Earlier this year the Congress directed me to reduce expenditures by $6 billion and obligations by $18 billion. This was not a responsibility I sought. While I appreciate the sense of the Congress-as expressed in this bill-that federal moneys not be withheld from the highway program, I must still exercise the responsibility to carry out these stringent economy measures.

All Government programs are being scrutinized with care. Highway projects will not be immune from this study and funds will be provided or withheld in accordance with the congressional mandate to cut $6 billion from the Federal budget.

4 Pres. Doc. 1277-78 (1968).

The Executive Branch continued to assert its authority to defer obligations under the "sense of Congress" provision, and Congress again considered this action in the Federal-Aid Highway Act of 1970, P.L. 91-605, 84 Stat. 1714. Rather than amend the language to prohibit the President's action, section 107 of the 1970 Act merely "reiterates the sense of Congress as expressed in section 15 of the FederalAid Highway Act of 1968 relative to impoundment of apportioned Federal-aid highway funds." H. Rep. No. 91-1554, 91st Cong., 2d Sess., p. 19; see text of section 107 at p. 46.

At the same time that it declined to amend the "sense of Congress" provision in 23 U.S.C. 101 (c), Congress amended the immediately following subsection, 101 (d), containing the same "sense of Congress" language. This amendment was made in response to assertions that Congress must

demand that highway funds collected for the highways, be used for the highways. * * * The executive department does not have the right to determine that this Highway Trust Fund shall be used for other purposes.

116 Cong. Rec. 38945, remarks of Representative Bray. To accomplish this purpose, section 107 of the 1970 Act replaced the "sense of Congress" provision with language stating that "No funds authorized to be appropriated from the Highway Trust Fund shall be expended" for other than highway purposes. H. Rep. No. 91-1554, supra, pp. 60–61. The Committee report explains:

This section [107] also prohibits the expenditure of funds authorized to be appropriated from the Highway Trust fund *** for other than highway purposes.

ld., p. 47.

We fail to see how Congress could have expressed more clearly its intent not to require the President to expand all apportioned highway funds. Congress was confronted with Presidential action (1) deferring apportioned funds and (2) using highway funds for other purposes; in each case the President had acted under similar "sense of Congress" language. Congress responded by amending section 101 (d), replacing the "sense of Congress" provision with clearly mandatory language to "prohibit" non-highway use of these funds. But Congress deliberately left intact the language which the President claimed left him with discretion to defer obligational authority. This action can only be construed as a ratification of the President's discretion under the Act.

On a number of other occasions, Congress has rejected efforts to amend section 101 (c) to make that section mandatory. S. 4049 was introduced in the second session of the 90th Congress to exempt highway funds from the spending limitations imposed by the Revenue Expenditures and Control Act of 1968, supra. See 114 Cong. Rec. 27096-7. The bill was never reported out of committee.

Another bill, H.R. 1214 introduced in the first session of the 91st Congress, would have amended 23 U.S.C. 101 (c) by striking the horatory "sense of Congress" phrase and substituting mandatory terms prohibiting impoundment. See 115 Cong. Rec. 82. That bill was not enacted into law by Congress. Nor was S. 3877, introduced by Senator Bellmon in the second session of the ninety-second Congress. S. 3877 would have provided:

That no part of any sums authorized to be apportioned by the provisions of section 104 of title 23, United States Code, which have been apportioned by Congress for expenditure shall be impounded or withheld from obligation, for the purposes and projects as provided in that title, by an officer or employee of any department, agency, or instrumentality of the executive branch of the Federal Government.

See 118 Cong. Rec. S12418 (daily ed.). This bill was not reported out of the committee, nor was it contained in the House or Senate drafts of the Federal-Aid Highway Act of 1972.

