject matter jurisdiction of the court. Lopez, 514
U.S. at 561. The district court had subject matter jurisdiction over this case because
Sabri was charged with an "offense[] against the laws of the United States." 18
U.S.C. § 3231 (2000). See, e.g., United States v. Ryan, 41 F.3d 361, 363 (8th Cir.
1994) (en banc) (concluding that the express jurisdictional element contained in 18
U.S.C. § 844(i) was merely an element of the offense and that "the court [would] not
by the failure of proof on that element [be] deprived of judicial jurisdiction"), cert.
denied, 514 U.S. 1082 (1995).
4
expansive, unqualified language, both as to the bribes forbidden and the entities
covered, does not support the interpretation that federal funds must be affected to
violate" the statute. Id. at 56-57. Specifically, the Court noted that the word "'any,'
which prefaces the business or transaction clause, undercuts the attempt to impose
this narrowing construction," id. at 57, and "that, as a matter of statutory construction,
§ 666(a)(1)(B) does not require the Government to prove the bribe in question had
any particular influence on federal funds," id. at 61.
The only issue before the Salinas Court, however, was a narrow question of
statutory construction: whether "§ 666 [is] limited to cases in which the bribe has a
demonstrated effect upon federal funds." Id. at 54 (emphasis added). The Court
explicitly left open the more sweeping question of whether § 666 requires the
government to demonstrate some other, less direct connection between the offense
conduct and federal funds. Id. at 59 ("We need not consider whether the statute
requires some other kind of connection between a bribe and the expenditure of federal
funds, for in this case the bribe was related to the housing of a prisoner in facilities
paid for in significant part by federal funds themselves."); see also United States v.
Zwick, 199 F.3d 672, 679 (3d Cir. 1999) (stating that the Salinas Court resolved the
question of whether the government must show that the offense conduct actually
affected or involved federal funds but left open the question of whether § 666
requires some other connection between the offense conduct and the expenditure of
federal funds). Several of our sister circuits have addressed this more broad question.
The Seventh Circuit has given § 666 a broad reading, ultimately concluding
that "[i]t [was] not [its] part to trim § 666 by giving its text a crabbed reading."
United States v. Grossi, 143 F.3d 348, 350 (7th Cir.), cert. denied, 525 U.S. 879(1998). Likewise, the Sixth Circuit has concluded that "18 U.S.C. § 666 does not
require a nexus between the alleged bribes and the federal funding." United States
5
v. Dakota, 197 F.3d 821, 826 (6th Cir. 1999).4 The Fifth Circuit also has eschewed
any nexus requirement. In United States v. Westmoreland, 841 F.2d 572 (5th Cir.),
cert. denied, 488 U.S. 820 (1988), a county supervisor was convicted of accepting
bribes and kickbacks in connection with her duty to purchase supplies for the county's
highway construction projects. Id. at 573-74. The county received $222,949 in
federal funds, but those funds were segregated and the alleged criminal activity did
not affect or implicate federal monies. Id. 575. Nonetheless, the Fifth Circuit
concluded that:
[b]y the terms of section 666, when a local government agency receives
an annual benefit of more than $10,000 under a federal assistance
program, its agents are governed by the statute, and an agent violates
subsection (b) when he engages in the prohibited conduct in any
transaction or matter or series of transactions or matters . . . concerning
the affairs of the local government agency.
Id. at 576 (internal quotation omitted). The Fifth Circuit reaffirmed its position in
United States v. Moeller, 987 F.2d 1134 (5th Cir. 1993), concluding that § 666
required only a nexus between the offense conduct and the agency receiving federal
funds and that this nexus was satisfied by § 666(b). Id. at 1137. It confirmed its
position more recently in United States v. Lipscomb, 299 F.3d 303 (5th Cir. 2002),
in an opinion the court itself described as suffering from "tripartite fractionation." Id.
at 305 (Wiener, J.). Despite their differences on other issues, see infra Part III. A.,
n.5, all members of the Lipscomb panel agreed that Westmoreland is still the law of
4
Although the Sixth Circuit has applied Dakota as good law, it has questioned
its validity. See United States v. Suarez, 263 F.3d 468, 489 (6th Cir. 2001) (stating
that if the court were writing on a clean slate, it "might well agree that proper
application of 18 U.S.C. § 666 requires a minimal nexus between the alleged criminal
activity and the federal funding received pursuant to that statute," but in light of
Dakota, it was bound to conclude that § 666 requires no nexus), cert. denied, 535 U.S.
991 (2002).
6
the Fifth Circuit. See id. at 313 (Wiener, J.), 354 (Duhé, J., concurring in part,
dissenting in part), 365 (Smith, J., dissenting).
Two circuits, the Second and the Third, conclude that § 666 requires the
government to prove at least some minimal nexus between the bribery and the federal
benefits beyond that explicitly required in § 666(b). See Zwick, 199 F.3d at 682 n.7;
United States v. Santopietro, 166 F.3d 88, 93 (2d Cir. 1999).
In Santopietro, the Second Circuit recognized that Salinas limited its decision
in United States v. Foley, 73 F.3d 484 (2d Cir. 1996), but concluded that it left
untouched that part of Foley holding that § 666 "requires at least some connection
between the bribe and a risk to the integrity of the federal funded program."
Santopietro, 166 F.3d at 93. The Foley Court reached the conclusion that § 666
required the government to prove a connection between the bribe and the federal
funds only after finding the statute to be ambiguous and then turning to the legislative
history to resolve that ambiguity. Foley, 73 F.3d at 489.
Despite the long-standing principle of statutory construction that the title of a
statute cannot control the plain language of the statute, the Third Circuit reasoned that
the title of § 666, "Theft or bribery concerning programs receiving Federal funds,"
implied that the statute contains a minimal nexus requirement. Zwick, 199 F.3d at
682. It avoided the "literal interpretation" of the statute and instead relied upon
legislative history to construct a "plausible, albeit more contextual[] alternative"
reading. Id. at 683. It reasoned that "Salinas found § 666(a)(1)(B) clear and
unambiguous only on the question of whether the government must prove that the
corrupt activity had a demonstrated effect on federal funds or programming," id. at
682 n.7, but that "nothing in Salinas prevent[ed it] from determining that §
666(a)(1)(B) is ambiguous on the issue of whether there is a federal connection
requirement," id. We respectfully disagree with the proposition that § 666 is
ambiguous on the federal connection requirement.
