STATE OF SOUTH DAKOTA, PETITIONER V. ELIZABETH H. DOLE, SECRETARY OF TRANSPORTATION No. 86-260 In the Supreme Court of the United States October Term, 1986 On Writ of Certiorari to the United States Court of Appeals for the Eighth Circuit Brief for the Respondent TABLE OF CONTENTS Question Presented Opinions below Jurisdiction Statement Summary of argument Argument: Section 158 does not violate the Constitution A. Section 158 constitutes a permissible exercise of the spending power B. Section 158 does not violate the Tenth Amendment C. Section 158 is not invalid under the Twenty-first Amendment 1. The Twenty-first Amendment is not implicated where, as here, Congress seeks to encourage a state to impose more stringent restrictions upon the availability of alcoholic beverages 2. Section 158 does not violate the Twenty-first Amendment because it does not alter the authority of States to regulate the sale and consumption of alcoholic beverages 3. If a constitutional balancing test is required, Section 158 easily satisfies the relevant standard Conclusion OPINIONS BELOW The opinion of the court of appeals (Pet. App. A2-A23) is reported at 791 F.2d 628. The opinion of the district court (Pet. App. A24-A38) is unreported. JURISDICTION The judgment of the court of appeals (Pet. App. A39) was entered on May 21, 1986. The petition for a writ of certiorari was filed on August 18, 1986, and was granted on December 1, 1986. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). QUESTION PRESENTED Whether either the Tenth Amendment or the Twenty-first Amendment bars Congress from conditioning a grant of federal highway funds to a state upon the state's adoption of a minimum drinking age of 21. STATEMENT 1. In April 1982, President Reagan, noting that "half of all automobile deaths involve drunk drivers" (18 Weekly Comp. of Pres. Doc. 475 (Apr. 14, 1982)), established a Presidential Commission on Drunk Driving to investigate the problem and recommend solutions (Exec. Order No. 12358 (1982), 3 C.F.R. 179 (1983). The Commission issued a report approximately 18 months later. It found that between 1973 and 1983, "$250,000 Americans * * * tragically lost their lives in alcohol-related crashes. Conservative estimates place the annual economic loss at $21 billion, while others run as high as $24 billion. There is, of course, no way to measure the loss of human lives" (Presidential Commission on Drunk Driving, Final Report 1 (1983) (hereinafter cited as Presidential Commission Report)). The Commission concluded that action by government, as well as by private citizens and corporations, was needed to "reduce the carnage caused by driving under the influence (of alcohol)" (Presidential Commission Report 2). It emphasized that "public officials at all levels of government must take action to eliminate or reduce the public health hazard of driving under the influence and should be primarily responsible for assuring legal and judicial innovation and program implementation" (ibid.). The Report set forth a number of recommendations for action (id. at 6-23). The Commission made two major findings that are directly relevant to state laws establishing minimum legal drinking ages. First, the Commission found "evidence of a direct correlation between the minimum drinking age and alcohol-related crashes among the age groups affected. Studies have shown that raising the legal drinking age produced an average annual reduction of 28 percent in nighttime fatal crashes involving affected 18- to 21-year-old drivers. One of the studies indicated that if all remaining States raised the legal drinking age to 21, there would be 730 fewer young persons killed annually on United States highways" (Presidential Commission Report 10). Second, the Commission observed that although 19 states had adopted a minimum drinking age of 21, the lack of uniformity among the states resulted in "an incentive to drink and drive" because "young persons commut(ed) to border States where the drinking age is lower" (id. at 11). It concluded that "(t)here is simply no way to adequately address the needless tragedies caused by young persons commuting to border States except by establishing a uniform drinking age among the States" (ibid.). On the basis of these findings, the Commission recommended that the states "immediately adopt 21 years as the minimum legal purchasing and public possession age for all alcoholic beverages" (Presidential Commission Report 10). The Commission also recommended that Congress enact a statute conditioning the Secretary of Transportation's approval of federally funded highway projects within a state upon the state's adoption of a minimum drinking age of 21 (ibid.). Congress has also devoted attention to the drunk driving problem, holding hearings to gather information and consider possible solutions. Testimony at these hearings supported the Commission's findings regarding the lethal interstate consequences of the lack of uniformity in state minimum drinking ages. See, e.g., National Minimum Drinking Age: Hearing Before the Subcomm. on Alcoholism and Drug Abuse of the Senate Comm. on Labor and Human Resources, 98th Cong., 2d Sess. 2-20, 23-41 (1984); Measures to Combat Drunk Driving: Hearing Before the Subcomm. on Surface Transportation of the Senate Comm. on Commerce, Science, and Transportation, 98th Cong., 2d Sess. 7-12, 12-21 (1984); Prohibit the Sale of Alcoholic Beverages to Persons Under 21 Years of Age: Hearings Before the Subcomm. on Commerce, Transportation, and Tourism of the House Comm. on Energy and Commerce, 98th Cong., 1st Sess. 239-261, 261-276, 427, 449 (1983). As a result of these studies, Congress in 1984 adopted Section 158 of Title 23, which directs the Secretary of Transportation to withhold a portion of the federal funds that would otherwise be apportioned to a state for highway construction if the state permits "the purchase or public possession * * * of any alcoholic beverage" by a person less than 21 years of age. Act of July 17, 1984, Pub. L. No. 98-363, Section 6, 98 Stat. 437 (codified at 23 U.S.C. (Supp. III) 158). The statute provided for a grace period of two years -- fiscal years 1985 and 1986 -- in which federal highway grants would not be reduced. It directs the withholding in fiscal year 1987 of 5% of the funds that otherwise would be apportioned to a state under certain highway grant programs; in subsequent years, 10% of such funds are to be withheld. Pub. L. No. 99-272, Section 4104, 100 Stat. 114-115 (to be codified at 23 U.S.C. 158). If a state subsequently adopts a 21-year minimum drinking age, it may be entitled to recoup funds withheld in fiscal years 1987 and 1988 (ibid.). Section 158 originated as an amendment proposed on the floor of the Senate. The principal sponsors of the amendment, Senators Danforth and Lautenberg, emphasized that a uniform minimum drinking age of 21 would "significantly reduce the drunk driving problem" (130 Cong. Rec. S8207 (daily ed. June 26, 1984) (remarks of Sen. Danforth)). Senator Lautenberg observed that drunk driving is the leading cause of death among teenagers, resulting in half of all deaths in that age group; that "(t)eenagers make up 10 percent of licensed drivers, but account for 21 percent of alcohol-related fatalities"; and that the states that had raised the drinking age to 21 had experienced a significant reduction in drunk driving deaths among teenagers. Id. at S8209; see also id. at S8212 (remarks of Sen. Pell); ibid. (remarks of Sen. Heinz); id. at S8214 (remarks of Sen. Specter). The legislators stated that the adoption of Section 158 would address what they found to be "the interstate problem of varying drinking age" (130 Cong. Rec. S8217) (daily ed. June 26, 1984) (remarks of Sen. Lautenberg)). As Senator Danforth observed, "some States now have a 21-year-old drinking age, some States have an 18-year-old drinking age, and those who go from the higher -- namely the 21 -- to the lower age States in order to get a drink have today, through this patchwork (of different minimum drinking ages), an incentive to both drink and drive." Id. at S8219; see also id. at S8212 (remarks of Sen. Heinz) ("(t)his issue is truly a national one demanding congressional action because we are faced in some States with situations where a State has a 21-year-old drinking limit, but an adjacent States does not. The result is that we end up with blood borders where young people drive over the State line to get alcohol"); id. at S8214 (remarks of Sen. Specter); id. at S8228 (remarks of Sen. Mitchell). The sponsors of the measure made clear that it was designed to "encourage" states to adopt laws that would be uniform in this respect by imposing a condition on a modest portion of the federal highway funds granted to a state. See 130 Cong. Rec. S8207 (daily ed. June 26, 1984) (remarks of Sen. Danforth); id. at S8208 (remarks of Sen. Lautenberg); see also id. at S8225-S8226 (remarks of Sen. Mathias) (noting that the legislation did not "require() any state to make any changes in its laws relating to drinking" and that "it is perfectly proper for Washington to encourage States to do more to make our streets and highways safer, and to provide that encouragement through specific conditions on the spending power"); id. at S8231 (remarks of Sen. Exon) ("(w)e are simply saying to the States: 'If you see (fit) not to come into compliance with this law, you will lose a rather small proportion of the rather generous amount of money that comes from the Federal Government to improve and keep your highways and bridges in shape'"). /1/ In his remarks upon signing into law the bill that contained Section 158, President Reagan emphasized that the drunk