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Block Grants
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James M. Cannon Files (Ford Administration)
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The original documents are located in Box 5, folder "Block Grants" of the James M.
Cannon Files at the Gerald R. Ford Presidential Library.
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
photocopies or other reproductions of copyrighted material. Gerald Ford donated to the United
States of America his copyrights in all of his unpublished writings in National Archives collections.
Works prepared by U.S. Government employees as part of their official duties are in the public
domain. The copyrights to materials written by other individuals or organizations are presumed to
remain with them. If you think any of the information displayed in the PDF is subject to a valid
copyright claim, please contact the Gerald R. Ford Presidential Library.
Digitized from Box 5 of the James M. Cannon Files at the Gerald R. Ford Presidential Library
Jim CANNON
MEMO
February 14, 1975
TO:
THE VICE PRESIDENT
FROM: Mary Kresky
Attached is the draft outline which you
requested regarding the problem of categorical
grants and the need for "block" grants.
The total number of categorical grants has
decreased from over 1,000 to about 870. This figure
of 870 was gotten from OMB by Art Quern. The reason
for the decline is that there has been some consolida-
tion of grants by Congress in the last few years.
If the President should decide to talk to the
Governors about the need for block grants, I would think
that after describing the problem with categorical grants
he would need to give some concrete evidence -- such as
proposed legislation -- that the Administration intends
to take action regarding block grants.
FORD LIBRARY & 038870
DRAFT OUTLINE
THE PROBLEM OF CATEGORICAL GRANTS AND THE NEED FOR BLOCK GRANTS
It is important at this time of economic difficulty that
government at all levels make the most productive and
effective use of its resources. This is unduly difficult
under the present chaotic network of some 870 federal
categorical grant-in-aid programs to state and local
governments.
In fiscal 1975, it is estimated that $53 billion in federal
dollars alone -- not counting the state and local matching
dollars -- will be spent on federal grant and shared revenue
programs. Because many of these programs are so restrictive
and narrowly focused, they in fact often hinder the efforts
of state and local governments to meet their most urgent needs
in the most effective and efficient manner.
A. The Problems of Categorical Grants-In-Aid
1. Not geared to the needs of today
Federal grant-in-aid programs were originally
designed to encourage state and local govern-
ments to undertake specific new programs,
particularly to help meet social needs. In
this the system was successful. But today
the need is no longer for stimulative narrowly
focused programs. Rather, the most urgent need
is to make existing programs more effective and
to help support the basic services for which
state and local governments have historically
FORD
been responsible.
2. Distort State and Local Priorities
Because categorical grants are so narrowly
focused and rigid, efforts of state and local
governments to mobilize and concentrate
resources on their most urgent needs are
often thwarted.
Within functional areas such as education,
health, and manpower, needs vary greatly
between regions, states and areas within
a state but the inflexibility and rigidity
- 2 -
of the congressionally mandated categorical
grants prevents the adaptation of them to
specific problem areas.
Furthermore, because these grants require
matching funds, state and local governments
often find that they are devoting scarce
fiscal resources to lower priority programs
in order to get readily available federal aid.
3. Inhibit Coordinated Planning
The categorical grant system tends to discourage,
rather than encourage, efforts to approach problems
on a comprehensive and inter-related basis. The
separate programs require separate plans and it is
almost impossible for a Governor or Mayor to bring
about any relationship between these plans.
In the area of elementary and secondary
education, for example, there are some
50 separate programs. Under these
circumstances, it is almost impossible
to develop a coordinated plan for improv-
FORD
ing education.
4. Waste of scarce fiscal resources
LIBRARI
Attempting to work through the maze of grant
programs with their authorizations, appropriations,
rules and regulations, applications, procedures
and reporting requirements is a time consuming,
expensive and often wasteful process. Too many
people have to spend too much time on the paper
work and the costs are too high. It is estimated
that on the average, the cost of getting a grant
is 10-15% of the grant. (This figure is being checked)
B. The Need for Block Grants
It is time for a renewed and concerted effort to
consolidate the many separate but related grant-
in-aid programs within borad functional areas into
"block" grants.
- 3 -
This is a difficult objective but progress toward it
can be made if officials at all levels of government
will actively work for it.
-- Many thought general revenue sharing
would not become a reality but it has.
Some progress has also already been
made in consolidating grants in the
areas of health, education, manpower,
social services and community development.
-- The present moment is especially appropriate
to move from categorical to block grants
because of congressional committee reform,
change and reassignment of legislative
responsibility.
FORD LIBHARY
THE WHITE HOUSE
WASHINGTON
January 23, 1976
INFORMATION
MEMORANDUM FOR
JIM CANNON
FROM
PAUL MYER
SUBJECT:
Block Grant Legislative
Strategy
The following are some tentative thoughts with regard
to the legislative strategy for implementation of the
President's proposed establishment of block grant pro-
grams in health, education, social services and child
nutrition.
1.
All legislative proposals and messages should
be transmitted to the Congress no later than February
15, 1976. Early transmittal to the Congress is neces-
sary so that we do not compound the obvious barriers
these proposals face in the form of special interest
group opposition, committee jurisdictional conflicts
and the maze of Budget Act procedures. Unnecessary
delay in this vital first step would only serve to under-
cut the President's position and weaken our efforts to
gain serious consideration by the Congress and the
public.
2.
All of the block grant legislative proposals
face a jurisdictional jungle due to conflicts in the
legislative authority of various committees and sub-
committees in both the House and Senate. Beyond careful
draftsmanship to avoid unintentional problems with
respect to referral, early consultation with the Leader-
ship and potential sponsors is a must. The image of
total Congressional control and a desperate search for
strong sponsorship would be legislatively damaging and
weaken the political side.
FORD
is
LIBRARY
-2-
3.
One of the major barriers facing the block
grant legislation is the parochial Congressional con-
cern over relinquishing the overwhelming authority
committees now hold over the Federal categorical grant
process. Without question, we must keep the initiative,
setting forth the benefits of the President's proposals
and thus focus attention on Congressional reluctance or
failure to act as not simply a matter of policy dispute.
In this regard, adequate facts and numbers must be made
available to both the public and Members of Congress.
Sord but Guit
Based upon our successful experiences with the GRS
program thus far with Congressional District printouts,
we may also want to consider using this approach for
the block grants.
4.
The action of the House and Senate Budget
Committees in preparing the first concurrent budget
resolution for FY 1977 will be viewed as an important
first battle between the President and the Congress.
By March 15 authorizing committees must present their
estimates on level of funding and other views to the
respective Budget Committees. While failure to main-
tain the Administration's position with respect to
funding levels will not be fatal, it should not be
treated lightly. Obviously, the GOP Budget Committee
Members must be strong supporters and advocates of the
President's position -- and every effort should be
made now to insure their full support and cooperation.
u
Note that Jim Hastings' resignation leaves an important
vacancy on this Committee.
5.
