Archives of the Mayor's Press Office

Date: Monday, July 6, 1998

Release #313 -98

Contact: Colleen Roche/Jennifer Chait (212) 788-2958



Mayor Rudolph W. Giuliani today congratulated Senators Alfonse D'Amato and Daniel Patrick Moynihan on the crucial roles they played in protecting $2.6 billion in Medicaid funding for New York City and State. On June 25, the U.S. Supreme Court, by a 6-3 margin, struck down as unconstitutional the Line Item Veto Act adopted by Congress in 1996. The decision protects New York City hospitals against a loss of federal Medicaid funds that could have been as great as $2.6 billion.

Joining the Mayor and Senators at today's press conference were Stanley Hill, Executive Director of District Council 37; Dennis Rivera, President of Local 1199; and Kenneth E. Raske, President of the Greater New York Hospital Association, all of whom were co-plaintiffs with the City in its lawsuit.

"The decision by the U.S. Supreme Court is a great victory for the people of the City, the State and for the Constitution of the United States," Mayor Giuliani said. "I want to reiterate my strong support for the concept of the Presidential Line Item Veto but it was clear that the specific statute under which it was created was unconstitutional.

"There are many individuals and organizations to thank for their efforts in helping the City to reverse a decision that would have limited Medical coverage for the poor and uninsured," the Mayor continued. " I want to thank Senator D'Amato for his work in passing the Medicaid law that saved the Medicaid program, and Senator Moynihan for filing an amicus curiae brief and for his ongoing efforts to ensure that the Line Item Veto was tested in court to see that it met the full measure of the Constitution. I also want to thank the support of Stanley Hill and District Council 37, Dennis Rivera and Local 1199, Ken Raske and the Greater New York Hospital Association, and Jamaica Hospital Medical Center for joining us as co-plaintiffs in this suit."

Senator Alfonse D'Amato said, "This victory for the children and poor of New York who need health care is all the more sweet because it was once in doubt. I am proud to have worked with Senator Moynihan, Mayor Giuliani and Governor Pataki to protect those most in need in New York."

Senator Daniel Patrick Moynihan said, "Together, we have saved the Constitution, and, at the same moment, saved approximately $2.6 billion for New York State. I would particularly like to thank Mayor Giuliani, who stepped up to this issue when many people suggested he ought not to. The Line Item Veto is the most important issue concerning the relationship between the legislative and executive branches to have arisen in more than two centuries of Constitutional government. Greater still, however, is the reward for New York. Senator D'Amato and I were able to ensure a provision that we would receive reimbursement from the Federal Government for a change in the Medicaid payments formula. This provision is once again the law. And the $2.6 billion contingent liability will no longer threaten hospitals and their employees throughout our state."

Executive Director of DC 37 Stanley Hill said, "When DC 37 joined the City of New York as a plaintiff in this landmark lawsuit against President Clinton's use of the Line Item Veto, we knew that it was the right thing to do to stop a wrong decision carried out in the name of an unfair and unconstitutional law. The President's ill-advised veto would have denied the needed funding for the Health and Hospitals Corporation. The Supreme Court's decision upheld our conviction that the law was wrong in the first place."

President of Greater New York Hospital Association Kenneth E. Raske said, "The health care community is extraordinarily pleased by the U.S. Supreme Court's decision to strike down the Line Item Veto Act, declaring it unconstitutional. President Clinton's first use of the Line Item Veto canceled a provision that protected New York's system of care for all New Yorkers, particularly the poor and uninsured. This decision is an important victory for our patients and for all New Yorkers."

U.S. Supreme Court Justice Anthony M. Kennedy in his concurring statement agreed with the City in its case City of New York vs. Clinton filed on October 16, 1997 that the Line Item Veto Act violates the Constitution by changing the procedure for enactment of Federal laws. Under the Constitution, a bill passed by Congress may be signed into law or vetoed in its entirety by the President. "Failure of political will does not justify unconstitutional remedies," he wrote.

The U.S. Supreme Court decision has a tremendous practical and financial impact on the City. For several years, the Federal government has been threatening to withdraw Medicaid funds for New York's health care system because of a dispute about how New York funds health care for the poor. In the Balanced Budget Act of 1997, Congress had accepted New York's position and guaranteed its funds. President Clinton signed the Balanced Budget Act, but then wielded the line item veto to remove the protections given New York by Congress.

On February 12, 1998, Washington D.C. Federal District Court Judge Thomas F. Hogan declared the Line Item Veto Act of 1996 unconstitutional, citing the need for a constitutional amendment for such a power to be given to the President. When it adopted the Line Item Veto Act, Congress built in a provision for expedited judicial review. Accordingly, the decision was appealed to the U.S. Supreme Court which made its final decision in favor of the City.

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