7
As with any question of statutory construction, we look first to the text of the
statute itself. United States v. McIntosh, 236 F.3d 968, 971 (8th Cir.), cert. denied,
532 U.S. 1022 (2001). Section 666(a)(2) makes it a crime to "corruptly give[],
offer[], or agree[] to give anything of value to any person, with intent to influence or
reward an agent of a[] . . . local . . . government, . . . or any agency thereof, in
connection with any business, transaction, or series of transactions of such
organization, government, or agency involving anything of value of $5,000 or more"
if the "organization, government, or agency receives, in any one year period, benefits
in excess of $10,000 under a Federal program involving a grant, contract, subsidy,
loan, guarantee, insurance or other form of Federal assistance." 18 U.S.C. § 666(emphasis added). The plain language encompasses the activity of local agents
wherever subsection (b) attains. There is no qualification that the prohibited conduct
must have some relation to federal funds. Indeed, the statute proscribes the conduct
of local agents in connection with "any" agency business or transaction. The word
"any" is unambiguous and unqualified. Salinas, 522 U.S. at 57; Mo. Mun. League v.
F.C.C., 299 F.3d 949, 955 (8th Cir. 2002) (citing cases and stating that time and time
again the Court has held that the modifier "any" prohibits a narrow construction of
a statute), petition for cert. filed (Feb. 18, 2003) (No. 02-1238); Westmoreland, 841
F.2d at 576 ("[T]he relevant statutory language [is] plain and unambiguous."); United
States v. McCormack, 31 F. Supp. 2d 176, 186 (D. Mass. 1998) (stating Salinas
"announced that the statutory language, 'in connection with any business or
transaction,' is not ambiguous," that "[t]he language is clear," and that "the reach of
the statute is clearly broad"). It is clear to us that the plain text of the statute does not
require any connection between the federal funds received by the agency and the
offense conduct. The statute applies to all offense conduct involving anything of
value of $5000 or more that involves "any" agency business, transaction, or series of
transactions so long as the relevant agency received the requisite amount of federal
benefits ($10,000) within the defined time period as required in § 666(b).
8
The argument that § 666 is unambiguous as to the narrow question answered
in Salinas but ambiguous as to the broad question presented here is unpersuasive. “A
statute can be unambiguous without addressing every interpretive theory offered. . .
. It need only be plain to anyone reading the Act that the statute encompasses the
conduct at issue." Salinas, 522 U.S. at 60 (internal quotation omitted). Thus, while
it is true that the Salinas Court held only that the government need not prove that the
offense conduct directly affected federal funds, the Salinas Court's characterization
of the operative terms of the statute as broad and unqualified supports our conclusion
that the statute is also unambiguous as to the broader question presented here. See
Salinas, 522 U.S. at 56 (stating that "[t]he enactment's expansive, unqualified
language" does not support a limiting interpretation of the statute), 57 ("The
prohibition is not confined to a business or transaction which affects federal funds."),
57 ("Furthermore, the broad definition of the 'circumstances' to which the statute
applies provides no textual basis for limiting the reach of the bribery prohibition."),
57 ("The statute applies to all cases in which an 'organization, government, or agency'
receives the statutory amount of benefits under a federal program."), 57 ("The
statute's plain language fails to provide any basis for limiting § 666(a)(1)(B) to bribes
affecting federal funds."). The Court reaffirmed this broad reading of § 666 in
Fischer v. United States, 529 U.S. 667 (2000). There, the court described § 666 as
"expansive, both as to the conduct forbidden and the entities covered." Id. at 678
(internal quotations and alteration omitted).
The fact that the Salinas Court construed § 666(a)(1)(B) and that this case
involves § 666(a)(2) makes no difference in our analysis. Section (a)(1) and section
(a)(2) are complementary provisions: one section criminalizes the solicitation or
acceptance of bribes while the other criminalizes the offering or giving of bribes.
Both provisions, however, prohibit bribery in connection with "any business,
transaction, or series of transactions" of organizations which receive the requisite
amount of federal benefits required in subsection (b). Neither provision suggests that
the business or transaction in question must somehow implicate a federal program.
9
For the point under consideration here, the relevant terms of the two sections are
identical. Therefore, relying on the text of the statute and the Supreme Court's
characterization of the operative language in the statute as broad and unqualified, we
conclude that § 666 is unambiguous as to the question presented here.
Generally, where the text of a statute is unambiguous, the statute should be
enforced as written, McIntosh, 236 F.3d at 972, and "[o]nly the most extraordinary
showing of contrary intentions in the legislative history will justify a departure from
that language," United States v. Albertini, 472 U.S. 675, 680 (1985) (internal
quotation omitted). We find no extraordinary showing of contrary intent that
warrants deviation from the plain text of the statute. Congress enacted § 666 to
"safeguard finite federal resources from corruption and to police those with control
of federal funds." U.S. v. Rooney, 37 F.3d 847, 851 (2d Cir.1994); see also S. Rep.
No. 98-225, at 370 (1984), reprinted in 1984 U.S.C.C.A.N. 3182, 3511 ("[T]he
purpose of this section [is] to protect the integrity of the vast sums of money
distributed through federal programs."). Prior to the enactment of § 666, however,
the task of protecting the integrity of federal funds was made more difficult because
of gaps in the statutory scheme. Specifically, prior to the enactment of § 666:
thefts from other organizations or governments receiving federal
financial assistance [could have been] prosecuted under the general theft
of federal property statute, 18 U.S.C. 641, only if it [could have been]
shown that the property stolen [was] property of the United States. In
many cases, such prosecution [was] impossible because title ha[d]
passed to the recipient before the property [was] stolen, or the funds
[were] so commingled that the federal character of the funds [could not]
be shown. This situation [gave] rise to a serious gap in the law, since
even though title to the monies may have passed, the federal government
clearly retain[ed] a strong interest in assuring the integrity of such
program funds.
S. Rep. No. 98-225, at 369, reprinted in 1984 U.S.C.C.A.N. at 3510; see also United
States v. Ferrara, 990 F. Supp. 146, 149-50 (E.D.N.Y. 1998) ("Moreover, [prior to the
10
enactment of § 666,] successful prosecutions were impossible in those instances
where title to the federal property had passed to a recipient before the property was
stolen, or where the federal character of the funds was irredeemably lost due to
commingling with non-federal monies."). Section 666 was passed to fill the gaps in
the prior anticorruption scheme. Westmoreland, 841 F.2d at 577 (stating that
Congress specifically chose to protect the integrity of federal funds "by enacting a
criminal statute that would eliminate the need to trace the flow of federal monies and
that would avoid inconsistencies caused by the different ways that various federal
programs disburse funds and control their administration"). Congress decided that
the most effective way to insure the integrity of federal funds disbursed to sub-
national agencies was to change the enforcement paradigm from one that monitored
federal funds to one that monitored the integrity of the recipient agencies. Fischer,
529 U.S. at 678 ("Coupled with the broad substantive prohibitions of subsection (a),
the language of subsection (b) reveals Congress's expansive, unambiguous intent to
ensure the integrity of organizations participating in federal assistance programs.");
United States v. Simas, 937 F.2d 459, 463 (9th Cir.1991) ("By enacting section 666,
Congress plainly decided to protect federal funds by preserving the integrity of the
entities that receive the federal funds rather than requiring the tracing of federal funds
to a particular illegal transaction."); Westmoreland, 841 F.2d at 578 ("Congress seeks
to preserve the integrity of federal funds by assuring the integrity of the organizations
or agencies that receive them.").