driving problem "is bigger than the individual States. It's a grave national problem and it touches all our lives" (20 Weekly Comp. Pres. Doc. 1036 (July 17, 1984)). He observed that "(n)early every State that has raised the drinking age to 21 has produced a significant drop in the teenage driving fatalities," but noted that the fact that all states had not adopted that drinking age "leaves us with a crazy-quilt of different States' drinking laws and far too many blood borders, borders where teens drive across to reach States with lower drinking ages. And these teenagers drink and then careen home and all too often cause crippling or fatal accidents" (id. at 1035, 1036). The President concluded that Section 158 was "a judicious use of Federal power" that "will help persuade State legislators to act in the national interest to save our children's lives" (id. at 1036). /2/ 2. South Dakota permits persons 19 years of age and older to purchase beer containing up to 3.2 percent alcohol (S.D. Codified Laws Ann. Section 35-6-27 (1986)); it has not changed that rule since the enactment of Section 158. /3/ Fearing a reduction of its federal grant funds, petitioner commenced this action against the Secretary of Transportation in the United States District Court for the District of South Dakota. It sought a declaration that Section 158 is unconstitutional and an order barring the Secretary from withholding highway construction funds from states that fail to adopt a minimum drinking age of 21 (see Pet. App. A41-A51). The district court granted the Secretary's motion to dismiss, rejecting petitioner's claims that Section 158 is invalid because it violates the Tenth and Twenty-first Amendments (id. at A24-A38). The court of appeals unanimously affirmed (Pet. App. A2-A23). The court of appeals held that Section 158 is a valid exercise of Congress's power under the Spending Clause. It observed that this power "is quite expansive and without question includes the authority to attach conditions to the receipt and further expenditure of federal funds" (Pet. App. A7-A8 (citation omitted)). The court noted that in legislating under the Spending Clause, Congress must seek to advance the general welfare and that "any conditions imposed by Congress must be reasonably related to the national interest Congress seeks to advance" (id. at A8). But the court found that Section 158 easily satisfies these requirements (Pet. App. A12-A13): We believe Congress reasonably could have concluded the problem of young adults drinking and driving is not a purely local or intrastate concern but rather is a concern of interstate and national proportions. We further believe Congress, in its reasoned discretion, could determine that a uniform minimum drinking age would lessen that problem and improve the safety of our nation's highways for all Americans. Finally, we conclude Congress's decision to condition a portion of a state's federal highway funds on the adoption of a minimum drinking age of twenty-one is reasonably related to Congress's interest in achieving a nationally uniform minimum drinking age. The court of appeals then turned to petitioner's claim that Section 158 violates affirmative limitations upon Congress's authority contained in Section 2 of the Twenty-first Amendment, which provides that "the transportation or importation into any State * * * for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited." The court rejected petitioner's assertion that this language grants the states "all encompassing and exclusive * * * authority " (Pet. App. A14) to regulate the use of alcoholic beverages. The court held, rather, that "the twenty-first amendment was intended to effect a much narrower grant of authority. Specifically, the primary intent of the twenty-first amendment was to authorize the State (where it would otherwise be prohibited from doing so) to regulate directly the transportation or importation of liquor into the state, in effect, to create 'an exception to the normal operation of the Commerce Clause'" (Pet. App. A16 (citations omitted)). The court stated that state regulatory authority over alcoholic beverages flows not from the Twenty-first Amendment but rather from state police power (Pet. App. A15); and that "the state's power to regulate liquor is not exclusive" because Congress "retains its authority under the Commerce Clause to regulate interstate commerce in liquor" (id. at A17). The court of appeals concluded that Congress had the affirmative authority to adopt Section 158 because the Twenty-first Amendment "did not limit or withdraw Congress's ability to exercise authority under its existing delegated powers, including the spending power" (Pet. App. A18). The court of appeals next concluded that Section 158 could not be invalidated on the theory that it conflicted with South Dakota's law permitting 19-year-olds to buy beer. The court acknowledged that, "in the area of alcohol regulation, when state and federal law directly conflict, a balancing of the state and federal interests involved may result in state law prevailing over a conflicting federal enactment" (Pet. App. A18). But the court held that this principle applies only where "the two laws * * * actually conflict," and it concluded that "no conflict exists" here (id. at A19). Because Section 158 "necessarily recognizes the State's power to reject Congress's judgment and adopt and legally maintain any drinking age it chooses," the court noted, "South Dakota is entirely free to maintain its law as it now exists and will violate no federal law if it chooses to do so" (Pet. App. A19-A20). Finally, the court of appeals determined that Section 158 does not violate the Tenth Amendment. Relying upon Oklahoma v. Civil Service Comm'n, 330 U.S. 127 (1947), the court held that the Tenth Amendment is not violated when Congress attaches conditions to grants of federal funds. "(T)o the extent a state finds the conditions attached by Congress distasteful," the court said, "the state has available to it the simple expedient of refusing to yield to what it urges is 'federal coercion'" (Pet. App. A21 (citation omitted)). The court of appeals also noted (id. at A21-A22) that the State's Tenth Amendment argument was "further undermined" by this Court's decision in Garcia v. San Antonio Metropolitan Transit Authority, 469 U.S. 528 (1985). SUMMARY OF ARGUMENT Grants of federal funds helped the states to build highways that permit high-speed interstate automobile travel. An unfortunate collateral consequence of that federal program was to make it much easier for young people living in a state where the minimum drinking age is 21 to drive to and from neighboring states where alcohol is legally available to them. Such interstate travel by young people in search of alcohol all too frequently leads to accidents, both on federally funded highways and on other roads, that cause death and serious injury. Congress and President Reagan, finding that differences in state minimum drinking ages create "blood borders" that induce such interstate automobile travel by young people, concluded that Section 158 would be a "judicious use of Federal power" to encourage the states to eliminate blood borders by adopting a uniform minimum drinking age. Section 158 does not deny or limit the authority of the states to regulate the sale or use of alcoholic beverages within their borders. To the contrary, it proceeds from the assumption that the states alone will continue to exercise this authority. But it encourages the elimination of one instance of nonuniformity of state regulation that has proved to be lethal by imposing, on a modest portion of the funds available to a state under federal highway grant programs, the condition that the state maintain or adopt a minimum drinking age of 21. Section 158 is, we submit, a valid condition on an exercise of the Spending Power that violates neither the Tenth Amendment nor the Twenty-first Amendment. The petition for a writ of certiorari did not present the question whether Section 158 falls within Congress's power under the Spending Clause to impose conditions upon grants of federal funds. Since that question was decided below and is argued extensively by amici in this Court, we nevertheless address it and argue that the clear answer is yes. Section 158 promotes the general welfare by combatting a problem that is both national in scope and interstate in character -- drunk driving by teenagers crossing state lines in search of alcohol. The conclusion of Congress and the President that a uniform minimum drinking age of 21 would reduce interstate drunk driving by young people was plainly a reasonable one. Section 158 also bears an appropriate relation to the grant program to which it is attached: although one of the express purposes of that program is highway safety (see 23 U.S.C. 101(b)), federally funded highways make it easier for young people to reach and cross state lines in search of alcohol, and such highways are themselves made unsafe by teenage drunk drivers returning from states where they are permitted to drink. Section 158 does not violate the Tenth Amendment. This Court has long held that a condition imposed upon a federal grant pursuant to a valid exercise of the Spending Power cannot contravene the reserved rights of the states under the Tenth Amendment as long as the grant is not coercive and the state therefore has the "simple expedient" of declining both the grant and the condition. There is no basis for finding coercion here because the effect of Section 158 is quite limited. If a state chooses to maintain a minimum drinking age of less than 21, Section 158 provides for at most a 10% reduction in the