Transcripts For CSPAN3 Politics Public Policy Today 20150309

Do that way and one of the things i wrote down that wasnt in my campaign, but as i took office, my major job was to spend money. Not to save money. But to spend money, but to spend it in the right way. And then as i analyzed and had when i was on the counsel, the very negative funding for us is property tax. If you raise property tax they want to hang you by the nearest tree. If theres not a tree, theyll just run over you with their pick up truck either way. But you dont mess with property tax, so i got our city out of the property tax business. We fund our city basically by two sources. Sales tax and eweutility franchise and when you do that, people dont care where you spend money. As long as you dont raise their taxes, they are fine and we raise the taxes by good, Economic Growth that ill talk about in a minute and so, that is where we have come from and that is a that has allowed me to do that in that way. Philosophically for my goals my overarching goal or principle is if it doesnt improve the quality of life for our citizens why do it . My job is to spend money to improve the quality of life. I also inherited an area in this 12. 6 square miles, i inherited an area that was a lot of farmland and then what permanent buildings we had and what i would call downtown riverton have been most of those have been taken away through widening the roads by udo. So, we had a pretty clean, clear canvas that we could develop. And when i went on the council, there was a Senior Member and his slogan was which i adopted in my own mind as well, you only have one time to build out a city. Build it out right. And so, that became the overarching goal, too, and so, we dont have a lot of economic redevelop. We have economic develop because of that. Which has been blessing for us. And these arent necessarily in the order of importance but theyre the goals that ive had all the time. One is to have and develop over space and we developed open space starting with parks. And in the nine years that ive been in as mayor, little over nine years, we spent 28 million on parks. And thats not a lot of money for you folks in one way but for us, 9. 2 million for a general fund, we spent a lot of money on parks. Our last project will be finished june 22nd. It was our old historic main park. It was falling apart. It had been built in the 50s by volunteers. The suer didnt work. The power didnt work. The buildings were old. Were just completing a 17 million project where we took the park down to the dirt. And everything has been replaced except the dirt and we even brought in more topsoil, so in a way, we replaced the dirt as well. That project is being completed and we turned it into a, instead of a baseball park, it has been turned into a passing park. We built in 2010, we built a new baseball park, spent 7 million on that. So that is just a baseball and football park. For our young people to be involved in organized sports. And some soccer and some tournaments with girls baseball. We have another park for girls baseball. But passive park. Our other parks are generally programmable parks for youth sports because we have a High Percentage of youth in our area. We have a very young population because of the growth. So, now, were taking and moving into the second part of that. And that is were now moving to trails. We have because we were farmland, we have irrigation canals that bisect our city. We have quite of those. And every canal if youre aware of the west and ir fwatrigateing to the dry farmings you have a road next to it, a path, for canal maintenance. We have the jordan river on our eastboundry. The jordan river has a nice trail that has been put down to jordan river and completed in our area. Were now in the designing and working with Canal Companies to move ahead and put trails as well. Were basically concerned with active transportation. Which is were moving and that is becoming our city engineers major focus in that regard. Well talk about our road transportation later but were pretty welcome pleated on that. Weve spent quite a bit of money on that as well. But were moving to the trails. Weve got young people old people that like to walk so we need bike trails walking trails and running trails and in part of our city, horse trails. Theres part of our city that were moving towards higher dense densities, so theres no horses up there, but in the traditional part of our city, we have horse trails and are expanding those as well as we go along and do that. In that way. The third goal weve had is Economic Development. Its critical to us to develop rides because were so dependent on sales tax and franchise and so, were in the process right now of finishing a deal that hopefully will bring about 400 million of construction into commercial koux into our area. Principally, a Retail Development with some office space, a hotel and big boxes as well. During my administration weve had the opportunity of seeing big boxes move in. So, we have the walmarts, we have two walmarts in our city. We have home depot. We have lowes, kohls. Before that, we had petersons market and riverton drug. Development in our county comes from the north and the east. So i learned easily and quickly this you have to wait your turn but i just didnt want to sit there, so my time was spent a lot of Infrastructure Improvements and thats whats going on there. Well finish out our improvements in the next couple of years in that way, so, Economic Development is important to us. If youre familiar with salt lake were in the southwest part of salt lake. We sit in a valley survey roubd rounded by mountains or the lake. We are very narrow. Im not sure how wide we are. I would guess about 15 miles wide. In that regard and so, we have this corridor and right now, when i moved there, there was one road out of riverton because of the jordan river it was a barrier to us and the sensitivity we have in our area for the lands around the environment around the jordan river and not to interfere with that. Very much. We now have two roads out of riverton. One is bang lar highway, a road that carries about 45,000 people a day and so, weve widened our other roads so that we have roads, our other road we had in riverton handles 30,000 people a day. We have bangular highway which goes north and south and east and west. It circles because were against the foothills where you cant go directly out. Weve had those kinds of things and mobilely Going Forward. Well talk about that later, but its important for us to include all aspects of transportation. Public transportation is an important part, rail, a very important part. Which well talk about a little later. As i mentioned i grew up in los angeles, california. Grew up in the smog era. Grew up where you cant see the beautiful mountains because they were hidden a lot of the year by what we call smog in those towns. Grew up with a healthy young man, but when youre too involved with athletics, your chest would hurt because of the air pollution that was in the area. Moved to salt lake and saw the big, blue skies and the mountains, but have seen that deteriorate as population has come. A major goal that i have is air quality. We dont have, we have some pollution, but we live between the mountains and the winds move it out of our city a lot against the mountains. Even though the bad pollution of the Salt Lake Valley is not my direct responsibility geographically it is politically. Thats another critical reason for rail as as develop it in our area. Thank you for letting me be here as a little dog. Nine years ago when i got involved my natural interest would have been to be involved with homeless shelters and social programs. Thats where i would normally like to move towards. We dont have any homeless in riverton. I still take part on boards and help finance homeless shelters in salt lake from our city. But i realized that as mayor, the important thing i got involved with was roads. Fs a teacher. What did i know about building roads and all of that . I was in my first elected office 13 years ago as a council member, what did i know about the political way to work . What i soon found is is i looked at grants that were coming our way and development coming our way as far as roads and so forth. I never saw rivertons name on it that first year, and so, i started asking what do i need to do and what do i need to be involved with. And this name probably will not mean anything to you, but mayor tom dolan of a major city in our valley, he was gracious enough to go out to lunch with me and i could pick his brain and he said, bill, get involved in the transportation community. So ive learned the language. Ive learned the politics. I have the passion. And its critical to our city, the mobility part is a very, very critical issue. And thats why ive gotten involved. Thanks for letting me be here. Hello. Thank you. I very much appreciate that. Im going to ask ugh to drill down into the Transportation Initiative that you have. As youve picked up on, youve got city thats got light rail under construction right now. Youve got pun one thats right on the cusp. Just about the there. Were happy to help you get over that line and then the mayor talks about future development, planning and preparing for future transportation investments. I was just in phoenix last month. And road the line out to mesa. Saw the construction. The train in the middle of the day was full and mayor help me but it was with those silver tsunamis. Silver tsunamis. Were packing that train and riding it around and loving it. Right. Its there. Ridership is at its highest point in history. Utah transit authorities, people are screaming for Transit Service and alternatives and options, so wed love to hear from you about a little more specifics about your project. And if you can focus on the benefits to the community. Economic benefits, community benefits. Perhaps environmental and beneficial. Sure. Well, as i mentioned earlier our ridership has really exceeded expectation, we are currently at a place where we had hoped to be ten years from now and right now, light rail just comes to the edge of my community. We are the end of the line for the phoenix transit line. This fall probably end of this summer will open three miles from the edge of our city to the heart of our downtown. Through literally down the middle of main street and that as i indicated earlier, from an Economic Development standpoint has been a huge blessing for us. From a transportation point of view as well, its a huge blessing. We are, we have a fair amount of seniors. Arizona particularly the east valley kind of viewed historically as a retirement community. We have one of the amenities we have in our downtown area is a huge, 100 million plus Performing Arts Center that is a magnet for seniors, so theres certainly its popular, we have a large senior population and its popular with the senior population but statistically actually mesa is a younger than average community. The ma len yals is whats been a surprise to me. Were in a, our culture has changed i think in ways that we didnt anticipate 20 or 30 years ago. Folks now dont want to sit in cars. If they can find any way to park a car and get on transit and it works with their lifestyle, they are going to do that. Mor often than not. And thats been the case in mesa. Soo so, we have a large, several large park and rides at this edge of our community where the system currently terminates. Huge parking