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Budget serves up mixed bag for cities; fiscal reality sets in.

A heavy dose of reality was served up along with President Clinton's first budget proposal, as campaign promises and high expectations have given way to fiscal practicality.

For the nation's cities and towns, the proposal begins to address some of NLC's top priorities and acknowledges the need to reinvest in America. But, the challenge of investing in people and communities while trying to reduce the federal deficit means the new investments are sorely limited and focused in a few key areas.

The budget proposal does address some of the priorities set by the NLC Board of Directors in March when it adopted a five-point Action Agenda.

The Action Agenda identifies major areas the NLC leadership felt were essential to building a stronger future for cities and towns. The five issues are: restoring safety in cities and towns; rebuilding communities through infrastructure investments; reversing federal mandates; investing in communities, particularly those affected by defense cutbacks; and reforming health care.

Winners among NLC priorities appear to be investment in children and families, infrastructure, and economic conversion. However, the Clinton proposal was silent on the priority issue of reversing the negative effects unfunded mandates visit on local government budgets.

"The President's budget reflects his commitment to invest in people and communities and begin to reduce the massive federal deficit," said NLC President Don Fraser. "But it's like the kid's challenge of rubbing your stomach and patting your head at the same time. It's not easy."

"What we see in this budget is a first step toward reordering federal budget priorities--something NLC has been advocating for years, "Fraser continued. "We still have a long way to go."

Infrastructure investments and funding for economic conversion to assist communities directly affected by defense cutbacks fare best in the President's budget. The budget calls for full funding of highway programs authorized under the surface transportation act and a 21 percent funding increase for public transportation programs.

As part of what is expected to be a long-term comprehensive economic conversion strategy, the defense budget proposes $3.3 billion to assist individuals and communities directly affected by defense cutbacks--nearly double the funding available in FY 1993.

In the area of restoring safety, the President's budget proposes funding to conduct national criminal records background checks to implement the Brady Bill if and when it is passed and funds for new federal/state and local partnership initiatives in the area of law enforcement. The overall direction of the national anti-drug efforts, however, remain largely unchanged from the previous administration.

The administration's overall direction on health care reform still awaits the report of the task force. Mandatory spending for health-related entitlement programs--medicaid and medicare would continue to increase at a rapid pace. Absent major health care reform, these two items will continue to consume a large and larger portion of the federal budget and impose ever greater mandates on state.

The budget proposal also makes a clear statement about investing in children and families-one of NLC's top priorities in recent years.

Funding for Head Start would nearly double--from $2.77 billion to $4.14 billion. The budget also proposes a new summer Head Start Program and increases in Even Start, the Special Education Preschool Grants for Infants and Families program, and in Special Education Preschool Grants -- all programs to assist children in being ready to learn. The budget also calls for increased funding to support the childhood immunization program that is included in the economic stimulus package.

A new multi-agency, urbanrural initiative designed to support efforts to integrate education and social services provides an opportunity to examine ways to coordinate service delivery at the local level and experiment with interagency cooperation at the federal level. The Departments of Agriculture and Housing and Urban Development would coordinate the new initiative.

There is little in the President's budget that would help reverse the impact of unfunded mandatory programs--particularly environmental mandates that have a significant impact on local budgets. Federal financial assistance for environmental mandates is proposed to be reduced in virtually all areas except drinking water where a new repayable low interest loan program is proposed.

"I am especially pleased about the significant increases proposed for children's and families programs and for public infrastrucutre--two of NLC's key priorities," Fraser said. "As local leaders, it is our responsibility now to examine all of the President's proposals closely and participate with Congress in making the tough decisions."
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Author:Becker, Christine
Publication:Nation's Cities Weekly
Date:Apr 19, 1993
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