funds otherwise available to the state under federal highway grant programs. This minor reduction in federal aid simply does not amount to coercion; the state retains the ability to decide for itself whether to forego the funds rather than comply with the condition. Section 158 does not violate the Twenty-first Amendment for three separate reasons. First, the Amendment does not reach this case at all. By its terms, it prohibits transportation, importation, delivery, or use of alcoholic beverages in violation of state law. Section 158 neither requires nor encourages any such activity, nor does it encourage any state to modify its law to legalize any transportation, importation, delivery or use previously prohibited. Second, Section 158 does not reduce the states' authority to regulate drinking. It presumes that they will continue to do so and merely encourages uniformity in one respect in order to alleviate a problem that is beyond the reach of any one state acting alone. There is no indication in the language or history of the Amendment that it was intended to prevent the federal government from encouraging the states, in a manner that passes muster under the Spending Clause and the Tenth Amentment, to exercise their acknowledged authority over alcohol in a particular way. Since Section 158 passes muster under the Tenth Amendment as a noncoercive exercise of the Spending Power, it does not violate the Twenty-first Amendment. Finally, if the Court deems it appropriate to develop a balancing test to determine whether an exercise of the Spending Power violates the Twenty-first Amendment (as it has for exercises of the Commerce Power), it is clear that the national interest in eliminating blood borders substantially exceeds South Dakota's interest in being able both to permit its own and neighboring states' young people to drink low alcohol beer and to receive the last ten percent of its federal highway grants. Especially because Section 158 does not eliminate the state's freedom of choice, but simply provides an incentive that the state is free to decline, the balance of interests favors the constitutionality of Section 158. ARGUMENT SECTION 158 DOES NOT VIOLATE THE CONSTITUTION Congress and the President concluded in 1984 that drunk teenagers were responsible for a large number of deaths on the Nation's highways, and that drunk driving by teenagers was actually encouraged by differences in minimum drinking ages in different states. In order to encourage states, which are principally responsible for regulating the sale and consumption of alcohol within their borders, to eliminate what it and the President concluded was a lethal nonuniformity in one feature of state regulation, Congress enacted Section 158, which conditions a small portion of the federal funds available to each state for highway construction -- five percent of certain programs in fiscal year 1987 and ten percent in subsequent years -- upon the state's adoption of a minimum drinking age of 21. Petitioner asserts that Section 158 violates limitations on Congress's authority imposed by the Tenth and Twenty-first Amendments and that, therefore, although petitioner declines to comply with the condition set forth in Section 158, it is nonetheless entitled to the federal funds that Congress has tied to this condition. But nothing in the Constitution prohibits Congress from seeking to alleviate a serious problem of national scope -- drunk driving by teenagers on the Nation's highways, a problem that stems in significant part from interstate travel by youths in search of a lower legal drinking age -- by encouraging through the mild incentive contained in Section 158 the adoption of a uniform minimum drinking age. This condition on a grant of federal funds serves a proper purpose and is reasonable and noncoercive. It does not impinge in any way on the state interests protected by the Twenty-first Amendment. A. Section 158 Constitutes A Permissible Exercise Of The Spending Power 1. The court of appeals held that, putting to one side petitioner's claims under the Tenth and Twenty-first Amendments, Section 158 is a valid exercise of Congress's power under the Spending Clause (Pet. App. A8-A13). Petitioner did not seek review by this Court of that determination. The questions presented in the petition for a writ of certiorari are limited to the validity of Section 158 under the Tenth and Twenty-first Amendments (see Pet. i). And petitioner does not argue in its brief on the merits that Section 158 violates any limitation upon congressional authority imposed by the Spending Clause. See Pet. Br. 52 ("(t)he State has never contended that the congressional action was unreasonable, or unrelated to a national concern in the absence of the Twenty-first Amendment"). We believe that petitioner's decision not to seek review of that determination forecloses any dispute about the Spending Clause in this Court. /4/ Some of the amici supporting petitioner have independently raised a Spending Clause challenge to the validity of Section 158. This Court's rules preclude consideration of a constitutional challenge raised by an amicus that was not presented in the petition. Sup. Ct. R. 21.1(a) ("(o)nly the questions set forth in the petition or fairly included therein will be considered by the Court"); see INS v. Cardoza-Fonseca, No. 85-782 (Mar. 9, 1987), slip op. 27 n.32. This is especially true where, as here, the party supported by the amicus has expressly declined to present the issue for review. We nevertheless briefly discuss the justifications for the court of appeals' ruling. 2. The Constitution empowers Congress to "lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common defence and general welfare of the United States" (Art. I, Section 8, Cl. 1). This Court has repeatedly recognized the breadth of this grant of authority to spend federal funds, observing that "(i)t is for Congress to decide which expenditures will promote the general welfare: '(T)he power of Congress to authorize expenditure of public moneys for public purposes is not limited by the direct grants of legislative powers found in the Constitution.' Any limitations upon the exercise of that granted power must be found elsewhere in the Constitution." Buckley v. Valeo, 424 U.S. 1, 90-91 (1976) (citation omitted); see also Helvering v. Davis, 301 U.S. 619, 640-641 (1937); United States v. Butler, 297 U.S. 1, 66 (1936). Congress's broad authority under the Spending Clause is not limited to selecting the purposes for which federal funds may be expended. "It is far from a novel proposition that pursuant to its powers under the Spending Clause, Congress may impose conditions on the receipt of federal funds, absent some independent constitutional bar." Lawrence County v. Lead-Deadwood School Dist. No. 40-1, 469 U.S. 256, 269-270 (1985) (footnote omitted); see also Fullilove v. Klutznick, 448 U.S. 448, 474 (1980) (opinion of Burger, C.J.), California Bankers Ass'n v. Shultz, 416 U.S. 21, 50 (1974); Lau v. Nichols, 414 U.S. 563, 569 (1974); King v. Smith, 392 U.S. 309, 333 n.34 (1968); Oklahoma v. Civil Service Comm'n, 330 U.S. 127, 144 (1947); Steward Machine Co. v. Davis, 301 U.S. 548, 590-591 (1937). And the Court has held that Congress may impose conditions upon federal grants that are not justified by reference to another of Congress's enumerated powers. Oklahoma v. Civil Service Comm'n, 330 U.S. at 142-143. To be sure, Congress's power under the Spending Clause is not unlimited. /5/ First, Congress may only exercise the Spending Power to promote the general welfare; it may not act merely to further a narrow or localized interest. Thus, a reviewing court must consider whether the congressional action furthers the general public interest. See Bowen v. Owens, No. 84-1905 (May 19, 1986), slip op. 5; Helvering v. Davis, 301 U.S. at 640; United States v. Butler, 297 U.S. at 67. Second, there are limits on the objectives that may be sought to be achieved through conditions to federal grants, although the Court has several times declined to define categorically what those limits are. See Fullilove v. Klutznick, 448 U.S. at 474 (opinion of Burger, C.J.); Lau v. Nichols, 414 U.S. at 569; cf. Steward Machine Co. v. Davis, 301 U.S. at 590-591. One theme, however, is that the condition must bear an appropriate relationship to the purposes of the spending program to which it is attached. See Massachusetts v. United States, 435 U.S. 444, 461 (1978) (plurality opinion) ("the Federal Government may impose appropriate conditions on the use of federal property or privileges and may require that state instrumentalities comply with conditions that are reasonably related to the federal interest in particular national projects or programs"); Ivanhoe Irrigation District v. McCracken, 357 U.S. 275, 295 (1958) (same); cf. Fleming v. Nestor, 363 U.S. 603, 611 (1960). The condition set forth in Section 158 promotes the general welfare. Congress reasonably concluded that drunk driving poses a significant threat to safety on the Nation's highways. It also concluded that differences in the minimum drinking ages in state drinking laws encourage young people to cross state lines to obtain alcoholic beverages, and because they frequently return to their home states by car shortly after drinking elsewhere, these differences in state laws lead directly to increased interstate drunk driving. Congress concluded, as did President Reagan, that the problem of "blood borders" is an interstate problem and that, while regulation of drinking is primarily a state matter, encouraging states to eliminate this instance of nonuniformity would be "a judicious use of Federal power." Far from being a