lot frankly and part of the challenge that were going to have as a community is once we move the terminals further east, were going to go back and redevelop these parking lots that arent quite as big a deals as they needed to be and thats a great opportunity for us as well. Its going to provide more Economic Development opportunity along this very act of downtown light rail route. So, its tremendously popular. As it goes further east, its going to continue to add thousands and thousands more people as we reach like i say ultimately, four or five years from now, well be in the neighborhood i live in, a very residential neighborhood. Not you know, a low income neighborhood. I could very easily hop in my car, travel a block or two, hop on the light rail, go to Downtown Phoenix go to all the sporting events go to the airport, all like i said just a short car ride, a block or two to go to a light rail station. So i think when that happens, youll see it impact not just the menials and seniors but youll get to the average joes like myself that see it as a viable transportation option as well. I think thats true. And we have a focus in ft. Worth now on healthy communities. A fit worth and Blue Zone Initiative and we will be by far the largest city today thats been designated blue zones and if you can get people out of their community, out of their car and back in their community and transit can do that. Transit can allow them to walk and stand and visit, whether at all levels. Whether its the mobility impaired transit that allows them to get around or whether its young folks with strollers young families or the its the silver tsunamis, but getting that Transit System expanded adds to the value and vibrancy of your community. We started traininity rail express in 96. It was the first commuter line in the southwest with about 2 million passengers a year and then it sat, but people used it and now, were back we realized that weve got to get light rail again. If were really going to succeed where we want to be in the city, youve got the starts of itened our friends in dallas have seen it. Houston, austin and so ft. Worth has been focused on our text rail project and its our latest project and it will help not only with vibrant Strong Healthy communities engaged communities, but with our air quality. All our buses like you in the salt lake we started, theres a brown haze and all of these will help, but tex rail will be our direct to start out with. Goal is ultimately it will be net worked out across the city. But originally, its going to dfw airport. The airport is joint hily owned. Its the third Busiest Airport in the world and dallas has had dart at the airport, you can come out of your terminal, hop on a people mover and go to the dart link and be this dallas. Now, if youre traveling public, coming on business for a convention or if youre coming just with your family for tourists and youve got an apgs when you fly into the airport, youd get a rent car or a 70 cab ride to ft. Worth or a 8 bus ride on light rail . To dallas. What are you going to do . I was on it last month. It is fantastic. It is fantastic. So, we really realize that we have to return our focus on connecting to the airport first and not only will it give us that competitive enl that we need to continue to grow and develop our convention trade, our tourism trade, but it also allows, weve got so many people who live in ft. Worth and work in dallas. And if they can go to the intermobile center, hop on tex rail, go to the airport and hop over on to the orange line on dart and be in dallas with no congestion and you know everybodys married to their ipad or iphone so youre not driving, so what can you do in you can work or you can read the morning paper. Or is my daughter used to say she could put on our make up and comb her hair when she took the rail because she didnt do it in the morning. But we have our partner cities, city of grapevine and Richland Hills are partnered with us and it will be funded with our sales tax and we have a request in for a full Funding Grant and 50 million has been put in one budget and 100 million in this times budget at the federal level and the good news about the federal grnts on this rail project is that it awe allows us to leverage our sales tax dollars. Its that leveraging we would lose if we dont get federal funding. Were really excited about what tex rail would offer. We have 54 miles of trails and many people say i want to take the train to the airport, get on a trail and peddle back into ft. Worth or i want to go to dallas and ride to ft. Worth. I want to peddle to dallas and ride back to ft. Worth and we even get runners who say were going to go to arlington, hop on a bus, go into is dallas for dinner. Its an interesting concept that people are beginning to think very creatively and innovatively, outside the box, but its Economic Development its mobility. Its better air quality. Its engaged and healthy cities. It would really make a difference on light rail. My previous boss had a saying, if you like to text, twitter or tweet, take transit. Were at an interesting time in our city. We have a culture well talk about this later a culture of unified transportation, roads and transits are together. So, we have that in our city. Or in our state. We also have, i came from a background of riding transit. As i worked downtown the downtown salt lake rather than drive, i took, i drove over to sandy to get the tracks lined when that came in. I did express buses and just different ways. I had a natural feel for transit. I was in a position where i was working ten to 12 hours a day. It gave me time back, i could answer my emails, coming and going and that kind of thing. So i had an interest in that, but transit is really a local issue. Its not locally financed in our area. Nor could i, but its a local issue. And so, i was sitting in an npo meeting and they were talking about transit and so forth and some of the new lines and things Going Forward and there was nothing coming my way at all. There was nothing coming my way. Close, to my way. And so as i sat there, it irritated me. And so, when i was there, i knew that i had to do something. It was my job. So i raised an objection to it. And that we needed to stay in the Southwest Corridor there. Study. And i pledged 100,000 for that study. Now, keep in mind that were a 9. 2 million. General budget. When i went back to our city manager and we were in high budget. It was during the downturn. I said youve got to find me 100,000. His eyes just went like that. Youve got to be kidding me. What have you done . And so we jumped into the study, it was a 2 million study and is going on now, were finishing it up in the next few months and it will go before the city councils, four cities that are involved in this. Where the city council for the preferred tor preferred corridor to do. Ended up being a 2 million study. U the ta threw in through their sources, a million dollars. We pledged 500,000 and then went knocking on doors of the other three cities and developers to get other money to round it off. So, it really is that kind of a local issue. And then where we are now in addition to funding the study, thats only the start. Weve had to work on corridor preservation. So, our planning director and i asked him so many times when new development was coming in, he just got sick of me. Do you have the setbacks far enough to that a transit corridor can go through this commercial area. The last thing we want to do is buy building at a time or house at a time, so, we had some various routes, but we had to protect them because of our geography geography, there was only a couple of ways we could go any way, so we moved in a quarter of preservation in that regard and in our area for roads, we got developers to donate land for roads, we have big developments coming in now and my expectation, ive already talked to them, my expectation is that we will get donated land. Theyre giving us farmland. Right now, the transit project can go through our city without tearing down one dwelling. Now, thats a, thats an accomplishment of corridor preservation and im proud of what our people have been able to do with that. But thats only part of o it in our study and poich. One is to educate our people. The foundation of our city is farmland. Farmland and transit dont necessarily mix. But we have it urbanizing, so were trying to bring through education, bring both groups together. So we have the peoples support. The last thing that uta needs if theyre going to build a line through our city is for political pressure to come against that line and protesters lining their board meetings and not want to not want it. If that comes, we will be dead. In the water. And so thats a very, very important part to me as well. But to get it its my job as a mayor and my colleagues job as mayors in our state to get involved in transportation funding. I dont believe that i should ask those in the state legislature and the county council in a congressional area to fund any kind of transportation, road and transit, that im not willing to stand out in the front of the parade and take some arrows. I asked them and im willing to support them. And so, well talk about that later, too. You raise an interesting point about planning. I think for 50 years particularly in the high growth urban areas, we tended to not do as good on regional planning. Probably 15, 20 years ago we started our rtv. Our Regional Transportation Coalition and it was made up of dallas and ft. Worth and all the surrounding seven counties involved in it and it has been a major tool in helping connect. Obviously, ultimately in a region like ours and like yours john, large areas, you cant operate alone. Its too expensive for one city to run a whole system is. Youve got leverage and youve got to leverage your regional dollars because if we can plan for the right away and corridors to try to get those through and if we can partner up with our partners and have a master plan, then were all better served. The t is in the middle of working on their master plan. The city is updating our master plan. Present a workshop on transit and it was very interesting and thats going on all over the metroplex and i think that will make you stronger by saying as a region, were working together. Dallas ft. Worth used to hard lyly talk and now, we have weekly dialogue. Paul and gary and a lot of them meet because it doesnt make sense for us to run a line that stops here and youve got to get off and jufr on another one. Thats a perfect segway to the next session. I was, what both mayors are saying really resognates at my experience. Theres no better issue for regionalism than transportation. And when one mayor that has an exciting transit project going on in the middle of his downtown, you become everybody elses new best friend. My mayors to both sides of me are clambering hey, we need to go out to lunch because i need you to partner with me on some studies. So its made from a personal popularity perspective its been a great thing for me with my fellow mayors and it just makes a tremendous amount of sense. Regionally, it can bring it together in bayways that other issues dont have the same sex appeal. And theres a whole lot of friendly competition and Mike Rawlings is the mayor of dallas and i say its a friendly coop. We get motivated when cities step up and decide they want to invest in this. That is the best motivator thatnd of to say okay, were quoing to partner and that is the segway to the next option. Which is what can we do to partner this enthusiasm and commitment at the local level. Were seeing referendums pass 75 80 around the nation, conservative states are passing referendums to support Public Transportation. Were seeing local governments step up and extend their budgets to the inth degree to invest in that planning thats so important. The mayor talked about three other cities, stepped up and said weve got to do this for our future. How can we convey that energy and enthusiasm here to washington. Share that with our congressman. Share with them how important this is to you your communities and frankly, mayor, you talked about community engagement. How do we build that grass roots support were evidencing inging with you and your cities and transfer that here to washington . Ill give you a couple of examples. We passed a bond election a 294 million bond election this past november. 