The legislative history reveals that § 666 was drafted and enacted to "extend
federal bribery prohibitions to bribes offered to state and local officials employed by
agencies receiving federal funds," Salinas, 522 U.S. at 58 (emphasis added), and not
to limit the scope of the federal bribery prohibition. In addition, because § 666
changed the focus of federal anticorruption efforts from policing federal funds to
policing the agencies that receive and administer those funds, the argument that there
must be a nexus between the offense conduct and the federal funds beyond that
explicitly provided for in § 666(b) seems inconsistent with the statute. In any event,
11
in light of the foregoing legislative history we conclude, at minimum, that there is no
clear or extraordinary showing of contrary legislative intent sufficient to cause us to
override the text of a statute unambiguous on its face.
While we recognize that in construing statutes courts should avoid
constitutional questions where possible, we note that even if we were to conclude that
§ 666 contained an unstated nexus requirement between the offense conduct and the
federal funds, that would not dispose of the lurking constitutional question. Simply
concluding that the statute contains an undefined nexus requirement ignores the
constitutional question of whether Congress had the power to enact this statute at all.
No amount of creative interpolation could save a statute that Congress lacked the
authority to enact. United States v. Morgan, 230 F.3d 1067, 1073 (8th Cir. 2000)
(Bye, J., concurring) ("Judicial efforts to render § 666 palatable by adding an element
to the crime cannot alter our Constitution's basic limitation on federal legislative
power. No amount of creative drafting permits the judiciary to preserve a statute that
Congress plainly lacked the power to create."), cert. denied, 534 U.S. 825 (2001).
Because we conclude, however, that § 666 as construed is a law necessary and proper
to the execution of the Spending Power, see infra Part III.B., we need not worry about
limiting the scope of a plainly written statute.
Given the plain and unambiguous language of the statute and the absence of
any extraordinary contrary legislative history which suggests that we should deviate
from the text, we are compelled to conclude that other than the threshhold showing
that the agency in question received more than $10,000 in federal benefits in any one-
year period, § 666 imposes no requirement that there be a connection between the
offense conduct and the federal funds. See Morgan, 230 F.3d at 1073 (Bye, J.,
concurring) (concluding that a federal nexus requirement should not be read into §
666 on the grounds that the court should not inject elements into plain and
unambiguous statutes); George D. Brown, Stealth Statute--Corruption, The Spending
Power, and the Rise of 18 U.S.C. § 666, 73 Notre Dame L. Rev. 247, 280-81 (1998)
12
("[I]t is impossible to deny that the actual statute is the antithesis of narrow. Fairly
read, it gives the federal government authority to deal with a range of malfeasance
anywhere within governmental . . . entities that benefit from a variety of programs,
whether or not the wrongdoing is connected to the federal assistance.").
III.
Having determined that the statute does not require a nexus between the
criminal activity and the federal funds, we now turn to the question of whether
Congress had the power to enact § 666. We review this federal constitutional
question de novo. United States v. Shepherd, 284 F.3d 965, 969 (8th Cir. 2002).
A. Section 666 is not a condition placed on the receipt of federal
funds.
It is axiomatic that "[e]very law enacted by Congress must be based on one or
more of its powers enumerated in the Constitution." United States v. Morrison, 529
U.S. 598, 607 (2000). The courts that have applied § 666 agree that Congress enacted
§ 666 pursuant to its spending powers. See, e.g., Fischer, 529 U.S. at 689-90 n.3
(Thomas, J., dissenting); McCormack, 31 F. Supp. 2d at 186 n.18 (collecting cases).
The spending power is encompassed in Art. I., § 8, cl. 1, of the Constitution.
Pennhurst State Sch. v. Halderman, 451 U.S. 1, 9 n.5 (1981). It provides that the
"Congress shall have Power To . . . provide for the . . . general Welfare of the United
States." U.S. Const. art. I, cl. 1. The Supreme Court has "repeatedly characterized
. . . Spending Clause legislation as much in the nature of a contract: in return for
federal funds, the recipients agree to comply with federally imposed conditions."
Barnes v. Gorman, 122 S. Ct. 2097, 2100-01 (2002) (internal quotation and alteration
omitted). The government argues that § 666 can be sustained as a valid condition
placed on the receipt of federal funds. We disagree.
13
While traditional Spending Clause legislation is in the "nature" of a contract,
it is not a contract. Mo. Child Care Ass'n v. Cross, 294 F.3d 1034, 1041 (8th Cir.
2002). Instead, "contract" is used only metaphorically to illuminate and explain
certain aspects of the relationship formed between the federal government and the
recipient of the federal funds. We find this metaphor useful to our discussion here,
and we note that § 666 has none of the hallmarks of a contractual relationship which
characterizes typical Spending Clause legislation.
Unlike typical Spending Clause enactments, § 666 imposes no affirmative
obligation on the recipient of federal funds. Cf. South Dakota v. Dole, 483 U.S. 203,
205 (1987) (sustaining 23 U.S.C. § 158 (1982 ed. Supp. III), which directed the
Secretary of Transportation to withhold a certain percentage of federal highway funds
from states which had not yet made it illegal for a person under age 21 to purchase
or possess alcohol, as a valid condition on the receipt of federal funds); Pennhurst,
451 U.S. at 12-13 (noting that under the Developmentally Disabled Assistance and
Bill of Rights Act of 1975, 89 Stat. 486, the recipient of federal funds had to take
"'affirmative action' to hire qualified handicapped individuals," submit a plan
evaluating services offered under the Act, and provide the federal government with
assurances that each person serviced in the program had a habilitation plan); Fullilove
v. Klutznick, 448 U.S. 448, 474 (1980) ("Congress has frequently employed the
Spending Power to further broad policy objectives by conditioning receipt of federal
moneys upon compliance by the recipient with federal . . . directives. This Court has
repeatedly upheld against constitutional challenge the use of this technique to induce
governments and private parties to cooperate voluntarily with federal policy."), 474
("The program conditions receipt of public works grants upon agreement by the state
or local governmental grantee that at least 10% of the federal funds will be devoted
to contracts with minority businesses."), overruled on other grounds by Adarand
Constructors, Inc. v. Pena, 515 U.S. 200 (1995).