Outside interest groups, specifically those
representing governors, county officials and mayors,
should be made a part of the legislative drafting
process. Of particular importance are their views on
the allocation formulas. While there have already
been expressions of their "conceptual" support, the
extent to which they are brought into the process and
clearly identified with the actual legislation could
be extremely useful in terms of our legislative
activity. To the extent that other interest groups
can be identified as supporters, efforts should be made
to also adequately brief them prior to the finalization
and actual transmittal of this legislation.
THE WHITE HOUSE
WASHINGTON
January 26, 1976
MEMORANDUM FOR
JIM CANNON
FROM
PAUL MYER
SUBJECT:
Block Grant Legislative
YORD VIRRAPT
Strategy -- Referral to
House Committees
Referral of bills in the House of Representatives is subject
to the provisions of Rule X, Rules of the House of Repre-
sentatives, 94th Congress.
The Speaker refers all bills to the committee which has juris-
diction over the subject matter of any provision of the legis-
lation. While bills are generally sent to only one committee,
under the referral procedures (Rule X, Clause 5), the Speaker
may divide the matter among two or more committees. Attached
for your review is a brief summary of the applicable House
Rules regarding referral of bills, resolutions and other mat-
ters to committees.
The block grant legislation which the President has proposed
will require the consolidation of numerous programs authorized
under a variety of statutes. Due to the jurisdictional
authority of existing Standing Committees and Subcommittees
in the House (and Senate), the block grant legislative pro-
posals will cut across jurisdictional lines and more than one
committee can properly claim jurisdiction over the proposed
legislation.
You will note in the attached document that there are a number
of alternative referral procedures which the Speaker may
follow.
As soon as we have drafts of the proposed block grant legisla-
tion before us, we can more exactly determine the jurisdictional
problems and make recommendations with respect to the type of
referral which would be in the President's interest. I believe
the transmittal message to the Congress should specifically
request a form of referral which would be most conducive to
insuring that these bills are given a fair and early hearing.
This will obviously require an attempt to gain the Speaker's
cooperation as well as those of the Committee Chairmen and
Ranking Minority Members of the committees affected. In this
-2-
respect we should also attempt to secure the strongest pos-
sible sponsorship of these legislative proposals. Even
though the legislation is not yet drafted, approaches should
be made to Members now to discuss with them their willingness
to sponsor this legislation.
As you know, we are also beginning to involve special interest
groups in the drafting of the legislation. A discussion of
how they can help with the legislative strategy will parallel
their input in the drafting stage.
Attachment
CERALO FORD LIBRARY
SUMMARY OF APPLICABLE HOUSE RULES --
REFERRAL OF BILLS, RESOLUTIONS AND OTHER MATTERS TO
COMMITTEES
Rule X provides for the establishment and jurisdiction of
Standing Committees and sets forth the procedures for referral
of bills, resolutions and other matters to these committees.
Clause 1 stipulates that all bills, resolutions and other
matters relating to subjects within the jurisdiction of any
Standing Committee as listed in the clause shall be referred
1
to such committees, in accordance with and subject to Clause 5.
/
Clause 5 authorizes the Speaker to make such referrals in a
manner which assures each Committee which has jurisdiction
over the subject matter of any provision of a bill or resolu-
tion will have responsibility for considering such provision
and reporting to the House. It specifically notes that prior
precedents, rulings and procedures shall only be applied to
the extent to which they contribute to the achievement of
this objective.
In carrying our this responsibility, the Speaker may:
1.
Refer the matter simultaneously to two or more commit-
tees for concurrent consideration or for consideration
in sequence (subject to appropriate time limitations in
the case of any committee after the first),
2.
Divide the matter into two or more parts reflecting
different subjects and jurisdictions and refer each
such part to a different committee, or
3.
Refer the matter to a special ad hoc committee
appointed by the Speaker with approval of the House
for the specific purpose of considering that matter
and reporting to the House, or
4.
Make such other provisions as he may consider appro-
priate.
FORD
1/ Prior to the 94th Congress a bill could not be divided
among two or more committees although it contained matters
properly within the jurisdiction of several committees. How-
ever, under Clause 5 of Rule X (made part of the Rules by
adoption of H. Res. 988, 93rd Congress, effective January 3,
1975), the Speaker is authorized to refer any matter to more
than one committee.
MEMORANDUM
THE WHITE HOUSE
WASHINGTON
Steve -
January 29, 1976
Lets
dirum
MEMORANDUM FOR:
PAUL O'NEILL
PHIL HANNA
ALLEN JACKSON
These
DAVID KLEINBERG
VICTOR ZAFRA
groups
ART QUERN
DICK PARSONS
DAVID LISSY
PAUL MEYER
FROM:
STEPHEN McCONAHEY
form
SUBJECT:
Block Grant Meetings with
Public Interest Groups
The following is the schedule of meetings with representatives of
public interest groups on the block grant legislation. The organi-
zations involved include:
National Governors Conference
National Conference of State Legislatures
National League of Cities
U. S. Conference of Mayors
National Association of Counties
GERALE, FORD LIBRARY
Wednesday, January 28
9:00 a. m.
Health/Social Services
Place: Department of HEW (North), Room 5037
Chair: Stu Altman
9:00 a.m.
Education
Place: Department of HEW (North), Room 5027
Chair: Charles Cooke
-2-
Thursday, January 29
2:00 p.m.
Nutrition
Place: Department of Agriculture, Room 201A
Chair: John Damgard
A representative from the Domestic Council and OMB should attend
each of these sessions. Either Ray Hanzlik or I will also be present.
Ray will be in contact with you to confirm which meetings you plan
to attend.
CC: Jim Cannon
FORD LIBRARY & GERALD
February 2, 1976
MEMORANDUM FOR:
MAX FRIEDERSDORF
FROM:
BOB WOLTHUIS
SUBJECT:
Sponsorship of the President's Block
Grant Legislation
In the next several days the Administration's messages dealing with
the elderly, social services, health crime, child nutrition and education
will be going to the Hill. We should start thinking about sponsorship
of the legislation. The block grant approach will have rough sledding
because of the interest groups which strongly support categorical grants.
In my meeting last Thursday with the Agriculture, HEW and OMB legislative
people they indicated some of the ranking Republicans on the key sub-
committees were already showing some hesitancy about the block grant
approach. Al Quie told the HEW people of his concerns about the education
approach. We generally agreed they will need some convincing and work
to get them on board as sponsors and co-sponsors. Some possible options
are as follows:
1. We can send up the legislation with our LA. people or the
departments to gain the necessary sponsors.
2. We could send up the respective Secretaries with a White House,
OMB, or L.A. representative to seek sponsors,
3. Key members could be invited to the White House in a variety
of formats. These would include:
a, A GOP leadership meeting to include the key subcommittee
members where the sponsorship question could be raised.
This could be delicate.
b. A briefing or meeting with Lynn and/or the respective
Secretary with a Presidential drop-by.
