Spending power

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Under Article I, Section 8, Clause 1 of the Constitution, Congress is granted the power to lay and collect taxes in order "to pay the Debts and provide for the common Defense and General Welfare of the United States."  As required by United States v. Butler, 297 U.S. 1 (1936), Congress must exercise its power to tax and spend for the "general welfare". Through use of its spending power, Congress is able to place a requirement on states that compliance with specified conditions must take place before the state will be considered to meet the qualification requirement for federal funds.  Under a test provided in South Dakota v. Dole, 483 U.S. 203 (1987),  for Congress to place a  condition on receipt of federal funds by a state, the spending has to serve the general welfare, the condition placed on the state must be unambiguous, the condition has to relate to the particular federal program, unconstitutional action cannot be a contingency of receipt of the funds, and the amount in question cannot be so great that it can be considered coercive to the state's acceptance of the condition.

See Congressional power.