police power measure randomly attached to a spending program, as amici suggest, Section 158 is a direct attempt to achieve one of the purposes -- and to combat a problem that is in part a collateral consequence -- of the major federal program to which it is attached. One of the express purposes of federal funding is "to increase the safety of (federally funded highway) systems to the maximum extent" (see 23 U.S.C. 101(b)). Paradoxically, however, federally funded highways make it easier for young people to cross state borders by automobile in search of alcohol, a search that all too often leads to serious accidents on federally funded highways and other roads. Section 158 is, we submit, an appropriate means to encourage states to act to eliminate a nonuniformity that creates an incentive to this misuse of the asset being funded. Amici National Conference of State Legislators, et al. (NCSL) argue that Congress's authority to impose conditions under the Spending Clause is limited to conditions that "specif(y) in some way how the (federal) money should be spent" (Br. 20). But that rule, if it is meant literally, is plainly too narrow. /6/ For example, when Congress provides a percentage of the funds for an activity, it frequently finds it necessary and proper to specify how the other funds for the activity will be spent. /7/ When Congress provides funds to build a special-purpose building, it may require that the building continue to be used for the specified purpose even though it is not funding any continuing activity. /8/ And Congress has imposed safety and antidiscrimination and handicapped-access conditions on work projects constructed with federal funds even though such conditions do not direct the use of the federal funds. /9/ By analogy, it seems clear that Congress may condition federal highway grants on the recipient state's denying alcoholic beverages to teenagers, who are likely to use highways constructed with federal funds to cross state lines in search of alcohol. In each of these cases, including the present one, there is a direct and strong relationship between the purposes of the federal exercise of the Spending Power and the imposition of the condition even though the condition does not itself direct the spending of the federal money. B. Section 158 Does Not Violate The Tenth Amendment This Court has made clear that Congress may attach some conditions to grants of federal funds to the states that it could not impose as direct regulations under any of its other enumerated powers. See, e.g., Lawrence County v. Lead-Deadwood School Dist. No. 40-1, 469 U.S. at 269-270; Lau v. Nichols, 414 U.S. at 569; King v. Smith, 392 U.S. at 333 n.34; Oklahoma v. Civil Service Comm'n, 330 U.S. at 142-144. The Court has repeatedly suggested that the Tenth Amendment bars Congress from exercising the Spending Power to force a state to comply with a federal rule that Congress could not impose directly; but such a grant condition is permissible as long as the state has the genuine option of avoiding the condition by rejecting the grant of federal funds. In Oklahoma v. Civil Service Comm'n, supra, for example, the Court rejected the claim that a condition upon a federal grant -- the requirement that state employees administering federal funds be subject to the standards set forth in the Hatch Act -- had a "coercive effect" that "interfer(ed) with the reserved powers of the state" (330 U.S. at 142). The Court observed that the mere fact that "the action taken by Congress does have an effect upon certain activities within the state" was not enough to implicate the Tenth Amendment because "Oklahoma adopted the 'simple expedient' of not yielding to what she urges is federal coercion." Id. at 143-144; see also Steward Machine Co. v. Davis, 301 U.S. at 590 (rejecting a Tenth Amendment challenge because the Court "(could) not say that (the state) was acting not of her unfettered will, but under the strain of a persuasion equivalent to undue influence" when it complied with the federally-imposed condition); Massachusetts v. Mellon, 262 U.S. 447, 482 (1923) (observing with respect to a condition on a federal grant that "the statute (did not) require the States to do or to yield anything. If Congress enacted it with the ulterior purpose of tempting them to yield, that purpose may be effectively frustrated by the simple expedient of not yielding"). The Court has characterized legislation enacted pursuant to the Spending Clause as "much in the nature of a contract: in return for federal funds, the States agree to comply with federally imposed conditions. The legitimacy of Congress' power to legislate under the spending power thus rests on whether the State voluntarily and knowingly accepts the terms of the 'contract'" (Pennhurst State School v. Halderman, 451 U.S. at 17). The contract analogy confirms that the relevant inquiry under the Tenth Amendment is whether the state has a genuine option of declining the grant and the condition -- the Tenth Amendment can be violated only if Congress has exercised the Spending Power in a manner that precludes the state from making that choice. A grant condition is not coercive simply because the potential loss of federal funds has some tendency to influence the state's decision to accede to the condition. The possible loss of federal aid is undoubtedly a consideration in a state's decision in virtually every case such as this. As the Court observed in Steward Machine Co. v. Davis, supra, "to hold that motive or temptation is equivalent to coercion is to plunge the law in endless difficulties" (301 U.S. at 589-590). The question is whether there is "the exertion of a power akin to undue influence" so that "pressure turns into compulsion, and ceases to be inducement" (ibid.). Judged in these terms, Section 158 cannot be characterized as coercive. To the contrary, the effects of Section 158 are quite limited. The statute provides for no reduction in federal highway grants for two years, a 5% decrease the following year, and a 10% decrease in subsequent years. A minor reduction in federal aid does not deprive the state of the genuine option of foregoing the funds rather than complying with the condition. See, e.g., Lau v. Nichols, supra (Court upheld condition where condition was tied to entire amount of federal grant); Oklahoma v. Civil Service Comm'n, supra (same); Oklahoma v. Schweiker, 655 F.2d 401, 413-414 (D.C. Cir. 1981) (collecting cases). /10/ Indeed, a contrary conclusion would call into question the validity of virtually every grant condition that Congress would not have had the power to impose as a direct regulation under one of its other enumerated powers, because in almost every case failure to comply with a grant condition may result in the loss of some funds. Since the states plainly retain the ability to choose not to comply with the statutory condition here, and the only consequence of such a decision is a small reduction in federal highway aid, Section 158 is plainly not coercive. /11/ Petitioner relies at several points in its brief (Br. 34, 39, 64) on the dissenting opinions in Garcia v. San Antonio Metropolitan Transit Authority, 469 U.S. 528 (1985), intimating that National League of Cities v. Usery, 426 U.S. 833 (1976), the decision that Garcia overruled, somehow supports petitioner's position here. But the rule enunciated in Natinal League of Cities and its progeny did not affect the Tenth Amendment standard governing Spending Clause enactments. /12/ Indeed, the Court's analysis in those decisions actually supports the rule for which we contend here. The Court concluded in National League of Cities that a principal evil of the application of minimum wage requirements to the states was that the federal statute "speaking directly to the States qua States, requires that they shall pay all but an extremely limited minority of their employees the minimum wage rates currently chosen by Congress" (426 U.S. at 847-848). "(I)t cannot be gainsaid," the Court observed, "that the federal requirement directly supplants the considered policy choices of the States' elected officials and administrators" (id. at 848 (emphasis added)). /13/ National League of Cities focused on the direct displacement of state policy choices by the federal government; it was the elimination of the state's discretion that was seen as a violation of the Tenth Amendment. Where a state voluntarily accedes to a condition on a federal grant, there has been no direct federal intervention and National League of Cities would not be implicated. Thus, even prior to Garcia, the courts of appeals uniformly concluded that the decision in National League of Cities did not alter the Tenth Amendment standard governing conditions on federal grants to the states. See Crawford v. Pittman, 708 F.2d 1028, 1036-1037 (5th Cir. 1983); Oklahoma v. Schweiker, 655 F.2d at 411-414; New Hampshire Dep't of Employment Security v. Marshall, 616 F.2d 240, 247 (1st Cir.), appeal dismissed, 449 U.S. 806 (1980); Walker Field Public Airport Authority v. Adams, 606 F.2d 290, 297 (10th Cir. 1979); North Carolina ex rel. Morrow v. Califano, 445 F. Supp. 532, 536 & n.10 (E.D.N.C. 1977) (three-judge court), aff'd mem., 435 U.S. 962 (1978); cf. FERC v. Mississippi, 456 U.S. 742, 766 (1982). /14/ C. Section 158 Is Not Invalid Under The Twenty-first Amendment Petitioner contends that under Section 2 of the Twenty-first Amendment the states have plenary authority to regulate the sale and consumption of alcoholic beverages within their borders and that Section 158 violates the Amendment because it seeks to influence the states' exercise of that authority. That contention is wrong for three reasons. First, neither the text of Section 2 nor any decision of this Court suggests that Section 2 confers on the states plenary authority to permit their nineteen- and twenty-year olds, and those of neighboring states, to drink alcoholic beverages; to the contrary, an otherwise valid federal restriction on teenage drinking would not contravene the language of Section 2 at all. Second, Section 158 does not reduce the states' authority to regulate drinking; Section 158 instead proceeds from the assumption that the states alone will continue to exercise that authority and, because of the deadly interstate consequences of nonuniformity in one feature of state regulation, it seeks to encourage the states to adopt a uniform rule; states that disagree have the "simple expedient" of not accepting a modest amount of federal funds. Third, if it were necessary to resort to a balancing test of the sort the Court has employed to reconcile conflicts between the Commerce Clause and the Twenty-first Amendment, the national interest in uniformity in this one respect plainly outweighs any competing state interest. 