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James M. Cannon Files (Ford Administration)
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The original documents are located in Box 30, folder "Revenue Sharing (1)" 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States of America his copyrights in all of his unpublished writings in National Archives collections.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 30 of the James M. Cannon Files at the Gerald R. Ford Presidential Library
REVENUE SHARING
ROUGH DRAFT
One of the major advances for the Federal system
came about in 1972, when Congress passed General
Revenue Sharing.
FORD LIBRARY j AERALD
It was my pleasure at that time to work with a
broad group of bi-partisan leaders in the House who
won passage of the Bill.
Since that time, I have had numerous meetings with
state and local officials, and many have told me that
their number one priority was the continuation of General
Revenue Sharing.
a) Legislation priority in
Washington was a continuation
In all of these meetings, I made it clear that I would
be a strong advocate for reenactment of this essential
program. It is, therefore, with great pleasure that I
have today sent to the Congress an official message and
a bill which would continue for 5 1/4 years General
Revenue Sharing - in substantially its present form.
In addition I am proposing that Congress increase the
amount by $150 million each year, so that the total
program over the full extended period will be (
)
billion dollars.
2
I am asking my staff to send a copy of the message
and the bill to you separately.
I am confident that you and the citizens you
represent know that you have a vital stake in the
continuation of this program, and I sincerely hope
that you will lend your support to the passage of the
extension of General Revenue Sharing at this Session
of the 94th Congress.
FORD LIBRARY & GERALD
DRAFT (For Governors, Mayors, and Others
Dear
:
FORD is LIBRARY GERALD
I am a strong believer in the Federal system
of shared sovereignty which protects freedom of action
and promotes creativity at all three Constitutional
levels of government. This Federal system was designed
to enable all Americans to be served by that level of
government closest to them and best able to act in the
public interest.
In 1972 we made an historic decision to support
and advance our Federal system with the passage of
General REvenue Sharing.
I am proud that I was one of a broadly based
and bipartisan group of leaders and Members of the House
and Senate who worked together to pass Revenue Sharing.
Since that time, I have had numerous meetings
with state and local officials, and many have told me
that their number one priority in Federal programs
was the continuation of General Revenue Sharing. In
these discussions, I emphasized that I would be a strong
advocate for reenactment of this essential program.
Today I sent to the Congress an official message
and a bill which would continue- in substantially its
present form - General Revenue Sharing for 5 1/4 years.
2
In addition, I am proposing that Congress increase
the amount by $150 million each year, so that the total
program over the full extended period will be $39,625,000,000.
My staff is sending you a copy of the message and
the bill.
I am confident that you and the citizens you
represent know that every American has a vital stake in
the continuation of this program, and I sincerely hope
that you will lend your support to the passage of the
extension of General Revenue Sharing at this Session of
the 94th Congress.
Sincerely,
FORD LIBRARY & GERALD
THE WHITE HOUSE
WASHINGTON
April 9, 1975
MEMORANDUM FOR THE PRESIDENT
FROM :
JIM CANNON
Attached is a draft letter to Governors, Mayors, State
Legislators, and County Officials when your message and
legislation for General Revenue Sharing is sent to the
Hill. The recipients would be:
1. All 50 State Governors
2
200 State Legislative leaders (Presidents
and Minority Leaders of the Senates and
Speakers and Minority Leaders of the Houses
of Representatives)
3. Mayors of 150 largest cities.
4. List of approximately 50 County Officials.
In order to expedite your letters to these leaders,
we propose that the message and Bill be sent separately.
Attachment
DRAFT for Governor mayor
Dear
:
FEDERAL
I am a strong believer in the system of
shared sovereignty which protects freedom of action
and promotes creativity at all three Constitutional
levels of government simultaneously. This federal
system was designed, in part, to enable all Americans
THAT LEVEL OF-
to be served by the government closest to them and
best able to act in the public interest.
one of the wort important nour steps other in
We made a historic advance for this rederal
support
A
system when Congress passed - General Revenue
WAS MRCN
Sharing in 1972.
It was my pleasure at that time to work with a
broadly based bi-partisan group of leaders and Members
in the House toward passage of Revenue Sharing.
Since that time, I have had numerous meetings with
state and local officials, and many have told me that
their number one priority in Federal programs was the
continuation of General Revenue Sharing. In these discussions,
I emphasized that I would be a strong advocate for reenact-
ment of this essential program.
Today I sent to the Congress an official message
and a bill which would continue in substantially its present
form General Revenue Sharing for 5 1/4 years.
A
In 1972 we made an historic decisionto
support and advance
our Federal system with the passage of
General Revenue Sharing.
I am
proud that I was one of a broadly based
and Suate
and bipartisan group of leaders and Members of the House who
worked together to pass Revenue Sharing.
As Vice President, and then President, I have had etc
FORD LIBRARY & GENALD
2
In addition, I am proposing that Congress increase the
amount by $150 million each year, so that the total
program over the full extended period will be $39,625 ,000, 00 oo
sending you
Tamasking my staff to a copy of the
message and the bill
to
I am confident that you and the citizens you
every Anilyren dias
represent know that have a vital stake in the
continuation of this program, and I sincerely hope
that you will lend your support to the passage of the
extension of General Revenue Sharing at this Session
of the 94th Congress.
Avenling
FORD LIBRARY "y GERALD
[1976]
Alexler Forter
CANNON
What's
at stake
what happens
The NGC +
The Art Natural Budget Ason officers of
FORD LIBRARY & QERALD
Revenue Sharing
OF
THE
THE 1789 TREASURY
THE SECRETARY OF THE TREASURY
Ms
WASHINGTON
Fold
February 21, 1975
MEMORANDUM FOR THE PRESIDENT
Subject: Distribution of Energy Tax Payments to State
FORD is GERALD LIBRARY
and Local Governments
Prior to your State of the Union Message, you approved
a proposal to compensate State and local governments for
the higher costs of energy purchases resulting from the
Administration's Energy Conservation Tax proposals. This
proposal would allocate $2 billion to State and local
governments pursuant to the distribution formulas appli-
cable to general revenue sharing (GRS), commencing with
the second quarter of 1975.
Before initiating discussions with the Ways and Means
Committee on this proposal, it is important that the Admin-
istration develop more specific recommendations concerning
the preferred method for allocating and distributing these
funds to State and local governments. My earlier memora-
dum to you on this subject mentioned the feasibility of
incorporating this $2 billion annual payment into the
existing GRS program. A second alternative, which would
distinguish the energy tax payments from the regular GRS
program and also provide greater flexibility to recipients
to meet energy needs, would be to consider these payments
as bona fide energy tax rebates to be used entirely at the
discretion of the various State and local governments.
This latter approach would use GRS formulas to allocate
the rebates but would not require adherence to existing
requirements and restrictions which govern the use of
regular GRS funds.
Under either of the alternatives described above, the
proposal to use existing GRS allocation formulas for dis-
tributing these funds will be met with two major criticisms,
which may make Congressional approval difficult. The
criticisms include (1) the uneven distribution of GRS funds
- 2 -
in relation to State and local energy costs and (2) the
exclusion of special purpose government districts
(primarily school districts) from the program. These
issues were raised recently by the National League of
Cities and U.S. Conference of Mayors in their critique of
the 1976 budget.
These options are presented in greater detail below
for your consideration.
Options
FORD i LIBRARY GERALD
A. Use the existing GRS program
The major arguments for this approach are the ease and
speed with which the funds could be distributed, as well as
the use of formulas previously approved by Congress for
distributing Federal revenues to State and local govern-
ments. This proposal would, in effect, constitute a one-
third add-on to the existing GRS program. Present formulas
and restrictions would not be modified other than to in-
corporate, when and if they become effective, the changes
you have approved in the Administration proposals for GRS
renewal.
My earlier memorandum did discuss one possible adjust-
ment to the current distribution formula: raising imme-
diately the upper limit on per capita entitlements to
local governments from 145% to 175% of their state per
capita. However, this adjustment was not recommended be-
cause of the problem it might present with GRS renewal
legislation (the renewal legislation will propose raising
this upper limit over five years).
B. Use GRS formulas to distribute energy funds as tax
rebates but eliminate restrictions on recipient uses
of funds
The direct linking of the energy tax payments with the
regular GRS program could cause problems with GRS renewal,
given that Congress will be considering both proposals
simultaneously. The temptation may be to tie both programs
together at their combined funding levels, and it may be
- 3 -
GERALD FORD LIBRARY
difficult to withdraw from such an enlarged program later
For this reason there are strong arguments for keeping
the two programs as separate as possible, while continuing
to rely on GRS distribution formulas as proposed in your
State of the Union Message.
The most justifiable approach for keeping the programs
separate may be to consider the $2 billion payments as tax
rebates to State and local governments rather than more
direct Federal financial assistance. This would not pre-
clude use of GRS formulas for distributing the funds to
State and local governments nor the use of GRS definitions
of governments eligible to receive payments. As legitimate
tax rebates, however, the added funds should be provided
with virtually no Federal requirements or controls on how
recipient State and local governments use their funds to
meet higher energy costs. Since the Administration's tax
proposals will affect a broad spectrum of State and local
government activities, those governments should have
maximum flexibility in choosing how to apply the tax re-
bates.