FORD LIBRARY is GERALD
C. A meeting as outlined in b without a Presidential drop-by.
d. A series of single meetings with the President and Wampler,
Doc Carter, Carl Curtis, Bob Dole, Al Quie, etc. to seek
their assistance and sponsorship.
FORD & LIBRARY GERALD
THE WHITE HOUSE
INFORMATION
WASHINGTON
February 4, 1976
MEMORANDUM FOR:
THE PRESIDENT
FROM:
JAMES M. CANNON
SUBJECT:
Education Block Grant
I think you should know that at a meeting Monday
with HEW officials Al Quie indicated he was so
opposed to your education proposal that he would
not submit the bill even on request.
Quie indicated the timing was bad because Congress,
having recently considered elementary and secon-
dary education and handicapped legislation, would
be ill disposed to reopen education issues. He
was unhappy with the proposed inclusion of certain
programs such as adult education, libraries and
the post secondary parts of vocational education.
Finally, he said his constituents in Minnesota
would expect him to exercise control over how
Federal dollars are spent and he could not go
along with a proposal which would lead to so
little Federal control.
In Sunday's New York Times, Al Quie was quoted in
considerably less detail, but as indicating his
opposition to the education block grant proposal.
FORD
file
THE WHITE HOUSE
INFORMATION
WASHINGTON
February 4, 1976
MEMORANDUM FOR:
THE PRESIDENT
FROM:
JAMES 8mc M. CANNON
SUBJECT:
Education Block Grant
I think you should know that at a meeting Monday
with HEW officials Al Quie indicated he was so
opposed to your education proposal that he would
not submit the bill even on request.
Quie indicated the timing was bad because Congress,
having recently considered elementary and secon-
dary education and handicapped legislation, would
be ill disposed to reopen education issues. He
was unhappy with the proposed inclusion of certain
programs such as adult education, libraries and
the post secondary parts of vocational education.
Finally, he said his constituents in Minnesota
would expect him to exercise control over how
Federal dollars are spent and he could not go
along with a proposal which would lead to so
little Federal control.
In Sunday's New York Times, Al Quie was quoted in
considerably less detail, but as indicating his
opposition to the education block grant proposal.
GERALO FORD LIBRARY
THE WHITE HOUSE
WASHINGTON
Date: 2.4-76
TO: Jim Cammon
FROM: Max L. Friedersdorf
For Your Information
Please Handle
Please See Me
Comments, Please
Other Yes. This Tracks
with Town conversation
with quie. He thinks The
block grant education
approach M is "nst in
Presidents vest interest. 0'Weill
in suing quie m Friday
THE WHITE HOUSE
WASHINGTON
max -
shoned
this in 7 go
Yes-mant
GERALD R. FORD LIBRARYA
THE WHITE HOUSE
WASHINGTON
Date 2/4
FROM J DAVID Cannor LISSY
TO:
FYI
For Appropriate Action
COMMENTS
Per conversation.
any
EDUCATION DAILY, FEB. 18,1976
FORD TOUTS BLOCK GRANTS IN SPEECH TO PRINCIPALS
President Ford
talked about education Monday before a throng of enthusiastic high school principals in
Washington, D. C., telling them that his administration will fatten allocations to local
school authorities through block grants while "untying the red tape" that binds local
prerogative.
Standard Fare
Speaking at the 60th annual convention of the National Association
of Secondary School Principals, Ford sparked hearty applause by condemning what he
called the "maze of complex and confusing Federal guidelines, 11 the differing standards
and the overlapping responsibility which are part of the Topsy-like growth of the Federal
role in education. "Too often we ask whether Federal forms have been filled out, not
whether children have been properly educated, 11 he said.
The reins belong back in the hands of local officials whose decisions "are wiser and more
responsive to community needs than the edicts of the Federal bureaucracy, Ford said.
Moving from the teachers to the taught, the President remarked that today's youth are
less naive than any previous generation, but at the same time a disappointing number of
citizens are untutored in the workings of the government, even the principles of the
Declaration of Independence. "This is a new challenge to education, Ford announced.
Ford also noted that educators still don't know how to measure the quality of education,
and attempts to buy results have failed. The real measure of quality, he said, "is the
degree of your commitment and the leadership you provide."
- 10-
FORD LIBRARY if SERALD
INFORMATION
THE WHITE HOUSE
WASHINGTON
February 20, 1976
MEMORANDUM TO:
JIM CANNON
JIM CAVANAUGH
ART QUERN
BOB GOLDWIN
DAVID BOORSTIN
FROM:
DAVID LISS oms
Thought you might find the attached of interest.
To
(________________________
24',
send com
Monton sentazio
Roa
M
BEHALD R. FORD
MEMORANDUM
OFFICE OF THE VICE PRESIDENT
WASHINGTON
February 19, 1975
TO:
Ann Whitman
Jim Cannon
Dick Dunham
FROM:
Art Quern
SUBJECT:
PRESIDENT'S COMMENTS AT
DINNER FOR GOVERNORS
For your information, I was contacted by
Fred Bird who is the speechwriter assigned to
prepare comments for President Ford to use at
the Thursday evening dinner for the National
Governors Conference.
Bird called me specifically to ask about
block grants but casully mentioned that the
President planned to make some remarks about
the Vice President's new role in the Domestic
Council. He had not written anything on this
yet, but seemed to feel it would be a significant
part of the comments.
In regard to block grants, Bird was preparing
remarks along the lines of:
"one area where the Vice President is
already hard at work is in efforts to
GEPALO, FORD
consolidate the many hundreds of
congressionally mandated categorical
grants into some manageable set of
block grants
"
TWQ
REQUEST
THE WHITE HOUSE
WASHINGTON
March 3, 1976
MEMORANDUM FOR:
JIM CANNON
FROM:
ALLEN MOORE M
SUBJECT:
Modified Description of Types of
Federal Assistance
Tuesday you asked for brief definitions of the five mechanisms
for Federal assistance to be added to the paper on "Comparative
Advantages of Federal Grant Mechanisms."
I have added these definitions and modified the first page
of the earlier memo to be the neutral first page of a short
paper on the subject instead of a memo from me to you.
FORD LIBRARY >
COMPARATIVE ADVANTAGES OF FEDERAL GRANT MECHANISMS
There are five distinct categories of Federal Assistance to
various types of grantees, i.e. state and local governments,
individuals, for-profit and not-for-profit entities. They are:
1. Categorical project grants.
(A grant intended to achieve a very specific purpose
and distributed on a project-by-project basis.)
2. Formula-based categorical grants.
(A grant intended to achieve a very specific purpose
and distributed on the basis of a narrowly defined
eligibility "formula.")
3. Target grant.
(A grant intended to achieve broadly defined purposes
and distributed on a project basis to specific
geographic "targets" of need.)
4. Block grant.
(A grant intended to achieve broadly defined purposes
and distributed on the basis of narrowly defined
eligibility criteria to various levels of general
purpose government.)
GERALE FORD
5. Revenue sharing.
(A grant intended to be used for virtually unlimited
purposes and distributed on the basis of narrowly defined
eligibility criteria to various levels of general
purpose government.)