220 million of that is dedicated to transportation, to streets and roads and the state of texas passed proposition 1 which was constitutional. We passed that bond election at almost 80 . Funding guarantees constitutional amendment of several billion dollars a year flowing back into transportation projects. But what you, i think part of what we did was we got out and we talked to, we did town halls and we advertised and talked and we formed coalitions on prop one to pass this state guarantee to get out and talk, but weve done the same thing with washington. We come up here and lobby fairly often and when theyre home and when they have, people tend to think and you as mayors understand, you get an invitation to a local elected official or u. S. Senator or house members election to their fundraiser. And you think, well, they just want me to give them money. Thats not necessarily the case. They want to hear from you. They want your money for their campaign, but you need to be going as transit members as people working on transit, youve got to go talk to them. Catch them with when their home, when theyre here. Tell them how critical it is. Give them the statistics on the growth. Give them the statistics on whats happening. You know, take them for a ride on your train system or your light rail or where ever you are, but keep them in the loop. Education is whats killing us in d. C. And for us in austin because theyve developed a tremendous disconnect from whats happening at the local level and no one knows better than whats going on than your mayor and council. It can help spread that message but to do it youve got to advocate with your citizens. They can help you because theyre voting for those people also. Youve got to turn your local citizens on to local transit to get d. C. Interested in it. I agree. In order to afford this, you have to have regional funding. You have to work with your neighboring communities and you have to pass sales tax you have to and i think there is a real appetite out there. All of us share the frustration of getting in our car and tryinging to get from point a to b. Thats a common denominator. So, there is that angst to draw upon and if we can rally regionally with our neighbors you can get it. An amount of money thats going the attract washingtons attention. Youre seeing from their point of view, the reasonable likelihood of a success stories. Washington leadoffs success stories. They love the come to ribbon cuttings. Tell positive stories and if you can paint a positive scenario in your community, you stand a good likelihood of attracting the federal money youll need. As mayor was saying, it has to be a regional priority. In our community in order to expedite things happening, we are able to shift some of the federal stp money and flex it in a way that we can prioritize it for light rail. And by doing that, we expedited things happening. Weve used this t pan is the phrase we use, but were using multiple dollars to expedite the funding. Were paying city of mesa funds knowing the money will be here rather than waiting five or ten years to make a project happen. People came to mesa knowing this was our priority and that we would put our money where our mouth is but i think that commitment to success attracted the cooperation of the federal government loosened up the regional dollars in ways that we can focus because we used some flexibility and said we dont really need some of the street projects that we have on our budget. Are less a priority than the transit projects so lets prioritize our money in a way that we can do a large, significant project and get it done now instead of ten years from now. You know, we have a region alal in our area statewide and we need to be working together and we, i had nothing to do with this, but im sure glad that others put in in place. We have a unified transportation plan. So, we are unified in our transit and our road and our active transportation. So, in our, our legislature is in in session right now. Will finish this thursday so we have some major transportation funding were after and the ceo of our Transit District the nbo, or npo is there as well. Hand in hand with their staffs. The city, league of cities in the state is there together. We also are have the business community, the chamber of comers is there with us. We realize that if we werent united in what we wanted and we were fighting against each other between transit and roads and this and that, that we werent going to get it. To say the least, utah is not a liberal legislature. Some of our representatives and i understand their position are fine trying to help you as long as it isnt a tax increase. And so now, whats happened in our state legislature whats going on right now and today well change some things i think and go forward from this. But right now, theres two types of financing that theyre looking at. For this. One is an increase in gas tax. And one is a sales tax. There are different groups that all have a part of this pie and we have to work together. Our state roads run through our cities. U dot in our city is finishing a project, a 45 million road project. So, i cant worry about city roads and say to the director of udot, hey, you do what you want, i dont have any interest in it. Hes united with transit as well in this, so the state needs money. They need more money. The city needs more money for construction and maintenance terribly needs more money in that for roads. So, we have that as well. And Public Transportation needs more money and so we have right now, a bill, we have several bills, but the bill that is more encompassing is a sales tax increase where you would get a. 1 for transit,. 1 for local roads and a. 05 for counties and in the rural part of our state where you dont have transit authorities or needs then that 1. 14 for transit goes to the county because youll have more roads in that. At first i thought why are we counting these roads . We have 30 miles of roads in Salt Lake City and some of our southern communities, we have three and four thousand miles of roads. Because thats all there are. Rural areas. And so we have that and we also have a gas tax several bills on the gas tax. Ones just a straight increase of ten cents on gasoline. Five cents on diesel. 70 of that goes for state roads. The other 30 goes for local roads. The other part of it is to take our gas tax, 24. 5 cents per gallon and change it into a sales tax on fuel so it grows with inflation. But its uniting together and each of us have our roles, so our fight in the legislature right now is is not its between the senate and the house. Its not about the need for more transportation money. A very conservative state keep in mind. Its not that. Its about you do gas tax or sales tax. Or do you do both . Isnt it kind of nice to have a mom and dad fighting over how to give the kids more money . I dont care whether it comes out of the left pocket or the right pogt but the way weve achieved that as mayors is that weve said to the legislature with the sells tax, we dont want you the raise sales tax. We want you to put it on the ballot. Were willing to stand with you and champion the cause champion the cause. So what problem is ann authorization for both these states through the the county council of commission and have a county council or commission put it on the ballot. It will be then distributed in the county of orgin it will distributed in a variety of ways, wu we as mayors and we are united on this. Are willing to stand up and walk on. Its not there. If i say to my legislator get me money. And then i just sit back and let him take the heat. Its my role to be arm in arm with him. And the other way to get their attention is to talk about jobs. They tend to forget how many jobs are involved in any transit and any transportation project. And then when you start construction, youve got additional jobs on the construction that come in and thats a big deal for any official to be able to talk about jobs. Youre going to move this into the q and a for the audience, but i wanted to summarize what i think ive heard today. To be successful, youve got to have four major ingredients. Good projects good merit. Good value added to your community ch youve got to have a good team that can deliver them. Whether theyre construction or operation, youve got to engender that trust in the community thats out there. Youve got to put your money where your mouth is and come up with the local resources an then you have to have that community that says i want it. Underscore what the mayor just said. There are 85 cities in six counties that have gotten together along with the Highway Department and Transit Agency and virtually every other Decision Making body for transportation and have endorseded a plan. Were not fighting about whats on the plan. Were just in the weeds frankly talking about how to pay for it. Those four ingredients understood score the need here in washington. We can do it, they can do it, too. They can be our partners. I dont want to forget and mayor, i touched upon the fact that a lot of this investment in utah is for state of good repair. To think about a conservative state that isnt talking as much about the shiny bells and whistles, more about potholes and replacing street pavement and running buses number one gel i think thats a story we can share, so, success, youve seen it in all these communities and i think thats the message we put forward in washington. Let me open up to these mayors and see if you can promote them. Shy crowd. Mayor, maybe one thing you can share with apta or us as an organization that we can help Carry Forward from your comments today. I love the stand up for transportation. I think taking the message back how critical it is that this country continue to rebuild its infrastructure that we can continue to offer modern innovative ways to attract people to use traffic because it helps us at every level from air quality, congestion, time save productivity and a healthier community. Its just a great message and this group can be a great vehicle for helping pass that along. Great 9th dont forget. The best lesson you can learn from whats happened in our community is the importance of flexibility. And looking at the pots of money that you have and trying to figure out how to focus the resources you do have on the most important projects. To prioritize. Are there ways you can shift some of the federal and our regional moneys to address the top needs. Weve all got budgets with a variety of projects on them. And if some of the projects