To be consistent with your State of the Union proposal,
the tax rebate approach would distribute funds to the
39,000 general purpose governments now receiving GRS pay-
ments through the existing formula. The restrictions and
requirements which govern the regular GRS program would
not be applicable to the tax rebate program. Specifically
excluded from this proposal would be:
local priority use categories (this would
eliminate all restrictions on programmatic
use of funds) ;
planned or actual use reports; (this would
eliminate reports to the Federal Government
on fund uses) ;
auditing of fund use by the Federal Government;
Federal requirements regarding civil rights
compliance (since these payments would become
State and local funds, their use should be
guided by State or local government civil
rights laws and procedures) ;
- 4 -
Federal requirements for public participation
in decisions on use of the funds (State and
local governments would follow their existing
procedures for gaining citizen involvement in
decision making).
The proposal to eliminate existing GRS requirements
and restrictions from the energy payments will meet strong
opposition from certain groups who will inevitably link
this program to GRS and maintain that appropriate Federal
controls should be exercised over recipient uses of the
funds. This will be especially true of civil rights groups,
certain public interest groups, and GRS critics in the
Congress.
C. Develop a special energy-based formula for distributing
funds with provision for special purposes government
districts
Based on a further review of the proposal to distribute
energy tax payments, Treasury and OMB believe there are
compelling reasons, as described below, to consider develop-
ment of a special allocation formula for this program which
more accurately reflects State and local government energy
needs.
1. Geographic distribution of energy tax rebates
The present GRS formula does not allocate funds in a
way that reflects the wide differences in the cost impact of
the energy program throughout the country. For example,
preliminary estimates of a $2 billion distribution related
to energy cost impact on State and local governments
indicate that the Mountain States ought to receive 25%
more than under the present GRS formula. The New England
and the West North Central States ought to receive 17% and
13% more, respectively. It must be emphasized that these
estimates are highly tentative, but do illustrate general
orders of magnitude. The regional differences, set forth
at Attachment A, mask greater differences that exist on a
state-by-state basis, and the disparities may be no less
great for local governments. For example, procurement as
a percentage of outlays varies widely among localities and
the energy cost impact of such purchases bears no relation-
ship to the GRS formula.
- 5 -
GERALD FORD LIBRARY
2. Exclusion of one of every two units of government
The present GRS program allocates funds to 39,000 general
purpose State and local governments. Special purpose govern-
ments are specifically excluded as direct recipients of GRS
funds. Since there are no restrictions on State uses of
GRS funds, States may elect to use all or a portion of
their one-third share to finance special purpose governments.
However, local governments are statutorily precluded from
using their two-thirds share for such purposes. At present
there are approximately 40,000 special units of government
at the local level (16,000 school districts and 24,000
special districts). The omission of those governments from
the original general revenue sharing program was intended
to give new emphasis to 39,000 general purpose governments,
and at the same time to maintain separate support for
education through State revenue sharing redistributions
and Federal grants-in-aid. It would be difficult to apply
the same rationale to the exclusion of special purpose
governments (especially school districts) from the energy
rebate program.
Special purpose districts account for a sizeable share
of all local government activity, including energy pur-
chases. Forty percent of all local taxes are raised by
special purpose governments and they account for almost
50 percent of local public payroll costs. The Department
of Commerce estimates that one-half of State and local
purchases of petroleum refining products and about two-
thirds of direct purchases of electricity and gas are made
by educational agencies of which special education districts
are an important component.
Many of the States with high fuel usage are those in
which education is provided through special districts. Al-
though some States (such as Maryland and Virginia) finance
schools as part of county government, most of the New
England, Mid-Atlantic, and Midwestern States provided
education through separate governments. In most of those
States, both constitutional and political constraints would
preclude local use of energy tax distributions for educa-
tion, even if the Administration's proposal waived the
current GRS restriction against such use.
In particular, many of the large city school systems
could not receive energy rebates because they are indepen-
dents or special districts. For example, Chicago would
receive no energy tax payment for its schools, nor would
Detroit.
- 6 -
The problems of equity in the allocation of energy
funds and the exclusion of education districts are likely
to be important considerations in the Congressional debate
on your proposal. The $2 billion energy payment proposal
provides a good vehicle to cope with these criticisms.
Although more work needs to be done to determine precise
state-by-state energy needs, a distribution formula could
be devised to allocate funds to the fifty States which
reflects both direct and indirect energy purchases by the
State and its local units of government, including special
education districts.
Based on these considerations there are several
possibilities for determining appropriate intrastate allo-
cations. Individual States could be given considerable
discretion in the allocation of funds among schools and
other local governments within the State. They could
elect to distribute funds to local general purpose govern-
ments pursuant to GRS formulas or use alternative formulas;
or they might in turn use State school aid formulas for
the education portion. The education problem might also
be met to some extent by offering incentives to States to
use their one-third share of the energy tax rebate to aid
schools as they may do under the present GRS formula. In
addition, they might be permitted, in certain cases, to
override the 1/3-2/3 State-local split to provide additional
aid to schools without introducing other changes in the
pattern of distribution through the present GRS formula.
Under either of these approaches, elimination of GRS require-
ments and restrictions would probably be necessary (as
proposed in option B) in order to give State and local
governments maximum flexibility in distributing funds.
The introduction of these concerns into the distribution
formula will give rise to political controversy and signif-
icant difference of opinion. If the Administration chooses
to cope with these concerns, the best method would be to
adopt a flexible approach for working out preferred mechanisms
with the Ways and Means Committee over the next few weeks.
If we are unable to work out satisfactory approaches with
the Committee along these lines, we would have the option of
returning to the regular GRS formula and negotiating, if
necessary, restrictions and requirements to be added to the
program.
- 7 -
There are already suggestions to make special adjust-
ments in the Administration's economic program for
geographic areas, industries and classes of taxpayers who
can show special oil consumption impact. If enacted by
Congress, a series of precise rebates or exemptions would
destroy the price elasticity assumptions on which the oil
conservation effect is based.
We believe that, although serious, this concern is
offset by the advantage that Option C provides over the
two other proposed methods of distribution. Since govern-
ments act for the benefit of citizens generally, a program
designed to distribute money to State and local govern-
ments can be distinguished from those targeted toward
specific classes of individuals or businesses. In addition,
we are not making adjustments in the tax mechanism with
respect to the proposed distribution. We have decided to
use revenue sharing as a base under whichever option is
chosen since it is a mechanism that is already in place and
can distribute money quickly and efficiently under a
formula that Congress has approved. There is general
agreement, however, that the present GRS program bears
little or no relation to the energy needs of the State and
local governments, especially since it excludes schools at
the local level. A proposal which corrects this difference
would, in all likelihood, be viewed as providing State and
local governments with some degree of "rough justice" as
is being provided generally to other recipients under your
tax rebate program.
Two other considerations should also be noted with
regard to Option C. Oil producing states may claim an
additional share of the distributed funds to compensate
them for the added indirect costs on local government re-
sulting from increased domestic oil production including
expenses of offsetting environmental impacts. Secondly,
seeking to compensate State and local governments for their
individual increased energy costs may put pressure on the
sufficiency of the $2 billion allocated for distribution.
We view the first problem as relatively minor and
think such an attempt could be resisted successfully. The
second question is also not troublesome if we can convey
the message that the distribution is not intended to
directly compensate governments for increased energy costs
but to distribute a fixed sum of money in an equitable
manner.
- 8 -
LIBRARY GERALD FORD
Recommendation
Based on further assessment, Treasury and OMB recommend
Option C. This would involve working with the Ways and
Means Committee to devise an allocation formula which re-
flects an equitable distribution of funds based on energy
needs and adequate provision for education districts. This
would not foreclose the possibility of returning to the GRS
formula if a satisfactory energy-based formula cannot be
worked out.
Decision
Option A: Include the $2 billion energy payments
as an add-on to the present GRS program.
Option B: Consider the $2 billion as a separate
energy tax rebate program which utilizes GRS
formulas but poses no restrictions or require-
ments on recipient uses of funds.
Option C: Adopt a flexible approach with the
Congress for arriving at a joint decision on a
special energy-based formula which makes adequate
provision for education needs.
William EV Simon
Attachment
Attachment "A"
Energy Tax Rebate
Allocated by
Allocated by
Estimated Cost
Region
Present GRS
Impact of Energy
Difference
(Number of States)
Formula ($ millions)
Proposals ($ millions)
(in Percent)
New England (6)
$ 123
$ 144
13%
Middle Atlantic (3)
395
384
-3%
East North Central (5)
137
112
-19%
West North Central (7)
154
174
17%
South Atlantic (8)
298
288
3%
East South Central (4)
360
340
-6%
West South Central (4)
185
184
*
Mountain (8)
89
111
25%
Pacific (5)
260
263
1%
$2,000
$2,000
GREAT FORD LIBRARY
*less than 1%
THE WHITE HOUSE
WASHINGTON
February 27, 1975
MEMORANDUM FOR:
JIM
FROM:
WARREN
SUBJECT:
Distribution of Energy Tax Payments
to State and Local Governments
Attached is a memorandum to the President from Secretary Simon
regarding compensation of State and local governments for the higher
costs of energy purchases resulting from the Administration's Energy
Conservation Tax proposals. Would you please initiate the necessary
staffing as well as to prepare an action memorandum to the President
for Jim Cannon's signature. If Judy Johnston can assist, please
let me know.
I have provided a copy to Bill Seidman.