The five types of grant programs are most easily compared on
the basis of four separate factors:
Spending discretion permitted with program funds;
Operating conditions the grantee must meet (i.e.,
planning, reporting, and administration requirements) ;
Distribution mechanism by which funds are allocated
(and the breadth of grantee eligibility) ; and
Future funding expectations.
The problem in developing an inclusive definition and description
of preferred purposes is that there is considerable variation
2
in the extent to which real programs follow the definitions.
For example, many project grant categorical programs have a
state-by-state earmark for planning which works much like a
block grant. Similarly, block grant programs may have per-
centage earmarks for specific purposes, separate titles which
are project grant programs, or (as in the case of LEAA)
categorical project grant attributes at the point where
recipient governments spend their block grant funds.
In the consolidation proposals, we are seeking to consolidate
programs with multiple attributes which range from small,
narrowly categorical project grant programs to the $9 billion,
formula-grant categorical Medicaid program. A separate
justification must be developed in every case which is tailored
to specific problems of the antecedent programs.
There follows a brief description of the attributes of the
five grant mechanisms identified, along with a summary of
preferred purposes for such grants and a specific programmatic
example:
1. Project grant categorical programs.
Very little spending discretion
Tight conditions on program operations
Discretionary distribution by grantor (often on
a "competitive" basis) and broad grantee eligibility
Time-limited funding (brief -- 1-3 years)
Preferred Purposes:
The attributes of project grant categorical
programs make them most useful for research and
demonstration purposes. In such cases, grants
can be made on a competitive basis, for very
specific purposes, with tightly administered
reporting and control mechanisms, and for a
relatively short, specified period of time.
These grants are not well suited to ongoing
projects where flexibility of spending and
administrative requirements is preferred, because
so much effort is wasted in competing for funds
and fulfilling operating conditions. Categorical
programs not utilized for research or demonstration
purposes are also particularly vulnerable to
grantsmanship and political partisanship because
demand far exceeds supply and knowing how to
"win" a grant is most of the battle. (Unfortunately,
categorical grant programs often fail to fulfill
a demonstration function, becoming instead small
"operating" programs popular locally and with
locally elected Congressional representatives.)
3
Example: HEW's former Youth Development and
Delinquency Prevention Program made grants for
local delinquency prevention (demonstration)
projects on a competitive basis. Funds had to
be spent for carefully spelled out purposes out-
lined in the proposal. Spending and program
results were supposedly closely monitored
throughout the project for results which could
be replicated elsewhere. The projects were
funded only for one to three years. Although
funds were quite limited, any community in the
nation could apply. (The program was under
attack for its failure to "demonstrate" anything
useful, and was consolidated into a larger
program.)
2. Formula-based categorical programs.
Very little spending discretion
Tight conditions on program operations
Distribution based on statutory entitlement formula
(narrow grantee eligibility)
Indefinite funding (more than 5 years)
Preferred Purposes:
The formula-based categorical program serves as
the preferred means for distributing funds for
very specific purposes to a broad clientele.
Like the project grant categoricals, there is
little spending discretion and rigid operating
rules. But unlike the project categorical, there
is no competition (or grantsmanship or patronage)
for funds -- they are distributed on a formula
basis. Funding is usually expected to continue
indefinitely. Programs like AFDC, SSI, and
Food Stamps fit logically into this category.
Example: Medicaid shares with States the costs
of medical care to the poor on a statutory
formula basis. Funds must be spent for medical
services allowed by Federal regulation. Reporting
requirements are tightly enforced. Persons
eligible for assistance are defined carefully
in the law, and funding is presumed to be avail-
able on a continuing basis.
4
3. Target grants.
Broad spending discretion
Moderate conditions on program operations
Discretionary funding (broad grantee eligibility)
Time-limited funding (intermediate, 3-5 years)
Preferred Purposes
Target grants best serve a program development
purpose. With broad spending discretion,
modest operating requirements, and time-limited
funding, these grants are useful in developing
the initial capacity for handling a problem.
The "target" is usually a depressed or problem
area where there is a need for flexible funds
targeted at specified purposes but where fund-
ing is scheduled to phase out over time. Model
Cities and OEO's Community Action Agency Programs
are examples of target grants.
Example: The Appalachian Regional Commission
legislation provides funds for a variety of
social and economic purposes in Appalachia.
The law has several functional titles, but within
each title (e.g. health services) there is fairly
broad spending discretion. Only moderate operating
conditions are imposed on grantees who receive
their funds on a discretionary basis as a result
of submitted proposals. The law defines quite
broadly the types of groups eligible to submit
proposals. Funding is limited to three years
when mandatory phasing out of Federal funding
must begin.
4. Block grants.
Broad spending discretion
Moderate conditions on program operations
Funding by entitlement formula (narrow grantee
eligibility)
Indefinite term funding (5 years +)
5
Preferred Purposes
Block grants are similar to target grants
except that they are usually available on a
formula basis to specified levels of general
purpose government. Since spending is flexible
and the formula usually relates to some measure
of need, future funding expectations tend to be
indefinite in length. Community Development
Block Grants and Partnership for Health Grants
are examples of block grants.
Example: The C.E.T.A. program provides funds
for manpower planning, job training, and public
service employment. Funds are distributed on a
formula basis to "prime sponsors" -- metropolitan
areas of 100,000 or more, or states. There is
broad flexibility in the statute regarding how
funds may be spent. Planning, administration,
and reporting requirements are moderate, although
prime sponsors are encouraged to take strong
initiative for their own purposes. Funding is
expected to be available indefinitely.
5. Revenue sharing.
Virtually unlimited spending discretion
Nominal conditions on program operations
Funding by entitlement formula
Indefinite term funding (5 years +)
Preferred Purposes
General revenue sharing is most useful as a
means to redistribute wealth from some portions
of the population to others, at minimal collec-
tion cost. Redistribution can occur from wealthy
to poor, urban to rural, etc. depending upon the
distribution formula. Empirical evidence
indicates it is extremely difficult to place
any meaningful controls on the purposes for
which general revenue sharing funds may be
spent.
GERALOR FORD
6
Example: General revenue sharing is basically
a transfer of Federal funds to State and local
governments based on a simple statutory entitle-
ment formula. The funds are passed without any
meaningful restrictions on how they may be used,
and only nominal operating conditions are
attached to the program. Funding is limited by
statute, but the expectation of state and local
governments is that the program will extend
indefinitely.
CC:
Art Quern
ΓOKO
THE WHITE HOUSE
REQUEST
WASHINGTON
March 23, 1976
MEMORANDUM FOR THE PRESIDENT
FROM:
JIM CAVANAUGH
SUBJECT:
Decrease in Indianapolis's Community
Development Block Grant Funding for FY 76
In response to your inquiry about the decrease of Indianapolis's
Community Development Block Grant funding in FY 76, as
reported to you by Mayor William Hudnut, the decrease occurred
because prior to FY 76 Indianapolis's "hold harmless" block
grant contained full funding for model cities programs. In
FY 76, however, the model cities portion was reduced 20%
because, under the terms of the Housing and Community
Development Act of 1974, model cities grants were assigned a
different phase out formula than the rest of the "hold
harmless" programs - in effect allowing cities receiving
model cities grants five action years of full funding,
followed by three years of declining percentages of the full
amount.