14
Nor does § 666 proscribe conduct of the recipient of the federal funds. Cf.
Barnes, 122 S. Ct. at 2101 n.1 (concluding that valid Spending Clause legislation can
include legislation that "simply prohibits certain discriminatory conduct." (internal
quotation and alteration omitted)); Gonzaga Univ. v. Doe, 122 S. Ct. 2268, 2272-73
(2002) (describing the Family Educational Rights and Privacy Act of 1974, 88 Stat.
571, as a conditions statute which authorizes the withholding of federal funds from
educational institutions that permit the release of education records without the
consent of the students); Davis v. Monroe County Bd. of Ed., 526 U.S. 629, 638
(1999) (discussing Title IX of the Education Amendments of 1972, 86 Stat. 373,
which prohibits sex-based discrimination under any education program receiving
federal financial assistance); Lau v. Nichols, 414 U.S. 563, 566 (1974) (upholding
application of the Civil Rights Act of 1964, 78 Stat. 241, which prohibits
discrimination in any program or activity receiving federal financial assistance).
As such, § 666 has no contractual "terms" with which the recipient of federal
funds must comply. Barnes, 122 S. Ct. at 2101 ("Just as a valid contract requires
offer and acceptance of its terms, the legitimacy of Congress's power to legislate
under the spending power rests on whether the recipient voluntarily and knowingly
accepts the terms of the 'contract.'" (internal quotation and alteration omitted)). We
conclude therefore that § 666 is not a conditions statute at all and that the traditional
Dole analysis is inapplicable here. United States v. Cantor, 897 F. Supp. 110, 113
(S.D.N.Y. 1995) ("18 U.S.C. § 666 does not impose a condition on the receipt of
federal funds. The statute neither requires a state's compliance with federal regulatory
or administrative directives, nor prevents state action. . . . Section 666 does not
derogate any state right. . . . Section 666 does not force the state government to do
anything." (internal citations and quotations omitted)), aff'd 141 F.3d 1152 (2d Cir.),
cert. denied, 525 U.S. 814 (1998).
The fact that § 666 directly regulates the conduct of third parties and not the
recipients of the federal benefits supports our conclusion that this is not a conditions
15
statute at all. Morgan, 230 F.3d at 1074 (Bye, J., concurring) ("In enacting § 666, .
. . Congress did not contract with states or local governments. . . . Section 666
reaches beyond punishment of the state and local governments who receive those
funds to proscribe the conduct of third persons who aren't parties to the funding
contract."); Cantor, 897 F. Supp. at 113 ("All Congress has done in Section 666 is to
pass a law making the conduct of individuals, not the state, criminal." (internal
quotations omitted)). We could find no persuasive or authoritative case law
supporting the proposition that Congress, acting pursuant to its power to attach
conditions to the receipt of federal funds, has the authority to directly regulate the
conduct of third parties who are not actually the recipients of the federal funds.5
Instead, the case law demonstrates that funding condition statutes may only directly
regulate the recipients of the federal funds who then may or may not undertake action
vis-a-vis third parties. See, e.g., Davis, 526 U.S. at 640 ("[I]n return for federal funds,
the States agree to comply with federally imposed conditions." (internal quotation
omitted) (emphasis added)), 641 (affirming statute because it was drafted in such a
way that "[t]he Government's enforcement power may only be exercised against the
funding recipient." (emphasis added)); Gebser v. Lago Vista Indep. Sch. Dist., 524
U.S. 274, 286 (1998) ("The two statutes [Title VI and Title IX] operate in the same
manner, conditioning an offer of federal funding on a promise by the recipient not to
discriminate, in what amounts essentially to a contract between the Government and
the recipient of funds." (emphasis added)); Dole, 483 U.S. at 206 ("Congress may
attach conditions on the receipt of federal funds, and has repeatedly employed the
5
The Fifth Circuit recently addressed the question of whether § 666 can be
sustained as a condition on the receipt of federal funds. The panel could not generate
a majority for any position. Judge Wiener opined that § 666 was similar to a cross-
cutting condition–one that applies to all grants of federal money–and applied the Dole
conditions analysis. Lipscomb, 299 F.3d at 318-23 (Wiener, J., writing separately as
to Part V. B.). Judge Duhé did not reach the issue because, he argued, it was not
raised at trial or on appeal. Id. at 360 (Duhé, J., concurring in part and dissenting in
part). Judge Jerry E. Smith concluded that § 666 "does not qualify as a conditional-
grant statute." Id. at 366 (Smith, J., dissenting).
16
power to further broad policy objectives by conditioning receipt of federal moneys
upon compliance by the recipient with federal . . . directives." (emphasis added)
(internal quotations omitted)); Oklahoma v. United States Civil Svc. Comm'n, 330
U.S. 127, 144 (1947) ("The offer of benefits to a state by the United States dependent
upon cooperation by the state with federal plans . . . is not unusual." (emphasis
added)). Accordingly, we conclude that § 666 cannot be sustained as a condition
attached to the receipt of federal funds because this statute is not a conditions statute
at all. Section 666 is merely a general criminal statute which directly regulates the
conduct of persons who are not parties to the funding "contract."
B. Section 666 is a necessary and proper exercise of Congressional
power.
Our conclusion that this statute is not a conditions-type statute does not
necessarily render it infirm. Indeed, the Supreme Court has intimated that § 666 is
a constitutional exercise of Congress's legislative power. See Salinas, 522 U.S. at 60("[T]here is no serious doubt about the constitutionality of § 666(a)(1)(B) as applied
to the facts of this case."), 61 ("We simply decide that . . . § 666(a)(1)(B) does not
require the Government to prove the bribe in question had any particular influence
on federal funds and that under this construction the statute is constitutional as
applied in this case."). Our brother Bye has previously concluded that the above
quoted sentences are mere "constitutional speculations." Morgan, 230 F.3d at 1072
n.3. We find it significant that no member of the unanimous Salinas Court disagreed
with or qualified these statements. In addition, in Fischer, the Court resolved another
issue of statutory construction arising under § 666, and no member of the Court
suggested that the statute might be constitutionally infirm. We think it ill-advised to
now declare that § 666 is void ab initio as being outside of Congress's legislative
domain after the Supreme Court has twice indicated that the statute can be
constitutional as applied. With that thought in mind, we look beyond the Spending
Clause to other provisions of the Constitution which may or may not provide legal
authority to sustain § 666.
17
So that the Constitution "be not a splendid bauble," the framers of our
government inserted the Necessary and Proper Clause into the Constitution to
"remove all doubts respecting the right to legislate on that vast mass of incidental
powers which must be involved in the constitution." M'Culloch v. Maryland, 17 U.S.