that you have funding for are not the most important projects, then you need to figure out how to make that problem be a problem anymore. So thats wup of the things im proud of that weve done that i would suggest you take a look at. I think from my perspective is do what you do best. And thats build and operate Public Transportation. I wish i could tell you that you wouldnt have to worry about your funding. But you do. But tell us as mayors how we can help you with the funding. I have no idea how to build anything. But i need your help in tells me what i need to do and where i need to support and what buttons i need to push. Because my job is to get the funding for you, but i cant do it on my own. Great. Sorry for being a little late coming up. To your funding question, you talked a lot about sales tax and youve talked about other pots of money. Have any of you used tax increment financing Value Capture, special assessment districts and could you just give us a little flavor of how to get the businesses that will be taxed in those areas on board with those funding streams . When trinity rail express came in in 96, following that, it comes to the whats our old t and prk, the texas and pacific term naninal and we had little Downtown Living and the t and p building is in a tiff a tax increment financing zone and that money was able to come in and help renovate what the terminal along with the t and several, the city money and build residential lofts there and they sold out in less than a year, but the tiff zone around it is an incredible asset because it helps with the landscaping, the upkeep on it. Theres another area theyre looking for looking at that is in that tiff. Hes telling me yeah, it extends over to the side. Its been an incredible tool for us for reinvestment and we expect to see the same thing on tod developments as tex rail comes in. That hasnt been part of our formula formula, frankly. We rely heavily on the Regional Transit tax. And i think that was past several years ago based in large part of the angst that our community was feeling over the failure to build highways as well as we should have. So, and wrapped up in that very popular notion of lets build more popular highways was a component for some transit and so, now, were the beneficiaries of the transit money that really was sold to the public as part of the larger, more aggravating concern about highways. The phoenix system now is fairly well built out when it comes to highways as a result of this regional tax and like i said, the smaller component were talking about here now has been the transit money that has allowed us to do the other portion of the projects. And funding for i35, the major renovation was sad lyly not getting funding. We just couldnt seem to get it across the finish line until we revamped the plan and put a transit lane up the middle and suddenly, they came in and said, well fund it. In our community, regional and federal funding is whats taken care of the actual building and theres a 600 Acre Development were involved in now. I believe my role is to get that land given to the city so we can give it to the transit authority. And we are using part of that is our cda cda, we can put in another infrastructure and pay for that. I dont know, but i dont believe we can do that with transit, pay for transit out of the cda money. Im not sure of the law there, but we can pay for other infrastructure and then get land donated as a result of that and were putting, were requiring 20 open space and that will be in transit is in that open space definition and so thats the way were trying to help. Theres an International Lesson learned here. In the asian properties. Theyre seeing 40 50 of their resources come from their Land Development in the european properties, there are 20 and 30 . Were having a hard time reaching that. Yet in this country. Its a long way to go. Its part of our cultural and institution infrastructure. Theres a lot of reasons why but there is great progress being made in cities that i know of in the United States and we need to keep that pressure on as the mayor talked about community development, grants and Value Capture and those kinds of things. Its a resource that probably isnt going to be the primary resource for our business, but its certainly one of those leveraging options youve talked about today. Any other questions . Im going to say thanks to these mayors. Its been an incredible, phenomenal [ applause ] and i want to show our appreciation by giving them each where is tom washington. This is a tshirt. They are rightsized. Thank you all for coming today. I appreciate it. Well have more from the american Public Transportation conference after the lunch break. Theyre expected to return at 1 45 eastern time with federal transportation officials from the federal transit sfrags administration and federal Railroad Administration and also today over on cspan senator Bernie Sanders of vermont will speak at the National Press club for his plans on the upcoming budget floor debate well take you there live at 1 00 on cspan. And live today were hearing from president obama speaking to the National League of citys congressional conference. More than 2,000 officials delegates meeting in washington, d. C. To talk about online tax fairness investing in transportation and infrastructure and protecting municipal bonds. The afternoon session will include remarks from Homeland Security sect jeh johnson and earnest monnes and others. You can watch that live on cspan or join us at 3 30 this afternoon for the afternoon session. And on capitol hill, the house is out. Members are on a district work break. The Senate Working on executive nominations. Votes on some of the nominations after 5 30 and tomorrow the senate could take up antihuman trafficking legislation offered by john cornyn. That seeks to provide justice for victims of trafficking by imposing fines on convicted traffickers and provide more restitution and assistance for victims. You can watch the senate live on our companion network on cspan 2 when they gavel in. Tonight on the communicators. Rocco commisso. Founder of media Com Communications corporation on the challenging facing media and the fallout from the latest fc krvc regulations. I have no doubt that will hurt communication. If they will impose regulatory fees additional fees, taxes at the local level i think utilities, regulatory utilities, and in the states where we operate will get into the act, i havent found one government that doesnt want to raise more money and that will give an opportunity to raise more money. Tonight at 8 00 eastern on the communicators on cspan 2. Next, a look at the future of the federal Health Care Law after the Supreme Court heard oral argument on a challenge to tax subsidies for people enrolled in federal insurance changes. The Supreme Court rests on six words in the more than 1,000 page law that stipulates subsidies are subject to an exchange established by a state. Only 16 states run their own exchanges. Federal government runs exchanged for 34 states that opted out of setting up their own. The court is expected to rule on a case before the end of the term in june. The oral argument ran about an hour and 20 minutes. This morning case 14114 king versus bur vehicle. Mr. Car vin. May it please the court. This is a statute of the statute that meets the court. Will you please back up, before we get to a question of statutory construction as know each plaintiff, or at least one plaintiff has to have a concrete stake in these questions. We cant put them as ideological questions and we have four plaintiffs, as to two of them, and there is a declaration stating, i am not eligible for Health Insurance from the government. But there is a question of whether they are eligible for coverage as veterans. Yes. Mr. Hurst who would have to i would refer you to joint appendix of page 42 where there is the governments recritation of tax where mr. Hurst would have to spend 3 5of his own money because of his irs rule. Mr. Hurst was a veteran for 10 months in 1970. He is not eligible for any Veterans Service because if you serve such a short Health Services if you serve ill ask the government if they agree. And i should point out the government has never disputed that. But the court has an obligation to look into it on its own. But there has been fact fighting in lower courts in an adversarial sitting. I dont think it was brought up by a lower court. If i could make one further point on this Justice Ginsburg and even when he was technical, which he is not there is an irs rule 1. 36 b2cii, with the clarity of the tax code, making clear that you are only disabled from receiving subsidies if you have actually enrolled in a veterans Health Services and it is undisputed that mr. Hurst if that is the position too. And then there are the two women, one of them was going to turn 65 in june which would make her medicaid eligible. She will turn 65 in late june. Shes subject to the individual mandate by virtue of the irs rule she would have to spend 1800 per year for Health Insurance by virtue of the excuse me. But she will turn 65 in june. Late june. So that takes care of 2015. No, right now she is obliged under the individual mandate to have insurance. You have to have insurance for nine months of the year and so as of april 1st, she will be subject to the penalty which will be alleviated only by ill ask the government if they agree with you on that and then for the fourth plaintiff is there is a question whether she would qualify for a hardship exemption from the individual mandate even if she received the tax credit, in which case the tax credit would be requireirrelevant. And again i refer you to the tax credit. We didnt want to get into a factual dispute about it because we have such clear understanding. Yeah, but you would have to establish the standing, prove the standing. If this gets beyond the opening door. Fair enough, yearn. But it is blackletter law that only one plaintiff needs standing and for the reasons ive already articulated both plaintiff hurst and mr. I dont want to detain you any more. But i will ask the state their position. And with the merits the only provision in the act that authorizes or limited subsidies says in plain english that the subsidyies are established only section 1311. If you are going to elaborate on that, i would appreciate your in your elab oration i read that, and this statute is like the tax code, more than its likely constitution, there are defined terms and the words you just used concern a defined term. Now as i read the definition, there is a section of definitions and it says quote, the Term Exchange means, quote, an exchange established under 1311 and 1311 says an exchange shall be a government agency, et cetera, that is established by a state. Those are the definitions. So then you look to 1321. And 1321 says if a state does not set up that exchange then the federal quote secretary shall establish and operate such exchange. So it says the secretary is to establish and operate such exchange. The only kind of exchange to which the act refers, which is, quote, an exchange established by a state under 1311. That is the definition. So the statute tells the secretary, set up such exchange. Namely a 1311 state exchange. And there is nothing else in this statute. Correct. So that is throughout what theyre talking about. So what is the problem . As your hon just said it tells the secretary to establish such exchange. And what 36 