District Court lets stand Branstad veto of mental health institute funding

Polk County District Court Judge Douglas Staskal has dismissed a lawsuit challenging Governor Terry Branstad’s authority to veto funding intended to keep two in-patient mental health facilities open. Twenty Democratic state lawmakers and the president of Iowa’s largest public-employee union filed the lawsuit in July, arguing that the governor’s line-item vetoes violated Iowa Code provisions requiring that the state “shall operate” mental health institutes in Mount Pleasant and Clarinda. But Judge Staskal found that “Existing statutes cannot limit the Governor’s item veto authority,” which “is of constitutional magnitude. The only limitations that have been placed on that authority have been derived from the language of the constitution itself. […] And, there is no language in the item veto provision which suggests a statutory limitation on the power it creates. It is elementary that, to the extent there is conflict between a constitutional provision and a statute, the constitution prevails.”

I enclose below longer excerpts from the court ruling, which can be read in full here. Mark Hedberg, the lead attorney representing the plaintiffs, told Bleeding Heartland they “are preparing an appeal” to the Iowa Supreme Court “and will ask that it be expedited.”

The first few pages of Judge Staskal’s ruling summarized the parties to the lawsuit, background facts, and the standards for summary judgment. On pages 3 and 4, the judge discussed the governor’s item veto authority, as outlined in the Iowa Constitution. Only appropriations bills are subject to an item veto. On page 5, the judge points out that the bills at issue in this lawsuit “are unquestionably ‘appropriation bills’ because they include allocations of money on their faces. They are, therefore, the types of bills which are subject to the Governor’s item veto power.”

Beginning near the bottom of page 5, the judge analyzed the plaintiffs’ arguments.

All of the Legislators’ arguments are premised on the contention that Iowa Code Sections 218 and 226 mandate the continued operation of the Mount Pleasant and Clarinda facilities. The Governor disputes the legitimacy of this premise. Because it does not make a difference in the outcome, the court assumes for the sake of argument that Iowa law does mandate the continued operation of the Mount Pleasant and Clarinda facilities.

The Legislators’ argument is twofold: (1) the statutory mandate of sections 218 and 226 operate in the same way as would a condition placed on a legislative appropriation; and (2) the statutory mandate of sections 218 and 226 operates as an independent limitation on the Governor’s item veto authority. The court addresses these arguments in turn.

1. Existing statutes are not conditions on appropriations.

The Legislators argue that sections 218 and 226 are “essentially [conditions] that [require] at least some funding for the institutes at Clarinda and Mount Pleasant. In order to eliminate all funding, as outlined statutorily, the Governor would be required to call a special session which would either change the Iowa Code or change the amount of funding provided to the operation of the mental health institutes.” Reply brief, p.2.

As stated earlier, the Iowa Supreme Court most recently discussed the meaning of “conditions” as it relates to item veto jurisprudence in Homan I. After noting that it had used several terms to describe what is meant by a “condition” on an appropriation, the Court stated that, regardless of terminology, a “condition” on an appropriation is ‘a provision in a bill that limits the use to which an appropriation may be put.’ Id. at 630, (emphasis added by this court)(citing and quoting from Rants, 684 N.W.2d at 205, n.3).

Thus, a “condition” on an appropriation is an explicit limitation on the appropriation itself. Sections 218 and 226 are not in the appropriation bills that the Governor vetoed, they are not themselves “bills” and they do not explicitly limit any appropriation. They cannot, therefore, be “conditions” on the appropriations included in those bills.

2. Existing statutes cannot limit the Governor’s item veto authority.

Relying primarily on the Court’s decision in AFSCME/Iowa Council 61 v. State, 484 N.W.2d 390 (Iowa 1992), the Legislators argue that Sections 218 and 226 are independent, external to the constitution, limitations on the Governor’s item veto power. AFSCME involved a dispute between the State and the labor unions representing a substantial number of state employees. The parties arbitrated a wage dispute, in accordance with Iowa law. The arbitration decision favored the employees, and the legislature passed an appropriations bill to fund the wage increase awarded. The Governor vetoed that appropriation. The employees brought an action “to enforce the [arbitration] awards.” Id. The Court held that the arbitration award was binding on the State. Id.

The Legislators assert that the Court’s holding in AFSCME demonstrates that there are independent, extra-constitution limitations on the Governor’s item veto authority. They liken the mandate of sections 218 and 226 to the arbitration award that was at issue in AFSCME and argue that an existing statutory mandate is at least as powerful a counterweight to the Governor’s item veto authority as is the contractual award of an arbitrator in a labor dispute.