(4 Wheat.) 316, 420-21 (1819). The Clause provides that "[t]he Congress shall have
Power . . . To make all Laws which shall be necessary and proper for carrying into
Execution" all the powers vested in the Government of the United States. U.S. Const.
art. I, § 8, cl. 18. Both the Spending Power and the Necessary and Proper Clause are
contained in section 8 of the first Article, and the Necessary and Proper Clause
applies to the spending power, enabling Congress to enact all laws which are
convenient to the exercise of disbursing federal funds. Fullilove, 448 U.S. at 474("[T]he power to 'provide for the . . . general Welfare' is an independent grant of
legislative authority, distinct from other broad congressional powers."); Buckley v.
Valeo, 424 U.S. 1, 90 (1976) ("[T]he General Welfare Clause . . . is . . . a grant of
power, the scope of which is quite expansive, particularly in view of the enlargement
of power by the Necessary and Proper Clause."); M'Culloch, 17 U.S. at 421. We
recognize that the Necessary and Proper Clause does not confer upon the Congress
a broad police power. It does, however, allow Congress the luxury to choose from
an array of means with which to implement its enumerated powers, including its
Spending Power. Chief Justice Marshall has best articulated the relationship between
constitutional means and ends: "[l]et the end be legitimate, let it be within the scope
of the constitution, and all means which are appropriate, which are plainly adapted
to that end, which are not prohibited, but consist with the letter and spirit of the
constitution, are constitutional." M'Culloch, 17 U.S. at 421.
Applying the M'Culloch framework, we conclude that § 666 is a law necessary
and proper to the execution of Congress's spending power. See United States v.
Edgar, 304 F.3d 1320, 1325 (11th Cir.) ("[W]e are persuaded that a basis for the
enactment of § 666 may be found in Congress's authority, under the Necessary and
Proper Clause, to protect its capacity to fruitfully exercise the spending power."), cert.
18
denied, 123 S. Ct. 679 (2002); United States v. Bigler, 907 F. Supp. 401, 402 (S.D.
Fla. 1995) ("Article I, § 8 gives Congress the power to 'provide for the ... general
Welfare.' This power, in conjunction with the necessary and proper clause, gives
Congress the power to enact § 666. In doing so, Congress did not violate the principle
of federalism, nor did it violate the tenth amendment."). First, we think it an
incontestable proposition that the disbursement of federal funds to subnational
agencies to advance the general welfare is a legitimate end within the scope of the
Constitution. We further quickly conclude that Congress also has a legitimate right
to protect these disbursements from misappropriation once made. We also conclude
that § 666 is consistent with and does not contravene the letter or spirit of the
Constitution.6 The difficult question in this case is whether § 666 is an appropriate
6
The dissent argues that this law is not "proper," that is, it contravenes the letter
and spirit of the Constitution by failing to recognize constitutional principles of
limited federal government and state sovereignty. In support of this argument, the
dissent relies on Alden v. Maine, 527 U.S. 706 (1999), Printz v. United States, 521
U.S. 898 (1997), and New York v. United States, 505 U.S. 144 (1992), for the
proposition that "[f]ederal laws that usurp the traditional domain of state authority are
. . . not proper." Post at 4. We, respectfully, are of the view that the dissent reads
these cases too broadly. Alden, Printz, and New York answer only the limited
question of when the central government is prohibited from acting directly on the
States or on the States' officers. See Alden, 527 U.S. at 712 ("We hold that the
powers delegated to Congress under Article I of the United States Constitution do not
include the power to subject nonconsenting States to private suits for damages in state
courts."); Printz, 521 U.S. at 935 (holding that Congress cannot compel State officers
to administer federal regulatory program); New York, 505 U.S. at 149 (holding that
Constitution does not confer upon Congress the power to compel the States to enact
a regulatory program). These cases merely recognize the larger constitutional
principle that "the Framers explicitly chose a Constitution that confers upon Congress
the power to regulate individuals, not States," and that "where Congress has the
authority under the Constitution to pass laws requiring or prohibiting certain acts it
lacks the power directly to compel the States to require or prohibit those acts." New
York, 505 U.S. at 166; accord Alden, 527 U.S. at 714; Printz, 521 U.S. at 919-20.
None of these cases addresses the question presented here: whether Congress has the
19
means plainly adapted to achieving Congress's end. The resolution of this inquiry
raises two subsidiary questions: (1) whether Congress has the power to enact criminal
legislation pursuant to the Necessary and Proper Clause, and if so, (2) whether § 666
is plainly adapted, i.e., rationally related, to achieving Congress's end.
As to the first question, we have no doubt that the creation of a general criminal
law incident to a constitutional end is within the sovereign power of the federal
government. M'Culloch, 17 U.S. at 418 ("The good sense of the public has
pronounced, without hesitation, that the power of punishment appertains to
sovereignty, and may be exercised, whenever the sovereign has a right to act, as
incidental to his constitutional powers."). Chief Justice Marshall provided concrete
examples of the scope of this power in M'Culloch:
Take, for example, the power 'to establish post-offices and post-roads.'
This power is executed, by the single act of making the establishment.
But, from this has been inferred the power and duty of carrying the mail
along the post-road, from one post-office to another. And from this
implied power, has again been inferred the right to punish those who
steal letters from the post-office, or rob the mail. . . . This right is indeed
essential to the beneficial exercise of the power, but not indispensably
necessary to its existence. So, of the punishment of the crimes of
stealing or falsifying a record or process of a court of the United States,
or of perjury in such court. To punish these offences, is certainly
conducive to the due administration of justice.
Id. at 417. More recently, our court has recognized that Congress has the authority
to pass a criminal law of general application pursuant to the Necessary and Proper
authority to regulate the conduct of individuals, not States, who deal with
organizations that receive federal benefits. Because there has been no clear signal
from the Supreme Court that there are independent federalism-based limits on the
power of Congress to regulate the conduct of individuals, we conclude that this
statute is "proper" and does not contravene the letter or spirit of the Constitution.
20
Clause. See United States v. Dittrich, 100 F.3d 84, 87 (8th Cir. 1996) ("A law
making it a crime to steal property from a Post Office is well within even the
narrowest construction of the Necessary and Proper Clause."), cert. denied, 520 U.S.
1178 (1997); see also Dropps v. United States, 34 F.2d 15, 18 (8th Cir. 1929) ("That
Congress has power under the constitution to enact a law punishing bribe taking on
the part of officers of the United States and others acting in an official capacity for
the United States is patently within its general powers to make all laws necessary and
proper for carrying into execution the particular powers specifically conferred upon
it."), cert. denied, 281 U.S. 720 (1930). These authorities demonstrate that Congress
has the authority to enact general criminal legislation incident to its specifically
enumerated powers.