b turned on is whether the state or the secretary is established. No, it uses the same terminology that is used 15 times in this statute, namely the terminology and the definition is, an exchange established by a state. That is the phrase. Well under 1311 that is the phrase and if 1311 if the definition section created ambiguity as to whether hhs was established a 1311 or 1321 exchange, that is immaterial because 36b does not say all 1311 exchanges get subsidies it said exchanges established by the state, not established by hhs under section 1311 so it eliminated any potential ambiguity created by the section. Mr. Car vin, can i give you an example simple life equivalent to what the sections say here to what Justice Breyer was talking about. I have three clerks. Their names are will, elizabeth and amanda. And any first clerk i say will, write me a memo. And i say elizabeth, edit wills memo once it is done. And i say amanda if bill is too busy to write the memo i want you to write such memo. Now my question is if will is too busy to write the memo and amanda has to write such memo should elizabeth edit in the memo . [ laughter ] if you are going to create monies to will for writing the memo and amanda writes the memo and you say the money had go if will writes the memo and under plain english and common sense, then no. You run a different shop. Because in my chambers if elizabeth did not edit the memo she would not be performing her function. In other words, there is a substitute and ive set up a substitute and ive given instructions elizabeth you write, you edit wills memo but if amenda writes the memo the instructions carry over elizabeth knows what she is supposed to do. Shes supposed to edit amandas memo too. In your chambers you are agnostic as to whether will or amanda writes it. But the key is under section 1311 congress was not agnostic as to whether states or hhs establish the chaex exchange. And well mr. Car vin, if i had those clerks, the same clerks, and amanda wrote the memo, and i received it, and i said, this is a great memo, who wrote it . Would the answer be it was written by will . Because amenda stepped into wills shoes . That was my first answer. The second answer which is you were agnostic between will and amanda but congress is not as between state and federal exchanges. That is a very important point because what you are saying is the answer to the question really does depend on context and it depends on an understanding of the law as a whole tand whether they were and whether they were agnostic. I agree with that. So it is not the simple four or five words because the four or five words in my example it is obvious that elizabeth shouldet edit the should edit the memo. It is the context that suggest whether those instructions carry over to the substitute, isnt it . We implore you to examine these words in the context of the act as a whole because our argument becomes stronger for five reasons. To respond to Justice Breyers point, he said such exchange con notes that it is the same person doing it but look at the provision on territorial exchanges. It says territories can establish such exchanges and then it says and shall be treated as a state. Yes it does. It is not a question of connotation, its a question of denotation. What does that mean . It means that the federal government, the secretary, is establishing a thing for the state. And what is the thing . The thing that it is establishing for the state is defined as an exchange established by the state. A person from mars, who is literal, which i am not. But i literalist would have to read it that way. But if you are a literalist, you could read it that way. And if you want to go into the context, at that point it seems your argument is weaker. Do the exchanges fall apart, nobody can buy anything on them. You know the arguments, they have read the briefs. There are no customers employers dont have to pay penalties as long as they use just people from virginia and one maryland person comes you know the arguments. How does the context support you. Again under the literalist and the nonliteralist interpretation saying that hhs will establish such exchange doesnt mean the state has established such an exchange if the if i could finish my answer to Justice Breyer look at a parallel provision, using precisely the same language and they said and shall be treated as a state, language omitted from 1321 and a basic principal of statutory construction then you interpret the same phrases the same way and shows that congress knew had you to create equivalence between nonstate exchanges and exchanges if and when it wanted to. Sorry Justice Sotomayor. Take a breath. [ laughter ] im a little concerned with how you envision this provision working. Youre saying that the hhs exchange cant be for the state so that is established by the choice of the state. The choice the state had was establish your own exchange, or let the federal government establish it for you. That was the choice. If we read it the way you are saying, then were going to read a statute as intruding on the federalstate relationship because then the states are going to be coerced into establishing their own exchanges. And you say oh, no, they cant be coerced. But lets go back to what Justice Breyer was talking about. In those states that dont the citizens dont receive subsidies, were going to have the death spiral that this system was created to avoid. States are obligated, insurers are obligated make sure in their states, whether they are part of this program or not, that they have guaranteed coverage, that that children are covered until they are 26 and that they base their costs on community ratings. So if they have to do that then costs are going to rise on every insurance every Insurance Plan offered in the country, in those 34 states. Three or six or nine of your states will have tightened their Medicaid Eligibility requirements in convention of the act so they are taking money by breaking their compacts. They would have to lose all of their medicaid money. Tell me how that is not coercive in an unconstitutional way . And if it is coercive in an unconstitutional way, in bond i think it was last term we said that is a primary statutory command, that we read a statute in a way where we dont impinge on the basic federalstate relationship. This court has never suggested outside the very unusual coercion context of the medicaid that a funding condition somehow invades a state police power. Well we said it last year. No in bond. There the federal government was taking away a police power. Here the federal government is doing the same thing. You want free federal and it is sovereignty and the kind of funding decision the this court has held several times. [ overlapping speakers ] let me say from the dynamics of federalism, it does seem there is something powerful to the point that if your argument is accepted the states are being told either create your own exchange, or well send an Insurance Market into a death spiral and have people pay mandated taxes which will not get any credit on the subsidies, cost of insurance will be sky high but this is not coercion. It seems under your argument, perhaps you would prevail in the plain words of the statute, there is a serious constitutional problem if we if we accept your argument. Number one, there is a serious problem in congress if they accept your argument. [ laughter ] if this was unconstitutional, then the medicaid statute this Court Approved in nfib would be unconstitutional. What would the results of unconstitutional, and if interpreting one way is unconstitutional it would be interpreted the other wail. But do we have any case that says when there is a clear provision that it is unconstitutional we can rewrite it . Is there any case that we have that says that. No, your honor. Of course. Think about the consequences of the medicaid being coercive. 22 states said no to the medicaid deal. That created a bizarre anomaly in the law i understand that. But i think the court and the counsel for both sides should confront the proposition that your argument raises a serious constitutional question. Im not sure that the government with agree with that. But it is in the back ground of how we interpret this statute. It may well be that you are correct as to these words and i understand that. A. , there is no saving construction to echo justice staleyas point. If this is unconstitutional then all of the provisions in the code if you do something for no child left behind then you will [ overlapping speakers ] in South Carolina versus dole, where the funding for the highway, Congress Said if you dont build the highways you have to go 35 Miles Per Hour all over the state. We wouldnt allow that. No. Well there of course you would be interfering with a basic state prerogative as to establish their limits and the condition is not related to that. Here is the condition is perfectly related. Because if you want to create mr. Carvin. You will be familiar to the medicaid statute, here is the federal money, and here are the conditions, take it or leave it. That is one pattern. But this pattern that we have says flexible state. You can have your program if you want it. And if you dont, there is a fallback, the federal program. That is the typical pattern. It is the pattern of the filter act. You can have a state plan but if you dont take that plan, there is a federal implementation plan. But i never seen anything like this where if you take what the statute says, you can have it in 1321, then you get these disastrous consequences. That is why this is much less risky a deal for congress and what distinguishes it from medicaid is in the dissenting opinion in nfib played out. In Medicaid Congress is playing all in if you take the deal. Then medicaid is thwarted. Here if they turn down the subsidy deal they still get the beneficiary of an exchange. What are those benefits to the customers that can buy on it or the insurance that can sell on it . Three points. Well we know textually they thought exchanges without subsidies work because again they have territorial changes but the government concedes no subsidies. That is no that is not what you said previously when you were here last time in this never ending saga. You said without the subsidies driving demand within the exchanges, Insurance Companies would have absolutely no reason to offer their products through exchanges. And then you said, the insurance exchanges cannot operate as intended by congress ab sent the ab sent the subsidies. That is true. They cannot operate as intended. Because congress intended all of the states to take this deal. So why create 1326 as all. Well they thought all states wouldnt. Because they set up a mechanism for that to happen. And what happened . You still get the exchange. It is not like medicaid where the entire program is thwarted. No one will visit the program if there is no subsidies because not enough people will buy the programs to stay in the exchanges. That is demonstrably untrue and not in the legislative history and the legislative history contradicts that. And many senators got up and said there are many benefits. Onestop shopping like amazon. The president said these two operate quite independently. We dont need Exchange Without subsidies. There is not a sent illa of legislative history that without subsidies there will be a death spiral. Wait a minute. That was the whole purpose that drove this bill. Because states had experimented