Indianapolis's last full year of eligibility for model
cities was FY 75. In FY 76, the overall block grant was
reduced by 20% of the full model cities allocation. Out of
approximately $14 million in FY 75 block grants, Indianapolis
was docked approximately $1 million in FY 76.
GERALD FORD LIBRARY
subj.
THE WHITE HOUSE
INFORMATION
WASHINGTON
April 14, 1976
MEMORANDUM FOR:
THE PRESIDENT
FROM:
JIM CANNOM &
SUBJECT:
Support of Block Grants
Attached is a copy of a letter jointly signed by Governor
Andrus (D-Idaho) and Governor Evans (R-Washington) expressing
to the other Governors of this country their support for
your block grant proposals. In their letter, these Governors
request that other chief executives help stimulate the dis-
cussion and support for these proposals in order that they
receive a due hearing and consideration by the Congress.
The Governors' Conference has been extremely interested and
cooperative in these block grant proposals. Governor Andrus
has taken special effort to go beyond party line and to
support a concept that he believes in very strongly.
We are continuing to work with Governor Andrus and Governor
Evans and their Human Resource Committee on a number of
items, and I am hopeful that this continued cooperation will
help move the block grants from their current stalemate
position.
GERALD R. LIBRARY FORD
National
Governors'
Robert D. Ray
Governor of lowa
Chairman
Conference Street N.W. Steve Suite 600
April 1, 1976
Washington, D.C. 20036
(202)785-5600
.) Aue wt Thank
Mr. James Cannon
Assistant to the President
2) Presidenting copy to w/
for Domestic Affairs
The White House
Washington, D.C. 20500
minote
Dear Jim:
I thought you might like to see a copy of the enclosed
letter from Governor Andrus and Governor Evans to their fellow
June
Governors on the subject of the President's block grant pro-
posals.
Sincerely,
State
Stephen B. Farber
Director
Enclosure
GENAME FORD
Cc McConakey
National
Governors
Robert D. Ray
Governor of lowe
Conference
Chairman
1150 Seventeenth Street N.W. Suite 600
Washington, D.C. 20036
(202)785-5600
March 29, 1976
Honorable
(ALL GOVERNORS)
Governor of
Dear
:
We take this opportunity to express our mutual belief that Congress
should shortly hold public hearings on the Administration's block grant
proposals.
During the past ten years we have all become painfully aware of the
program and management conditions caused by federal categorical funding
of human services. One of our biggest challenges in the next years will
be revamping the intergovernmental funding and management of education and
human services so that these services may become more responsive, realistic,
and meaningful to recipients of the services as well as to the people who
pay for them.
While neither of us endorses all the specific details of the Adminis-
tration's block grant proposals, we firmly believe it is important that
the concepts be publicly discussed. Furthermore, we believe that Congress
must be given a concise message that this is a direction in intergovernmental
funding that Governors believe to be vital to the successful exercise of our
joint responsibility for the funding and management of human service programs.
We are asking that you join us in communicating to our respective
Congressional delegations and appropriate Committee chairmen our belief that
hearings should be soon held for the purpose of discussing the concepts
contained in the Administration's block grant proposals. The list of block
grant proposals and the Committee to which they have been referred is attached
for your reference. Through our united efforts we hope to impress upon
Congress the necessity of addressing these issues promptly and directly.
Sincerely,
GERALD FORD LIZRARY
Cecil D. Andrus
Daniel J. Evans
Chairman, NGC Committee on
Vice Chairman, NGC Committee on
Human Resources
Human Resources
Dan
Dear Governor Evans:
I would like to thank you and Governor Andrus for
your March 29th letter in which you expressed to
your fellow Governors your joint support for the
Administration's block grant proposals.
As I am sure you are aware, these proposals reflect
the President's desires to improve the delivery
of Federal categorical programs. Needless to say,
there has not been overwhelming support shown for
these proposals in the Congress. The support that
you express in your letter and the support which
your letter will hopefully create within the
Governors' Conference are much needed and appre-
ciated.
I would like to again express my appreciation for
your support and hope that it will, along with
other efforts, generate a positive response in the
Congress.
Sincerely
James M. Cannon
Assistant to the President
for Domestic Affairs
The Honorable Daniel J. Evans
Governor of Washington
Olympia, Washington 98501
U
,USE
HINGTON
Dear Governor Andrus:
I would like to thank you and Governor Evans for
your March 29th letter in which you expressed to
your fellow Governors your joint support for the
Administration's block grant proposals.
As I am sure you are aware, these proposals reflect
the President's desires to improve the delivery
of Federal categorical programs. Needless to say,
there has not been overwhelming support shown for
these proposals in the Congress. The support that
you express in your letter and the support which
your letter will hopefully create within the
Governors' Conference are much needed and appre-
ciated.
I would like to again express my appreciation for
your support and hope that it will, along with
other efforts, generate a positive response in the
Congress.
Sincerely,
James M. Cannon
Assistant to the President
for Domestic Affairs
The Honorable Cecil D. Andrus
Governor of Idaho
Boise, Idaho 83701
THE WHITE HOUSE
WASHINGTON
April 27, 1976
MEMORANDUM FOR:
JIM CANNON
PAUL O'NEILL
ART QUERN
FROM:
STEVE McCONAHEY S&M
SUBJECT:
ACIR's Tentative Evaluation
on Health and Safe Streets
Block Grant Programs
Attached are ACIR's (tentative) summary findings of their
evaluation of the Partnership for Health and Safe Streets
block grant programs. The preliminary findings are part of
a broader study of The Block Grant Principles, Practice,
and Prognosis in which several block grant programs are
being evaluated. (Earlier, I forwarded a nemo to you on the
evaluation of CETA). I have indicate our interest in these
analyses and findings, and Wayne Anderson has agreed to keep
us posted.
FORD
Attachment
How am
d leok suppore What, will los w Buif, June
- 38
Lessons From The Case Studies
The Safe Streets and Partnership for Acts provide several
important lessons about how, through the
instrument,
national
purposes can be achieved while at the same eximizing State and
local discretion. They also underscore the Terence between the
conceptual and operational features of block Grants and reveal the
compromises and trade-offs that apparently need to be made in order to
ensure the effectiveness and perhaps survival of the instrument. At
this point, it is useful to summarize our principal findings concerning
the block grant experience under these Acts, and to indicate their
significance to intergovernmental policy-makers.