Congress very recently reconsidered what response it should take to the fact that "in the past 5 years, the Executive Branch of the Government has adopted the practice of annually withholding portions of the authorized highway obligation

authority from the States." See S. Rep. 92-1081, 92nd Cong., 2d Sess., p. 18. S. 3939 provided for an "alternative Federal-Aid Highway Procedure" which "when implemented would prevent the withholding of apportioned highway funds." Id. This section would have added to the Highway Act a new section 174 (c), providing that funds apportioned to a State pursuant to section 104 shall be available for obligation by the State under the State's comprehensive procedure without restriction." Id., p. 126

228

Although S. 3939 passed the Senate, a number of Senators opposed the mandatory obligation provision of the bill. Senator Buckley, a member of the Senate Public Works Committee, stated his views as follows:

Control over the rate of spending on the federal highway program is exercised through the level of authorization (and appropriation) established by Congress and through the rate at which these funds are released by the Executive Branch within the constraints of its budget and priorities.

In this connection, I joined with Senator Cooper and others to strike seetion 133. ... I believe such a provision unwisely restricts a President in his options for confining federal expenditures to the limits of his budget in any given fiscal year.

S. Rep. No. 92–1081, supra, pp. 64–65. In offering an amendment to strike the section, Senator Cooper stated that the bill "would deny to the executive branch the authority to withhold funds," and that "[i]f a President were required to spend all of the money that Congress authorizes and appropriates, we would be in a worse fiscal situation than we are." 118 Cong. Rec. S14848 (daily ed.). Senator Bennett added:

I firmly support the administration position in opposition to this new chapter [Chapter 1-A, proposed by section 133]. Its effect upon the Federalaid highway program. I believe, will be most unfortunate. And, in the broader scope of managing Federal expenditures, there is no question that it would attempt to deny to the executive branch the authority to withhold funding. even in the face of economic crisis where such withholding would be the most prudent way to proceed.

I believe that any President should have sufficient management flexibility to determine program funding levels within the overall constraints of fiscal responsibility.

118 Cong. Rec. S15328 (daily ed.)

This viewpoint prevailed when S. 3939 was submitted to the House. H.R. 16656 struck the Senate language in its entirety, and the Federal-Aid Highway Act bill as passed by the House contained no provisions to deny the Executive Branch the authority to defer authorized and apportioned highway funds. See H. Rep. 92-1443, 92nd Cong., 2d Sess. The conference committee accepted the House version without mandatory spending requirements. See 118 Cong. Rec. H1292, H1619 (daily ed.).23

Thus, on at least six occasions since 1967, the Congress has considered amending the non-mandatory language of the Federal-Aid Highway Act to prohibit the President's deferral of highway funds, and has refused to prohibit such deferral. This fact, standing alone, completely undercuts the district court's holding that Congress intended that obligation be mandatory and that the President have no discretion to defer obligation. Congress has expressed its views regarding deferral of highway funds on other occasions as well.

For example, the legislative history of the Foreign Assistance Act of 1971 P.L. 92-226, 86 Stat. 20, reflects another approach to the imposition by Congress of mandatory spending requirements under the Federal-Aid Highway Act. During the first session of the ninety-second Congress, the Senate passed the foreign-aid bill, S. 2820. The bill contained a provision in section 108 (a) as follows:

(a) Except as otherwise provided in this section, none of the funds appropriated to carry out the provisions of this Act or the Foreign Military Sales Act shall be obligated or expended until the Comptroller General of the United States certifies to the Congress that all funds previously appropriated and thereafter impounded during the fiscal year 1971 for highway construc

22 Even those Senators who supported this measure acknowledged that the "sense of Congress" language did not bar withholding of apportioned funds. See remarks of Senator Randolph, 118 Cong. Rec. $14826 (daily ed.): "The alternative procedure of section 133 also seeks to eliminate the withholding of highway funds. It provides that once funds are apportioned to the States, the States have the authority to use them."

23 Congress adjourned prior to final action on the Federal-Aid Highway Act of 1972 (see Add. 2A).

tion, low-rent public housing, Model Cities, water and sewer grants, urban renewal, regional economic development, farm credit, and mass transportation has been released for obligation and expenditure. [Emphasis added.] See S. Rep. 92-432, 92d Cong., 1st Sess., p. 44. The House and Senate conferees, however, modified this section by striking the reference to highway construction funds, so that the bill required release only of funds for programs of "the Department of Agriculture, the Department of Housing and Urban Development, and the Department of Health, Education and Welfare." S. Rep. 92–590, 92d Cong., 1st Sess., p. 13; H. Rep. 92-761, 92d Cong., 1st Sess., p. 32.