with this and those that didnt have subsidies or other provisions of the act didnt survive. You said it yourself in the prior case. No. The prior case was about the individual mandate. The government came in and said the individual mandate is necessary to effect death spirals. No one in the findings in congress or anywhere else suggested that subsidies were paer were avail able. My problem is the resource. Youre talking about congress, borrowing the phrase of one of my colleagues a huge thing in a mouse trap, okay. Because do you really believe that states fully understood they were not going to get their their citizens were not going to get subsidies if they let the federal government. What senator said that during the hearing. The same amount that said subsidies were available on hhs exchanges which is none. They didnt deal with it in the legislative history just as they didnt deal with medicaid because the statute was quite clear. Lets talk about it in context again Justice Sotomayor. The only provisions in the act establishing any limits is found in 36b but it is not the mouse hole you exact to find it, it is the only place in the act that [ overlapping speakers ] if the Capital Expenditure with the tax code provision, it tells you how you compute the individual amount. Its not in the body of the legislation where you would expect to find this. No. Your honor if that is true but Justice Kagan just read to you you had the idea that the subsidies were essential. That is what you told us last time. What i told you is it wouldnt work as expected because they thought this deal would work just like the medicaid deal with all 50 states would say yes so you would have both but that is the thing. If they didnt think anybody was going to take it. Well that was my response to Justice Sotomayor. That is empirical stipulation made by legislative history and indeed the legislative history imputes. And justice, weve heard talk about this other case. Did you win that other case . So maybe it makes sense you have a different story today . Im really glad your honor said that. And if i could return the context im sorry, mr. Carvin, please. Just briefly, Justice Kagan. Very much appreciate it. To respond. Weve talked about the response section 1311 says in the strongest possible terms we want states to be on the exchanges. If you give unconditional subsidies there is no incentive for the states to do it and you have fundamentally undermined that statutory purpose but if you give it widespread subsidies plus staterun exchanges. In terms of art again there is language in the statute which says exchanges exchanges under the act. Those phrases naturally encompass both hhs exchanges and stateestablished exchanges but the solicitor general is coming here to tell you that a racial englishspeaking person contended to convey exchanges available on hhs use the exchanges establish by a state and he cannot provide to you any racial reason why somebody trying to convey the former would use the latter formulation. Mr. Carvin why dont you take an extra ten minutes and well let you give give you an extra chance to talk. Well then let me ask you a question. [ laughter ] lets go back to where congress put this aside putting aside constitutional things that congress does not mean to put heady burdens or draconian imposes on states and this goes back to what Justice Ginsburg was saying, there is nothing clear about this and this took a year and a half for anybody to notice this and as Justice Ginsburg said, it is not put in the place you would expect it to be put in, which is where it says to the states here is the choice you have, it is not even put in where the statute defines who a qualified individual is or who is entitled to get the subsidies but it comes in in this technical formula directed to the department of treasury saying how much the amount of the subsidy should be. But it seems to me it makes no sense from congresss point of view in terms of our own point of view and in sense of interpreting statutes that is not the clarity with which we require the government to speak when it is upsetting federalstate relations like this. I must respectfully disagree for three reasons, Justice Kagan kagan. In first place, where else would you expect a tax code except in the tax section. It is the only place where exchange is limitation is placed. You have three audiences here. Not just states. You have to tell taxpayers what they are entitled to you have to tell Insurance Companies when the subsidyies are available and so you have to put it in 36b and the state is saying you should have put half in 36b and half in 1321. 36b would say exchanges period and then go to 3121 and say when we said exchanges in 36b we pent ex changes. If i were a state official and i was trying to decide whether my state should establish an exchange and i wanted to know whether individuals who enrolled in a plan on my possible stateestablished exchange would get a credit, where would i look . Exactly. The basic thesis here is the exchanges dont work without subsidies. Youve read 1311 and 1321 and now you go find out where the subsidies are. I think not. Mr. Carvin. I think the place i would like to find my choices is in the provision of the statute that talks about my choices. I think the last place i would look is a provision of the statute that talks about what is it coverage months, for purposes of this subsection, which by the way isnt even the right subsection but whatever. [ laughter ] that is where i would look, is in where it talks about what a coverage month is. But, your honor, ive described the difficulties of putting part of it in 1321 because you would create this bizarre tax credit provision which is only half true and you wouldnt tell taxpayers and Insurance Companies so i believe that is the complete answer. But the other practical point i would like to make is they had three years to implement this. And no one thought the states would have to make a decision overnight. If the irs had done its job, every state would have been fully informed of the consequences because presumably theyve red 36b and then make an intent jell decision well an intelligent decision. And if the states were unable to read a statute or read a regulation we want to hear what you were going to say in your five to ten minutes, and if you want only if you want, i would be interested in your response to the governments brief that if you read the words established by the state, without reference to the technical deaf definition, as you wish, this isnt just about the taxes if employers in virginia dont have to make policy and dont have to give policies, but if they have one maryland worker, they do. It means they can never tighten up the medicaid regulations never in 34 states, but of course in the others they can. It means that there is no qualified person ever to buy anything. On an exchange established by the secretary for the state and they have two or other three anomalies that have nothing to do with taxes all of which supports their argument that you have to read this frad technically according to the definition. Now that is their basic point, i summarized this. Do as you wish. I wanted you to have five or ten minutes to answer that. Im going to clock that. The first point i would like to make is, there is no anomaly stemming from our interpretation of 36b. The government agrees with that. The biggest anomaly is the qualified individual point onyx changes. The solicitor general is not going to stand up here and say if we prevail they will be obliged to empty out hhs exchanges. So we all agree there is no connection between 36 b and the qualified individual. That is point one. Point two is if you want anomalies their interpretation of the statute requires 34 states today to lose all medicaid coverage. Why is that . Because of the provisions on 64 a through 66 a of the government brief. There are various statements on the state upon losing medicaid funds must coordinate through the state establishment for medicaid and chip for enrollment that makes perfect sense if established by the state means what it says. Well the state cannot ensure coordination between hhs exchanges and the state agencies and none of the 34 are doing it today. So under their a textual reading of the statute 34 states will suffer the results of what this court found. As to the medicaid maintenance anomaly. The government agrees the purpose of the provision was to freeze medicaid until you have an exchange of subsidies which makes sense, because you want to coordinate the two and that is exactly what this means under our interpretation. Until you have an exchange the subsidy will be withhold. And the statute said it ended on 2014 and it makes no sense. Before 2014, the states were powerless to have an exchange with subsidies. They couldnt do it. So there was a threeyear freeze on medicaid they were powerless to get out of. And after 2014 if they dont want medicaid, all they have to do is create an exchange. It gives them another purpose to create exchange which is the purpose annunciated in 1311. Maybe somebody would if you have an employee that lived in another state. Maybe you would be subject to the employer mandate. Why is that an anomaly. Congress wants the employer mandate. They want to expand it. They never thought it would happen. What they thought it would happen is there would be neighboring states because nobody would turn down this normally extraordinary deal. I dont know if my five minutes is up but but in regard to but if wow you have been talking for a long more time. You have two more sentences. Even if there were anomalies you dont transport them to 36b which is neither absurd and furthers the continuance of the act, because just pollutants didnt work in one section you dont spread it like in the other act [ overlapping speakers ] that was a long sentence. Yes. I think Justice Breyers complete in the act in your interpretation which is most glaring which is this qualified individuals thing. That you are setting up a system in which the federal exchanges, that there will be no customers and in fact there will be no products because section 1311 said the exchange shall make health plans available to qualified individuals and the next said said qualified individual is someone who resides the state that established the exchange so in your theaty if theory if someone doesnt qualify, that means federal exchanges have no customers. Which is not the reading that the government is going to it because they are not going to tell you. That is because they dont share your theory. In your theory that is the result. Let me be as clear as i can. If we prevail in this case they are not going to empty out the hhs exchangesba they understand because they understand there are numerous defenses established by the state in the qualified individuals statement. And number one, it says you have to be a qualified individual with respect to an exchange. As Justice Breyer pointed out, the statutory definition of exchange is a 1311 exchange. So they are only talking about state exchanges, not the hhs exchanges and it is in section 1312 which followed 1311 before 1321. Number two qualified individual doesnt mean that that means youre guaranteed access or if you are not qualified you are absolutely denied access. We know that from illegal alien provision. It says they are not qualified nor eligible for subsidy. But look at the prison provision. Which said prison should be treated as