Attachments
CC: Judy Johnston
FORD LIBRARY y GERALD
Mike Duval
\
[March
18
GOVERNMENT OPERATIONS
Ratio 29/14
1. Jack Brooks, Tex., chairman
1. Frank Horton, N.Y.
2. L. H. Fountain, N.C.
2. John N. Erlenborn, Ill.
3. John E. Moss, Calif.
3. John W. Wydler, N.Y.
4. Dante B. Fascell, Fla.
4. Clarence J. Brown, Ohio
5. Torbert H. Macdonald, Mass.
5. Gilbert Gude, Md.
6. William S. Moorhead, Pa.
6. Paul N. McCloskey, Jr., Calif.
7. Wm. J. Randall, Mo.
7. Sam Steiger, Ariz.
8. Benjamin S. Rosenthal, N.Y.
8. Garry Brown, Mich.
9. Jim Wright, Tex.
9. Charles Thone, Nebr.
10. Fernand J. St Germain, R.I.
10. Alan Steelman, Tex.
11. Floyd V. Hicks, Wash.
11. Joel Pritchard, Wash.
12. Don Fuqua, Fla.
12. Edwin B. Forsythe, N.J.
13. John Conyers, Jr., Mich.
13. Robert W. Kasten, Jr., Wis.
14. Bella S. Abzug, N.Y.
14. Willis D. Gradison, Jr., Ohio
15. James V. Stanton, Ohio
16. Leo J. Ryan, Calif.
17. Cardiss Collins, Ill.
18. John L. Burton, Calif.
19. Richardson Preyer, N.C.
20. Michael Harrington, Mass.
21. Robert F. Drinan, Mass.
22. Edward Mezvinsky, Iowa
23. Barbara Jordan, Tex.
24. Glenn English, Okla.
25. Elliott H. Levitas, Ga.
26. David W. Evans, Ind.
27. Anthony Toby Moffett, Conn.
28. Andrew Maguire, N.J.
29. Les Aspin, Wis.
SUBCOMMITTEES OF THE COMMITTEE ON
GOVERNMENT OPERATIONS
[The_chairman and ranking minority member are ex officio members of all
subcommittees on which they do not hold a regular assignment.]
COMMERCE, CONSUMER, AND MONETARY AFFAIRS
Benjamin S. Rosenthal, N.Y., chairman
Garry Brown, Mich.
Cardiss Collins, Ill.
Willis D. Gradison, Jr., Ohio
Robert F. Drinan, Mass.
John N. Erlenborn, III.
Elliott H. Levitas, Ga.
David W. Evans, Ind.
Anthony Toby Moffett, Conn.
Andrew Maguire, N.J.
Edward Mezvinsky, Iowa
CONSERVATION, ENERGY, AND NATURAL RESOURCES
William S. Moorhead, Pa., chairman
Gilbert Gude, Md.
Dante B. Fascell, Fla.
Paul N. McCloskey, Jr., Calif.
Leo J. Ryan, Calif.
Edwin B. Forsythe, N.J.
L. H. Fountain, N.C.
John L. Burton, Calif.
Torbert H. Macdonald, Mass.
Fernand J. St Germain, R.I.
Richardson Preyer, N.C.
GERALD R. LIBRARY FORD
19
SUBCOMMITTEES OF THE COMMITTEE ON GOVERNMENT
OPERATIONS-Continued
GOVERNMENT ACTIVITIES AND TRANSPORTATION
Wm. J. Randall, Mo., chairman
Charles Thone, Nebr.
Cardiss Collins, Ill.
Edwin B. Forsythe, N.J.
Glenn English, Okla.
Willis D. Gradison, Jr., Ohio
Bella S. Abzug, N.Y.
Richardson Preyer, N.C.
David W. Evans, Ind.
GOVERNMENT INFORMATION AND INDIVIDUAL RIGHTS
Bella S. Abzug, N.Y., chairman
Sam Steiger, Ariz.
Jim Wright, Tex.
Clarence J. Brown, Ohio
Leo J. Ryan, Calif.
Paul N. McCloskey, Jr., Calif.
John Conyers, Jr., Mich.
Torbert H. Macdonald, Mass.
John E. Moss, Calif.
Michael Harrington, Mass.
Andrew Maguire, N.J.
INTERGOVERNMENTAL RELATIONS AND HUMAN RESOURCES
L. H. Fountain, N.C., chairman
John W. Wydler, N.Y.
Don Fuqua, Fla.
Clarence J. Brown, Ohio
Edward Mezvinsky, Iowa
Robert W. Kasten, Jr., Wis.
Barbara Jordan, Tex.
John L. Burton, Calif.
Robert F. Drinan, Mass.
Glenn English, Okla.
Elliott H. Levitas, Ga.
LEGISLATION AND NATIONAL SECURITY
Jack Brooks, Tex., chairman
Frank Horton, N.Y.
John E. Moss, Calif.
John N. Erlenborn, Ill.
Benjamin S. Rosenthal, N.Y.
Joel Pritchard, Wash.
Jim Wright, Tex.
Don Fuqua, Fla.
William S. Moorhead, Pa.
James V. Stanton, Ohio
Michael Harrington, Mass.
MANPOWER AND HOUSING
Floyd V. Hicks, Wash., chairman
Alan Steelman, Tex.
Wm. J. Randall, Mo.
Joel Pritchard, Wash:
Fernand J. St Germain, R.I.
Robert W. Kasten, Jr., Wis.
John Conyers, Jr., Mich.
James V. Stanton, Ohio
Barbara Jordan, Tex.
Anthony Toby Moffett, Conn.
FORD LIBRARY is GERALD
THE WHITE HOUSE
WASHINGTON
March 3, 1975
MEMORANDUM FOR:
WARREN HENDRIKS
FROM:
MIKE DUVAL
A
SUBJECT:
SECRETARY SIMON'S MEMO ON
ENERGY TAX REBATES TO STATE
AND LOCAL GOVERNMENTS
On February 27 you assigned the action on this memor-
andum to Jim Falk. This is primarily an energy issue
and should remain so.
Accordingly, I recommend that you send the attached
memo to Frank Zarb for consideration by the ERC. They
should than forward their recommendations back to us
for our cover memo to the President.
CC: Jim Falk
THE WHITE HOUSE
F.Y.I.
WASHINGTON
DOMESTIC COUNCIL CLEARANCE SHEET
DATE: March 18, 1975
JMC action required by: Info
TO:
JIM CANNON
VIA:
DICK DUNHAM X
JIM CAVANAUGH X
LIBRARY is
FROM:
JIM FALK J
SUBJECT: Reenactment of General Revenue Sharing
COMMENTS:
This is informational
Jim V Dick have copies
γ asked that I get it
to you for your info.
Jim 7.
THE WHITE HOUSE
WASHINGTON
March 18, 1975
MEMORANDUM FOR:
JIM CANNON
FROM:
JIM FALK
7
SUBJECT:
Reenactment of General Revenue Sharing
As we discussed in South Bend, we have been developing a plan and following
our schedule fairly faithfully with respect to the reenactment of the program.
The policy development work is largely complete with the Presidential decisions
that have been made in two options papers which I have given to Dick Dunham
with all of the attendant backup materials. We are now in the process of mechan-
ically putting together the legislation and the Presidential Message as well as
planning the action phase which will begin with the transmission of the Message
and the legislation to the Congress. Our tentative plan is to have the Message
and the legislation ready when Congress reconvenes following their Easter
recess, April 7-11.
The following is a schedule of the steps that need to be carried out to lay the
groundwork for the introduction in Congress of the President's program:
I. LEGISLATION
FORD LIBRARY
Individual
Date
Action
Responsible
Friday
Deadline for agency comments on
Purcell
3/14
legislation to be submitted to OMB.
Wednesday
Agency comments to have been re-
Schmults
3/19
viewed and agreement reached on
changes in legislation.
Friday
Revised legislation readied in final
Albrecht
3/21
form.
- 2 -
GERALD Yotes
II. PRESIDENTIAL MESSAGE
Individual
Date
Action
Responsible
Tuesday
Message as revised by White House
Falk
3/1
to be returned to Treasury.
Wednesday
Message to be further edited by Treas-
Schmults
3/19
ury and OMB to take into account changes
in the legislation.
Thursday
Message to be returned to White House
Schmults
3/20
for final review.
Monday
Final Message to be returned to Treasury
Falk
3/24
III. PRESS PACKAGE
Individual
Date
Action
Responsible
Friday
First draft of fact sheet prepared
Peterson
3/14
Wednesday
Revised fact sheet taking into ac-
Peterson
3/19
count changes in legislation
Thursday
Q's and A's for press package pre-
Peterson
3/20
pared.
Thursday
Press release prepared.
Crane
3/20
Friday
Description of legislation for press
Parker
3/21
package prepared
Monday
Items in press package (Presidential
Schmults
3/24
message, press release, fact sheet,
press Q's & A's, description of legis-
lation) reviewed.
Tuesday
Press package sent to printer
Adams
3/25
- 3 -
Individual
Date
Action
Responsible
Thursday
Press package returned from printer
Adams
It is also essential that we plan the initial announcement and press conference
with adequate advance notice to State and local officials to enable as many as
possible to make their statements.
Further, the plan we have been following for meetings with members of Congress,
public interst groups, and special interest groups in attached at Tab A.
There is much more that needs to be done, particularly the development of an
implementation plan once the legislation is submitted, so that we can sustain
interest and answer questions such as the one Congressman Brown raised with
Max Friedersdorf. Some of these questions are not yet answered, but should be
shortly.
I would appreciate an opportunity to sit down and talk with you about this at
your earliest possible convenience.
Date: JAN 15 1975
MEMORANDUM FOR: SECRETARY SIMON
From:
Edward C. Schmults
(Initialed) E.C.S.
Subject: Revenue Sharing Renewal - Proposed Course of Action
FORD i LIBRARY 077839
The following discusses plans we have made with regard
to the legislative phase of the revenue shaing renewal pro-
gram. I have outlined the steps we plan to take over the
next few weeks so you will be aware of them.