GERALD R: FORD VIBRARY
Purpose
The block grant means different things to different people. In the
past, it has been proposed on the grounds of economy and efficiency,
functional and fiscal expansion, policy and administrative decentralization,
and political compromise. These reflect the high expectations generated
by either consolidating a number of narrow existing categorical grants
into a broad, visible assistance program covering a wide functional
territory or to the launching of a new, resumably integrated, Federal
initiative in an area that traditionally had been the most exclusive domain
of State and local jurisdictions. At the present time, at least three
major purposes of a grant instrument can be distilled: stimulation; system
building; and system support. Where 3 mix of these objectives is sought,
the block grant device appears most appropriate. Taken individually, however,
it secus that the project grant maximizes opportunities for innovation;
formula based categorical or revenue shering is best suited to system support,
while the block grant enhances system building prospects.
Funding Threshold
When a block grant accounts for a relatively small proportion of
total public sector expenditures in a functional area, as in both criminal
justice and health, it is often difficult to discern an impact resulting
from the investment of Federal funds, This is the case both when a "mix"
of program objectives is sought and funds tend to be spread (sometimes
thinly) between innovative, supportive, and "systemic" undertakings, and
when a cluster of other Federal aids and State supported efforts crowd its
functional terrain. If the block grant is expected to produce even short-
term changes in intergovernmental or functional relationships and show
progess in tackling problems it was designed to address, then the funding
threshold must be increased substantially relative to State-local direct
outlays and relative to the total for the grants consolidated (if this
is the mode of establishment) to generate a "critical mass" for change,
or the basic objectives must be prioritized to avoid dilution of available
resources.
Discretion
As can be seen from both studies, the block grant gives wide discretion
to recipients in planning for and allocating Federal funds. Yet, in the
case of Safe Streets, LEAA has been accused of being too intrusive vis-a-vis
States and localities. With Partnership for Health, of course, State program
and policy discretion grew to the point where after 1970 no Federal supervision
of any significance occurred and with this State dominance came a decline in
Congressional interest and a static supply of dollars. The block grant forces
(or should force) Federal administrators to walk : tightrone between
Congressional demands for accountability and State demands for
flexibility. While the two demands are not irreconcilable, it is a 8
difficult balance to strike, especially in the absence of clear
expressions of Congressional intent. While it affords recipients
maximum flexibility in determining the use of funds, the block
grant instrument does not excuse the Federal administering agency
from developing and enforcing nerformance standards, conducting
substantive reviews of recipient plans and activities, and exercising
other oversight responsibilities--ever if this leads to a withholding
of funds or State secession from the program. If these responsibilities
are ignored, the fate of the program is jeopandized.
Categorization
An ideal type block grant does not exist. Partly in response to
political pressures and partly due to gaps in block grant allocations,
the earmarking of assistance categories within the grant or the establish-
ment of categoricals around it have been facts of life with which most
block grant administrators have had to reckon. As the block grant
matures, two conflicting patterns emerge: Concress becomes more
interested in categorizing, while States become better equipped to achieve
functional and jurisdictional balance in funding. The presence of a
discretionary fund, however, seems to be an expeditious way of deflecting
pressures for earmarking and increasing funding flexibility at the Federal
level.
& GERALD R. LIBRARY FORD
walists
The block grant approach carries with it a functional (framework
and decision-making process conducive to generalist participation.
The Safe Streets and PHA experience, however, suggests that it is
difficult to harness the rather diverse political, programmatic,
and personal interests of elected chief executives, legislators, top
administrators. and planners. Unless the block grant provides substantial
amounts of Federal funds, decentalizes authority to make resource
allocation decisions, or fills a major program void, generalists will
be reluctant to make the time and intellectual commitments necessary
for effective involvement. Otherwise, functional specialists and
professional staff will dominate policy-making.
Planning
State criminal justice planning under SPA auspices has been geared
largely to the allocation of Safe Streets funds. Too often planning has
been eclipsed by grant administration. SPAs have been generally unable,
and occasionally unwilling, to comprehensively plan for the State criminal
justice system and to seek to influence spending decisions on the part
of related State agencies. In the case of PHA, there has been little real
relationship to the comprehensive health planning process, though in
practical terms the program has been used fairly widely as a means of
filling small program gaps left after the allocation of Federal categorical
and State health funds. If the planning process is considered instrumental
to achieving the objectives of a block grant, then the State agency responsible
for comprehensive planning must have sufficient authority to plan for all
activities encompassed within the functional scope of the block grant,
including those supported directly by State approcriations.
U
THE WHITE HOUSE
WASHINGTON
May 11, 1976
MEMORANDUM FOR:
JIM CANNON
JIM CAVANAUGH
ART QUERN
PAUL O'NEILL
FROM:
DAVID LISSY 0mg
I wanted to be sure you were aware of the attached letter to
David Mathews from Senators Domenici and Bellmon. They
suggest a modified, optional, block grant but do not indicate
what "substantial changes" are necessary.
AN Do you wl
twin
Attachment
we ? 7
Jun FORD
et LIBRARY
FRANK E. MOSS, UTAH, CHAIRMAN
START SYMINGTON, MO.
EARLY GOLDWATER, ARIZ.
JOHN C.
PETE V. DOMENICI, N. MEX.
HOWARD W. CANNON, NEV.
PAUL LAYALT. NEV.
WINDFIL H. FOND, KY.
JAKE GARN, UTAH
DALE NUMPERS, ANK,
GILBERT W. KEYES, STAFF DIRECTOR
United States Senate
COMMITTEE ON
AERONAUTICAL AND SPACE SCIENCES
/
Dick H.
WASHINGTON, D.C. 20510
May 5, 1976
2
SK
Honorable David Mathews
3
BB
Secretary
Department of Health, Education.
and Welfare
Oloretta
330 Independence Avenue, S. W.
Washington, D. C. 20201
5
CFA
Dear Secretary Mathews:
We are advocates of modifying the categorical grant
programs for the country's elementary and secondary schools.
We believe a block grant approach such as suggested by the
President is a viable alternative.
As you know, it is unlikely that the block grant
legislation will pass at this time. We strongly believe,
however, that legislation which would make it optional for
states to take the block grant alternative is a more realis-
tic approach and could be promptly enacted. During the past
few weeks, a possible optional approach to block grant legis-
lation has been discussed with several Senators and the idea
was enthusiastically received. Therefore, we have joined in
developing an optional approach. We believe this idea is
realistic as it has favorable political overtones which should
add immeasurably to its chances to become law.
There are certain legislative problems with the
block grant proposal as specified in S. 3166. It will be
necessary to make substantial changes in this bill as well
as making the program optional to individual states. We
would appreciate it if you would enlist the Office of Educa
tion to provide its expertise to us for the purpose of
GERALD P. LIBRARY FORD
drafting new legislation.
As the current session of Congress will be abbre-
viated substantially to accommodate the political conven-
tions and elections, we hope to introduce this legislation
within the next month. Your early response will be greatly
appreciated.
