INSIDE WASHINGTON/Lining up locals’ post-war priorities

A host of domestic issues, ranging from President Bush’s proposed tax cut to transportation funding, top the items that city and county leaders are focusing on as they look beyond the Iraqi conflict. The first item, though, is to ensure that local governments receive emergency homeland security funding in the supplemental appropriations legislation — a mid-year spending bill expected to allocate $100 billion, mostly for additional military expenses.

Last month, city and county officials asked for a one-time emergency funding appropriation to help pay for homeland security expenses that have cost local governments about $3 billion since Sept. 11, 2001. “We strongly believe that a majority of the [homeland security] funding must be provided directly to cities and counties to avoid delays at the state level and ensure that our nation’s front-line troops — which are predominately at the local level — have access to flexible resources,” Boston Mayor Thomas Menino, president of the Washington, D.C.-based U.S. Conference of Mayors, wrote Bush in March.

Menino did not state how much cities and counties were looking for, but the figure is at least $2.5 billion. Congress only earmarked about $1 billion for homeland security in the 2003 fiscal year, $2.5 billion less than what the White House and Congress promised local governments.

Local leaders also are closely watching how Congress receives Bush’s proposed $700 billion-plus stimulus package that is built largely on tax cuts. There is no direct stimulus boost for cities and counties in Bush’s plan.

Opposition from most Senate Democrats and some Republicans likely will cause the tax plan to be reduced by about half of what Bush has proposed, which pleases some local leaders. New Haven, Conn., Mayor John DeStefano describes the Bush economic stimulus plan as “crazy,” saying it is inappropriate to offer such large tax cuts at a time when the president proposes cutting back on domestic programs.

“Things they want to cut are going to slow the economy,” says DeStefano, president of the Washington, D.C.-based National League of Cities (NLC), referring to Bush’s 2004 budget that calls for across-the-board cuts in domestic spending. DeStefano’s observations come as a new NLC poll shows that 75 percent of city leaders “are less able to meet financial needs this fiscal year than they were last fiscal year.” The Washington, D.C.-based National Association of Counties (NACo) also released a survey in February that stated 72 percent of counties are facing similar financial hardships.

Despite Bush’s plan to cut domestic spending, city and county leaders say they will continue to lobby for increased spending on key programs. For example, a smooth reauthorization of the Transportation Equity Act for the 21st Century (TEA-21) is a major priority for local government leaders. TEA-21 is a $200 billion-plus program that helps pay for transportation initiatives such as new roads and is reauthorized every six years. The current program is scheduled to expire on Sept. 30.

Counties, meanwhile, are watching to see if Congress will move to require Internet retailers to start charging sales tax to customers. The current sales tax moratorium is backed by some members of Congress, such as Sen. John McCain, R-Ariz., who want to make the moratorium permanent. Larry Naake, executive director for NACo, says local governments will lose about $20 billion in tax revenue this year because of the moratorium. The figure jumps to $50 billion by 2005, Naake says.

City and county leaders also will be lobbying this year for increased funding for such traditional issues as affordable housing, education, water infrastructure investment and workforce investment.

The author is Washington correspondent for American City & County.