The Revenue Sharing Steering Group which analyzed and
proposed recommendations for the Administration's considera-
tion will play an important role in preparing materials for
our use in enlisting support for the program. Jim Purcell of
OMB has already held a preliminary meeting at. which various
issues that will be raised as the program is evaluated by
Congress and by interested groups have been assigned for
analysis to those who helped to formulate those aspects of
the program.
I. Meetings
A. Congressional. An attempt will be made to call upon
as many Congressional leaders and key Congressman as feasible
to brief them on our program, and solicit their support for it.
Appointments already have been scheduled for you, along with
Fred Webber and myself, to meet with Carl Albert, John Rhodes,
Mike Mansfield, and Hugh Scott on the afternoon of January 20.
Fred Webber, Graham Watt and I will meet later during the week
of January 20 and during the next week on an individual basis
with the chairman and ranking minority members of the committees -
and subcommittees with responsibility for revenue sharing legis-
lation. This will involve visits with Congressmen Brooks,
Horton, Fountain, and Clarence Brown and Senators Long, Curtis,
Muskie, and Roth. Other leaders and key Congressmen will be
called upon as well. A listing prepared by Fred Webber is
attached at Tab A. In addition, if feasible, we will meet
Initiator
Reviewer
Reviewer
Reviewer
Reviewer
Ex. Sec.
Surname
Initials / Date
/
/
/
Form 0S-3129
Department of Treasury
1 2 -
individually with all members of the committees which are to
consider revenue sharing renewal. The Steering Group will
be informed as particular meetings are scheduled so that
briefing materials can be readied.
B. Civil Rights, Labor, and Community Interest Groups.
During the week of January 20, or as soon as possible there-
after, Ed Schmults and Graham Watt will meet with Congressman
Louis Stokes of Ohio, the Chairman of the Congressional Black
Caucus, to outline the proposed revenue sharing program to
him and to discuss in detail the anti-discrimination area of
the program.
It will be pointed out to the Congressman that ORS
regulations and court action with respect to revenue sharing
matters will play an important role in assuring that discrim-
ination does not take place. An attempt will be made to get
Congressman Stokes to support the Administration's bill.
His suggestions for improvements in the legislation to be
introduced will be considered. Congressman Stokes will also
be briefed about the changes in funding level being made in
regard to urban areas under the Administration's proposals.
During the week of January 20, and thereafter, Ed
Schmults and Graham Watt, and possibly J. Stanley Pottinger,
the Assistant Attorney General, Civil Rights Division, will
meet with representatives of civil rights and community
interest groups to discuss with them the Administration's
proposals. Their views will be solicited and suggestions
for change will be considered.
We are exploring the possibility of meeting and
exchanging views with representatives of organized labor
about the Administration's revenue sharing renewal program.
Two representatives of each of the following civil
rights and community interest organizations will be
invited to meet with us in the groupings indicated:
GERALD R. LIBRARY FORD
- 3 -
1. National Association for the Advancement of Colored
People (NAACP) Ran w lkins V clarance colemon
National Urban League Vernon Londan
National Urban Coalition
Leadership Conference on Civil Rights
People United to Save Humanity (PUSH)
0.1.C. Rev Lean sullivan
2. National Council of La Raza
American G.I. Forum
Raza Association of Spanish Surnamed Americans.
(RASSA)
3. National Organization for Women
Center for National Policy Review
Joint Center for Political Studies
League of Women Voters
GERALD FORD LIBRARY
Center for Community Change
Lawyers Committee on Civil Rights
At some point during this series of meetings it is sug-
gested that Messrs. Schmults and Watt and Assistant Attorney
General Pottinger meet with John A. Buggs, Staff Director of
the U.S. Civil Rights Commission, to review the proposed revenue
sharing program with him.
A list of the representatives of the groups listed above
who would be invited to participate in the meetings is attached
at Tab B.
C. Public Interest Groups. The major public interest
groups will be holding meetings in Washington during late
January and early February. It is suggested that the President
meet briefly with officials from each group -- governors, mayors,
county executives, and state legislators to talk with them about
revenue sharing reenactment.
The following is a schedule of when the groups will be
meeting:
National League of Cities (Committee meeting on
revenue sharing) -- January 29
U.S. Conference of Mayors -- January 30 and 31
National Governors Conference --- February 18, 19, and 20
National Association of Counties -- February 26, 27 and 28
National Conference of State Legislators -- February 28
- 4 -
These meetings will provide an excellent forum for senior
Administration officials to seek to generate support for the
revenue sharing program. We are planning to make arrangements
to have appropriate Administration spokesmen, including perhaps
Vice President Rockefeller or yourself, address these groups
when they are in Washington.
The New Coalition, which consists of three governors,
three mayors, three county executives, and three state legis-
lators, will meet in Washington on February 17 to discuss topics
of interest to government officials including the NLRB and
government employees; revenue sharing; state and local regula-
tion; and state aid to local government. Moon Landrieu, Mayor
of New Orleans, heads up the New Coalition task force on
revenue sharing. We will be prepared to make a presentation
to the New Coalition if invited to do so.
II. Documentation
GERALD FORD LIBRARY
The following materials are to be produced by the dates
noted. Deadlines are subject to change as our time schedule
becomes more definitive.
A. Briefing Materials for Meetings with Key Congressmen
and with Civil Rights Leaders. These are among the first items
to be prepared. The proposed program will be outlined and the
reasons why particular approaches were adopted will be set
forth. Data showing the effect of the proposed changes on the
state and local government allocations of those jurisdictions
which individual Congressmen represent will be prepared for
each meeting. An analysis of the civil rights aspects of the
program and data showing how the proposed increase in the
maximum per capita limitation operates with respect to large
cities with substantial minority population will be assembled.
(Materials for 1/20 meetings with Congressmen - 1/17/75;
materials for other Congressional meetings - 1/20/75; civil
rights materials - 1/22/75.)
B. Press Package. A two- or three-page descriptive
document explaining the Administration's new program is to be
prepared along with a fact sheet illustrating what changes
will result both with regard to the amounts allocated and
modifications in the program's administrative requirements.
(1/21/75)
-- 5 -
C. Briefing Book. This will discuss each of the impor-
tant issues that might be raised in connection with revenue
sharing renewal. Included will be information about both the
accomplishments and problems associated with the present
program. The briefing book will also include a series of
questions and answers on controversial issues. (1/27/75 -
with revisions and additions to be inserted thereafter.)
D. Transmittal Documents. These will accompany the
Administration's legislation when it is sent to the Congress.
They will analyze the legislation and explain what it seeks to
accomplish and the reasons why particular approaches were
taken. The legislation itself will be initially drafted by
the Treasury General Counsel and the Office of Revenue Sharing
and reviewed by the Steering Group. Work on the legislation
has begun. Work on the transmittal documents should be com-
pleted when the legislation is ready to be introduced. (Ap-
proximately 2/3/75.)
E. Speeches and Statements. Speeches and statements
will be prepared as the need for them arises. When an invi-
tation is received, someone will be assigned to prepare a
speech tailored to fit the interests of the audience involved.
Excerpts from the transmittal documents and the prepared
testimony should provide much of the basis for speech materials.
(One week in advance of speaking engagements.)
F. Testimony. Written testimony explaining the program
and supporting the proposals offered will be prepared for
Secretary Simon and others who may be testifying before
Congress. The testimony will take into account criticisms
that might be offered and provide a response as to why the
program is in the form which the Administration is proposing.
(Mid-February.)
III. Calendar
A calendar of relevant dates and deadlines is to be main-
tained in my office and updated as the reenactment program
progresses. The initial version is attached at Tab C. Revised
copies of this master schedule will be distributed to the
Steering Group, the Office of Revenue Sharing and other inter-
ested officials periodically.
FORD LIBRARY is GERALD
GRS Courtesy Calls and 94th Congress
by Secretary Simon (where indicated),
Schmults, Webber, Watt
I
House Government Operations Committee
Chm:
Jack Brooks (D-Tex.)
Minority:
Frank Horton (R-N.Y.)
Key Member: Henry Reuss (D-Wisc.)
II
House Subcomm on Intergovernmental Relations
Chm:
L.H. Fountain (D-N. Car.)
Minority: Clarence "Bud" Brown (R-Ohio)
III
Senate Finance Committee
Chm:
Russell Long (D-La.)
Minority: Carl Curtis (R-Neb.)
IV
Senate Subcomm. on Intergovernmental Relations
Chm:
Edmund S. Muskie (D-Me.)
Minority: Bill Roth (R-Del.)
V
House Leadership
Speaker:
Carl Albert (D-Okla.) - Sec. Simon
Majority Leader: "Tip" O'Neill (D-Mass.)
Majority Whip: John McFall (D-Calif.)
Minority Leader: John J. Rhodes (R-Ariz.) - Sec. Simon
Minority Whip: Robert H. Michel (R-Ill.)
Chm, House Republican Conference: John Anderson (R-Ill.)
VI
Senate Leadership
Majority Leader: Mike Mansfield (D-Mont.) i Sec. Simon
Majority Whip: Robert Byrd (D- W, Va.)
Minority Leader: Hugh Scott (R-Pa.) - Sec. Simon
Minority Whip: Robert Griffin (R-Mich.)
VII Others
Sen. Bill Brock (R-Tenn.) Gov. Ops.
Sen. Howard Baker (R-Tenn.)
Sen. Charles H. Percy (R-Ill.) Gov. Ops.
Cong. Charles Wiggins (R-Calif.)
Cong. Don Edwards (D - Calif.)
