Volume 55, Issue 3

3 posts

Do Municipalities Need a Lender of Last Resort? Evaluating the Federal Reserve’s Pandemic-Era Municipal Lending Program

Issues Volume 55, Issue 3

By Arpan Patel

In March 2020, the COVID-19 pandemic pushed the $4 trillion American municipal debt market—a critical source of funding for state and local governments—to the brink of collapse. On March 27, 2020, Congress passed the Coronavirus Aid, Relief, and Economic Security Act, which in part empowered the Board of Governors of the Federal Reserve and the Department of the Treasury to establish a Municipal Liquidity Facility to “help state and local governments better manage cash flow pressures in order to continue to serve households and businesses in their communities.” Although the Federal Reserve authorized the Municipal Liquidity Facility to lend up to $500 billion to municipalities, only two borrowers, who drew on 1.27% of the total capacity, tapped the facility. The debates that sprang up around the Municipal Liquidity Facility demonstrate that scholars have yet to grapple with the institutional, legal, and historical constraints of Federal Reserve support for state and local governments.

This Note addresses that gap. It begins by situating the Municipal Liquidity Facility within the history of the Federal Reserve’s monetization of municipal bonds. The Note goes on to evaluate Congress’ legislative mandate for the Municipal Liquidity Facility and the operational, political, and legal dynamics of the program. Finally, based on the institutional history, legal authority, and politics of the Federal Reserve, this Note examines policy proposals to reform the Federal Reserve’s role for supporting municipalities during crises. Ultimately, this Note attempts to place the pandemic-era policy experiment in historical context, and then draw out lessons to help answer a critical question for policy makers: when municipal governments face financing crises, what is the proper role for the Federal Reserve?

Download Article

Harris Funeral Homes: A Proposed Tool for Claiming Trans Rights that is Dead on Arrival

Issues Volume 55, Issue 3

By Joe Sullivan

In June 2020, the Supreme Court extended protections under Title VII of the Civil Rights Act to LGBTQ Americans in Bostock v. Clayton County, Georgia. This historic decision presents the LGBTQ community with the opportunity to claim rights under a wide range of laws. This Note will consider implications of the Supreme Court’s recent ruling in Bostock on future challenges to transgender health care discrimination by employers. Defining “sex” as including “sexual orientation” has the potential to make great progress towards ending trans health care discrimination. The Religious Freedom Restoration Act (RFRA), however, stands in the way as a formidable obstacle. RFRA allows corporations to engage in conduct that would otherwise be unlawful, if those laws conflict with their religious beliefs. Unless those laws further a compelling state interest in the least restrictive manner, RFRA provides a loophole. Closely held religious corporations are still able to employ a RFRA-based defense against Title VII claims, narrowing the scope of Title VII rights.

In Part I, this Note provides a background of the current state of trans health care coverage denial in the United States and notes the inherent conflicts between RFRA and Title VII. In Part II, it provides an explanation of the three cases which were consolidated by the Court in Bostock. Part III then analyzes Bostock’s majority opinion and Justice Alito’s dissent to highlight the uncertainty left in the wake of Bostock. Next, Part IV examines scholars’ optimism that Harris Funeral Homes is a guide for claiming future LGBTQ rights. Finally, Part V argues instead that Harris Funeral Homes is a weak tool to use for future litigation, concluding that a legislative solution can best secure trans health care rights.

Download Article

Price Gouging, the Amazon Marketplace, and the Dormant Commerce Clause

Issues Volume 55, Issue 3

By Julia Levitan

This Note argues that states can regulate price gouging on the Amazon Marketplace without offending the dormant commerce clause. Part I provides an overview of state price gouging statutes and enforcement efforts. Part II examines the reported price gouging, including on the Amazon Marketplace, in connection with the COVID-19 pandemic. Part III explains the dormant commerce clause jurisprudence, with a particular emphasis on the doctrine’s application to state laws governing internet activities. Part IV considers the dormant commerce clause implications of regulating price gouging on the Amazon Marketplace and concludes that state price gouging laws can be enforced against both Amazon and its third-party sellers without violating the dormant commerce clause. Part IV also places the two enforcement targets in an optimal deterrence framework and identifies Amazon as the ideal regulatory target to effectuate robust enforcement of price gouging prohibitions.

Download Article