practical necessity of federal intervention versus the ideal of federalism: An expansive view of section 666 in the prosecution of state and local corrutpion, The

Georgetown Law Journal, Jul 2001 by Salvatoriello, Paul

The Founding Fathers, I think, would have been surprised to find the federal courts trying cases of corruption of the New York City administration simply because one of the participants has rowed across the Hudson in the course of the criminal venture. Yet would one want truly serious offenses to go unprosecuted because of corruption or even extreme slackness in state or local law enforcement if a basis for federal criminal jurisdiction exists?

-Judge Henry Friendly1

INTRODUCTION

Beginning in the 1970s, the Department of Justice (DOJ) made it a priority to root out public corruption at all levels of government.2 In the spirit of this initiative, federal prosecutors have been particularly vigorous about targeting corruption at the state and local level.3 In fact, statistics show that thousands of state and local officials have been indicted on federal criminal charges and that this trend shows no sign of slowing down.4

Although Congress has considered, but never enacted, a general federal statute focused specifically on state and local corruption,5 federal prosecutors have resorted to charging state and local officials under an array of statutes that were not initially intended to target such corruption.6 These statutes include the Hobbs Act,7 the mail fraud statute,8 the Travel Act,9 and the Racketeer Influenced and Corrupt Organizations Act (RICO).10 Not surprisingly, such federal intervention in state affairs has sparked a significant controversy among courts and legal commentators.11

Judge Friendly, in the quotation above, succinctly articulates the fundamental issue in the debate surrounding the federal prosecution of state and local corruption.12 At its most basic level, the issue pits the intellectual ideal of federalism versus the practical necessity of federal intervention.13 Professor George D. Brown has noted that the recent trend in the Supreme Court favors federalism, as cases including Printz v. United States,14 United States v. Lopez,15 and New York v. United States16 reflect the Court's "renewed interest in curbing national authority in favor of state and local power."17 However, in the context of public corruption, one cannot deny the import of the opposing view, as stated by Whitney North Seymour, Jr., former United States Attorney for the Southern District of New York, that "[a]s long as law enforcement power is kept in the hands of those who are themselves corrupt, the public interest is frustrated."18

This ongoing debate has come to the forefront once again in the interpretation of 18 U.S.C. (sec) 666.(19) Entitled "Theft or bribery concerning programs receiving Federal funds," (sec) 666 makes it a federal crime for an agent of a state or local government20 that receives more than $10,000 in federal assistance in one year to (1) embezzle, steal, or obtain by fraud $5,000 or more from the state or local government, or (2) "corruptly" accept or give "anything of value" in connection with any business or transaction worth $5,000 or more to that state or local government.21 The issue at the core of this most recent federalism debate is whether (sec) 666, which is rooted in Congress's spending power,22 requires a connection between an act of theft or bribery involving a state or local official and a federal interest stemming from the federal funding that the state or local government receives.23

In Salinas v. United States,24 the United States Supreme Court upheld a conviction based on 666, but specifically left open the issue of whether the statute requires some connection between the theft or bribe and the expenditure of federal funds.25 In the last year, the federal circuit courts of appeals have split over this federal connection issue.26 Although no nexus between a bribe and a federal interest beyond the receipt of federal funds is explicitly stated in the statute, the Second Circuit and, most recently, the Third Circuit have found that courts must recognize a federal interest requirement when construing 666 in order to avoid upsetting the federal-state balance.27 Such a requirement may be a step in the spirit of federalism,28 but it also serves to substantially curtail the federal government's ability to ensure the integrity of the organizations that receive federal funding,29 and it risks permitting serious acts of state and local corruption to go unpunished.30

This Note explores how (sec) 666 jurisprudence has developed into the current split in the circuits and takes the position that reading a new federal connection requirement into (sec) 666, which essentially limits its effectiveness, is inappropriate under canons of statutory interpretation, under current spending power jurisprudence, and for reasons of public policy. Part I briefly discusses the purpose and legislative history of (sec) 666, reviews some early cases construing (sec) 666, and compares (sec) 666 to other statutes often used by federal prosecutors to pursue state and local corruption. Part II presents an analysis of the current conflict among the circuits on the federal connection issue. Part III establishes the reasons why the proposed federal connection requirement should not be read into (sec) 666. Finally, Part IV offers two proposals that would satisfy the ideal of federalism while not limiting federal power under (sec) 666 to prosecute state and local corruption that would otherwise go unprosecuted.