Block Grants

This report includes the material on block grants, including a CRS Report on the Omnibus Reconciliation Act of 1981, several articles, and a guide to State block grant implementation. For additional information and assistance, we have also included addresses of people to contact on the Federal (p. 59) and State levels (p. 70-104).

- 0 . . kr~i6.j r o -,I B Congressional Research Service 2 ^I 4 The Library of Congress ** BLOCK GRANTS TP0157 Enclosed is material on block grants, including a CRS Report on the Omnibus Reconciliation Act of 1981, several articles, and a guide to State block grant implementation. For additional information and assistance, we have also included addresses of people to contact on the Federal (p. 59) and State levels ( p . 70-104). Page - Contents Block Grants in the Omnibus Reconciliation Act of 1981 (P.L. 97-35): an Overview of Their Characteristics 1 Rlock Grants: Transferring Power, Money, and Responsibility 48 The Rlock Grant Story 51 The Puzzle of Block Grants 53 Block Grants: the Question of State Capability 60 ~overnors'Guide to Block Grant Implementatioq 66 We h o ~ ethis information will be useful Congressional Reference Division ~(y,j~k!'l!~:;.EplTDOCUMENTS ~~L~-ECT?Q% Congressional Research Service The Library of Congress BLOCK GRANTS IN THE OMNIBUS RECONCILIATION ACT OF 1981 (P.L. AN OVERVIEW OF THEIR CHARACTERISTICS Sandra S. Osbourn Analyst in American National Government Government Division August 31, 1981 97-35): CONTENTS ................................................................. 1 BLOCK GRANT PROVISIONS ....................................................... 3 THE FEDERAL AID CONTINUUM.................................................... 7 CONSOLIDATION ................................................................ 9 FEDERAL ADMINISTRATIVE STRUCTURE............................................. 11 STATE ADMINISTRATIVE STRUCTURE............................................... 13 ALLOCATION AMONG STATES...................................................... 1 5 FEDERAL-STATE ADMINISTRATIVE RESPONSIBILITIES ................................ 1 7 STATE-LOCAL RELATIONSHIPS.................................................... 2 1 TITLE XVII ................................................................... 25 MAINTENANCE-OF-EFFORT. SUPPLEMENT-NOT-SUPPLANT. MATCHING ..................... 29 NON-DISCRIMINATION.. ......................................................... 31 TRANSFER OF FUNDS TO RELATED PROGRAMS........................................ 33 APPENDIX A: COMPOSITION OF BLOCK GRANTS ..................................... 35 APPENDIX B: BLOCK GRANTS: TRANSFERRING MONEY. POWER. AND RESPONSIBILTY ..... 48 INTRODUCTION (NOTE: Pages 6. 8. 12. 1 4 . 1 6 . 2 0 . 2 4 . 28. 30. 32 and 34 have b e e n left i n t e n t i o n a l l y b l a n k ) . BLOCK GFANTS 11: THE OMNIEUS RECONCILIATION ACT OF 1981 ( P . L . AN OVERVIEW 97-35): INTRODUCTION This overview of the ten new and one amended block grants included in the Reconciliation Act of 1981 provides a survey of major issues in the block grant debate and a sampling of the various solutions to these issues in the various block grants. The overview does not provide a comprehensive catalogue of these resolutions. If a reader is interested in the resolution of a particular issue in a particular block grant--e.g., how are funds for the Maternal and Child Health Block Grant allocated among the States--and if the overview does not include that block grant in the examples it cites, then the reader should turn to the language of the block grant for that information. A reader interested in transfer of funds authority will find three examples listed in the report; this does not mean that there dre not similar provisions in other block grants. A more comprehensive survey of the resolution of these issues in each block grant will be available later. A list of the block grants created or amended by the Reconciliation Act allpears at p. 3. This list also includes a citation to the relevant sections of the law, the effective date of the block grant, and the funding levels authorized by P.L. 97-35. Appendix A presents, in tabular form, an overview of block grant composition as proposed by the Administration and as it was enacted by P.L. 97-35. This table includes a list of the programs that the Administration sought to include in block grant, the block grant into which the Administration proposed to incorporate the program, and the result of Con::;rcss.ional action--i.e., whether the program remained categorical or was included in a block grant, and if the latter occurred, which block grant. The reader will find background information on specific block grants in the following CRS Issue Briefs: Grant Consolidation for Education Programs: IB 7 9 0 2 1 Social Services Programs: Proposed Grant Consolidation: Health Block Grants: IB 81111 Food Stamps: Budget Reductions: IB 8 1 1 3 2 Low-Income Energy Assistance Reauthorization: MB 8 1 2 2 7 Community Services Administration: ME3 8 1 2 3 4 IB 8 1 1 0 2 An article from the June issue of the -CRS Review, included as Appendix B to this report, discusses block grants in the context of the Reagan