Both houses accepted the conference report and the bill passed. See 117 Cong. Rec. S21909–21910 (daily ed.); 118 Cong. Rec. H243-252 (daily ed.). Senator Cooper explained that "[h]ighway funds are not affected by the section to which the Senator has referred," 117 Cong. Rec. S21905 (daily ed.), and Representative Morgan, one of the House managers, informed the House that the conferees "did not buy that language in the Senate bill and we did bring back a much more limited compromise." 118 Cong. Rec. H244 (daily ed.). Congress thus again considered, and rejected, the possibility of compelling the expenditure of deferred highway funds.

Finally, during debate in the past session of Congress on the Water Pollution Control Act, the issue of the rate of obligation of highway trust funds again arose. Representative Harsha, the ranking minority member of the Subcommittee on Roads of the House Public Works Committee and the Representative who had introduced the original proposal to compel obligation of highway funds, see fn. 22, supra, discussed language in the Water Pollution Control Act to "emphasize the President's flexibility to control the rate of spending ***." He commented:

Expenditures from the highway trust fund are made in accordance with similar contract authority provisions of those in this bill. Obviously expenditures and appropriations in the water pollution control bill could also be controlled. ***. Surely, if the administration can impound monies from the highway trust fund which does not have the flexibility of the language of the water pollution control bill, it can just as rightly control expenditures from the contract authority produced in this legislation by the same means. 118 Cong. Rec. H9122 (daily ed.).

24

In summary, the overwhelming weight of the legislative history demonstrates a deliberate Congressional refusal to require the Executive to release apportioned funds for obligation. This conscious Congressional decision was made with full knowledge that the Executive had deferred the release of highway funds. The district court was in error in finding a mandatory intent where Congress imposed none, and in requiring the Executive to expend funds which Congress had not seen fit to require expended.

3. The deferral of obligational authority is not inconsistent with the substantive provisions of the Federal Aid Highway Act. We have demonstrated that Congress has deliberately refused to require the immediate obligation of FederalAid Highway Act funds. This refusal plainly indicates that Congress felt the Act did not preclude the President from considering the state of the economy in determining the rate at which apportioned funds would be released. We now show that the substantive provisions of the statute do not compel a different conclusion. The Federal-Aid Highway Act provides for separate and distinct stages of authorization, apportionment, project and program approval (i.e., obligation) and expenditure. 23 U.S.C. 118, which provides that apportioned funds "shall be available for expenditure under the provisions of this title," does not give the states

24 While not specifically limited to the deferral of federal-aid highway funds, Congress has considered but failed to pass several proposals to preclude the President from withholding all impounded funds. In the ninety-second Congress, Representative O'Neill introduced a joint resolution instructing the President to release all impounded funds. See 117 Cong. Rec. H3011-3013 (daily ed.). The resolution was not adopted.

Following hearings on the general subject of impoundment, see Senate Hearings, supra, Senator Ervin introduced S. 2481 into the ninety-second Congress, 1st session. The bill was intended "to require the President to notify the Congress whenever he impounds funds, or authorizes the impounding of funds, and to provide a procedure under which the Senate and House of Representatives may approve the President's action or require the President to cease such action." 117 Cong. Rec. $15086. A comparable bill, H.R. 1264, was introduced in the House. 118 Cong. Rec. H364 (daily ed.).

These bills were not enacted. Instead, the Congress passed H.R. 16810, as P.L. 92-599, 86 Stat. 1324. 1326, which requires the President to inform Congress when funds are impounded. The statute apparently applies only to appropriated funds, see § 402, and thus is inapplicable to the deferral of highway trust fund apportionments. Compare § 3(b) of S. 2581, at 117 Cong. Rec. 15086, which defined impoundment to include "delaying the expenditure or obligation of funds beyond the close of the fiscal year in which expendi ture or obligation was intended by Congress in appropriating such funds."

any inchoate right to the apportioned funds. The thrust of this section is that apportioned funds are available for obligation for a period of two years after the end of the fiscal year for which they are authorized. It does not mean that the Secretary is under a mandatory duty to approve all projects which comply with the technical requirements of 23 U.S.C. 109 as soon as funds are apportioned.