qualified individuals so under your theory this statute effectively said that prisoners should be allowed to enroll on federal exchanges. That makes no sense . It makes perfect sense to say the states get a choice. Think about somebody in prison in january and they get out in february. They have to buy insurance in february. If nobody incarcerated that means they couldnt buy insurance during the relative enrollment period. It gives states to decide, as for those incarcerated individuals, they can be eligible but for illegal aliens they are not qualified nor eligible. Even if you dont find that most pristine logic applied to the statute, remember we are observing these statute to avoid an absurd result and you should give a plausible, if not the most persuasive reading to a statute to avoid the result. But youre interpreting a statute generally to make it make sense as a whole. We look at the whole text. We dont look at four words we look at the whole text, the particular content and the more general context and try to make everything harmonious with everything else. And i think you said even at the very beginning of the argument as we were going back and forth about my hypothetical that of course context matters and context might make all of the difference with respect to what the five words mean. And i think what were expecting is that if you look at the entire text, it is clear you ought to treat the five words in the way they are. Ive given you the context, but the key is section 1311. You say the statute must work harmoniously. If you provide subsidies to hhs exchanges, you have essentially gutted section 1311 strong preference for state exchanges. What will happen is precisely what did happen under the irs rule. Two thirds the state are saying no, were not going to undertake this thankless task of running the exchanges with no incentives to do so. So, yes, what have i here in terms of what the statute means is 36b is quite clearly saying exchanges are available only on states. I have 1311 explaining why they limited subsidies to that and there is no contrary legislative history at all. What do they have . An atextual reading of 36b and they cant explain why an would explain it and undermined the rules of 1311 and no supportively legislative history. So under the theory of what this statutetory provision means, we clearly prevail. Thank you, counsel. General verrilli, youll have an extra ten minutes as well. Let me start by telling you where we stand on standing and i would appreciate to summarize what i think are the two key points in this case. With regard to standing, the question turns on whether any of the four petitioners are liable for the tax penalty for 2014. Now this case was litigated in the District Court in 2013 based on projections on the part of each of the four petitioners that they would earn a certain income in 2014. They filed declarations saying. With two of the four they would qualify for the unaffordable exemption and not have standing. With the other two they wouldnt qualify and they would have standing. But those were projections in 2013 about their income in 2014. 2014 has now come and gone and we know we dont know but the petitioners know whether any of the four have in fact are in fact liable for the tax penalty and that would depend on whether income in 2014 matches their projections. And mr. Carvin said there was fact finding for this. The petitioners did file a motion motion for Summary Judgment but that was dismissed. Im assuming because mr. Carvin has not said anything about the absence of a tax penalty at least one of the four is in fact liable for a tax penalty but that is a key point. But in respect to the veteran if mr. Hurst was a veteran for only ten months, he is correct he would not qualify for v. A. Health care because you have to serve for three years. Are you saying one person does have standing . No, it would depend on one of the four is in fact liable for the tax penalty for 2014. And that is information that is not in the governments position, it is in the position of petitioners counsel and with respect to 2015, there were no provekss and nothing in the record about any of the income for the plaintiffs for 2015 so nothing that would establish a controversy for 2015. You are not raising a standing question with us here for the first time at oral argument here, are you . Chief justice. We said based on our projections, it is our understanding that one of the four would be liable for tax penalty, the question is raised and i have to ask the relevant question which is whether any one of the four is in fact liable for a tax penalty because this is is this is on a motion to dismiss right . But it does go to this courts just injure is diction. And none of them is liable and i dont think there is a question about veteran status but i think that is the question. Isnt the question before us as to whether the District Court correctly held in the motion to dismiss context that there was standing. That may not be the end of the matter, but dont we have to isnt that before us . Well that may be yes. But and you mightality turnly turnlyturnly alternatively think about this in term of mootness if the projection didnt come to pass and none of the plaintiffs is not liable then you. Are you suggesting we have a trial here. I did not raise the fact the court did but im doing my best to know the court to let the court know what it is our standing. Would you send it back to the District Court . No i guess mr. Carvin hasnt suggested there is no plaintiff liable for a tax penaltyond based on that im inferring one of the petitions why wouldnt we accept a representation by him . There is no reason not if he makes a recommendation that one of the four was liable in 2014, and is liable in 20 or will be liable in 2015, i mean, we know at least one of them wont. The thing about that is im going to step further than that, Justice Sotomayor given that there hasnt been im willing to accept the absence of a representation as an indication there is a case of controversy here and that is why, mr. Chief justice, we havent raised standing. But i do think the key question is whether one of the four is liable for a tax penalty. You have to have that to have a case of controversy. And let me turn to the merits of what i think are the key summaries. We apply to the applicable provisions and it makes adirect to 36b and co hashtly they are reading to an act that doesnt work and second their reading forces hhs making exchanges due to failure and the promise of state flexibility and precipitates the Insurance Market death spiral and the findings say the statute was designed to avoid and revokes the promise of Affordable Care for millions of americans. That cannot be the statute that congress intended of course it could be. It may not be the statute they intended. The question is whether it is the statute that they wrote. I mean, there are no provisions in the statute that turn out to be illconsidered and illconceived. So it is not the statute they wrote and the reason it is not the statute that they wrote im going to start, if i could picking up i think on a variation of the hypothetical that justice caggan asked. In the brief they throw down the hypothetical about airports the statute that requires the state to construct an airport and the federal government shall construct such airport if state doesnt and no one could think that the federal governments airport was an airport instructed by the state. And i would say if those statutory provisions were con joined with a provision that say airports can only land at airports constructed by the state, you would conclude immediately that federally constructed airport qualified as constructed by the state other wise the statute would make no sense and the same exact thing is true there are no statutes that make no sense. Every statute must make sense and we will we will twist the words as necessary to make it that cant be the rule. That isnt the rule. But the rule is that you dont read statutory provisions in isolation isolation. You read them in context. You read them to make sure it operates as a harmonious whole. Read them so they are not ineffective. You read them so that you acknowledge that all of what you are saying only applies where there are alternative readings that are reasonable. You pick the one that will do all of the there are but if it can only reasonly mean one thing, it will continue to mean that one thing even if it has unterred consequences with respect from the standard. I want to make answer me in principle. Isnt no the case if the only reasonable interpretation of a reasonable provision it nonetheless means what it says is that true or not . I think there are a couple of limitations on that principal. The first is if what you have is a situation in which that it creates conflict within a statutory scheme then the cord has to harmonize and well i disagree. You have a single case in which we have said the provision is not ambiguous, it means this thing, but lord, that would make a terrible statute. So well interpret it to mean something else. I think brown and williamson is a good example. And they said a Drug Delivery device would cover tobacco but when you read it in context and considering the full scope of the regulatory regime, it cant possibly mean that. But let me work through the text here because i do think i can show you that there is a quite reasonable reading of this statutory text that allows you to affirm and requires you to affirm the governments position. General verrilli, before we get too immersed in a number of provisions of this, could you respond to a question that was asked dr. Mr. Carvins argument. If we adopt their interpretation of this act, is it constitution constitutionally coercive . I think it would be a novel constitutional question, and i think that im not prepared to say to the court today that it is unconstitutional. It would be my duty to defend the statute and on the authority of new york versus the United States i think we would do so. But i dont think there is a doubt it is a novel question and if the court believes it is a serious question. I was going to say does novel mean difficult. Because it does seem to me that if the petitions argument is creck, this is just not a racial choice for the states to make and they are being coerced and you then have to invoke the standard of constitutional avoidance. What i was going to say, justice kennedy, to the extent the court believes this is a serious constitutional question and if this does arise to coercion coercion, i think it becomes another powerful reason to read the statutory text our way. Because i do think and i do think with respect to the point your honor is making remember it is not just a situation in which there is conditions or state residents, but a profound problem of notice here. If you read if you take petitioners reading of the statute, then the idea that states were given you cant possibly justify this as adequate notice to the states. General verrilli, let me ask you about notice. We get a lot and lot of amicus briefs. We have two here. And 34 states declined to or failed to establish a state exchange . Correct. Now if they were all caught off guard and they were upset about this you would expect them to file an ameem us brief telling amicus brief telling us, but only some of them signed the brief. 