budget proposals and of the Federal aid system. BLOCK GRANT PROVISIONS The Omnibus Budget Reconciliation Act of 1981 creates ten new block grants and modifies an existing block grant. These block grants vary in terms of numbers of programs involved (some affect only one program), effective date, and other significant details. The model block grant proposals submitted by the Administration were virtually identical in design; the block grants created by H.R. 3982 are not. This section of the paper identifies the block grants created by P.L. 97-35, and provides a guide to the relevant sections of the bill, information on the effective date of the block grant program changes, and funding levels authorized by the bill. The block grants are listed in the order in which they appear in the bill. 1. Puerto Rico Food st am^ Block Grant Citation: Title I; Sec. 116-117 Effective Date: 1/ July 1, 1982 Authorization: $825,000,000, annually 2. Communitv Develo~mentBlock Grant Amendments Citation: Title 111; Sec. 301-315 Effective Date: October 1, 1981; however, if a State opts not to participate in the Small Cities program, the Secretary will continue to administer the program in that State. Authorization: 2/ FY 1982: $4,166,000,000; FY 1983: $4,166,000,000 1/ - Transition provisions in Title XVII may apply to some effective dates. 2/ The small city program, which may be administered by the states as a reszlt of the Amendments, will receive 30 percent of this amount, calculated after set-asides are made. Elementary and Secondary Education Block Grants (Two) Citation: Title V; Sec. 551-596: Chapter I and Chapter I1 Effective Date: October 1, 1982, except for the Follow-Through Program, which will be phased in beginning in FY 1983; its repeal will not be effective untilOctober 1, 1984. Authorization: Chapter I: FY 1982 through FY 1984: $3,480,000,000, annually Chapter 11: FY 1982 through FY 1984: $589,368,000, annually 4. Community Services Block Grant Citation: Title VI; Sec. 671-683 Effective Date: October 1, 1981; however, 90 percent of the program funds must go to existing community action agencies in FY 1982. If a State chooses, the Secretary is authorized to continue to operate the program in that State through FY 1982. Authorization: FY 1982 through FY 1986: $389,000,000, annually Preventive Health and Health Services Block Grant Citation: Title IX; Sec. 1901-1909 Effective Date: October 1, 1981; however, emergency medical services, hypertension programs, and the rape crisis centers all are guaranteed funding at specified levels. Authorization: FY 1982: $95,000,000 FY 1983: $96,500,000 FY 1984: $98,500,000 6. Alcohol and Drug Abuse and Mental Health Block Grant Citation: Title IX; Sec. 1911-1920 Effective Date: October 1, 1981; however, in FY 1982 the States must spend the same proportion of their total allocation on mental health as they had been spending when the programs were separate; 35 percent of the State's substance abuse allocation must go to alcoholism, and 35 percent must go to drug abuse. Authorization: FY 1982: $491,000,000 FY 1983: $511,000,000 FY 1984: $532,000,000 7. Primary Care Block Grant Citation: Title IX; Sec. 1921-1932 Effective Date: October 1, 1982; after this date, a State may choose to operate the program or to have the Secretary continue to operate it. Authorization: FY 1982: $ 2,500,000 Planning Grants $284,000,000 Operating Grants FY 1983: $302,500,000 FY 1984: $327,000,000 Maternal and Child Health Block Grant Citation: Title =I; Sec. 2191-2194 Effective Date: October 1, 1981; however States may opt to continue categorical funding until October 1, 1982 or to change over at the beginning of any quarter between October 1, 1981 and October 1, 1982. Authorization: FY 1982 through FY 1984: $373,000,000 annually 9. Social Services Block Grant Citation: Title XXIII; Sec. 2351-2355 Effective Date: October 1, 1981 Authorization: FY 1982: $2,400,000,000 FY 1983: $2,450,000,000 FY 1984: $2,500,000,000 FY 1985: $2,600,000,000 FY 1986: $2,700,000,000 Low-Income Energy Assistance Block Grant Citation: Title XXVI Effective Date: October 1, 1981 Authorization: FY 1982 through FY 1984: $1,875,000,000 annually THE FEDERAL AID COlJTIMUUM The various forms of Federal aid can be placed on a continuum of diminishing Federal authority, with categorical grants characterized by the strongest Federal role, and special or general revenue sharing the weakest. The Reagan Administration's "block grant" proposals were more similar to special revenue sharing than to existing block grants and were characterized by an extremely limited Federal presence. The block grants as enacted resemble more closely the existing block grants, which have been characterized as a hybrid form of grant, incorporating some features of categorical grants and some features of special revenue sharing. The mix of features varies from block grant to block grant, but none of them adopted the Reagan model in its pure form. 31 3 1 See Appendix B for further discussion of the continuum. to the Administration proposals, see p. 35 fn. 2. For references CONSOLIDATION Consolidation is frequently associated with block grants. It is possible, however, to have block grants