1. The Twenty-first Amendment is not Implicated Where, as Here, Congress Seeks to Encourage a State to Impose more Stringent Restrictions Upon the Availability of Alcoholic Beverages By its terms -- whether they are read narrowly or expansively -- Section 2 of the Twenty-first Amendment does not reach this case at all. Section 2 says, "The transportation or importation into any State, Territory or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited." Section 158 does not require, or seek to induce, any transportation, importation, delivery, or use of intoxicating liquors in violation of South Dakota law, nor does it seek to induce South Dakota to change its laws to allow any such activity that would have violated its laws as they stood when Section 158 was enacted. The federal statute instead encourages South Dakota to adopt a more restrictive regulation regarding the sale and use of alcoholic beverages. Section 2, by its terms, broadly confirms the states' power to prohibit, restrict, license, tax, or otherwise regulate importation, delivery, or use of alcoholic beverages within their boundaries notwithstanding the Commerce Clause and (in some circumstances) other provisions of the Constitution. But the language of Section 2 plainly does not confer or confirm any state right to permit particular sales of alcoholic beverages. No decision of this Court has held that an otherwise valid federal law that prohibits specified transactions in alcoholic beverages somehow violates a Section 2 right of a state to allow such transactions to occur, and any such ruling would wholly disregard the text of Section 2. /15/ Whenever this Court has read Section 2 broadly, it has done so precisely because it was following the words of the Amendment, which broadly confer upon the states the power to burden the importation, delivery, and use of liquor. See State Board of Equalization v. Young's Market, 299 U.S. 59, 62-64 (1936) (state license fee for privilege of importing beer permissible because "(t)he words used (in Section 2) are apt to confer upon the State the power to forbid all importations which do not comply with the provisions which it prescribes"; because "the language of the Amendment is clear, we do not discuss" its history); Indianapolis Brewing Co. v. Liquor Control Comm'n, 305 U.S. 391, 394 (1939) (restriction on sales of imported beer permissible); Finch & Co. v. McKittrick, 305 U.S. 395, 398 (1939) (same, because proposed narrowing of states' right to limit importation of alcoholic beverages "would involve not a construction of the Amendment but a rewriting of it"). But the words of Section 2 are not "apt" here: they simply cannot be read to protect, against federal cajoling, South Dakota's right to make beer available to its own nineteen year olds and those of neighboring states. Any such construction of Section 2 would require precisely the sort of rewriting of the Amendment that the Court in these early cases rejected. The history of the Twenty-first Amendment is consistent with its language and confirms that its purpose was to protect the states' right to prohibit or regulate delivery or use of alcoholic beverages, not to insulate from federal authority a state's decision to permit the use of alcoholic beverages in ways its neighbors might find harmful to their citizens. The states have inherent police power to regulate the distribution and consumption of alcoholic beverages. But pre-prohibition decision of this Court had determined that, having yielded power over interstate commerce to the federal government, the states were not free to burden the movement of liquor in interstate commerce. E.g., Leisy v. Hardin, 135 U.S. 100 (1890); See Craig v. Boren, 429 U.S. 190, 205 (1976). In response to these decision, Congress enacted two statutes that sought to return power to the states to regulate commerce in liquor. The first of these statutes, the Wilson Act, ch. 728, 26 Stat. 313 (codified at 27 U.S.C. 121), was narrowly construed by this Court in Rhodes v. Iowa, 170 U.S. 412 (1898). The second statute was the Webb-Kenyon Act, ch. 90, 37 Stat. 699-700 (codified at 27 U.S.C. 122), whose purpose was "to withdraw the protecting hand of interstate commerce from intoxicating liquors transported into a state" and "permit the state officers * * * to seize such liquors (if) intended to be used in violation of the laws of the state." H.R. Rep. 1461, 62d Cong., 3d Sess. 1 (1913). This law was passed over vigorous constitutional objection and President Taft's veto on constitutional grounds (see 49 Cong. Rec. 4291-4292, 4299, 4447 (1913)). Several years after the passage of the Webb-Kenyon Act, the Eighteenth Amendment was adopted. The Amendment removed any question regarding the states' authority to regulate commerce in alcoholic beverages because, in Section 2, it expressly relieved the states of the Commerce Clause restriction on their police power to regulate liquor. See United States v. Lanza, 260 U.S. 377, 381 (1922). The Twenty-first Amendment effected the repeal of the Eighteenth Amendment and thereby ended national prohibition (Amend. XXI, Section 1). Congress wrote the substance of the Webb-Kenyon Act into Section 2 of the Twenty-first Amendment, primarily for the purpose of insulating state police power to regulate liquor from the implied restrictions of the Commerce Clause and, to some extent, from statutes enacted by Congress pursuant to its authority under the Commerce Clause. See Craig v. Boren, 429 U.S. at 206 (Section 2 constitutionalized the arrangement created by the Webb-Kenyon Act, creating an exception to the normal operation of the Commerce Clause); Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691, 712 (1984). Senator Blaine, the floor manager of the Amendment, noted the division of opinion concerning the constitutionality of the pre-prohibition statutes designed to enhance state authority to regulate commerce in liquor and stated that "to assure the so-called dry States against the importation of intoxicating liquor into those States, it is proposed to write permanently into the Constitution a prohibition along that line" (76 Cong. Rec. 4141 (1933)). While the assurance to states that they will not have to accept liquor "in violation of" their laws is quite broad, there is no evidence of any intention to prohibit Congress from exercising its Commerce, or Taxing, or Spending Power to additionally restrict the availability of alcoholic beverages in ways that do not involve transportation, importation, delivery or use of intoxicating liquors in violation of state law. The history of the proposed but unadopted Section 3 of the Twenty-first Amendment is not to the contrary. That provision would have given Congress the power (which it was presumed to lack after repeal of the Eighteenth Amendment) to "regulate or prohibit the sale of intoxicating liquors to be drunk on the premises where sold" (76 Cong. Rec. 4138 (1933)). The deletion of Section 3 reflected the belief that the Eighteenth Amendment's grant of additional powers to Congress to regulate local use of liquor had been a mistake: the deletion confirmed the "'withdraw(al of) the Federal Government from the field of local police regulation into which it has trespassed.'" 324 Liquor Corp. v. Duffy, No. 84-2022 (Jan. 13, 1987), slip op. 3-4 (O'Connor, J., dissenting), quoting 76 Cong. Rec. 4144 (1933) (remarks of Sen. Wagner). But the deletion of Section 3 did not itself affect Congress' pre-Eighteenth Amendment powers, under the Commerce Clause and the Spending Clause, to legislate in the national interest in ways not prohibited by Section 2. It simply reflects a decision not to supply Congress with any additional authority -- above and beyond that available under the other provisions of the Constitution -- to regulate the use of alcoholic beverages. /16/ In sum, the deletion of Section 3 has no affirmative effect, and Section 2 limits federal actions with respect to alcoholic beverages only where that action relates to transportation, importation, delivery or use of intoxicating liquor in violation of state law. /17/ Because Section 158 neither requires nor encourages either that conduct or any change of state law to permit any activity that would formerly have been a violation, Section 158 cannot violate the Twenty-first Amendment. 