23 states 23 jurisdictions submitted that brief, 17 of them are states that established state exchanges. Only six of the states that didnt establish state exchanges signed that brief. How do you account for that . I would make two points justice alito. You have states in camps all of whom told you they didnt understand the statute that way. And with the other eight states, i think it is an important point going to their understanding of what this act did. Remember this is an irs rule were talking about here and that irs put out a notice of proposed rule making saying this is what we intend to do. And the states oklahoma indiana and nebraska they filed rulemaking comments in the proceeding, you can see they address a number of issues and they say nothing nothing about the issue before the court now. So if they really understood the statute as denying subsidies in states that did not set up their own exchanges that would have been front and center in the rulemaking comments and they said nothing and i think that tells you a good deal about what everybody understood this statute said. There is another point on notice on this hurst argument and when an argument comes up a state has signed up for a federal program and then they say we didnt realize what we have gotten ourselves into. But here, it is not too late for a state to establish an exchange if we were to adopt petitioners interpretation of the statute. So Going Forward there would be no harm . Well let me address that directly and then would you like to make a broader point about statutory context. Now, directly of course i dont think it is possible to say there would be no harm. The tax credits would be cut off immediately and you would have very significant and adverse effects for millions of people in many states i said Going Forward. After the current tax year. And then Going Forward and would it not be possible if we were to adopt the petitioners interpretation of the mandate to sustain the mandate until the end of the tax year, as we have done in other cases where we have adopted the interpretation of a constitution or a statute that would have destruction, such as the northern pipeline case. And that is a case. It is up to the court to decide whether they have the digs to do the decision to do that. And if that is where the court is going and that is where the court thinks the proper disposition is, that would reduce the disruption but another point as a practical matter, the idea that a number of states all of these states or a significant number are going to be able in the six months between when a decision in this case would come out and when the new the new year from insurance purposes will begin to set up exchanges and get them up and running and get the approvals done is unrealistic. How long has it taken . To give you an example of the current timeline Justice Ginsburg, in order to have an exchange approved and insurance policy approved and ready for the 2016 year, year those approvals have to occur by may 2015. So that gives you a sense of the time line that hhs is operating under. What about congress. You really think congress is just going to sit there while all of these disastrous consequences ensue . How often have we come out with a decision, such as the Bankruptcy Court decision, congress adjusts and nakts a statute that takes care of the problem. Happens all the time. Why is this not going to happen here . This congress . I dont care what congress youre talking about. If the consequences are as disastrous as you say, so many Million People without insurance an what not yes i think this congress would act. The relevant question and im going to try to get back to the point i was trying to make in response to Justice Alitos question. The relevant what did Congress Enacting this statute in 2002 do. Did they really set up a system where the states are subject to the kind of onerous situation the petitioner claims. I think there are three text ral indications that could not be the statutory scheme they tried to set up. First is the existence of the federal exchange. It would make no sense, no sense for congress to have provided for federal exchanges if as mr. Cardin suggests, the statutory design was supposed to result in every state established in this exchange. Well, again, talking about federalism a mechanism for states to show they had concerns about the wisdom and workability of the act in the form it was passed. Justice kennedy i think federalism values are promoted by our interpretation. If that is, indeed, what a state thought. If a state would have preferred not to have State Government participate in the implementation of this act for reasons identified, the structure of the act congress put in place were advocating for today fully vindicates without adverse consequences visited upon the citizen of the state. Thats why our reading is the pro federalism reading. Its their reading, seems to me that is the antifederalism reading. Thats a powerful reading to reject it. If i could go to the second statutory related to what were talking about, section 21 says this statute is designed to afford state flexibility. State flexibility. It would be a norwellian sense of flexibility to use it in the way, its polar opposite. The third pointish seems to me is the notice point. If indeed the plan was, as mr. Carvin said, every state was bog to establish an exchange for itself, that would cure all the statutory anomalies and absurdities and possibilities his reading provides for, if that was really the plan then the consequence for the states would be in neon lights in the statute. You would want to make absolutely sure that every state got the message. Instead what you have is subclause in section 36b, which is a provision that addresses eligibility of individual taxpayers. This is not the most elegantly drafted statute. It was pushed through on expedited procedures and didnt have consideration by a conference committee, for example, that statutes usually do. What would be so surprising if among its other imperfections theres the imperfection that what the states have to do is not obvious enough. It doesnt strike me as inconceivable. So justice scalia, im going to answer that question by talking about the legislative process, because i think it is quite relevant and i think it should be quite relevant to you with respect to the question you just asked. The language here in 36b was not the product of some lastminute deal. It wasnt the product of scrambling at the end. The language that emerged, language in 1311, languages in 1321 was the product of the Senate Finance committee markup, which went on for weeks and weeks. It was a public it was a public hearing. Frankly it was covered by cspan. You can go watch it on cspan archives if you want to. You can see coming out of that a clear understanding was with this statutory setup will result in being available in every state. Were there senators opposed to having the federal government run the whole thing because they thought that would lead to a single payer system which some people wanted. And the explanation for this provision is it prevents federalization of the entire thing. Certainly a plausible explanation, the provisions there. Mr. Carvin has floated that as an explanation and he suggests it was senator ben nelson that required it. Theres absolutely no contemporaneous evidence none whatsoever, that anybody thought that way. The solution to the problem your honor has identified is what congress did by having states have the option to set up their own exchanges with state by state federal fallbacks rather than national system. Senator nelson made clear. He stated no intention of the kind, no contemporaneous evidence at all that anyone did. What mr. Carvin has suggested is that this was the product of some deal to try to get votes, so get passed. What i would suggest to your honor, there is objective proof thats not true. The provisions and the act negotiated at the end to secure the necessary votes are in title 10 of the act. If you look in the act pages 823, 924, thats title 10, you can see all the amendments, not a single one has anything to do with the statutory language before the court. The puzzle thats created by your interpretation is this. If congress did not want the phrase established by the state to mean what that would normally be taken to mean, why did they use that language . Why didnt they use other formulations that and elsewhere in the act . Why didnt they say established under the act established within the state . Why didnt they include a provision that said an exchange established by hhs is a state exchange when they have a provision in there that does exactly that for the District Of Columbia and for the territories. It says they are deemed to be states for purposes of this tax. So why would they do that . Of course the provision says doesnt say established by the state with a period after state it says established by the state under section 1311. And our position textureally is crossreading, effectively what congress is doing is saying that exchanges established through whatever mechanism, exchanges set up by the states themselves youre saying by crossreferencing 1311 1311 and 1321. I do think that. Let me walk through why i think thats true. That seems to be going in the wrong direction of your case not the right direction. I think its the right direction if you will ride with me on that. Before under the circumstances to that your answer doesnt explain why by the state is in there. Why didnt they say established under 1311 . The second point is that wherever this provision appears in the act, established under 1311, its doing work. The work its doing is were saying talking about the specific exchange established in the specific state as opposed to general rules for exchanges. Medicaid, chipa works the same way. In the state. Why isnt that the phrase they used. In the state. I suppose they could have. It works perfectly well this way. If you look at qualified individual, its clearly with respect to qualified individual. It says qualified individual is a person who is located, who resides in the state that established the exchange. Clearly what they are talking about is a geographical reference to the state. Thats whats going on there. Its going on every time the statute uses that phrase. Its doing that work. Thats why its in there. Now if i could go back to your point, says established by the state under section 1311. Section 1311b 1 says each state shall establish an American Health benefits exchange for the state. Its not as mr. Carvin said an urging, it says each state shall establish. Now, we know that when congress used that language each state shall establish it must have been meant something more inclusive than each State Government should itself set up the can exchange. We know that congress unthe backdrop of the amendment, couldnt impose that requirement, we know that because of section 1321. Section 1321 provides the means by which 1311 b 1 requirement is satisfied. It will be satisfied by a state electing to meet the federal requirements for exchanges or it can be satisfied in the event a state doesnt or tries but comes up short. Hhs stepping in and establishing. When the statute says each state shall establish it really means federal government shall establish if state doesnt establish. If that were the correct interpretation you wouldnt need 1321 at all. I think the right way to think about this, justice alito, whats going on here is that the right place to focus, let me put it that way, the right place to focus is not on