Sincerely,
Viter honem
Henry Bellmon
Pete V. Domenici
Henry Bellmon
United States Senator
United States Senator
Is
RECOMMENDATIONS. ON MIDDLE RANGE REFORM EFFORTS IN
THE INTERGOVERNMENTAL GRANT SYSTEM ADOPTED MARCH 11, 1976
AND MAY 20, 1976
RECOMMENDATION 1: BASIC POLICY POSITION
On balance, while fully supporting the enactment of additional
block grants where appropriate and the effective administration of
existing ones, the Commission concludes that categorical grant
programs will continue to be an integral component of the Federal
assistance system. Hence, the Commission believes that efforts must
1/
be continued to improve grant administration through such means as
management circulars, measures to improve intergovernmental information
and consultation, as well as procedures for strengthening State and
local coordination and discretion.
Hence, the Commission recommends that the political branches of the
Federal, State, and general units of local government assume their
historic responsibility for jointly establishing and sustaining the
necessary central management mechanisms to achieve improved operations
of governmental programs and to render the civil service more fully
accountable. The Commission further urges that the intergovernmental
dimensions (fiscal, programmatic, and policy) of public management be
made an integral component of all such administrative systems.
TURD
1/ This includes block grants as well as categoricals.
RECOMMENDATION 2: THE CENTRAL MANAGEMENT MECHANISM
The Commission concludes that the Federal executive branch needs
a stronger central management capacity, but recognizes that no single
strategy for organizing the Executive Offi a of the President could
or would over time suit the varying administrative styles of individual
Presidents. Hence, the Commission recommends that the organization of
the Executive Office of the President for cer ral management purposes
be flexible enough to reflect Presidential desires, but that there
should be in place sufficient institutional staff to enable the President
to exert vigorous and visible leadership in the five basic central
management activities essential to smoother and more productive Federal-
State-local relations: budget preparation and consultation; management,
including government-wide grants management; domestic policy development;
intergovernmental liaison; and legislative reference. The Executive Re-
organization Act concept should be revived to allow the President expeditiously
to achieve his desired Executive Office organizational objectives.
The Commission further recommends that the President appoint a
high-ranking assistant for intergovernmental affairs having direct access
to the President who, with a small professional staff, would monitor
and evaluate for the President the various intergovernmental relations
activities performed on a government-wide basis under whatever
organizational arrangements the President may establish. A key official
in agencies responsible for budget preparation, management, and domestic
policy development, as well as officers of Presidential appointive
rank responsible for intergovernmental affairs in each
department, would serve as strategic points of contact
- 3 -
for and consultation with the Presidential assistant.
Furthermore, recognizing the present essentially bifurcated
pattern of management-budget and policy organization, the Commission
recommends that, if this present arrangement is continued, the
organization, staffing, and internal operating procedures of the Office
of Management and Budget be thoroughly reviewed and evaluated by the
President, the Director, and the appropriate committees of the Congress,
with a view toward making the OMB the primary focal point with adequate
staff for management improvement on an interdepartmental, interprogram,
and intergovernmental basis. Specific provision should be made for
regular consultation between the Office of Management and Budget and
officials and representatives of State and local governments on long-
and short-range budgetary and fiscal issues. Activities relating to
intergovernmental relations and grants management delegated by executive
order to the Department of the Treasury (TC1082) and by Circular A-85 to
the Advisory Commission on Intergovernmental Relations should be vested
in the Office of Management and Budget. A key OMB official should
be specifically assigned intergovernmental responsibilities.
The Commission also recommends that the performance of the Domestic
Council or its successor in the identification of domestic problems
requiring national attention and the development of general domestic
objectives and policies through the report on national growth and other
activities be improved. Meetings of the full membership of the Council
for the consideration of domestic policy problems and issues should be
held on a regular basis. Other domestic policy-related councils and
boards with membership which largely duplicates that (in full or part)
- 4
of the Domestic Council should be consolidated with the Domestic Council.
The creation of similar bodies in the future should be avoided.
The Commission further recommends that OMB and the Domestic Council
continue to collaborate, but more effectively, in "the determination
of national domestic priorities for the allocation of available resources"
and in assuring "a continuing review of oncoing programs from the stand-
point of their relative contribution to natio al goals as compared with
the use of available resources," as was called for in executive order
11541.
Finally, the Commission recognizes that organizational arrangements
may change from time to time, but believes that the essence of this
recommendation pertaining to the budget, management, and policy functions
will remain valid and compelling.
- 5 -
RECOMMENDATION 3: THE FEDERAL REGIONAL COUNCILS
The Commission recommends that the President, the Office of
Management and Budget , and the Under Secretaries Group
for Regional Operations move aggressively to eliminate the impediments
to the more effective operation of the Federal Regional Councils by
(a) fully familiarizing policy-level officials of State and local
governments with the purposes and activities of the Councils; (b)
analyzing the political and administrative factors that permit
decentralization of grant sign-off authority in some assistance programs
and not in others and securing the decentralization of the former under
the direction of the principal regional official of each appropriate
department and agency; (c) obtaining greater conformity to the
standard administrative regions and field office locations set forth
in OMB Circular A-105; (d) assuring the assignment by each FRC member
agency of the staff members required for ongoing Council operations,
including the A-95 review and comment procedure, joint funding, and
special task forces; (e) providing to Council staff such special training
as is required for the effective performance of their duties; and (f)
assuring continuing communications with and support from Washington,
largely through a more active Under Secretaries Group.
RECOMMENDATION 4: ASSIGNMENT OF RESPONSIBILITY FOR INTERPROGRAM GRANTS
MANAGEMENT WITHIN INDIVIDUAL DEPARTMENTS AND AGENCIES
The Commission recommends that the President require the heads of
Federal grant-administering departments and agencies to assign leadership
FORD
1/ Mr. Cannon and Mr. White dissented on Recommendation 3
- 6 -
responsibility for interprogram grants management activities to a single
unit with adequate authority, stature, and staff in their respective
departments or agencies. Such activities, at a minimum, should
include oversight of the agency's compliance with OMB Circulars A-85,
A-89, and A-95 and management circulars (including FMC 74-7, FMC 74-4,
FMC 73-2, and OMB Circular A-105), and responsibility for leadership
and compliance with regulations under the Joint Funding Simplification
Act of 1974.
RECOMMENDATION 5: MONITORING INTERAGENCY AGREEMENTS
The Commission recommends that the Office of Management
and Budget be given responsibility for compiling and undating
a list of the interagency agreements in effect, for evaluating them and
initiating new ones or improvements to existing ones as needed to effec-
tively further and support maximum feasible coordination among the
various Federal aid programs. The Office of Management and
Budget, acting through the Under Secretaries Group for Regional
Operations and the Federal Regional Councils, also should be given
responsibility for monitoring and supporting the proper and full
implementation of these agreements. All new and amended interagency
agreements having a significant and broad intergovernmental impact on the
management of Federal aid programs should be reviewed and commented upon at
the draft stage by State and local governments through the A-85
consultation process.
