This special report prepared by the Center for Practical Federalism at State Policy Network is derived from a 50-state analysis of multiple variables—our Federalism Scorecard—that reveal the vulnerability of states to influence by federal agency officials.

States that perform well on this Scorecard place authority over internal state agency operations, as well as the state’s relationship with federal agencies, in the hands of elected officials rather than unelected administrators. We include the extent to which state agencies are accountable to legislators in our analysis (rather than simply looking at state–federal relations), because federal agencies often exert power through their state counterparts. If elected officials don’t have visibility and oversight with regard to their own state’s agencies, in other words, they won’t be able to check federal influence over how their own laws and budgets are administered.

The first set of variables assesses the extent to which elected representatives properly govern state agencies, and the second set assesses the extent to which those representatives have visibility and authority over their state’s engagement with federal agencies. This report draws its reform recommendations from the best laws in “red” and “blue” states alike, consistent with the principle that citizens ought to be governed by people they elect.

Scorecard Highlights

Report Variables

For full explanations and footnotes please see the Federalism Scorecard

State Agency Influence

  • Every legislative committee can engage in some kind of oversight. Dedicated oversight committees, on the other hand, exist to hold investigatory hearings, report their findings, and make reform recommendations, where warranted, to the larger legislative body.

  • Some states have judicial precedent and practice that limit deference to agency interpretation, others have statutes restricting state court deference to agency interpretations, and a few have both.

  • Constraints on the ability of state agencies to lobby their own legislature are necessary to defend federalism because federal agencies can quietly influence state agency officials through a variety of means, in effect making them federal proxies in state capitals.

  • Some states have laws that subject regulations with estimated costs above a certain level to legislative review and approval.

  • While legislative review of regulations is a valuable and proper check on state agencies, this balance of power can be assisted by independent bodies tasked with ensuring that agencies are following state administrative procedures and otherwise complying with state laws.

  • Cost-benefit analysis (CBA) is a proven rubric for assessing the merit of regulations, and it provides overseers—be they legislators, independent review boards, or others—a means of making objective judgments that are consistent across issue and time. The two-part metric we employ includes CBA regulations as well as the availability of that analysis to the public.

  • When state agencies initiate some kind of action that a citizen believes is illegal or unconstitutional, it can be difficult for the citizen to get a hearing in court. Tennessee is the only state that currently guarantees the opportunity to seek injunctive relief for citizens harmed by state agency actions.

  • Legislative powers of oversight and regulatory review are more properly and thoroughly exercised when legislators have personnel and resources available to help them.

  • These laws ensure a proper balance of legislative and executive authority in the event of a statewide emergency.

Federal Agency Influence

  • It is imperative that a state’s elected representatives maintain both visibility and authority over the commitments and unreimbursed costs that states take on when they accept a federal grant.

  • Requiring elected officials’ approval for federal grants ensures unelected bureaucrats are not the ones agreeing to a grant’s conditions and hidden costs.

  • A number of states require some form of elected-official oversight for federal grants but have exemptions for entities such as public universities, enabling them to lobby federal agencies for rules that conflict with the interests of the state’s citizens and taxpayers.

  • There is no guarantee that most federal grants will continue to flow to states, yet many states fail to maintain even rudimentary plans for minimizing harm and disruption in the event of a delay, reduction, or cessation of federal funds.

  • Federal money isn’t free; it generates unreimbursed costs, and increasingly federal agencies threaten discontinuation to compel compliance with directives that bear little connection to the stated intent of the funds. States that fully account for these costs are in a better position to judge whether accepting any particular grant is truly in the best interest of their citizens.

  • Federal agencies can exert substantial influence over state and local governments through guidance. Although federal guidance is not law and is not legally binding on regulated parties, state agencies often treat it as if it carries the weight of law. Worse yet, some federal guidance crosses a legal boundary from clarification of existing regulation into formulation of new rules that are not authorized by statute.

    Because guidance is rarely examined by lawmakers or the public, it may lead to substantial alteration in state agency practices that contravene both law and the desires of citizens. Requiring a state agency to disclose federal guidance will shine a light on unlawful practices, enabling lawmakers to craft policies that best serve their communities

  • States are required to follow reporting guidelines for federal grants and have some visibility through websites such as USASpending.gov. This variable assesses individual states’ laws and practices around how they disclose receipt and expenditure of federal moneys, and in particular whether those practices yield transparency and public accessibility.

  • We focus on two significant State Implementation Plans (SIP): those tied to the Clean Air Act and to Medicaid administration. State agencies can change key elements of these SIPs without the agreement or knowledge of elected officials, and sometimes even with subsequent enforcement taken up by federal officials. States which require that changes to key SIPs be subjected to legislative scrutiny help guard against such secretive lawmaking.

  • Unelected state officials can influence federal policy in ways that circumvent the intentions of citizens as expressed through their elected representatives by spending millions lobbying federal agencies on all manner of legislation, spending, and rules governing the particulars of that spending.

  • The more dollars a state receives from federal agencies, the more vulnerable it is to agency demands. There are many reasons a state may receive an above-average percentage of its revenue from DC, and many of those reasons are beyond a state’s control. We incorporate this variable nonetheless, because it indicates a significant vulnerability to federal influence.