Sen. Joseph M. Montoya (D-N.M.)
FORD is LIBRARY GENALD
Organizations Interested in Civil Rights
and Public Participation Aspects
of General Revenue Sharing Renewal
Organizations
Individuals
U.S. Civil Rights Commission
John A. Buggs, Staff Director
NAACP
Clarence Mitchell, Director,
Washington Bureau; Bill Morris,
Director of Housing Programs
National Urban League
Vernon Jordan, Executive Dir-
ector; Ron Brown, Washington
Office Director
National Urban Coalition
Carl Holman
Southern Christian Leader-
Ralph Abernathy
ship Conference
Leadership Conference on
Marvin Caplan, Director,
Civil Rights
Washington Office,
Harold Coleman, Chairman, Federal
Programs Task Force
PUSH
Jesse Jackson
Southern Regional Conference
Don Easley
Lawyers Committee on Civil
Harold Himmelman
Rights
National Council of La Raza
Roberto Olly Olivas, National
Services Director
American G.I. Forum
Tony Gallegas, National Chairman
RASSA
Mannie Ferrero
National Organization for
Whitney Adams
Women
League of Women Voters
Mary Lampke
Center for National Policy
Bill Taylor, Mort Sklar
FORD i LIBRARY
Review
Joint Center for Political
Eddie Williams, President
Studies
Center for Community Change
David Ramage
REVENUE SHARING
CALENDAR OF APPOINTMENTS AND DEADLINES
Date
Event or Assignment
Responsible Parties
Week of Jan. 13
Fri., Jan. 17 (AM)
-- Briefing paper for Congressional
Adams, Peterson
meetings during next week due.
--- Home district data for Monday
Buck
Congressional meetings due.
Week of Jan. 20
Mon., Jan. 20
--- Messrs. Simon, Schmults, and Webber
meet with Congressmen:
2:30 p.m. - Carl Albert
LIBRARY
3:30 p.m. - John Rhodes
3:45 p.m. - Mike Mansfield
FORD
4:15 p.m. - Hugh Scott
GENALD
--- Home district data for Congressional
Buck
meetings on Jan. 21 and Jan. 22 due.
Tues., Jan. 21
-- Messrs. Schmults, Webber, and Watt
meet with Senators:
10:00 a.m. - Brock
4:30 p.m. - Curtis
--- Press handout due.
Peterson
Wed., Jan. 22
-- Messrs. Schmults, Webber, and Watt
meet with Congressmen:
9:30 a.m. - Frank Horton
10:30 a.m. - Charles Wiggins
11:15 a.m. - L. H. Fountain
2:00 p.m. - Jack Brooks
2:30 p.m. - Clarence Brown
-- Briefing materials for civil rights
Bashein, Buck
meetings due.
- 2 -
Date
Event or Assignment
Responsible Parties
Week of Jan. 27
Mon., Jan. 27
-- Briefing book due.
Thurs., Jan. 30
--- U.S. Conference of Mayors
FORD LIBRARY 076830
o Peterson
Fri., Jan. 31
-- U.S. Conference of Mayors
Week of Feb. 3
Mon., Feb. 3
--- Transmittal documents due.
Peterson
Week of Feb. 17
Tues., Feb. 18
:- National Governors Conference
Wed., Feb. 19
--- National Governors Conference
Thurs., Feb. 20
----- National Governors Conference
Week of Feb. 24
Wed., Feb. 26
--- National Association of Counties
Thurs., Feb. 27
--- National Association of Counties
Fri., Feb. 28
--- National Association of Counties
-- National Conference of State Legislators
THE WHITE HOUSE
F.Y.D.
WASHINGTON
DOMESTIC COUNCIL CLEARANCE SHEET
DATE: March 18, 1975
JMC action required by: Info
TO:
JIM CANNON
R
VIA:
DICK DUNHAM X
15sus
JIM CAVANAUGH X
FROM:
JIM FALK 7
SUBJECT: Reenactment of General Revenue Sharing
GERALD FORD LIBRARY
COMMENTS:
This is informational
Jim V Dick have copies
γ asked that I get it
to you for your info.
4imF.
THE WHITE HOUSE
is
FORD
WASHINGTON
March 18, 1975
THRUST
MEMORANDUM FOR:
JIM CANNON
FROM:
JIM FALK 7
SUBJECT:
Reenactment of General Revenue Sharing
As we discussed in South Bend, we have been developing a plan and following
our schedule fairly faithfully with respect to the reenactment of the program.
The policy development work is largely complete with the Presidential decisions
that have been made in two options papers which I have given to Dick Dunham
with all of the attendant backup materials. We are now in the process of mechan-
ically putting together the legislation and the Presidential Message as well as
planning the action phase which will begin with the transmission of the Message
and the legislation to the Congress. Our tentative plan is to have the Message
and the legislation ready when Congress reconvenes following their Easter
recess, April 7-11.
The following is a schedule of the steps that need to be carried out to lay the
groundwork for the introduction in Congress of the President's program:
I. LEGISLATION
Individual
Date
Action
Responsible
Friday
Deadline for agency comments on
Purcell
3/14
legislation to be submitted to OMB.
Wednesday
Agency comments to have been re-
Schmults
3/19
viewed and agreement reached on
changes in legislation.
Friday
Revised legislation readied in final
Albrecht
3/21
form.
- 2 -
FORD :- LIBRARY 076839
II. PRESIDENTIAL MESSAGE
Individual
Date
Action
Responsible
Tuesday
Message as revised by White House
Falk
3/1
to be returned to Treasury.
Wednesday
Message to be further edited by Treas-
Schmults
3/19
ury and OMB to take into account changes
in the legislation.
Thursday
Message to be returned to White House
Schmults
3/20
for final review.
Monday
Final Message to be returned to Treasury
Falk
3/24
III. PRESS PACKAGE
Individual
Date
Action
Responsible
Friday
First draft of fact sheet prepared
Peterson
3/14
Wednesday
Revised fact sheet taking into ac-
Peterson
3/19
count changes in legislation
Thursday
Q's and A's for press package pre-
Peterson
3/20
pared.
Thursday
Press release prepared.
Crane
3/20
Friday
Description of legislation for press
Parker
3/21
package prepared
Monday
Items in press package (Presidential
Schmults
3/24
message, press release, fact sheet,
press Q's & A's, description of legis-
lation) reviewed.
Tuesday
Press package sent to printer
Adams
3/25
- 3 -
Individual
Date
Action
Responsible
Thursday
Press package returned from printer
Adams
It is also essential that we plan the initial announcement and press conference
with adequate advance notice to State and local officials to enable as many as
possible to make their statements.
Further, the plan we have been following for meetings with members of Congress,
public interst groups, and special interest groups in attached at Tab A.
There is much more that needs to be done, particularly the development of an
implementation plan once the legislation is submitted, so that we can sustain
interest and answer questions such as the one Congressman Brown raised with
Max Friedersdorf. Some of these questions are not yet answered, but should be
shortly.
I would appreciate an opportunity to sit down and talk with you about this at
your earliest possible convenience.
FORD LIBRARY "II GENALD
Date: JAN 15 1975
MEMORANDUM FOR: SECRETARY SIMON
From: Edward C. Schmults (Initialed) E.C.S.
Subject: Revenue Sharing Renewal - Proposed Course of Action
The following discusses plans we have made with regard
to the legislative phase of the revenue shaing renewal pro-
gram. I have outlined the steps we plan to take over the
next few weeks so you will be aware of them.
The Revenue Sharing Steering Group which analyzed and
proposed recommendations for the Administration's considera-
tion will play an important role in preparing materials for
our use in enlisting support for the program. Jim Purcell of
OMB has already held a preliminary meeting at. which various
issues that will be raised as the program is evaluated by
Congress and by interested groups have been assigned for
analysis to those who helped to formulate those aspects of
the program.
I. Meetings
A. Congressional. An attempt will be made to call upon
as many Congressional leaders and key Congressman as feasible
to brief them on our program, and solicit their support for it.
Appointments already have been scheduled for you, along with
Fred Webber and myself, to meet with Carl Albert, John Rhodes,
Mike Mansfield, and Hugh Scott on the afternoon of January 20.
Fred Webber, Graham Watt and I will meet later during the week
of January 20 and during the next week on an individual basis
with the chairman and ranking minority members of the committees -
and subcommittees with responsibility for revenue sharing legis-
lation. This will involve visits with Congressmen Brooks,
Horton, Fountain, and Clarence Brown and Senators Long, Curtis,
Muskie, and Roth. Other leaders and key Congressmen will be
called upon as well. A listing prepared by Fred Webber is
attached at Tab A. In addition, if feasible, we will meet
Initiator
Reviewer
Reviewer
Reviewer
Reviewer
Ex. Sec.
Surname
nitials / Date
/
/
/
/
/
/
Form 0S-3129
Department of Treasury
1 2 -
individually with all members of the committees which are to
consider revenue sharing renewal. The Steering Group will
be informed as particular meetings are scheduled so that
briefing materials can be readied.
B. Civil Rights, Labor, and Community Interest Groups.
During the week of January 20, or as soon as possible there-
after, Ed Schmults and Graham Watt will meet with Congressman
Louis Stokes of Ohio, the Chairman of the Congressional Black
Caucus, to outline the proposed revenue sharing program to
him and to discuss in detail the anti-discrimination area of
the program.
It will be pointed out to the Congressman that ORS
regulations and court action with respect to revenue sharing
matters will play an important role in assuring that discrim-
ination does not take place. An attempt will be made to get
Congressman Stokes to support the Administration's bill.