2. Section 158 Does not Violate the Twenty-first Amendment Because it Does not Alter the Authority of States to Regulate the Sale and Consumption of Alcoholic Beverages Section 158 does not attempt to reduce or otherwise preempt the authority of the states to regulate the sale and consumption of alcoholic beverages within their borders. To the contrary, it proceeds from the premise that states alone will continue to exercise that authority. Noting, however, that nonuniformity in one respect -- minimum drinking ages -- has lethal consequences, Congress and the President chose a reasonable means of encouraging, but not compelling, the states to act uniformly in this respect. While the question what limitations the Twenty-first Amendment (assuming it is applicable at all) might impose on an exercise of the Spending Power is one of first impression, we suggest that the answer need not be difficult: an exercise of the Spending Power may constitutionally influence the exercise of the state prerogative to regulate drinking, as it may influence the exercise of the prerogatives reserved to the states by the Tenth Amendment, if it passes three tests: the condition must serve a proper national purpose; the condition must bear an appropriate relationship to the spending program; and the grant must be noncoercive. /18/ All of this Court's prior decisions interpreting the Twenty-first Amendment address the permissibility of coercive limitations upon state authority flowing from other provisions of the Constitution or from preemptive federal regulations. /19/ There is no indication in the language or history of the Amendment that it was intended to prevent the federal government from encouraging the states, in a manner that passes muster under the Spending Clause and the Tenth Amendment, to exercise their acknowledged authority over alcohol in a particular way. See 324 Liquor Corp. v. Duffy, slip op. 9-10 (Section 2 of the Twenty-First Amendment reserves the states' "power to regulate"); slip op. 5 (O'Connor, J., dissenting) (Section 2's legislative history reveals that "the Federal Government could not use its Commerce Clause powers to interfere in any manner with the States' exercise of the power conferred by the Amendment" (emphasis added)). For the reasons explained above, Section 158 plainly passes the three tests. First, there is obviously a proper national interest -- within the "general welfare" -- in achieving uniformity in this one aspect of state regulation of the sale and consumption of liquor. An individual state cannot prevent its neighbors from making liquor available to the first state's teenagers, creating a "blood border" that takes lives and damages property in the first state. The President and Congress both felt strongly that this is a problem of interstate scope, requiring action at the federal level. Second, the condition imposed by Section 158 passes any test of the appropriate relationship to the purposes of the spending measure to which it is attached. Federal highway funding helps to create the highways that enable persons under 21 to cross state borders in automobiles in search of alcohol. Section 158 seeks among other things to reduce the use of these federally funded highways in a lethal manner. Third, Section 158 falls well within the area in which grant conditions have been found to be noncoercive and therefore to leave the ultimate decision to the states. Section 158 imposes a condition on a small fraction of the federal grant. It seeks, quite properly, to provide significant encouragement toward uniformity of state liquor laws in one respect. But it does not require uniformity; a state that disagrees has the "simple expedient" of declining this portion of the grant, as several states other than South Dakota have chosen to do. /20/ 3. If a Constitutional Balancing Test is Required, Section 158 Easily Satisfies the Relevant Standard In assessing the validity of federal regulatory measures, enacted pursuant to the Commerce Clause, that affect the states' prerogative to regulate traffic in liquor, the Court has "engaged in a 'pragmatic effort to harmonize state and federal powers.' The question in each case is 'whether the interests implicated by a state regulation are so closely related to the powers reserved by the Twenty-first Amendment that the regulation may prevail, not withstanding that its requirements directly conflict with express federal policies.'" 324 Liquor Corp. v. Duffy, slip op. 10-11 (citations omitted); see also Capital Cities Cable, Inc. v. Crisp, 467 U.S. at 712-714; California Retail Liquor Dealers Ass'n v. Midcal Aluminum, Inc., 445 U.S. at 110; Hostetter v. Idlewild Bon Voyage Liquor Corp., 377 U.S. 324, 332 (1964). Because Section 158 is not a regulation binding on the states but a grant condition that they have the "simple expedient" of refusing, we believe that no such balancing test is appropriate here and that Section 158 should be sustained pursuant to traditional Spending Clause jurisprudence. If the Court does seek to develop a balancing test for application to Spending Clause cases, however, it seems inconceivable that Section 158 would not be upheld. The national interest in uniformity of minimum drinking ages is strong, and South Dakota's contrary interest is not. The states do, of course, have an important interest in regulating the sale and consumption of alcoholic beverages within their borders. But the weight of South Dakota's interest is in this instance sharply reduced by two facts. First, South Dakota is not denied the right to set a drinking age below 21 but only the right to do so and receive the last five percent or ten percent of the federal highway funds to which it would otherwise be entitled; the fact that the federal action here is not a regulation but a spending condition obviously reduces the weight of the state's interest even if it is not (as we argue at pages 31-34, supra) entirely dispositive of the case. Second, South Dakota's right to restrict, condition, or tax the sale and consumption of alcoholic beverages is not affected in any way. If South Dakota's interest in permitting nineteen- and twenty-year olds to drink beer is protected at all by the Twenty-first Amendment (a point we dispute at pages 25-30, supra), it is plainly not an interest that carries anywhere near as much weight as the states' interest in restricting the availability of alcohol. The Court has indicated that the more "closely (the state interest is) related to the powers reserved by the Twenty-first Amendment," the greater the weight that should be accorded to the state interest. Capital Cities Cable, Inc. v. Crisp, 467 U.S. at 714; see also 324 Liquor Corp. v. Duffy, slip op. 11. /21/ The Court has not precisely identified the "core" interests that are entitled to such extra weight. But, as we have discussed (see pages 25-30), the plain language and history of Section 2 demonstrate that its central purpose was to protect a state's right to prohibit or restrict the sale or consumption of alcoholic beverages. The Court has indicated that greater weight should be accorded to a statute supported by a state's interest in temperance. For example, in Bacchus Imports, Ltd. v. Dias, 468 U.S. 263 (1984), the Court indicated that temperance values have a preferred status under the Amendment, declining to accord special weight to the state's interest in protecting local industry because "(s)tate laws that constitute mere economic protectionism are * * * not entitled to the same deference as laws enacted to combat the perceived evils of an unrestricted traffic in liquor." 468 U.S. at 276; see also Capital Cities Cable, Inc. v. Crisp, 467 U.S. at 713 (characterizing the Court's decision in Midcal Aluminum as resting on the determination that "the important federal objectives of the Sherman Act" outweighed the interest underlying the State's pricing program because "the State's interest in promoting temperance through the (pricing) program was not substantial"). /22/ Petitioner asserts (Br. 46) that "the state has a temperance interest in its nineteen-year-old drinking age." But the minimum drinking age statute at issue here is an exception to South Dakota's general minimum drinking age of 21 (see S.D. Codified Law Ann. Section 35-4-78 (1986)). To paraphrase an observation made by the Court in a related context, "(o)ne would hardly suggest that the (South Dakota) Legislature set out to promote temperance by" enacting a special, lower drinking age (324 Liquor Corp. v. Duffy, slip op. 14). Petitioner contends that a temperance interest is implicated by the statute because "(t)he South Dakota system promotes keeping some teenage drinking under control by legalizing it and allowing those who would be drinking anyway to do so in a more controlled fashion under state regulations" (Br. 49). But, because the nature of the state interest is important in determining the weight to be accorded the statute, the interest must be supported by more than the post hoc rationalizations of petitioner's counsel. The study cited by petitioner to justify its assertion (Br. 48-49 & n.2) was written more than 40 years after South Dakota's initial decision to adopt a lower drinking age for some alcoholic beverages; petitioner has not indicated that the study ever came to the attention of the South Dakota legislature. And, at least in the absence of a contrary finding by the state legislature, there is no reason to question Congress's quite logical determination (see pages 4-6, supra) that a higher minimum drinking age reduces consumption of alcoholic beverages by persons under 21. South Dakota's statute therefore cannot be justified as a temperance measure. Cf. 324 Liquor Corp. v. Duffy, slip op. 15-16. The federal interest underlying Section 158 includes the substantial interest in promoting safety on the highways funded by the grants to which Section 158 is attached, as well as other highways constructed with federal