Introduced by Senator Lyons of Chittenden District, Senator Bartlett of Lamoille District, Senator Condos of Chittenden District, Senator Dunne of Windsor District, Senator Illuzzi of Essex‑Orleans District and Senator MacDonald of Orange District
Statement of purpose: This bill proposes to protect state sovereignty by urging Congress and the United States Trade Representative to incorporate in future treaty provisions entered by the United States provisions set forth in the bill in a model state sovereignty section. This policy would require that state action be upheld if it is: rationally related to a legitimate objective; within the exercise of regulatory or prosecutorial discretion; and not subject to an act of Congress that expressly declares the law or application invalid. This model state sovereignty section also: accords no deference to any determination of a dispute panel established under an international trade agreement or treaty; ensures the right to intervene to any state that has an interest that is impaired or impeded; and provides that any provisions relating to expropriation shall be consistent with United States law regarding takings. The sovereignty section would prohibit the United States or any other entity from seeking indemnification from the state for any monetary awards under any agreement or treaty to which the state has not been made a party by specific act of legislation, and it would require that all proceedings related to state law are open to the public and that related submissions, findings, and decisions are promptly released to the public. The bill proposes to require an act of legislation before the state is obligated under any treaty or international trade agreement that is inconsistent with state law. Finally, the bill would require the attorney general in conjunction with legislative council staff to solicit input from a range of different groups regarding the model state sovereignty section and to submit legislative recommendations.
AN ACT RELATING TO THE DEFENSE OF STATE SOVEREIGNTY
It is hereby enacted by the General Assembly of the State of Vermont:
Sec. 1. 1 V.S.A. chapter 6 is added to read:
Chapter 6. Defense of State Sovereignty Act
§ 351. STATE SOVEREIGNTY
(a) The general assembly finds that the Constitution of the State of Vermont is specific with respect to how state laws are created and in detailing the enactment procedures and processes to which the citizens of the state are entitled, including the following:
(1) Chapter II of the Constitution of the State of Vermont, in Section 2, provides that the supreme legislative power shall be exercised by a senate and a house of representatives.
(2) Chapter II of the constitution, in Section 6, requires that both houses of the general assembly concur in any bill before it shall have the effect of or be declared to be law.
(3) Chapter II of the constitution, in Section 11, provides that bills that have passed both houses shall be presented to the governor, who has the power to approve or veto. A bill that has been vetoed by the governor may still be enacted by the general assembly by a two-thirds vote in each chamber.
(4) Chapter II of the constitution, in Section 4, vests the judicial power of the state in a supreme court, a superior court, and other courts as may be created by the general assembly.
(5) Article 4 of Chapter I of the constitution provides that “every person within the state ought to find a certain remedy, by having recourse to the laws, for all injuries or wrongs … conformably to the laws.”
(6) Chapter II of the constitution, in Section 5, provides that the powers of the branches shall be separate and distinct, and that neither shall exercise the powers properly belonging to the others.
(7) Chapter I of the constitution, in Article 6, provides that “all power being originally inherent in and … derived from the people, therefore, all officers of government, whether legislative or executive, are their trustees and servants; and at all times, in a legal way, accountable to them.”
(8) Chapter I of the constitution, in Article 7, provides that “government is, or ought to be, instituted for the common benefit, protection, and security of the people, nation, or community … and that the community hath an indubitable, unalienable, and indefeasible right, to reform or alter government, in such manner as shall be, by that community, judged most conducive to the public weal.”
(9) Chapter I of the constitution, in Article 12, provides that “when any issue in fact, proper for the cognizance of a jury is joined in a court of law, the parties have a right to trial by jury, which ought to be held sacred.”
(10) Chapter I of the constitution, in Article 15, provides that the “power of suspending laws, or the execution of laws, ought never to be exercised but by the Legislature, or by authority derived from it, to be exercised in such particular cases, as this constitution, or the Legislature shall provide for.”
(11) Under Chapter I of the constitution, in Article 9, “every member of society hath a right to be protected in the enjoyment of life, liberty, and property … and … no part of any person’s property can be … taken … without … consent … nor are the people bound by any law but such as they have in like manner assented to, for their common good.”
(12) Under Chapter II of the constitution, in Section 8, “The doors of the House in which the General Assembly … shall sit, shall be open for the admission of all persons who behave decently, except only when the welfare of the State may require them to be shut.”
(b) The general assembly also finds that:
(1) International trade agreements and treaties entered by the United States have created and may continue to create situations where general terms of vaguely worded documents may be construed by international arbiters in a manner that abrogates the role of the courts in this state, that has the effect of superseding the duly enacted laws of this state, that ignores the provisions of the Vermont constitution, that establishes the process by which laws that govern citizens of the state are enacted, that takes place without the due process and public access that are a hallmark of a democracy, and that assesses damages against the United States for state actions that are entirely appropriate and within the bounds of the state’s fundamental duty to protect the public health, safety, and welfare.
(2) The people of the state deserve predictability regarding the range of possible interpretations that may result in proceedings under international trade agreements and treaties.
(3) It is appropriate for the states to suggest to Congress a model statute that addresses the relationship between state law and the international trade obligations of the United States in a reasonable way that lends predictability to commerce involving international trade, while at the same time assuring the sovereignty of the various states.
