After consulting for months with the Conference and other Big 7 state and local groups, the White House issued a new Federalism Executive Order on August 4 which promises to substantially strengthen the partnership between the Administration and state and local governments. Consultation on the new order was developed in stark contrast to an order issued last year. President Clinton suspended the order (Executive Order 13083) after Big 7 groups complained that it was issued without consultation with state and local leaders and provided federal agencies increased authority to preempt state and local laws. After suspending the order, President Clinton ordered the White House staff to work with representatives of state and local governments to come up with a new order that meets the goals of the Administration and addresses the concerns raised by state and local officials.

In a joint letter to President Clinton signed on August 3 by Conference president and Denver Mayor Wellington Webb and the presidents of the other Big 7 organizations, state and local leaders thanked President Clinton for "consulting extensively with us" prior to the issuance of the new executive order. They also said "The executive order constructively responds to the concerns we raised during the consultations and provides to federal agencies strengthened guidance on the importance of federalism and state and local government authority. We welcome your commitment to implement and enforce this executive order."

The new order not only provides strengthened guidance to federal agencies but establishes an accountable process to ensure meaningful and timely state and local input in the development of regulations that have federalism implications. Each federal agency is directed to designate an official, within 90 days of the order, who will be principally responsible for the agency's implementation of the order. Also, when federal agencies transmit to the Office of Management and Budget (OMB) draft legislation or draft final regulations with federalism implications, they must certify that the requirements of the order have been met in a meaningful and timely manner.

Further, the order directs federal agencies to:

• closely examine statutory authority supporting any action that would limit the policymaking discretion of state and local governments and carefully assess the necessity for such action;

• construe federal statutes to preempt state law only where the exercise of state authority directly conflicts with the exercise of federal authority under the federal statutes or there is other clear evidence to conclude that Congress intended the agency to have the authority to preempt state law;

• not submit legislation that would directly regulate the states in ways that would interfere with functions essential to the states' separate existence; and not attach to federal grants conditions that are reasonably related to the purpose of the grant.