funds. Congress and the President devoted considerable attention to the drunk driving problem and concluded that a uniform minimum drinking age would substantially reduce the death toll. They found, in addition, that the interstate nature of the problem mandated a national solution. See pages 4-6, supra. These important interests weigh heavily in favor of the federal statute. The balance of the state and federal interests thus favors the constitutionality of the Section 158. The federal interest in saving lives outweighs the state's more generalized interest in liquor regulation, especially where the state regulation is not supported by temperance concerns. In view of the additional fact that the federal statute does not eliminate the state's freedom of choice, but simply provides an incentive to the states to exercise their regulatory authority in a uniform fashion in this one respect, Section 158 plainly does not violate the Twenty-first Amendment. See Pet. App. A36-A37. CONCLUSION The judgment of the court of appeals should be affirmed. Respectfully submitted. CHARLES FRIED Solicitor General RICHARD K. WILLARD Assistant Attorney General LOUIS R. COHEN Deputy Solicitor General ANDREW J. PINCUS Assistant to the Solicitor General LEONARD SCHAITMAN ROBERT V. ZENER Attorneys MARCH 1987 /1/ Opponents of Section 158, by contrast, characterized the provision as coercive. See, e.g., 130 Cong. Rec. S8246 (daily ed. June 26, 1984) (remarks of Sen. Thurmond); id. at S8234 (remarks of Sen. Pressler); id. at S8223 (remarks of Sen. Symms). The House of Representatives had previously adopted virtually identical legislation, and it quickly passed the bill that contained Section 158. See 130 Cong. Rec. H7220-H7223 (daily ed. June 27, 1984). The debate on the earlier House bill indicates that its purposes were the same as those of the amendment adopted by the Senate (130 Cong. Rec. H5395-H5407 (daily ed. June 7, 1984)). /2/ The conclusions reached by Congress and the President regarding the effectiveness of a minimum drinking age of 21 in reducing highway fatalities have been confirmed by a recent General Accounting Office study regarding the relationship between the minimum drinking age and highway safety. The study found that "raising the drinking age has, in fact, had direct, significant effects on reducing traffic accidents among the affected age groups, typically 18- to 20-year-olds, on average across the States." National Minimum Drinking Age Law: Hearing Before the Subcomm. on Investigations and Oversight of the House Comm. on Public Works and Transportation, 99th Cong., 2d Sess. 5 (1986) (testimony of Eleanor Chelimsky); see also id. at 4-40 (testimony regarding GAO study). /3/ Low alcohol beer is an "alcoholic beverage" within the meaning of Section 158 (see 23 U.S.C. (Supp. III) 158(c)). It is also an "intoxicating liquor" within the meaning of the Twenty-first Amendment. Both houses of the South Dakota legislature have passed a bill raising the minimum drinking age for low alcohol beer to 21, effective April 1, 1988 (see House Bill 1345 (1987)); as far as we are aware, the Governor has not yet taken any action with respect to this measure. The bill provides that the new minimum drinking age will automatically be repealed in the event Section 158 is found to be unconstitutional. /4/ In addition, the Spending Clause question, while considered by the court of appeals, was not raised by either party below. The Court generally does not consider questions in that posture. See City of Springfield v. Kibbe, No. 85-1217 (Feb. 25, 1987), slip op. 2. /5/ In addition to the limitations discussed in the text, a particular grant condition may be limited by other provisions of the Constitution. When the condition is imposed on a grant to a State, for example, Congress's authority may be limited by the Tenth Amendment. See pages 19-24, infra. When the condition is imposed on a grant to an individual, other constitutional guarantees, such as the First Amendment, may be implicated. Moreover, at least with respect to grants to a state, "if Congress intends to impose a condition on the grant of federal moneys, it must do so unambiguously" (Pennhurst State School v. Halderman, 451 U.S. 1, 17 (1981) (footnote omitted). The last requirement needs no discussion here, however, because there can be no claim that the condition imposed by Section 158 is in any way unclear. /6/ NCSL argues that a condition that goes beyond "specifying how the money should be spent" is "not a condition, but a regulation" (Br. 20), but on that point NCSL is simply wrong. A "regulation" is a legal rule that mandates compliance with specified standards of conduct. Grant conditions that do not satisfy NCSL's test remain simply grant conditions: the prospective recipient of federal funds still has the choice of foregoing the grant rather than conforming to the condition. /7/ See, e.g., 20 U.S.C. 352 et seq. (federal aid for public libraries); 20 U.S.C. 801 et seq. (community development training program; 20 U.S.C. 1001 et seq. (assistance for higher education); 29 U.S.C. 1501 et seq. (job training partnership funds). Indeed, "maintenance of effort" provisions, which prohibit grant recipients from using federal funds in place of local expenditures, are a standard feature of many federal grant programs. See, e.g., 20 U.S.C. 3861 (education block grants); Bennett v. Kentucky Dep't of Education, 470 U.S. 656, 670-673 (1985) (discussing similar provision). /8/ See, e.g., 20 U.S.C. 355b (assistance for construction of public libraries); 42 U.S.C. 291c(e) (assistance for hospital construction). /9/ See, e.g., 29 U.S.C. 794 (prohibiting discrimination on the basis of handicap); 42 U.S.C. 2000d (prohibiting discrimination on the basis of race, color, or national origin); 42 U.S.C. 4151 (requiring handicapped access for certain buildings constructed with federal funds); 42 U.S.C. 6101 (age discrimination). /10/ Petitioner asserts (Br. 50-51, 53-54) that the existence of coercion is a question of fact and that it is entitled to adduce evidence showing that it will be coerced into complying with the statutory condition. As a threshold matter, petitioner's complaint did not allege the existence of coercion (see Pet. App. A41-A51); in the absence of such an allegation, the issue may be resolved against petitioner on a motion to dismiss. More fundamentally, petitioner misapprehends the nature of the inquiry under the Tenth Amendment. The question of coercion is not a question of fact in each particular case but turns upon an assessment of the effect of the federal statute upon the relationship between the states and the federal government. An individualized state-by-state inquiry is neither necessary nor appropriate. Oklahoma v. Schweiker, 655 F.2d at 414; New Hampshire Dep't of Employment Security v. Marshall, 616 F.2d 240, 246 (1st Cir.), appeal dismissed, 449 U.S. 806 (1980); cf. Commonwealth Edison Co. v. Montana, 453 U.S. 609, 627-628 (1981) (validity of state tax under the Commerce Clause does not depend upon individualized factual inquiry); Coyle v. Oklahoma, 221 U.S. 559 (1911) (finding coercion where condition was imposed upon Oklahoma's admission as a state). Amici National Beer Wholesalers' Association et al. intimate (Br. 20-21 & n.13) that Congress intended to compel the States to adopt a minimum drinking age of 21. See also NCSL Br. 9-10, 14. The legislative history makes clear, however, that Section 158 was designed to give the states an incentive to adopt a uniform drinking age; Congress was well aware that the states retained the right to make their own choice (see pages 5-6, supra). /11/ Amici NCSL et al. argue (Br. 28-30) that Congress may not compel the states to enact legislation. But Section 158 does not compel a state to do anything; it simply conditions a portion of a federal grant upon the state's enactment of a minimum drinking age of 21. This Court's decision in FERC v. Mississippi, 456 U.S. 742, 766 (1982), as well as its prior decisions upholding similar conditions on federal grants, make clear that such a choice does not violate the Tenth Amendment. /12/ National League of Cities itself expressly disclaimed any applicability in the Spending Clause context (426 U.S. at 852 n.17). /13/ The Court subsequently elaborated upon the rule adopted in National League of Cities, holding that in order to succeed, a claim that congressional commerce power legislation is invalid under the reasoning of National League of Cities must satisfy each of three requirements. First, there must be a showing that the challenged statute regulates the "States as States." Second, the federal regulation must address matters that are indisputably "attribute(s) of state sovereignty." And third, it must be apparent that the States' compliance with the federal law would directly impair their ability "to structure integral operations in areas of traditional governmental functions." Hodel v. Virginia Surface Mining & Reclamation Ass'n, 452 U.S. 264, 287-288 (1981) (emphasis in original; citations omitted). /14/ Amici National Beer Wholesalers' Association et al. argue (Br. 22-25) that the coercion standard is unrealistic because states cannot as a practical matter decline to accept federal funds. They appear to contend that Congress may impose only such conditions as are supportable under the other enumerated powers. We do not believe that the Court should reconsider the longstanding rule that Spending Power conditions do not require such an independent constitutional justification. And whatever merit there may be in theoretical criticisms of the coercion standard, the sanction here plainly leaves the state the simple expedient of