As to the more specific question, we conclude that § 666 is a means plainly
adapted, i.e., rationally related, to achieving the efficacious expenditure of federal
funds and is, therefore, a law necessary and proper to the execution of the spending
power. In M'Culloch, Chief Justice Marshall determined that "necessary" had an
expansive meaning. The Clause does not restrain Congress's choice of means to only
those means that are absolutely or indispensably necessary to the exercise of its
powers. Rather, the Necessary and Proper Clause allows Congress to exercise its
discretion in choosing particular means that may not be "necessary" in the strict sense
of the word, but instead are convenient or conducive to the exercise of its powers.
The Legal Tender Cases, 110 U.S. 421, 441 (1884) ("Where various systems might
be adopted . . . , it might be said, with respect to each, that it was not necessary,
because the end might be obtained by other means. Congress must possess the choice
of means, and must be empowered to use any means which are in fact conducive to
the exercise of a power granted by the constitution."); M'Culloch, 17 U.S. at 420.
Thus, Chief Justice Marshall, relying on his expansive interpretation of "necessary,"
concluded that the power to establish post offices and post roads included the power
to establish criminal penalties for interfering with the mail. Likewise, he concluded
that the federal government could incorporate a National Bank even though that
21
power is not enumerated in Article I. Chief Justice Marshall concluded that these so-
called "implied powers" were constitutional exercises of the sovereign power because
each reasonably advanced an enumerated power. M'Culloch thus teaches us that
Congress may use means which are unspecified in the text of the constitution to
achieve enumerated ends where there is a rational relationship between the means and
the ends. Here, we know the end is the efficacious disbursement of federal funds. To
determine whether § 666 is rationally related to that end we must look to Congress's
intent in passing the law and the specific mechanisms by which § 666 hopes to
achieve the desired end.
As we have discussed above, § 666 was designed to protect the integrity of the
vast sums of federal monies disbursed through federal programs. Section 666 could
have been more narrowly crafted to more directly advance this goal, for example, by
criminalizing the theft of the federal funds themselves while in the hands of the
recipient, or by requiring a direct nexus between the offense conduct and a federal
program, but "[t]he Constitution has never been regarded as denying to the Congress
the necessary resources of flexibility and practicality to perform its function." Yakus
v. United States, 321 U.S. 414, 425 (1944) (internal quotation and alteration omitted).
Here, Congress has made a determination that the most effective way to protect the
integrity of federal funds is to police the integrity of the agencies administering those
funds. As discussed in Part II, a more limited statutory scheme was rendered
toothless because of the difficulty of tracing federal funds once they had been
disbursed. In addition, we note that "money is fungible and its effect transcends
program boundaries." Grossi, 143 F.3d at 350. The maladministration of funds in
one part of an agency can affect the allocation of funds, whether federal or local in
origin, throughout an entire agency. Thus, to suggest that corruption involving a
discrete department or section of an agency that does not itself receive federal funds
or administer a federal program can have no effect on the integrity or efficacy of a
federal program is to ignore the fact that money is fungible and that federal funds are
often comingled with funds from other sources. Section 666 addresses this problem
22
by policing the integrity of the entire organization that receives federal benefits. In
sustaining the constitutionality of § 666 under the Necessary and Proper Clause , the
Eleventh Circuit recently has come to the same conclusion. See Edgar, 304 F.3d at
1327 ("It is reasonable for Congress to conclude that any corruption of such recipient
organizations, regardless of whether the corruption involves the misappropriation of
specifically federal funds, endangers the comprehensive programs in which the
organizations participate, and thus the effective exercise of the Congressional
spending power as well.").
The Court has approved this type of indirect enforcement mechanism in
another context. In Westfall v. United States, 274 U.S. 256 (1927), the Supreme
Court affirmed the constitutionality of the Federal Reserve Act, 38 Stat. 259, as
amended, 40 Stat. 232, which made it a crime to misapply the funds of a State bank
that was a member of the Federal Reserve System. The reasoning of the Court is
persuasive on the issue presented in this case:
The argument is that Congress has no power to punish offences against
the property rights of State banks. It is said that the statute is so broad
that it covers such offenses when they could not result in any loss to the
Federal Reserve Banks. . . . [I]f a State bank chooses to come into the
System created by the United States, the United States may punish acts
injurious to the System, although done to a corporation that the State
also is entitled to protect. . . . That there is such a System and that the
Reserve Banks are interested in the solvency and financial condition of
the members also is too obvious to require a repetition of the careful
analysis presented by the Solicitor General. The only suggestion that
may deserve a word is that the statute applies indifferently whether there
is a loss to the Reserve Banks or not. But every fraud like the one before
us weakens the member bank and therefore weakens the System.
Moreover, when it is necessary in order to prevent an evil to make the
law embrace more than the precise thing to be prevented it may do so.
23
Id. at 258-59 (internal citations omitted). As in Westfall, the government here has an
interest in ensuring that the system of subnational agencies that administer federal
funds remains strong even where there is not a direct loss to the federal funds
themselves. Congress could well have determined that an agency official who is
willing to take a bribe in the disbursements of nonfederal program money is not a
person who should be entrusted with federal program funds either.
Any concern that we may have had regarding the scope of this law is allayed
by the statute itself. The statute is self-limiting to ensure that "federal regulatory
power [does not] tag along after federal money like a hungry dog." Morgan, 230 F.3d
at 1074 (Bye, J., concurring) (internal quotations and emphasis omitted). Section
666(b) is a jurisdictional provision that ensures in each particular case that the federal
power will be exercised only where the federal government has a substantial interest
at stake and where substantial federal funds may be at risk. See Fischer, 529 U.S. at689 n.3 (Thomas, J., dissenting) ("Title 18 U.S.C. § 666(b) is, after all, a
jurisdictional provision that allows federal prosecution only if the specific
organization at issue received more than $10,000 in 'benefits.'"), id. at 690 n.3
("Without a jurisdiction provision that would ensure that in each case the exercise of
federal power is related to the federal interest in a federal program, § 666 would
criminalize routine acts of fraud or bribery."). The $10,000 threshold requirement
and the $5000 transactional requirement create a sufficient nexus between the offense
conduct and federal funds to ensure that federal power will not be extended to the
prosecution of merely local matters that may not jeopardize in any significant manner
the integrity of federal programs.