AFSCME does not support the Legislator’s argument because it is not an item veto case and it does not do what the Legislators suggest. […] the issue in AFSCME was whether an arbitration award amounted to a binding contract with the State. The validity of the Governor’s veto was not at issue. On that point, the Court stated:

We do not hold that the governor’s veto was invalid. Our holding is only that the trial court was correct in its determination that the arbitration decisions amounted to binding obligations of the State, a matter that was not adjudicated at the time of the veto. The governor had the power to veto the particular appropriation bill in question. We affirm the trial court finding that the governor did not act in bad faith in exercising it. See Iowa Const. art. IV, § 9.2
Id. at 395

There is some later language in the AFSCME decision that, it could be argued, implies that the Court would have found the veto to be improper if a court had adjudicated the enforceability of the arbitration award before the Governor exercised the veto. Id. (“It was entirely appropriate for the governor to secure a judicial determination of the validity or enforceability of the arbitration decisions before acting to fund the awards.”). From this, one could argue that the veto at issue in this case cannot be justified because the enforceability of sections 218 and 226 is not up in the air – no Court decision is required to know that those sections are existing, enforceable statutes. But, even assuming that the implication of the quoted language is correct, one cannot legitimately make the equation necessary to support the Legislators’ argument. Quoting Alexander Hamilton, the AFSCME court makes clear that the right at issue in that case (the State’s obligation to honor its contracts) was “justly considered as excepted out of [the State’s] power to legislate unless in aid of [the obligation].” Id. So, if the State’s obligation to honor a contract is a limit on the Governor’s authority to veto legislation intended to carry out the obligation, it is likewise a limit on the power of the legislature either to take action to interfere with the obligation or, perhaps, even to refuse to take action “in aid of” it.

No similar right or interest places the dispute in this case outside the scope of the constitutionally-intended manner of operation of the legislative and executive branches of government. The Governor’s veto was clearly legitimate by the well-established standards already discussed. The veto does not interfere with or contravene any contractual obligation of the State. And the legislature has the constitutional authority, as it would with any other veto, to override it. Iowa Const. Art. III, § 16.

Moreover, when the issue here is reduced to resolving a conflict between the Governor’s authority and the operation of a statute, the Governor’s authority must prevail. The Governor’s item veto authority is of constitutional magnitude. The only limitations that have been placed on that authority have been derived from the language of the constitution itself. Rants, 684 N.W.2d at 203. And, there is no language in the item veto provision which suggests a statutory limitation on the power it creates. It is elementary that, to the extent there is conflict between a constitutional provision and a statute, the constitution prevails. See Varnum v. Brien, 763 N.W.2d 862, 875–76 (Iowa 2009) (discussing constitutional supremacy).

Judge Staskal also found that “adopting the Legislators’ position would create fundamental separation of power problems,” for two reasons (page 10).

First, if the scope of one branch’s constitutional authority is to be curtailed at the point at which it interferes with an existing statute, the legislature could completely eliminate the Governor’s item veto authority by placing language in any statute prohibiting the Governor from vetoing any appropriation associated with carrying out that statute. Further, the judicial branch’s constitutional authority of judicial review would be meaningless since it could not be exercised whenever it resulted in invalidating an existing statute.

Second, under the Legislators’ argument, the entire Iowa Code would become a limit on the executive branch’s item veto authority. The courts would be embroiled in endless litigation over the legitimacy of a veto that arguably interfered with the operation of an existing statute.

In support of their argument that there must be external limits on the Governor’s item veto power, the Legislators posited the hypothetical of the Governor vetoing the entire appropriation for the judicial branch, thereby eliminating an entire branch of government. While this is an interesting scenario to ponder, it is not the scenario at issue. The Governor’s veto does not conflict with any other provision of the constitution. This would likely be a different case if the veto at issue placed two constitutional provisions at loggerheads.

In summary, the Iowa Constitution gives the Governor the power to use the item veto. The only limitations on that power are that the veto be of an “item” in an “appropriation bill.” When the Governor acts within those limitations in exercising his item veto power, he acts within constitutional bounds. The vetoes at issue in this case were of “items” within “appropriation bills.” The vetoes were, therefore, constitutional and must be upheld.

Judge Staskal granted the state’s motion for summary judgment, dismissing the lawsuit and assessing court costs to the plaintiffs.

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