declining, bringing this case well within the holdings of prior cases. We note in addition that the Tenth Amendment is not necessarily the sole source of protection for the states. The Court has recognized that "the federal political process (provides an additional check) in preserving the States' interests" (Garcia v. San Antonio Metropolitan Transit Authority, 469 U.S. 528, 552 (1985)). /15/ This Court has considered challenges to federal statutes on the ground that federal law could not constitutionally displace a more restrictive state regulatory scheme, rejecting the constitutional challenge in each case. See 324 Liquor Corp. v. Duffy, No. 84-2022 (Jan. 13, 1987); Capital Cities Cable, Inc. v. Crisp, 467 U.S. 691 (1984); California Retail Liquor Dealers Ass'n v. Midcal Aluminum, Inc., 445 U.S. 97 (1980); Hostetter v. Idlewild Bon Voyage Liquor Corp., 377 U.S. 324 (1964); cf. William Jameson & Co. v. Morgenthau, 307 U.S. 171 (1939). The Court has not to our knowledge considered a Twenty-First Amendment challenge to a federal statute that had the effect of prohibiting transactions in alcoholic beverages that were permissible under state law. /16/ Senator Wagner, one of the principal opponents of Section 3, objected that it would prevent the attainment of the "equilibrium * * * prior to the Eighteenth Amendment (that) was one of the functional marvels of our system of government" (76 Cong. Rec. 4144 (1933)). He did not appear to view the deletion of Section 3 as effecting any reduction in Congress's pre-Eighteenth Amendment authority. Indeed, shortly after the Twenty-first Amendment was adopted, Congress exercised its residual authority over interstate commerce in alcoholic beverages by enacting the Federal Alcohol Administration Act of 1935, ch. 814, 49 Stat. 977 et seq. Petitioner stresses (Br. 27) that Senator Wagner, in urging the deletion of Section 3, expressed the fear that Congress might utilize the authority conferred by Section 3 to regulate "the sex and age of the purchasers" of alcoholic beverages (see 76 Cong. Rec. 4147 (1933)). But Senator Wagner's point was that the Amendment should not confer on Congress the right to regulate what he correctly viewed, under the circumstances of the time, as a matter of purely local concern. His view prevailed, Congress was not given any such new power, and Congress has not sought to regulate activities of only local import. What Senator Wagner could not have foreseen was that the national highway system, funded by Congress, would help make nonuniformity of minimum drinking age an interstate problem by making it easier for teenagers to cross state borders by automobile in search of alcohol. There is no reason to believe that Senator Wagner would have wanted to deny Congress the ability to utilize its preexisting power, under the Spending Clause, to combat a tragic situation related to the highway grant program. Incidentally, Senator Wagner also expressed concern that Section 3 would enable Congress to dictate "the price at which beverages are to be sold" (ibid.), but this Court has nevertheless repeatedly ruled that state price regulations may be overridden by federal law. See 324 Liquor Corp. v. Duffy, supra; California Retail Liquor Dealers Ass'n v. Midcal Aluminum, Inc., supra. /17/ The Court only recently observed that "Section 2 directly qualifies the federal commerce power" (324 Liquor Corp. v. Duffy, slip op. 10 (emphasis added)). /18/ Petitioner contends (Br. 55-58) that Section 158 is invalid under the doctrine of unconstitutional conditions because it burdens a state's decision to exercise its Twenty-first Amendment "right" to regulate commerce in alcoholic beverages. But that is simply another way of saying that the Twenty-first Amendment limits Congress's power to encourage the states to exercise their regulatory authority in a particular manner. As we discuss in the text, the Twenty-first Amendment, like the Tenth Amendment, permits such congressional action as long as it serves a proper national purpose, is reasonable, and is noncoercive. /19/ Even in that context, the Court has observed that "(o)nce passing beyond consideration of the Commerce Clause, the relevance of the Twenty-first Amendment to other constitutional provisions becomes increasingly doubtful." Craig v. Boren, 429 U.S. at 206; see also 324 Liquor Corp. v. Duffy, slip op. 10 ("(t)he States' Twenty-first Amendment powers, though broad, are circumscribed by other provisions of the Constitution"). The Court has rejected a variety of claims that the Twenty-first Amendment overrides other constitutional limitations upon state authority. See Larkin v. Grendel's Den, Inc., 459 U.S. 116, 122 n.5 (1982) (Establishment Clause); Craig v. Boren, 429 U.S. at 204-209 (Equal Protection Clause); Wisconsin v. Constantineau, 400 U.S. 433, 436 (1971) (procedural due process); Department of Revenue v. James Beam Co., 377 U.S. 341, 345-346 (1964) (Export-Import Clause). The Court has found that the Twenty-first Amendment does not limit some of the powers of the federal government. Thus, the Amendment does not vitiate the federal government's constitutionally-based immunity from state taxation (see United States v. Tax Comm'n, 421 U.S. 599, 613-614 (1975)). Neither does the Amendment modify Congress's constitutional authority (see Art. I, Section 8, Cl. 17) to legislate with respect to areas under exclusive federal jurisdiction. See United States v. State Tax Comm'n, 412 U.S. 363, 373-378 (1973); Collins v. Yosemite Park & Curry Co., 304 U.S. 518, 538 (1938). The Court has relied upon the Twenty-first Amendment to uphold state statutes against challenges under the Equal Protection Clause, the Due Process Clause, and the First Amendment. See, e.g., City of Newport v. Iacobucci, No. 86-139 (Nov. 17, 1986) (per curiam); New York State Liquor Authority v. Bellanca, 452 U.S. 714 (1981) (per curiam); California v. LaRue, 409 U.S. 109 (1972); Indianapolis Brewing Co. v. Liquor Control Comm'n, 305 U.S. at 394. These decisions are a byproduct of the reallocation to the states of the authority to regulate commerce in liquor. They may be read as indicating that under a balancing test such as the test that applies to government regulations implicating the First Amendment, the weight of the state interest in the challenged regulation is enhanced because of the policy embodied in the Twenty-first Amendment. See City of Newport v. Iacobucci, slip op. 3-4; Larkin v. Grendel's Den, Inc., 459 U.S. at 121-122 ("(g)iven the broad powers of states under the Twenty-first Amendment, judicial deference to the legislative exercise of zoning powers * * * is especially appropriate in the area of liquor regulation"). Alternatively, the Amendment can be viewed as reducing the restrictions upon state police power imposed by these provisions of the Constitution in the same way that it affects the limits on state authority imposed by the Commerce Clause. /20/ The Department of Transportation informs us that, other than petitioner, six states and the Commonwealth of Puerto Rico have laws that do not meet the condition set forth in Section 158. /21/ Petitioner contends (Br. 46-49) that balancing of the state and federal interests is not appropriate if the state statute furthers a "core" interest, because state law automatically prevails over a conflicting federal statute in that circumstance. This Court, however, has never held that a core Twenty-first Amendment interest need not be weighed against a competing federal interest; instead, the Court has always applied a balancing test. There is no reason to adopt a rule bypassing the balancing test in the manner suggested by petitioner. To be sure, a state statute that furthers an interest at the core of the Twenty-first Amendment should be accorded heavy weight in the balancing process, but that is no reason to ignore completely the interests that underlie the competing federal rule. If a federal statute supported by weighty concerns, such as the national defense or public safety, impacts in some way on a state liquor regulation, it would be wrong to require a court to overturn the federal rule without any consideration at all for the relevant federal interest. The more logical approach is to permit consideration of the federal interest while giving added weight to state interests that warrant special protection under the Amendment. /22/ Although the Court has referred to regulation of "the sale or use of liquor within (the State's) borders" as the "core Section 2 power" (Capital Cities Cable, Inc. v. Crisp, 467 U.S. at 713), it has not indicated that all state statutes falling within this category are entitled to extra protection under the Twenty-first Amendment. Indeed, that description is so broad as to include virtually every state regulation that could possibly implicate the Twenty-first Amendment at all; it cannot be the case that almost every state statute that implicates the Amendment is entitled to extra weight in the balancing test. This Court's decisions invalidating state laws regulating liquor prices indicate that -- at least for the purpose of defining the state interests entitled to special weight in the balancing test -- this general interest in state regulation must be viewed as one step away from the "core" of the Amendment. See 324 Liquor Corp. v. Duffy, supra; California Retail Liquor Dealers Ass'n v. Midcal Aluminum, Inc., supra; see also Bacchus Imports, Ltd. v. Dias, supra (invalidating exemption from excise tax on sales of certain liquor at wholesale). While the balancing test applies with respect to such regulations, extra weight is reserved for the subgroup of state regulations that rest upon temperance concerns.