More importantly, were we to conclude that Congress lacked the authority to
legislate in this area, then the protection of federal funds would be left to the whim
of state and local officials–perhaps even the same officials who pose a threat to the
integrity of the federal funds in the first place and who therefore possess a strong
24
disincentive to protect them. The proposition that the federal government is
powerless to vindicate its own interests is clearly untenable:
"The government of the Union, though limited in its powers, is supreme
within its sphere of action. No trace is to be found in the constitution of
an intention to create a dependence of the government of the Union on
those of the states, for the execution of the great powers assigned to it.
Its means are adequate to its ends; and on those means alone was it
expected to rely for the accomplishment of its ends. To impose on it the
necessity of resorting to means which it cannot control, which another
government may furnish or withhold, would render its course
precarious, the result of its measures uncertain, and create a dependence
on other governments, which might disappoint its most important
designs, and is incompatible with the language of the constitution."
Logan v. United States, 144 U.S. 263, 283 (1892), quoting M'Culloch, 17 U.S. at 424.
We reject it.
Accordingly, we hold that § 666 is a legitimate exercise of Congress's
undisputed power to make a law that is necessary and proper for the carrying out of
its enumerated power to provide for the general welfare of the United States.
IV.
To the extent that the district court held that 18 U.S.C. § 666 requires no nexus
between the offense conduct and federal funds beyond that required in subsection (b),
the judgment of the district court is affirmed. We reverse that part of the district
court's judgment finding § 666 is facially unconstitutional. We remand this case to
the district court for reinstatement of the indictment and for such further proceedings
not inconsistent with this opinion.
25
BYE, Circuit Judge, dissenting.
No one doubts the constitutional authority of Congress to enact criminal laws
punishing behavior affecting tangible federal interests. However, when Congress
seeks to punish conduct with no connection to federal interests, conduct traditionally
punished only by state and local governments exercising their general police powers,
Congress exceeds its constitutional authority. The statute we review today, 18 U.S.C.
§ 666(a)(2), punishes a broad swath of conduct bearing little relationship to any
federal interest. It establishes federal criminal liability for those who bribe state and
local government officials, provided only that the government receives $10,000 per
year in federal program benefits. Id. § 666(a)(2), 666(b). A briber need not handle,
manage, administer or supervise the receipt or disbursement of federal funds, and the
purpose of the bribe need not relate to federal program benefits. It is therefore
logically and legally untenable to assert a federal interest in punishing these bribers.
In my view, the majority's decision to uphold § 666(a)(2) despite this infirmity
swims against the tide of governing law. A wave of recent Supreme Court decisions
emphasizes Congress' limited ability to federalize criminal conduct, United States v.
Morrison, 529 U.S. 598 (2000), United States v. Lopez, 514 U.S. 549 (1995), and to
interfere in matters traditionally left to state governance, Alden v. Maine, 527 U.S.
706 (1999), Printz v. United States, 521 U.S. 898 (1997). These decisions guide my
review of § 666(a)(2) and require my respectful dissent.
I
I do agree with the majority in one important respect: section 666(a)(2) cannot
be justified solely as an exercise of Congress' Spending Clause authority. The
majority properly rests this holding upon the absence of any statutory link between
the bribe and the state or local government's receipt or use of federal benefits.
Because § 666(a)(2) does not link the bribe to federal benefits, the statute
26
encompasses and punishes conduct well beyond Congress' ability to "provide for the
. . . general Welfare of the United States." U.S. Const. Art. I, § 8, cl. 1. Indeed, the
statute's breadth leads to absurd results: only by injecting a new element into the
statute can a court forestall the conviction of a person who bribes the city meat
inspector while the city parks department receives $10,000 in federal benefits. See
United States v. Santopietro, 166 F.3d 88, 93 (2d Cir. 1999). The majority wisely
rejects the supposed Spending Clause moorings of § 666(a)(2).
Had the majority stopped at this point, I would have joined its opinion. The
majority continues onward, however, reaching beyond its Spending Clause analysis
and "resort[ing] to the last, best hope of those who defend ultra vires congressional
action, the Necessary and Proper Clause." Printz, 521 U.S. at 923. The majority
apparently casts aside its earlier qualm that § 666(a)(2) requires no connection
between the bribe and federal benefits. The majority instead perceives a bare,
"rational relationship" between punishing bribers and maintaining the integrity of
federal programs, and on that basis declares the Necessary and Proper Clause a proper
font of congressional authority. This may be correct, but it answers only half the
question we must decide.
II
In my view, the principal defect in the majority opinion is its inattention to the
conjunctive "and" that separates the words "necessary and proper." The majority
advances several arguments suggesting § 666(a)(2) is "necessary," in the sense
envisioned in M'Culloch v. Maryland, 17 U.S. (4 Wheat.) 316, 420-21 (1819). But
the majority fails to ask—let alone resolve—whether the statute is also "proper."
This is not merely a semantic dispute, for in Printz and Alden the Supreme Court
advanced an interpretation of "proper" that calls into question the constitutionality of
federal statutes that trespass upon the domain of state and local legislative power.
Section 666(a)(2) is one such statute.
27
M'Culloch holds that Congress enjoys broad powers to select the means of
enacting its objectives. Id. at 421. Thus, in determining whether a law is "necessary,"
courts must review Congress' law-making efforts with considerable deference. The
majority describes this deference in terms of rationality: courts may not demand of
Congress anything more than a rational relationship between its chosen means and
ends. This reading of M'Culloch is, of course, received wisdom. Applying
M'Culloch in this fashion, the majority makes a fairly convincing argument that the
"fit" between § 666(a)(2) and Congress' underlying objective to preserve the integrity
of federal programs is rational. However, because there is a rational relationship
between Congress' aim and the law it enacted, under M'Culloch, the law is
"necessary." But M'Culloch says very little, if anything, about what makes a law
"proper." That specific question largely evaded the Court's attention until Printz and
Alden.
Printz began bridging this doctrinal gap by drawing upon a law review article
that develops a legal and historical distinction between "necessary" laws and "proper"
ones. Gary Lawson & Patricia B. Granger, The "Proper" Scope of Federal Power: A
Jurisdictional Interpretation of the Sweeping Clause, 43 Duke L.J. 267 (1993). Printz
rejected the argument that Congress could commandeer state officials to implement
certain federal mandates by using its Necessary and Proper Clause power to effectuate
its Commerce Clause authority. 521 U.S. at 923-24. Relying solely on its
understanding of what constitutes a "proper" law, the Court held the Necessary and
Proper Clause forbids Congress from enacting legislation that intrudes on state
sovereignty.
When a "La[w] . . . for carrying into Execution" the Commerce Clause
violates the principle of state sovereignty reflected in [the Constitution,]
it is not a "La[w] . . . proper for carrying into Execution the Commerce
Clause," and is thus, in the words of The Federalist, "merely [an] ac[t]
of usurpation" which "deserve[s] to be treated as such."