His suggestions for improvements in the legislation to be
introduced will be considered. Congressman Stokes will also
be briefed about the changes in funding level being made in
regard to urban areas under the Administration's proposals.
During the week of January 20, and thereafter, Ed
Schmults and Graham Watt, and possibly J. Stanley Pottinger,
the Assistant Attorney General, Civil Rights Division, will
meet with representatives of civil rights and community
interest groups to discuss with them the Administration's
proposals. Their views will be solicited and suggestions
for change will be considered.
We are exploring the possibility of meeting and
exchanging views with representatives of organized labor
GREATO FORD LIBRARY
about the Administration's revenue sharing renewal program.
Two representatives of each of the following civil
rights and community interest organizations will be
invited to meet with us in the groupings indicated:
- 3 -
1. National Association for the Advancement of Colored
People (NAACP) Ray w llkins Y clarance Colemger
National Urban League Vermon Landan
National Urban Coalition
Leadership Conference on Civil Rights
People United to Save Humanity (PUSH)
0.1.C. Rev Lean sullivan
2. National Council of La Raza
American G.I. Forum
Raza Association of Spanish Surnamed Americans.
(RASSA)
3. National Organization for Women
Center for National Policy Review
Joint Center for Political Studies
League of Women Voters
Center for Community Change
Lawyers Committee on Civil Rights
At some point during this series of meetings it is sug-
gested that Messrs. Schmults and Watt and Assistant Attorney
General Pottinger meet with John A. Buggs, Staff Director of
the U.S. Civil Rights Commission, to review the proposed revenue
sharing program with him.
A list of the representatives of the groups listed above
who would be invited to participate in the meetings is attached
at Tab B.
C. Public Interest Groups. The major public interest
groups will be holding meetings in Washington during late
January and early February. It is suggested that the President
meet briefly with officials from each group -- governors, mayors,
county executives, and state legislators to talk with them about
revenue sharing reenactment.
The following is a schedule of when the groups will be
meeting:
National League of Cities (Committee meeting on
revenue sharing) -- January 29
U.S. Conference of Mayors -- January 30 and 31
National Governors Conference -- February 18, 19, and 20
National Association of Counties -- February 26, 27 and 28
National Conference of State Legislators -- February 28
- 4 -
These meetings will provide an excellent forum for senior
Administration officials to seek to generate support for the
revenue sharing program. We are planning to make arrangements
to have appropriate Administration spokesmen, including perhaps
Vice President Rockefeller or yourself, address these groups
when they are in Washington.
The New Coalition, which consists of three governors,
three mayors, three county executives, and three state legis-
lators, will meet in Washington on February 17 to discuss topics
of interest to government officials including the NLRB and
government employees; revenue sharing; state and local regula-
tion; and state aid to local government. Moon Landrieu, Mayor
of New Orleans, heads up the New Coalition task force on
revenue sharing. We will be prepared to make a presentation
to the New Coalition if invited to do SO.
II. Documentation
The following materials are to be produced by the dates
GERALD
noted. Deadlines are subject to change as our time schedule
becomes more definitive.
A. Briefing Materials for Meetings with Key Congressmen
and with Civil Rights Leaders. These are among the first items
to be prepared. The proposed program will be outlined and the
reasons why particular approaches were adopted will be set
forth. Data showing the effect of the proposed changes on the
state and local government allocations of those jurisdictions
which individual Congressmen represent will be prepared for
each meeting. An analysis of the civil rights aspects of the
program and data showing how the proposed increase in the
maximum per capita limitation operates with respect to large
cities with substantial minority population will be assembled.
(Materials for 1/20 meetings with Congressmen - 1/17/75;
materials for other Congressional meetings - 1/20/75; civil
rights materials - 1/22/75.)
B. Press Package. A two- or three-page descriptive
document explaining the Administration's new program is to be
prepared along with a fact sheet illustrating what changes
will result both with regard to the amounts allocated and
modifications in the program's administrative requirements.
(1/21/75)
- 5 -
C. Briefing Book. This will discuss each of the impor-
tant issues that might be raised in connection with revenue
sharing renewal. Included will be information about both the
accomplishments and problems associated with the present
program. The briefing book will also include a series of
questions and answers on controversial issues. (1/27/75 -
with revisions and additions to be inserted thereafter.)
D. Transmittal Documents. These will accompany the
Administration's legislation when it is sent to the Congress.
They will analyze the legislation and explain what it seeks to
accomplish and the reasons why particular approaches were
taken. The legislation itself will be initially drafted by
the Treasury General Counsel and the Office of Revenue Sharing
and reviewed by the Steering Group. Work on the legislation
has begun. Work on the transmittal documents should be com-
pleted when the legislation is ready to be introduced. (Ap-
proximately 2/3/75.)
E. Speeches and Statements. Speeches and statements
will be prepared as the need for them arises. When an invi-
tation is received, someone will be assigned to prepare a
speech tailored to fit the interests of the audience involved.
Excerpts from the transmittal documents and the prepared
testimony should provide much of the basis for speech materials.
(One week in advance of speaking engagements.)
F. Testimony. Written testimony explaining the program
and supporting the proposals offered will be prepared for
Secretary Simon and others who may be testifying before
Congress. The testimony will take into account criticisms
that might be offered and provide a response as to why the
program is in the form which the Administration is proposing.
(Mid-February.)
III. Calendar
A calendar of relevant dates and deadlines is to be main-
tained in my office and updated as the reenactment program
progresses. The initial version is attached at Tab C. Revised
copies of this master schedule will be distributed to the
Steering Group, the Office of Revenue Sharing and other inter-
ested officials periodically.
GRS Courtesy Calls - - 94th Congress
by Secretary Simon (where indicated),
Schmults, Webber, Watt
I
House Government Operations Committee
Chm:
Jack Brooks (D-Tex.)
Minority:
Frank Horton (R-N.Y.)
Key Member: Henry Reuss (D-Wisc.)
II
House Subcomm on Intergovernmental Relations
Chm:
L.H. Fountain (D-N. Car.)
Minority: Clarence "Bud" Brown (R-Ohio)
III
Senate Finance Committee
Chm:
Russell Long (D-La.)
Minority: Carl Curtis (R-Neb.)
IV
Senate Subcomm. on Intergovernmental Relations
Chm:
Edmund S. Muskie (D-Me.)
Minority: Bill Roth (R-Del.)
V
House Leadership
Speaker:
Carl Albert (D-Okla.) - Sec. Simon
Majority Leader: "Tip" O'Neill (D-Mass.)
Majority Whip: John McFall (D-Calif.)
Minority Leader: John J. Rhodes (R-Ariz.) - Sec. Simon
Minority Whip: Robert H. Michel (R-Ill.)
Chm, House Republican Conference: John Anderson (R-Ill.)
VI
Senate Leadership
Majority Leader: Mike Mansfield (D-Mont.) 1 Sec. Simon
Majority Whip: Robert Byrd (D- W, Va.)
Minority Leader: Hugh Scott (R-Pa.) - Sec. Simon
Minority Whip: Robert Griffin (R-Mich.)
VII
Others
Sen. Bill Brock (R-Tenn.) Gov. Ops.
Sen. Howard Baker (R-Tenn.)
Sen. Charles H. Percy (R-Ill.) Gov. Ops.
Cong. Charles Wiggins (R-Calif.)
Cong. Don Edwards (D - Calif.)
Sen. Joseph M. Montoya (D-N.M.)
Organizations Interested in Civil Rights
and Public Participation Aspects
of General Revenue Sharing Renewal
Organizations
Individuals
U.S. Civil Rights Commission
John A. Buggs, Staff Director
NAACP
Clarence Mitchell, Director,
Washington Bureau; Bill Morris,
Director of Housing Programs
National Urban League
Vernon Jordan, Executive Dir-
ector; Ron Brown, Washington
Office Director
National Urban Coalition
Carl Holman
Southern Christian Leader-
Ralph Abernathy
ship Conference
GERRES
LISBARY
Leadership Conference on
Marvin Caplan, Director,
Civil Rights
Washington Office,
Harold Coleman, Chairman, Federal
Programs Task Force
PUSH
Jesse Jackson
Southern Regional Conference
Don Easley
Lawyers Committee on Civil
Harold Himmelman
Rights
National Council of La Raza
Roberto Olly Olivas, National
Services Director
American G.I. Forum
Tony Gallegas, National Chairman
RASSA
Mannie Ferrero
National Organization for
Whitney Adams
Women
League of Women Voters
Mary Lampke
Center for National Policy
Bill Taylor, Mort Sklar
Review
Joint Center for Political
Eddie Williams, President
Studies
Center for Community Change
David Ramage
REVENUE SHARING
CALENDAR OF APPOINTMENTS AND DEADLINES
Date
Event or Assignment
Responsible Parties
Week of Jan. 13
Fri., Jan. 17 (AM)
-- Briefing paper for Congressional
Adams, Peterson
meetings during next week due.
-- Home district data for Monday
Buck
Congressional meetings due.
Week of Jan. 20
Mon., Jan. 20
-- Messrs. Simon, Schmults, and Webber
meet with Congressmen:
2:30 p.m. - Carl Albert
3:30 p.m. - John Rhodes
3:45 p.m. - Mike Mansfield
4:15 p.m. - Hugh Scott
--- Home district data for Congressional
Buck
meetings on Jan. 21 and Jan. 22 due.
Tues., Jan. 21
-- Messrs. Schmults, Webber, and Watt
meet with Senators:
10:00 a.m. - Brock
4:30 p.m. - Curtis
--- Press handout due.