without consolidation or to have consolidation without block grants. The Reconciliation Act contains examples of both. For example, the Consolidated Refugee Education Assistance Act (Title V; See. 541-546) consolidates several existing authorities for refugee education assistance into a single authority. However, the administrative relationships were not changed so in essence this becomes a larger categorical grant, and not a block grant. On the other hand, several of the new block grants did not involve any consolidation. The Primary Care Block Grant includes only the Community Health Centers Program. The Low-Income Energy Assistance program, which the Administration had sought to combine with an Emergency Assistance Program, was put into a block grant by itself; the Emergency Assistance Program was not merged with it. The Puerto Rico Food Stamp Block Grant applies to one program in one jurisdiction. The Education Block Grant created in Chapter I applies only to the Title I program for the education of disadvantaged children. Consolidation of programs was a key component of the Administration's budget reduction efforts. The Administration argued that consolidation would lower costs by eliminating the problems and associated costs of administering Federal categorical programs with different matching ratios, procurement requirements, reporting standards, and accounting practices. These anticipated savings, according to the Administration, would offset, at least in part, the funding cuts accompanying the consolidation proposals. Opponents of consolidation base their opposition, in part, on a conviction that consolidation rcakes budget reductions easier, though not necessarily through lower administrative costs. They argue that if programs with special identity and appeal (e.g., black lung clinics or foster children) are folded into broader Health Services or Social Services Block Grants they will lose their special identity. It is thought that this special identity is an important factor in protecting funding for programs. Both the black lung clinics and the foster child program did continue their status as separate categorical programs. Six of the new block grants do involve consolidation of programs, but fewer programs were consolidated than the Administration had requested and some of the consolidations were qualified. 4/ Major education programs included in the Administration's model, including ESEA Title I grants for disadvantaged children, aid to the handicapped, and adult education, were retained as separate programs, although Title I will be administered as block grant. The health block grants require that some programs, such as hypertension and rape crisis center, continue to be funded at specified levels, thereby ensuring their separate existence to some extent. Discretionary funds are created in most of the block grants, and the Secretary is directed to use these funds for programs that had been categorical. For example, alcohol and drug abuse education receives this protection in the Education Block Grant, and hemophilia is protected in the Maternal and Child Health Block Grant. Consequently, even though the authorities for these programs were repealed, they will continue to exist as identifiable funded activities. 4 / Appendix A compares the programs consolidated in the Administration's propo~alsand those consolidated in P.L. 97-35. FEDERAL ADMINISTRATIVE STRUCTURE One Federal agency, the Community Services Administration (CSA), is abolished by the block grants. The programs previously administered by CSA are to be transferred to a new Office of Community Services in the Department of Health and Ilunan Services (HHS). HHS will be responsible for administering seven of the new block grants: Community Services, Preventive Health and Health Services, Alcohol and Drug Abuse and Mental Health, Primary Care, Maternal and Child Health, Social Services, and Low-Income Energy Assistance. The Puerto Rico Food Stamp Block Grant will be administered by the Department of Agriculture, and the Elementary and Secondary Education Block Grants will be administered by the Department of Education. Department of Housing and Urban Development will continue to administer the amended Community Development Block Grant. The STATE ADMINISTRATIVE STRUCTURE Typically, grant-in-aid legislation includes specific instructions with regard to the designation of a State agency to administer the program. The block grant models proposed by the Reagan Administration were silent on this issue, reflecting the Administration's philosophy of non-intervention in the internal affairs of sub-national governments. With one exception, however, each of the block grants in the Reconciliation Act follows the more traditional practice of assigning administrative roles. The exception is the Social Services Block Grant, which refers to administration by "the State," without defining the roles to be played by the various available actors: governor, State Social Services or Welfare Agency, State legislature. The Community Development, Comnunity Services, Preventive Health and Health Services, Alcohol and Drug Abuse and Mental Health, Primary Care, and Low-Income