- 7 -
RECOMMENDATION 6: INTERAGENCY COMMITTEE MANAGEMENT
The Commission recommends that the President re-institute
administrative guidelines and instructions regarding the establish-
ment, use, and termination of interagency committees, with a view
toward (a) monitoring and evaluating the operation of such committees
within the executive branch; (b) supporting and strengthening those
committees necessary to the effective operation of Federal assistance
programs and related activities; and (c) discouraging the formation
or continuation of unnecessary or unproductive committees.
RECOMMENDATION 7: CONGRESSIONAL SUPPORT FOR CIRCULARS
The Commission recommends that Congress provide specific statutory
authorization for OMB Circulars A-85 and A-95 and existing and future
circulars issued by the Office of Management and Budget directed toward
standardization, simplification, and other improvements of grants
management.
The Commission further recommends that Congress enact legislation
clearly vesting in the Office of Management and Budget the responsibility
for developing the circulars, interpreting them, and otherwise
enforcing compliance by the grants-administering agencies. Monitoring
by the OMB of agencies' compliance with the circulars should
include approval of agency regulations and related documents
implementing these circulars.
Finally, the Commission recommends that Congress enact legislation
requiring submission of periodic evaluation reports on the circulars
to the Congress by the Office of Management and Budget.
- 8 -
RECOMMENDATION 8: POSSIBLE MODIFICATIONS OF STANDARDIZATION
REQUIREMENTS
The Commission recommends that the Office of Management and
Budget organize and head an interagency review of FMC 74-7 for the
purpose of determining whether additional areas of administrative
requirements should be standardized and whether existing standardized
requirements should be modified. Representatives of State and local
governments should be given the opportunity to review and comment
on any revisions recommended by the interagency group.
RECOMMENDATION 9: THE STATES AND THE MANAGEMENT CIRCULARS
The Commission recommends that the States examine their
legislative and administrative policies and practices applicable
to the expenditure of Federal grant funds by the States or their
political subdivisions, including conditions attached to the
pass-through of Federal funds to localities, with a view toward
resolving in cooperation with the Office of Management and
Budget any conflicts between those policies and practices and
the provisions of Federal grants management circulars. Such
examination should include problems involved in claiming allowable
overhead costs in performance of audits by non-Federal agencies.
RECOMMENDATION 10: THE STATE AND A-95
The Commission recommends that States upgrade their participation
in the Circular A-95 process. Specifically, the Commission recommends
- 9 -
that Governors and/or legislatures take steps to assure that Federal
program plans are reviewed for their conformity with State policies
and plans pursuant to Part III of the Circular; and that where States
have developed and adopted statewide policies and plans impacting
on local government, the legislatures enact statutes or the Governors
issue executive orders making State grants to political subdivisions
that relate to such policies and plans subject to the A-95 clearance
process.
RECOMMENDATION 11: A-85 AND THE PUBLIC INTEREST GROUPS
The Commission recommends that the public interest groups
involved in OMB Circular A-85 re-examine their internal
A-85 procedures and the resources they deploy to them and
take steps necessary to assure more fully responsive participation
in the process.
RECOMMENDATION 12: FRCs AND A-95
The Commission recommends that the Office of Management and
Budget designate the Federal Regional Councils as Federal clearing-
houses under Circular A-95, making them responsible for (a) notifying
affected Federal agencies of grant applications having major regional
impact and intergovernmental significance, as well as comparable direct
Federal activities subject to A-95, (b) preparing comments concerning
the interprogram and intergovernmental effects of these proposed pro-
jects, (c) transmitting their own comments as well as individual agency
- 10 -
reviews to the Federal action agency, and (d) more vigorously pursuing
their currently assigned responsibilities for enforcing Federal agency
compliance with existing Circular A-95 provisions. The Commission
further recommends that Federal Regional Councils provide the means for
resolving issues raised in the Federal interagency review process.
RECOMMENDATION 13: JOINT FUNDING AND RECIPIENTS
To strengthen State and local support for and use of the
Joint Funding Simplification Act, the Commission recommends that States
and larger units of general local government assign to a single agency
leadership responsibility for participation by their respective
jurisdictions in jointly funded projects. Such responsibility should
include the development of proposed projects and coordination of
the joint funding activities of participating departments.
RECOMMENDATION 14: IMPROVING GRANT INFORMATION
The Commission recommends that Congress and the Administration take
steps to improve information that is available on grants-in-aid through
the Catalog of Federal Domestic Assistance and other sources.
Specifically, the Commission recommends that:
(a) Congress amend Section 201 of the Intergovernmental Cooperation
Act of 1968 to require Federal agencies, upon request of the chief
executive or legislative body of larger cities and counties, to inform
them on a timely basis of the purpose and amounts of grants-in-aid
that are made directly to such localities and authorities within such
localities;
- 11 -
(b) the Office of Management and Budget publish annually,
prior to the conclusion of each calendar year, a list of grant-in-aid
programs that are scheduled to terminate in the following calendar year;
(c) the Office of Management and Budget assume the initiative for
assuring that all authorized programs are listed in the Catalog of
Federal Domestic Assistance instead of relying on grantor agencies to
identify such programs; and
(d) the Office of Management and Budget revise the format of the
Catalog of Federal Domestic Assistance so that each listing represents
not more than one discrete program or clearly identifies the
separate programs included under that listing; that all authorized
programs are listed whether or not funds are appropriated therefor;
and that the program titles in the State and local government indexes
show the code for the type of assistance provided (for example, formula
grants, project grants, direct loans, technical assistance, training).
The Commission further recommends, in connection with paragraph (a)
above, that States explore the possibility of providing their larger
localities with information on the purpose and amounts of grants-in-aid
which the States sends. to such localities. Such information should
cover both direct grants from the State and Federal grants passed
through the State government.
THE WHITE HOUSE
Per
weiting
WASHINGTON
June 11, 1976
MEMORANDUM FOR:
JAMES CANNON
FROM:
BILL DIEFENDERFER
RE:
Education Block Grant Proposal
Update
On June 9, 1972 the first of two scheduled days of hearings in the House
Subcommittee on Elementary, Secondary and Vocational Education were
held on the Administration education block grant proposal. Four witnesses
testified and expressed strong support for the proposal. The witnesses
were: State Senator Hunter Andrews (Va) representing Education Commission
of the States; Owen Kiernan, Executive Secretary National Association of
Secondary School principals; Edward Keller, Deputy Executive Director,
National Association of Elementary School Principals and Secretary David
Matthews, HEW.
The committee members directed much of their attention to the red tape
and paperwork problem that surrounds Federal education programs.
There was some indication that those opposed to the Block Grant proposal
were anxious to make red tape and paperwork the central issue as they
felt remedies could be found for those problems without adopting the
block grant concept. Secretary Mathews pointed out that implementation
and encouragement of state and local initiatives as well as increased
flexibility were major improvements to be gained through adoption of the
block grant approach.
The second day of hearings is scheduled for 15 June 1976. Scheduled to
testify are: Senators Domenici and Bellmon; The National Council of
State Legislators represented by Martin Sabo and Gerald Harden;
National State Boards of Education represented by James Connor, President.