Peterson
Wed., Jan. 22
-- Messrs. Schmults, Webber, and Watt
meet with Congressmen:
9:30 a.m. - Frank Horton
GERALD
10:30 a.m. - Charles Wiggins
11:15 a.m. - L. H. Fountain
2:00 p.m. - Jack Brooks
LISBARY
2:30 p.m. - Clarence Brown
-- Briefing materials for civil rights
Bashein, Buck
meetings due.
- 2 -
Date
Event or Assignment
Responsible Parties
Week of Jan. 27
Mon., Jan. 27
- - - - Briefing book due.
Peterson
Thurs., Jan. 30
-- U.S. Conference of Mayors
Fri., Jan. 31
- U.S. Conference of Mayors
Week of Feb. 3
Mon., Feb. 3
- Transmittal documents due.
Peterson
Week of Feb. 17
Tues., Feb. 18
:- National Governors Conference
Wed., Feb. 19
-- National Governors Conference
Thurs., Feb. 20
-- National Governors Conference
Week of Feb. 24
Wed., Feb. 26
-- National Association of Counties
Thurs., Feb. 27
-- National Association of Counties
Fri., Feb. 28
--- National Association of Counties
--- National Conference of State Legislators
22ps. 2 2
THE WHITE HOUSE
WASHINGTON
March 20, 1975
MEMORANDUM FOR:
WARREN HENDRIKS
FROM:
JIM FALK 47
SUBJECT:
Summer Public Interest Group
Meetings
The following is a list of public interest group meetings, dates and
cities where they will take place for the Summer of 1975:
National Governors' Conference
New Orleans, La.
June 8-11
National Association of Counties
Honolulu, Hawaii
June 22-25
National League of Cities &
U.S. Conference of Mayors
Boston, Mass.
July 5-9
National Conference of State
Legislatures
Philadelphia, Pa.
October 7-10
International City Management
Association
Seattle, Washington
September 28-Oct. 2
**National Governors' Conference formal State Dinner will be held on Tues-
day, June 10, 1975 at 8:00 p.m. -- Fairmont-Roosevelt Hotel, New Orleans, La.
THE WHITE HOUSE
WASHINGTON
March 27, 1975
MEMORANDUM FOR:
JIM CANNON
FROM:
JIM CAVANAUGH
SUBJECT:
Revenue Sharing Talking Points
Here is some information pulled together by Jim Falk for
your meeting with the President this afternoon.
I. POLICY STATUS
The President has made the basic decisions on the shape
and form of the legislation promised to be sent to the
Congress in his State of the Union Address. (President's
action paper at Tab A.)
The plans are:
-- Renewal of the program in substantially its present
form.
-- Authorization and cooperation for 5 3/4 years.
-- Continuation of the stair step increase of $150
million per annum. (This issue is explained in
paper at Tab B.)
II. PRESENT LAW
Key dates:
-- October 20, 1972 the legislation was signed into
law as State and Local Fiscal Assistance Act of 1972.
-- The program presently in effect will expire
December 31, 1976.
-- The funds go to 39,000 units of State and Local
Government.
- 2 -
III. MESSAGE TO CONGRESS
GERALD FORD LIBRARY
Present plan:
-- Send Special Message and draft Bill to Congress in
mid-April.
-- Final work on Bill and Message now being completed.
IV. STATE AND LOCAL GOVERNMENT
Their plans:
-- To try to keep the State, City, County coalition
together.
-- While they disagree among themselves about the
timing of when to push for reenactment, they
generally seek reenactment this year.
-- Governors, Mayors, County officials and Legislators
will all have Revenue Sharing as topic number one
at their upcoming national conferences.
V. REENACTMENT PLANS
Timing is the question:
-- When to launch.
-- When to push with maximum effort.
-- What happens if we push and Congress doesn't act
this year.
-- Should we send package to Congress but not push
so that issue is carried over to next year.
TAB A
ACTION
THE WHITE HOUSE
WASHINGTON
January 10, 1975
MEMORANDUM FOR:
THE PRESIDENT
FROM:
KEN COLE
SUBJECT:
Policy Options for Renewal of General
FORD
Revenue Sharing
LIBRARY
BACKGROUND
Attached is Secretary Simon's memorandum prepared following your meeting
on November 30 with the Steering Group working on this issue. (Tab A) A
number of steps have been taken to refine the recommendations and consult with
State and Local government leaders.
Almost all of the recommendations of the paper are supported unanimously by
Secretary Simon, Roy Ash, Bill Seidman, Alan Greenspan, Bob Hartmann,
Max Friedersdorf and myself.
However, Jack Marsh and I have serious reservations about particular sections
of the recommendations dealing with anti-discrimination and spending (use)
restrictions. These are spelled out later in this memorandum.
On all other issues it is fair to say that we are unanimous and feel the recom-
mendations have the strong support of the leaders of State and Local government
necessary for favorable Congressional action.
You are on record as supporting the renewal of the present program in sub-
stantially its present form. Your approval of these recommendations will
assure action consistent with your public positions while attempting to seek
some needed improvements.
This memorandum identifies issues for your decision contained in Secretary
Simon's paper and provides you with recommendations.
- 2 -
RECOMMENDATIONS
FORD LIBRARY
1.
That we seek to renew the program for 5 3/4 years (both authorization
and appropriations) with a provision calling for a review 2 years before
expiration.
We recommend approval.
Approve
Disapprove
2.
That we seek to continue the stair-step annual increment increase of
$150 million.
We recommend approval.
Approve
Disapprove
Note: We looked seriously at the possibility of "capping" the program
at its 1976 level. It is felt that this would raise much fear and criticism
and undercut support as well as highlighting the efforts of those who
will seek to tie increases to some form of index, i.e., Consumer Price
Index, Cost of Living or Federal Income Tax.
3.
That we retain the present formulas which have worked reasonably well
and are the consensus result of the Congressional process.
We recommend approval.
Approve
Disapprove
4.
That we retain the present 1/3 -2/3 split in funding between State and
Local governments.
We recommend approval.
Approve
Disapprove
5.
That the present "maximum limitation" on the amount of funding per
capita that can be allocated to high tax effort areas be raised gradually
over 5 years from 145% to a new maximum of 175%.
We recommend approval.
Approve
Disapprove
Note: This would not be a major retargeting, but would direct additional
money to some cities, partially addressing some increased needs and minority
undercount criticisms of past census data which is the base.
- 3 -
6.
That we retain, as is, the 20% "minimum requirement" which serves to
ensure that small units of government receive a minimum level of
assistance.
We recommend approval.
Approve
Disapprove
7.
That we strengthen the anti-discrimination protection afforded by the
act and clarify the Secretary's authority to defer payments in certain
cases.
(a) The Steering Group recommends a change in the legislation to allow
deferral of payments by the Secretary after a due process hearing and
a finding of discrimination by the Federal or State courts; a human
rights agency in the State; and/or an administrative law judge to be
created in the office of Revenue Sharing.
Jack Marsh and I recommend that you approve part of this change but
disapprove other parts. The Federal and State Courts should be relied on
completely to determine legal questions. The existing judicial system is
adequate and we should not attempt to rely on quasi-agencies in such matters.
Marsh and Cole recommend approval of reliance on Federal and State
Courts for such findings.
Approve
Disapprove
Marsh and Cole recommend disapproval of reliance on human rights agencies
or administrative law processes.
Approve
Disapprove
(b) That we seek authority for the Secretary to withhold or defer only that
portion of funds being used in a discriminatory manner.
We recommend approval.
Approve
Disapprove
CERAME FORD CIRREET
4 -
(c) That we seek to permit the Secretary to request the Attorney General
to seek injunctions if termination of funding does not result in cor-
rective action.
We recommend approval.
Approve
Disapprove
8.
The deletion of Spending (Use) Restrictions.
(a) The Steering Group recommends deletion of the Spending (Use)
restrictions which target expenditures on priority categories in the
Act.
In actuality these spending restrictions have no impact because the funds
can be used in almost any way they want. But Congress wanted to be able
to target certain areas of priority and did so with these rather loose targeting
restrictions. To remove the restrictions would probably put us in a position
of contention with the Congress and create an unnecessary controversy.
Therefore, I recommend disapproval.
Approve
Disapprove
(b) The Steering Group recommends deletion of the restriction against
the use of Revenue Sharing funds for matching of other Federal funds.
This provision is disliked by State and local government since they
must take care to free their own funds for matching purposes while
putting Revenue Sharing funds into expenditures that do not involve
Federal matching funds.
Revenue Sharing funds were intended as new money to help State and local
government meet their own objectives. If it is freed for use as matching funds
it would distort the patterns of use because far more leverage could be gained
by using all of the GRS funds for matching purposes. Many governments
would gain additional leverage by putting up GRS dollars to buy other Fed-
eral funds increasing the value of GRS dollars by a substantial percentage
but causing expenditures to be made where the best matching gain could be
made rather than where the greatest local need existed.
Jack Marsh and I recommend retaining the matching restriction and urge
you to disapprove this change.
Approve
Disapprove
- 5 -
9.
To encourage greater citizen participation, we should seek a change in the
legislation to assure public hearings on the use of the funds to be received.
We recommend approval.
Approve
Disapprove
10.
We should seek broader discretion for the Secretary of the Treasury to deter-
mine the form and content of planned and actual use reports and the require-
ments of publication. This could permit the lifting of some unnecessary
burdens from small governments and enable the Secretary to make the re-
ports more informative for Congress and the Executive Branch.
We recommend approval.
