Court Weighs Challenge to Line-Item Veto

WASHINGTON —  The Line Item Veto Act presents a great constitutional question: Can Congress give the president extra power to reduce wasteful spending by allowing him to “cancel” some parts of spending and tax bills after he has signed them into law?

Scholars are divided. Some say that the Constitution gives the president an all-or-nothing choice: He must sign a bill into law in total, or veto it in total. Others say that the president has long been allowed to spend less than Congress appropriates. And some maintain that only Congress has the power to legislate.

But in the Supreme Court, the issue may depend in large part on Idaho potato farmers.

On Monday, as the justices heard arguments on the line-item veto, they spent much of the time questioning whether the Snake River potato farmers who brought the lawsuit challenging the authority were truly injured by a small tax change that President Clinton canceled last summer.

The outcome probably will turn on that issue. If the potato farmers have convinced the court that they suffered a real injury, the justices sounded inclined to strike down as unconstitutional the line-item veto, which Congress approved in 1996. If not, the high court may dismiss the lawsuit and wait for another case.

The justices do not decide abstract questions of law, insisting instead on deciding real lawsuits. Someone must have suffered an “actual injury” of some sort and assert that it was caused by an illegal action.

Last year, the court dismissed a challenge to the line-item veto filed by Sen. Robert C. Byrd (D-W. Va.) and five other lawmakers because they had no standing to sue. The lawmakers were not personally injured, the justices said, but instead were just complaining about a law that they had opposed in Congress.

Referring to the prospect that the same flaw may afflict the current challenge to the veto, Justice Antonin Scalia said Monday: “It’s disappointing. We went into the big windup last year without a pitch.” And it may happen again, he added.

The justices heard a combined lawsuit filed by the Snake River Potato Growers and New York City health officials, both of whom maintain that they were hurt last summer by Clinton’s use of the line-item veto.

The independent potato growers formed cooperatives that seek to buy storage facilities and processing plants in Idaho. Congress made a small tax change that would encourage families who owned such facilities to sell them directly to the farmers. However, before the farmers could take advantage of the tax break, Clinton canceled it with a line-item veto.

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“Though well-intended,” the tax benefit to help small farmers “is poorly designed [and] could have benefited not only traditional farm co-ops but giant organizations,” he said in August.

Clinton also canceled a special provision that would have shielded New York from having to repay as much as $2.6 billion in Medicaid funds. Most of the money would have come from New York City.

Lawyers for the Idaho potato growers and New York City health officials sued, asserting that Clinton’s veto was unconstitutional. In February, they won before a federal judge in Washington, who struck down the law.

But Scalia disputed whether the farmers had standing to sue, since the tax break helped the sellers. “Why isn’t the seller here?” he asked Louis Cohen, a lawyer for the farmers. “None of these provisions directly [affects] your client at all.”

Justice Ruth Bader Ginsburg, also a stickler for proper procedures, said that New York state officials could have challenged Clinton’s cut in funds to its state Medicaid program. Instead, the lawsuit was filed by the city of New York. “That’s puzzling.”

Injecting a practical note, Chief Justice William H. Rehnquist said that the high cost of bringing a lawsuit all the way to the Supreme Court may have dissuaded others.

U.S. Solicitor General Seth Waxman urged the court to throw out the case on standing grounds. New York City officials “have not been denied a single dollar” because of Clinton’s action, and the Snake River potato growers “have not shown they were affected” by the tax change for the owners of the processing plants, he said.

But Waxman also insisted that the law is constitutional and, indeed, is little different from long-standing practice. Under the new law, the president “is exercising a discretionary authority that Congress has granted him,” he said.

But Ginsburg noted that the Constitution gives Congress alone the authority to legislate, and, if the president can change bills that were signed into law, “that sounds like legislating, no matter what legal dressing you want to give it.”

The court will hand down a decision in the case (Clinton vs. City of New York, and Rubin vs. Snake River Potato Growers, 97-1374) by July.