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102nd Congress adjourns after productive final week.

The 102nd Congress adjourned with a flourish on October 9. In its last week, Congress passed more bills and addressed more city issues than in any other week of its two year duration.

The closing week made up for some of the gridlock which characterized most of the year, but White House silence on the urban aid bill continued to leave in doubt whether the federal government would keep its promises to begin to respond to city concerns and whether cities and towns could issue tax exempt housing and economic development bonds.

Congress easily overrode President Bush's veto of the NLC supported cable bill, passed and sent to the President a bill to delay the massive and complex, unfunded stormwater mandates, passed the urban aid bill, passed NLC-supported base closing legislation, and sent to the President legislation to reauthorize the nation's housing and community development laws.

On its last day, the House killed an NLC-opposed bankruptcy bill, while last minute efforts to help cities fight crime and drugs in the Senate were unable to overcome a year-long Republican filibuster.

The action on the city front came as the nation heads into elections expected to result in the greatest turnover in any Congress in this century in the first post Cold War election. The elections are expected to result in one of the largest freshman classes of former municipal officials ever elected to federal office.

After staying in session throughout the weekend and through the night on Monday, October 5, the House adopted the final urban aid bill just before dawn on Tuesday, and then tentatively adjourned just after noon, leaving the Senate with a take-it-or-leave-it ultimatum. The Senate easily overcame efforts to filibuster the urban aid bill on the 8th and passed and sent the bill to the President by a wide, bipartisan margin. That same day, the Senate easily overcame filibusters and passed and sent to the White House massive water and energy bills which had delayed adjournment.

Relief a swallow away

On the key issue of municipal stormwater relief, the efforts of city leaders across the nation to overcome Sen. Howard Metzenbaum's (D-Ohio) hold on an NLC-supported House-passed measure finally met success when the Senate late on October 8 passed and sent to the White House a two year extension of the moratorium on the administration promulgated stormwater mandates. The moratorium fell far short of NLC efforts for a more comprehensive, long-term solution, but assured protection for thousands of cities and towns from liability for noncompliance.

Urban and Rural Aid?

Confusion continued to swirl around the urban aid tax bill as city officials continued to press President Bush last week to sign the bill. The bill would provide more than $11 billion in aid to distressed urban and rural areas, slightly less than half the amount the President approved last week to aid the former Soviet Union. The White House has not made any specific statement on the urban aid bill, although House and Senate Republican leaders have indicated the President intends to veto the bill, apparently because it includes tax and revenue increased to pay for its tax cuts and incentives.

However, the White House has indicated the President intends to sign the new energy bill into law. That bill includes some $5 billion in new federal tax increases.

If the President vetoes or pocket vetoes (allows the bill to die simply not signing it) the bill, it is unclear when the new 103rd Congress would be able to pass legislation reauthorizing cities and towns to issue mortgage revenue and small issue industrial development bonds. President Bush vetoed legislation which would have extended municipal authority last April before the programs expired in June.

Housing and Community Development

The Senate also passed legislation to reauthorize the nation's housing and community development laws on its final day, but this bill too faces a potential White House veto. The two-year reauthorization bill would reduce federal restrictions on the HOME state and local housing block grand program and reject HUD Secretary Jack Kemp's proposed preemption of municipal land use and zoning authority.

Kemp, however, has said he is recommending a veto.

Base Closing

In its final days, Congress completed action not only on a major economic conversion plan as part of the 1993 defense authorization legislation, but also approved NLC-supported legislation to allow parcelization of closed military bases. Under the legislation, uncontaminated portions of closed military bases could be transferred to adjacent communities, with the Pentagon responsible for cleaning up the contaminated parcel.


After overcoming a filibuster by Nevada's Senators, the Senate sent a major energy bill to the White House. The bill seeks to decrease U.S. dependence on imported oil by promoting domestic energy production and conservation.

For cities, the energy bill contains both a new mandate on municipal fleets for large metropolitan areas and a number of tax changes.

The bill would require the Department of Energy to issue rules mandating cities to phase in cars and light vehicles that run on non-gasoline fuels. The new federal mandates would apply to metropolitan areas of 250,000 with municipal fleets of 20 or more centrally fueled vehicles, proposing a phase-in of purchase goals of 20 percent by 1999 and 70 percent by 2006.

The bill would also increase the existing cap on employee deductions for employer-provided transit passes from $21 per month to $60. The bill would pay for this change by imposing a cap on parking deductions of $155 per month.

The energy bill would remove current incentives for nuclear trust funds to invest in municipal bonds, in effect encouraging disinvestment, and it would create a new kind of tax exempt municipal bond for hydroelectric facilities that would be exempt from the private activity volume cap. Current nuclear trust funds are set up to finance decommissioning of nuclear plants. The trust funds may only invest in Treasury securities or municipal bonds.

The new legislation would remove the investment limitations and drop the tax rate from 34 down to 20 percent.

Municipal Bankruptcy

On its final day, the House refused to adopt Senate-passed bankruptcy legislation which would have severely limited the access of cities and towns in 38 states to protection from creditors.

The legislation, a compromise developed in the final week in a series of closed-door meetings between House and Senate negotiators, originally contained two provisions affecting cities. The first, offered by House Judiciary Committee Chairman Jack Brooks (D-Tex), would have clarified federal bankruptcy law to ensure the priority of cities and towns to collect already-owed property taxes from a corporation filing for bankruptcy.

Recent federal court decisions in New Jersey, New York, Vermont, Florida, and Texas have eroded municipal rights. According to Judiciary Committee staff, however, Senators Howard Metzenbaum (D-Oh) and Charles Grassley (R-Iowa) effectively opposed the clarification, expressing concern about the impact of the clarification on banks.

In a recent decision affecting a small city in Vermont, a federal court overturned a lower court decision awarding nearly $1 million in back taxes to the city. The court reversed and awarded the money to a Japanese bank citing federal circuit court decisions in New Jersey.

On the second issue, the House proposed to overturn current federal law and prohibit any municipality authority to seek bankruptcy protection unless specifically authorized by state law. Currently only 12 states provide such authority, and a number of states adamently oppose granting such rights.
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Author:Shafroth, Frank
Publication:Nation's Cities Weekly
Date:Oct 19, 1992
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