Approve
Disapprove
FORD
LIBRARY
TAB B
THE WHITE HOUSE
WASHINGTON
January 17, 1975
DOMESTIC COUNCIL REVIEW SESSION
General Revenue Sharing
Saturday, January 18, 1975
12: 00 Noon (30 minutes)
The Oval Office
From: Ken Cole
and
I.
PURPOSE
To make some final decisions on the extension of General Revenue
Sharing.
II.
BACKGROUND, PARTICIPANTS AND PRESS PLAN
A.
Background:
You have made all but one of the major decisions necessary to
enable us to go forward with the effort to seek reenactment.
That remaining decision is of course, the funding level and
whether or not to continue the stair-step annual increment in-
crease of $150 million.
This is now even more important since your announcement to take
$2 billion to be raised from the new import duties and windfall
profit taxes, to be returned to State and local governments to
offset added energy costs.
Further, there is one issue you have decided which this group
would like you to reconsider. It has to do with the authority of
the Secretary to withhold funds in discrimination cases.
ORD
- 2 -
At present, Treasury takes the position that they are bound to
withhold the entire amount of General Revenue Sharing money
going to a recipient if any portion is used in a discriminatory
way. This can be unfair in some cases and could be more flex-
ible. The proposed change would allow Treasury to hold back
only the portion being used wrongfully. A further explana-
tion appears later in this paper.
B.
Participants:
Secretary Simon
Undersecretary Schmults
Roy Ash
Jack Marsh
Ken Cole
Jim Falk
Wally Scott
C.
Press Plan
To be announced.
III.
POINTS OF DISCUSSION
1.
All but one key decision has been made and I want to wrap up as
much as possible today so the reenactment process can go forward.
2.
The funding level and whether or not to continue the stair-step
approach, both are parts of the same question.
3.
The plan to distribute $2 billion more by the same formula also
may require some strategy decisions.
4.
There is also the concern about Treasury's authority to hold
back all or only part of the funds in cases involving discrimination.
5.
What are the next steps we should take?
6.
Ken, what is the State and local reaction so far?
FORD
- 3 -
IV.
FURTHER BACKGROUND AND RECOMMENDATIONS
A.
Magnitude of Funding
In the previous paper we recommended that we seek to continue the
stair-step annual increment increase of $150 million. The paper indi-
cated that we looked seriously at the possibility of "capping" the
program at its 1976 level. It is felt that this would raise much fear
and criticism and undercut support as well as highlighting the
efforts of those who will seek to tie increases to some form of indexine
There are several possibilities:
Options Magnitude of Funding
Seek to "cap" the program by holding expenditures at one annual
level
7,250
Seek to continue stair-step increments of $150 million
Other
B.
Authority To Withhold
In the previous decision paper the anti-discrimination portions were
all set forth in one section and we felt if it was more clearly set out
you might reach a different decision. A complete hold back could
seriously disrupt a city's governing processes. A partial hold back
should be effective enough to bring about a remedy.
At present if City X, which received $5 million in revenue sharing
monies, were utilizing $500,000 to support a hospital which, dis-
criminated in admitting patients, the Office of Revenue Sharing,
under present interpretations would hold back payment of the entire
$5 million. If changed, the Secretary could specifically have the
discretion to defer only the $500,000 going to the hospital and City X
would still be able to receive $4.5 million in revenue sharing pay-
ments.
With this explanation we feel it is appropriate to present the
question for your re-consideration. There are two options which
follow.
-- 4 -
Options
1.
The Secretary of the Treasury should be granted specifically the
discretion to defer, in appropriate cases, only that portion of
revenue sharing funding that is used in a discriminatory manner.
2.
The legislation should be reenacted in its present form. The
Secretary of the Treasury would retain the ability to defer all GRS
funding. The Secretary's ability to defer only that portion of
funding used in a discriminatory manner would remain uncertain.
March 27, 1975
Revenue Sharing Notes
1. Present act expires end of calendar '76.
2. President's message and bill to go to
Congress shortly after the end of the recess.
3. House hearings - August or later.
4. Cities, counties, states other met yesterday --
differ over when to begin major push for
meaningful hearings and action.
7080
*
*
*
1975
A. Passage in '75 may be forgotten
B. Defeat would be damaging to Presidential leadership
1976
A. Passage in '76 would be remembered by cities,
counties, states
B. Defeat could be a major issue against the
Democratic Congress
Mossan - late April -
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UNITED STATES CONFERENCE OF MAYORS
1620 EYE STREET, N.W.
WASHINGTON, D.C. 20006
28 march
Jun -
you may find the enclosed
of interest.
John Gronther
Hold - for showing
The United States
Conference
CTATES
CONFERENCE
of
Mayors
UNITED 3H1 HAVORS OF
1975
CITY
GERALD R. LIBRARY FORD
FINANCE
SURVEY
taxes
services
capital
improvements
APRIL-1975
1
- 2
SUMMARY SHEET
Taxes
During the last week in March, 1975, the United States
Overall general increase
Conference of Mayors surveyed fifty cities to determine the
state of local finances, services, and capital improvements.
Services
The cities were selected to present a full range as to size
Overall cutback including police, fire, and sanitation
and geographical location. We believe the survey portrays
the situation which is typical throughout the nation's
Capital Improvements
cities. For purposes of this survey, school taxes were
General maintenance of streets and buildings being reduced
included even if the school system is independent of the
to transfer funds to services.
city government.
New construction being abandoned, deferred, or stretched out.
This survey was prompted by questions asked by the
Congress and the Administration. The questions were to
determine whether local governmental actions might be
Scope of Survey: Fifty cities were asked tax, service, and
opposite to the direction of national government policy.
capital improvements experience in 1974 and 1975 expectations.
There are 18 cities with populations under 100,000; 14 cities
Are local governments taking money out of the economy
with populations of 100,000 - 500,000; 14 cities with populations
while federal government policy is to pump in funds to
of 500,000 - 1,000,000; and 4 cities with a population of over
stimulate economic recovery?
1,000,000. The information was gathered with the understanding
that individual city survey data would not be disclosed.
The answer is yes, local governments are increasing
taxes, cutting services, and seriously rearranging their
The cities surveyed ranked by population are:
capital improvements.
Taxes: With a few exceptions, local governments are
New York City, New York
Anaheim, California
increasing taxes. Property taxes are going up ten to
Chicago, Illinois
Santa Ana, California
twenty-five percent either as a result of rate increases
Detroit, Michigan
Bridgeport, Connecticut
or increases in assessments because of greater value of
Houston, Texas
Riverside, California
existing properties.
Baltimore, Maryland
Garden Grove, California
Washington, D. C.
Hampton, Virginia
Where property tax rates and/or assessments have
Cleveland, Ohio
Alexandria, Virginia
reached their legal limits, usually set by state law,
Indianapolis, Indiana
Duluth, Minnesota
cities. have turned to other revenue sources such as
Milwaukee, Wisconsin
Inglewood, California
increases in sales taxes, twenty-five to fifty percent
San Francisco, California
Fullerton, California
increases in wage and net profits taxes, twenty to fifty
San Diego, California
Miami Beach, Florida
percent increases in hotel/motel taxes, and anywhere from
Boston, Massachusetts
Wilmington, Delaware
ten to seventy-five percent increases in licensing, occu-
St. Louis, Missouri
East Orange, New Jersey
pation, utility and other miscellaneous taxes.
New Orleans, Louisiana
East St. Louis, Illinois
Phoenix, Arizona
San Leandro, California
In no instance was the total tax collected in 1974
Seattle, Washington
Boulder, Colorado
or anticipated in 1975 equal to the increases in the cost
Pittsburgh, Pennsylvania
Tuscaloosa, Alabama
of city government. Major cost increases were in labor
Denver, Colorado
Oak Park, Illinois
(in most instances related to cost of living index), fuel,
Kansas City, Missouri
Clearwater, Florida
petroleum-related products, and paper.
Buffalo, New York
Hamden, Connecticut
Cincinnati, Ohio
Plainfield, New Jersey
San Jose, California
Lawrence, Kansas
Fort Worth, Texas
Hoboken, New Jersey
Portland, Oregon
Rockville, Maryland
Dayton, Ohio
Lewiston, Maine
Michigan City, Indiana
- 3 -
Services: Most jurisdictions have had to reduce
service levels in sanitation, recreation, library, health,
and transportation. Many of the cities anticipate reductions
in police, fire, and education services. This does not mean
that less dollars will be spent and budgeted but, because
of inflation, the dollars will buy less.
Capital Improvements: Basic maintenance of present
capital investments such as streets, buildings, and
machinery has been cut back. The cost of material has
outpaced the cost of labor in most instances. Local
government is not permitted to run a deficit in basic
service or maintenance and operations. In cases where
deeper cuts could not be made in services and maintenance,
the completion or initiation of new capital improvements
is being deferred or eliminated. In instances where work
is to be financed with revenue sharing bonds, capital
improvements funds may not be used for services, maintenance,
or operations.
Conclusion: Local governments are in fact taking
dollars out of the economy while the federal government
is trying to put dollars into the economy. Local government
revenues have fallen behind costs and reductions have
occurred in services, maintenance, operations, and capital
improvements.
The situation with respect to taxes and expenditures
varies widely from city to city. Block grant federal
assistance for manpower (CETA), community development,
and community facilities meet many of the shortfalls.
However, general fiscal relief is needed to meet
major increases in city government costs not covered by
such block grants. As would be expected, the largest
gaps are found in cities with the highest levels of
unemployment.
The U.S. Conference of Mayors survey of 50 selected
cities projected nationally for 1975 indicates the fiscal
gap will be between five and eight billion dollars.