Such an interpretation would be inconsistent with the pay-as-you-go principle underlying the Federal-Aid Highway program. Thus, when it appears that the balance in the Highway Trust Fund is or will be less than the sums apportioned among the states on the basis of the authorizations, the Secretary must limit the approvals of projects under 23 U.S.C. 106(a) to a figure within the sums estimated to be actually "available for expenditure." 25

Certainly it is not consistent with this approach to conclude, as did the district court, that the States have vested rights in the funds apportioned prior to the actual approval of projects under 23 U.S.C. 106 (a). In that section Congress EXplicitly provided that it is the Secretary's discretionary "approval of any such project [which] shall be deemed a contractual obligation of the Federal Government" to the state. No provision of the Act gives any state a vested right to the apportioned funds prior to such approval. See Massachusetts v. Connor, 248 F. Supp. 656 (D. Mass., 1966), affirmed on opinion below, 366 F. 2d 778 (C.A. 1. 1967).

That the substantive provisions of the Act do not preclude deferring FederalAid Highway Act funds is precisely the conclusion reached by the Comptroller General when Congress submitted the issue to him in 1967. See Comp. Gen. Dec. B-160891, February 24, 1967 (unreported). The Comptroller General, after analyzing the statutory language, concluded:

We find nothing in title 23 which specifically requires the Executive Branch to obligate in fiscal year 1967 all the Federal-aid highway funds available for obligation during that fiscal year, if it is determined not to be in the best interests of the United States to do so, nor are we aware of such a requirement in any other law.

(Add., p. 4A). Likewise the Attorney General has held that "nothing in Title S of the United States Code *** imposes upon the executive branch the duty to approve all qualifying projects for which apportioned funds are available.“ £ Opinions of the Attorney General 32 (Add. 12A).

In any event, on the facts of this case, Missouri has certainly failed to show that the Secretary's actions violated 23 U.S.C. 118. With regard to the availability of funds for expenditure, 23 U.S.C. 118(b) provides that

Such sums for any fiscal year shall be deemed to be expended if a sum equal to the total of the sums apportioned to the State for such fiscal year and previous fiscal years is covered by formal project agreements providing for the expenditures of funds authorized * *

The uncontroverted testimony of the Commission's own witnesses was that Missouri had been permitted to obligate both in fiscal 1971 and 1972 “the total of the sums apportioned to the State for such fiscal year and previous fiscal years" (See App. ). Clearly then the contract controls imposed did not deprive Missouri of any right conferred on it by the Act.

Finally, the district court suggested that deferring obligations in order to control inflation in the economy was impermissible because this authority was not contained in section 109 of the Act, 23 U.S.C. 109 (App. ). That section provides the standards the Secretary is to employ in determining whether to approve state-submitted plans and specifications. It has nothing whatever to do with the rate at which apportioned funds are to be obligated.

Although Congress has not specifically provided for deferring obligational authority to prevent substantial inflation, it has left the rate of expenditure to the President's discretion. More importantly, when informed that this was the basis for the President's action, it has implicitly ratified that decision. See above,

25 Congress has set forth in the Act's declaration of policy its intent that the interstate highway system "be completed as nearly as practicable over the period of availability" of the appropriations authorized. The Federal-Aid Highway Act of 1956 establishing that policy contemplated the completion of the interstate sistem 1971. Since then, tr reasons unrelated to the imposition of contract controls. Congress has extended that period to 1976, and the proposed Federal-Aid Highway Act of 1972 further extended the period to 1980. See S. Ren. No. 92-1081. 92nd Cong., 1st Sess., pp. 5. 73. Thus Congress clearly did not intend to impose a mandatory completion requirement, as indeed the use of the phrase "as soon as practicable" suggests. The deferral of obligational authority has resulted in only approximately a five month delay in completing the system, which in the context of the extension of the Act and the language used by Congress is insubstantial.

p. 34. Certainly, given this background, the choice of purposes for which the President may impound funds includes the need to control inflation in the economy."