28
Id. (emphasis in original; internal citations omitted). Like Printz, Alden recognized
the word "proper" restricts the scope of legislative power. Alden continued the
Court's analysis of "proper" laws by rejecting the argument that the Necessary and
Proper Clause conferred authority on Congress to subject unconsenting states to suit
in state court "as a means of achieving objectives otherwise within the scope of the
enumerated powers." 527 U.S. at 732.
The Court's analysis in Printz and Alden rested entirely upon the propriety of
a statute, not whether that statute was necessary. A law is "proper," the Court
maintained, if it respects both the Constitution's limits on federal power and its grants
of power to the states and the people. Printz, 521 U.S. at 918-22, 923-24. These
cases teach us that a law is "proper" for the enforcement of an enumerated power only
if it hews to constitutional principles of limited federal government and state
sovereignty. Federal laws that usurp the traditional domain of state authority are
therefore not "proper."
I believe § 666(a)(2) lies outside the guideposts erected in Printz and Alden for
assessing a "proper" law. The statute intrudes upon state and local concerns by
federalizing anticorruption law, which is traditionally the domain of state and local
legislation. See United States v. Bass, 404 U.S. 336, 349 (1971) ("Congress has
traditionally been reluctant to define as a federal crime conduct readily denounced as
criminal by the States. This congressional policy is rooted in the same concepts of
American federalism that have provided the basis for judge-made doctrines. . . . [W]e
will not be quick to assume that Congress has meant to effect a significant change in
the sensitive relation between federal and state criminal jurisdiction.") (internal
citations omitted) (cited in Lopez, 514 U.S. at 561 n.3). Section 666(a)(2) thereby
offends the Constitution's basic limitations on federal power. The only possible
relationship between § 666(a)(2) and federal interests is the sum of $10,000 in federal
benefits received each year by state or local governments. There is scarcely any limit
to this relationship, however. Even under a narrow view of "federal benefits," Fischer
29
v. United States, 529 U.S. 667, 681 (2000), it is beyond dispute that every state—and
nearly every county, tribe and city—receives that sum in yearly federal benefits.
Moreover, the statute requires no connection between those federal benefits and the
bribe. The lack of any connection makes all too real the risk that federal
anticorruption efforts will swamp state and local efforts to combat bribery.
The majority suggests the federal interest in punishing bribery of state and local
government officials is at least as great as the federal interest in punishing those who
misapply funds belonging to state banks. Westfall v. United States, 274 U.S. 256,
258-59 (1927). But the statute in Westfall included an element establishing a federal
interest in every prosecution—the state bank had to be a member of the Federal
Reserve System. Misapplication of a bank's funds weakened the entire membership
of the Reserve, so the Supreme Court could easily identify the federal interest in
protecting each bank's assets. Westfall therefore adds nothing to the majority's
argument. If anything, Westfall proves my point: Congress cannot enact criminal
laws absent a quantifiable federal interest in punishment.
Both the majority and the Eleventh Circuit in United States v. Edgar, 304 F.3d
1320, 1326 (11th Cir. 2002), sanction this federalization of anticorruption law. They
all but admit that once the federal government provides $10,000 in yearly benefits to
a state or local government, the federal government obtains an ongoing interest in the
entire structure and operations of state and local governments, and in the credibility
and integrity of their agents. Congress may, in effect, regulate (in this case,
criminalize) many activities that tangentially threaten that structure, credibility or
integrity. The real-world effects are truly startling. It is now a federal crime for an
auto mechanic to induce a public high school principal to hire him to teach shop class
by offering free car repair. This federalization of anticorruption law erodes the
Constitution's limits on federal power.
30
The majority's sweeping view of the Necessary and Proper Clause calls to mind
Congress' unbounded deployment of its Commerce Clause authority before Lopez and
Morrison. Both Lopez and Morrison curtailed federal power, forbidding Congress
from piling "inference upon inference" to demonstrate a relationship between crimes
and federal interests. Lopez, 514 U.S. at 566; Morrison, 529 U.S. at 615. I fear
Congress relied upon similarly weak and attenuated inferences in enacting §
666(a)(2). For many of the same concerns articulated in Lopez and Morrison, I am
troubled by the majority's efforts to interpret the Necessary and Proper Clause to
permit the federalization of criminal laws. "Were the Federal Government to take
over the regulation of entire areas of traditional state concern, areas having nothing
to do with the regulation of commercial activities, the boundaries between the spheres
of federal and state authority would blur." Lopez, 514 U.S. at 577. This is precisely
what makes § 666(a)(2) not "proper."
I recognize, of course, § 666(a)(2) does not preempt state or local power to
punish corruption. Even though § 666(a)(2) lacks preemptive effect, the sheer size
and funding of the federal government's criminal justice machinery suggests the
possibility of state and local anticorruption efforts dwindling. It blinks at reality to
believe § 666(a)(2) does no more than provide an additional weapon in the
anticorruption arsenal. By inserting itself into a domain traditionally reserved for
state and local prosecutions, the federal government treats state governments, for
example, not with the respect and dignity due them as "residuary sovereigns and joint
participants in the Nation's governance," Alden, 527 U.S. at 748-49, but as
untrustworthy organs incapable of policing their own. The development and
enforcement of sound ethical standards, and of political accountability to citizens for
failing to do so, lies at the very heart of sovereignty. See Printz, 521 U.S. at 920("The Constitution thus contemplates that a State's government will represent and
remain accountable to its own citizens."); New York v. United States, 505 U.S. 144,
168-69 (1992).
31
Section 666(a)(2) upsets the delicate balance between federal and state
authority that animates our Constitution. See id. at 921; Alden, 527 U.S. at 751.
"Congress has no more power to punish theft from the beneficiaries of its largesse
than it has to punish theft from anyone else. . . . The Constitution does not
contemplate that federal regulatory power should tag along after federal money like
a hungry dog." United States v. Morgan, 230 F.3d 1067, 1074 (8th Cir. 2000) (Bye,
J., specially concurring) (quoting David E. Engdahl, The Spending Power, 44 Duke
L.J. 1, 92 (1994)).
III
I do not believe § 666(a)(2) validly "carr[ies] into [e]xecution" Congress'
Spending Clause authority because the statute sweeps within its ambit a wide range
of criminal activity bearing little or no relation to federal interests. I am not alone in
this view. Even the government disavowed reliance on the Necessary and Proper
Clause when the question first arose at oral argument. The government never urged
our court to uphold § 666(a)(2) on the strength of Congress' Necessary and Proper
Clause power, and, when pressed, the government expressed considerable discomfort
with such a notion. For the reasons expressed above, I share the government's
discomfort with this argument, and therefore respectfully dissent.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
32