§ 352. DEFINITIONS
For purposes of this chapter, “state” includes any agency, department, board, office, or subdivision of the state of Vermont.
§ 353. MODEL STATE SOVEREIGNTY SECTION
It is state policy to urge the Congress to require that any negotiated international trade agreement or treaty that affects the sovereignty of the state of Vermont shall assure the following:
(1) Nothing may be construed as prohibiting any state from engaging in standards-related activities that do not create unnecessary obstacles to the foreign commerce of the United States. No standards-related activity of any state shall be deemed to constitute an unnecessary obstacle if the standards‑related activity has a rational relation to one or more legitimate state objectives, which include the protection of health, safety, security, environment, employment opportunity, or consumer interests, and if that activity does not operate to exclude imported products or services which fully comply with those standards.
(2) With respect to nonstandards-related activities of any state, the states retain the ability to make purchases in compliance with criteria that are rationally related to one or more legitimate state objectives and to take measures and establish requirements that are also rationally related to one or more legitimate state objectives.
(3) States shall retain the right to exercise discretion with respect to investigatory, prosecutorial, regulatory, and compliance matters and to make decisions regarding the allocation of resources to enforcement with respect to matters determined to have higher priorities. It shall be recognized that a state is effectively enforcing its laws if a course of action or inaction reflects a reasonable exercise of that discretion or results from a good faith decision regarding the allocation of resources.
(4) No state law or application of state law may be declared invalid as to any entity or circumstance on the ground that the provision or application is inconsistent with an international trade agreement or treaty, except pursuant to an act of Congress that expressly declares that law or application invalid.
(5) No entity, except the United States acting pursuant to a specific act of Congress that expressly declares a state law or application invalid:
(A) shall have any cause of action or defense against a state under an international trade agreement or treaty; or
(B) may challenge any action or inaction by any state on the ground that such action or inaction is inconsistent with an international trade agreement or treaty.
(6) In case of a challenge by the United States under subdivision (5) of this section:
(A) If any dispute panel or appellate panel is established under an international trade agreement or treaty, no dispute panel or appellate panel report regarding the interpretation or application of state law shall be binding or accorded deference.
(B) The United States shall have the burden of proving that the state law or application of the state law has been expressly declared by Congress to be invalid.
(C) Any other state with an interest that is impaired or impeded in the action shall have the unconditional right to intervene in the action as a party, and the United States shall be entitled to amend its complaint to include a claim or cross-claim concerning the law of a state that so intervenes.
(D) Any state law that is declared invalid by express act of Congress shall not be deemed to have been invalid in its application during any period before the effective date of that act.
(7) Any international trade agreement or treaty that addresses expropriation shall establish standards that are consistent with United States legal principles and practices for determining what constitutes a taking and what compensation shall be made for a taking.
(8) Neither the United States nor any other entity shall have the power to seek indemnification from the state for any monetary awards required to be made under any international trade agreement or treaty to which the state is not specifically a party, with specific legislative approval being required before the state may be a party under a particular international trade agreement or treaty.
(9) There shall be transparency in all matters relating to the applicability of state law or the effects of state law by ensuring that all proceedings that relate to state law are open to the public, and that submissions, findings, and decisions relating to state law are promptly released to the public.
(10) No international trade agreement or treaty shall allow or be construed to allow the extrajudicial reconsidering, revising, or overruling of issues determined by a state court acting within its jurisdiction.
(11) No international trade agreement or treaty shall be construed to prevent the state from adopting, implementing, and enforcing state law.
(12) When the President of the United States submits an agreement to Congress, the president shall also submit to the state legislature, the governor, the attorney general, and the chief justice of the state supreme court an implementing plan, which shall include a description of the impact the trade agreement will have on state and local sovereignty, including the sovereignty of the state court system, as a result of any potential preemption of state law.
§ 354. STATE ENTRY INTO OBLIGATIONS UNDER TREATY OR
Neither the governor nor any other person or entity may subject the state to the terms of a treaty or international trade agreement entered by the United States that is inconsistent with state law, without the specific approval of the general assembly to the terms of that treaty or international trade agreement.
§ 355. EFFECT OF CHAPTER
This chapter shall inform and guide the governor and the attorney general with respect to the state’s policy on matters covered under this chapter, and how best to represent the interests of the state before federal and international bodies.
Sec. 2. STUDY
The attorney general, in cooperation with legislative council staff acting under the direction of the Joint Committee on Rules, shall consult with representatives of the National Conference of State Legislatures, the Commission on Uniform State Laws, the United States Trade Representative, the state and national representatives of the cities and towns, the National Association of Attorneys General, the Association of Chief Justices of the states, interested agencies of state government, the Vermont Law School, members of the general public, representatives of manufacturers and commercial and environmental groups, and representatives of labor groups and shall develop recommendations for model provisions that may be presented to the United States Trade Representative and Congress on behalf of collaborating states with respect to issues identified in the model state sovereignty statute adopted as part of this act. A portion of these recommendations may include proposed amendments to that model state sovereignty section. The goal shall be to create a model that will protect state sovereignty, while at the same time facilitating international trade by creating a level of certainty as to the nature of state sovereignty provisions that are agreed upon by the trade representatives of the United States.
Sec. 3. EFFECTIVE DATE
This act shall take effect upon passage.
The Vermont General Assembly
115 State Street