26

B. The Commission's Suit to Compel Expenditure of Funds, Which the Legislative Branch Has Refused to Order Expended and Which the Executive Branch Had Determined Should Not Be Spent, Presents Political Questions Inappropriate For Judicial Resolution.

We have shown that the Executive Branch has determined that it is not in the National interest to obligate the full apportionments of federal-aid highway funds, and that Congress has refused to override the Executive's judgment to compel their expenditure. The Commission's attempt to compel action in an area committed to the coordinate political branches, which those branches have refused to take, clearly presents political questions inappropriate for judicial resolution. There can be no question that Congress possesses the power to directly attempt to impose mandatory spending requirements on the Executive Branch. That conclusion was repeatedly asserted by witnesses testifying before the Subcommittee on Separation of Powers. See, e.g., Senate Hearings, supra, pp. 26, 30, 33, 92, 147, 181, 241, 271, 276. Following those hearings, the Subcommittee Chairman, Senator Ervin, introduced a bill to require the Executive to report all impoundments, and giving Congress the right to veto or approve such action. See footnote, infra. Congress is thus well aware that it may attempt to assert this power, and has done so on occasion. See e.g., the Foreign Assistance Act of 1971, P.L. 92–226, 86 Stat. 20. In that bill Congress conditioned the granting of foreign aid funds upon the President's releasing other funds impounded for several Government agencies. See above, pp.

27

More recently, the Senate Committee on Banking, Housing and Urban Affairs approved an amendment to the Urban Mass Transportation Act of 1964 to provide "an additional $3 billion in contract authority” for capital financing. See S. Rep. No. 1103, 92nd Cong., 2d Sess., p. 5. In attempting to preclude impoundment, the Committee

asked during public hearings for assurance from Secretary Volpe that if the Congress authorizes the $3 billion contained in Title III of the bill and the appropriations follow that the funds would not be impounded. Secretary Volpe replied: "I did not start this fight until I was given assurance that every dollar that the Congress authorized and appropriated would be spent, because the needs are there, and I have that assurance." The Committee would expect this assurance to prove valid should the Congress approve the increased authorization.

Id., p. 8. Congress certainly has a variety of means to attempt, in the words of Senator Ervin, "to tell the President *** [to] spend the money we have made available here ***." Senate Hearings, supra, p. 33.

The question of whether these funds should be expended, then, is one between the coordinate political branches of the Federal Government, and does not present the justiciable controversy necessary to the exercise of judicial review. The Constitution does not commit to the judicial branch the responsibility for determining whether public funds should be spent and at what rate. It is well established that federal courts will not adjudicate political questions presented by court actions. See Powell v. McCormack, 395 U.S. 486, 518 (1969); Epstein v. Resor, 421 F. 2d 930 (C.A. 9, 1970), certiorari denied, 398 U.S. 965 (1970); Pauling v. McNamara, 331 F. 2d 796 (C.A.D.C., 1963), certiorari denied, 377 U.S. 933 (1964).

The limitation of obligational authority also may have substantial benefit to the highway program. In 1966, when obligational authority was first limited, highway construction prices had risen 12 percent in the previous 18 months. When funds were withheld, the construction cost index dropped by about 3 percent for several quarters. See Senate Hearings, supra, p. 113.

Congress recently increased the public debt limitation. P.L. 92-599, 80 Stat. 1324. In the committee report on this bill, the Senate Finance Committee commented that "[w]hen the country is faced with excessive economic stimulation, one way to meet the problem is to reduce the rate of increase in Federal expenditures ***" S. Rep. 92-1292, 92nd Cong., 2d Sess., p. 7.

Several administrative representatives, testifying before the Subcommittee, indicated Congress could attempt to halt impoundment of appropriated funds. E.g., Senate Hearings, supra, pp. 136-137 (testimony of Mr. Weinberger); p. 235 (testimony of Mr. Rehnquist). Mr. Rehnquist emphasized that the Executive Branch "has not taken any position on the matter." Id., p. 235.