Energy Assistance Block Grants are all the responsiblity of the governor, who must certify that the State's performance meets certain criteria spelled out in the Act. Presumably, most Governors will delegate the actual administration of the programs to a State agency. With the exception of the Community Development and Low-Income Energy Assistance Block grants, all of the block grants in this category require that the State legislature hold an annual hearing on the proposed use and distribution of the program funds. The Education Block Grants are to be administered by the State Education Agency, and the Maternal and Child Health Block Grant is to he administered by the State Health Agency. The Puerto Rico Food Stamp Block Grant is to be administered by a "single agency" to be designated by the Commonwealth. ALLOCATIONS AMONG STATES In accordance with the Administration's proposals, virtually all of the block grant funds will be allocated among the States according to the proportions each received from the susperseded programs in a specified base year--usually FY 1981. In some cases, other factors, such as number of school-age children (Education) must be taken into account. Several of the block grants include requirements for studies of alternative formulas. FEDERAL-STATE ADMINISTRATIVE RESPONSIBILITIES One of the major aims of the Administration's block grant proposals was to return decisionmaking authority to State and local governments by reducing the rules and regulations under which the categorical programs operated. According to the Administration, this would lower the administrative costs associated with meeting Federal planning, auditing, and reporting requirements, and would give the recipients greater flexibility--as well as greater responsibility for results--in providing services. Those running the block grants would be accountable to the local electorate rather than to Federal program administrators. All of the block grants go at least part of the way toward this goal of the Administration; however, the retention of some specific program identities within the block grants through earmarking or set-asides reduces the flexibility of the recipients in deciding which activities to fund. Most of the new block grants do not require that a State submit a plan or application which must receive prior approval by the Secretary before funds will be released. Instead, they must submit annual applications certifying that the State has met or will meet certain requirements. The Secretary is prohibited from spelling out in any detail how the States meet the requirements. For example, the Community Services Block Grant requires the Governor to certify that the State agrees to: (1) use the funds for certain purposes, such as assisting low-income participants to secure and retain meaningful employment; (2) pass through to recipients at the local level 90 percent of the State's allocation and spend no more than 5 percent of the allocation for administrative expenses; (3) assure that the board structures of local entities meets certain membership requirements; (4) give special consideration to existing agencies at the local level; (5) arrange for the possibility of transferring up to 5 percent of the State's Community Services Block Grant allocation to related programs; (6) prohibit certain political activities; (7) provide for coordination with the Low-Income Energy Assistance Block Grant; (8) provide for fiscal control and fund accounting procedures, and for annual audits; and (9) permit and cooperate with Federal investigations of failures to comply with these requirements. But the Secretary is explicitly forbidden to "prescribe the manner in which the States will comply with the[se] provisions." The Education Block Grant takes a different approach to limiting the regulatory powers of the Secretary. It limits authority to issue regulations to (1) those necessary to carry out duties specifically assigned to him, (2) those necessary for proper fiscal audit, and (3) those necessary to insure compliance with specify requirements of the Act. The Secretary is prohibited from issuing regulations in all matters relating to the details of planning, developing, implementing, and evaluating programs and projects by State and local education agencies. The Secretary is authorized to "consult with" these agencies, and to provide technical assistance, information, and suggested guidelines on request. Although the audit provisions vary, the block grants generally give the States a major role in conducting financial and compliance audits. Most of the block grants also spell out specific obligations of the Comptroller General in evaluating the programs. Title XVII (see p. 25) includes audit requirements that apply to all the block grants in the Reconciliation Act, unless the language governing a particular block grant provides otherwise. For example, t%e Preventive health and Health Services Rlock Grant specifically states that the Title XVII requirements do not apply to it. Host of the block grants include provisions for withholding and repayment of funds from a State that is not complying with the requirements of the Act. In discussinfi the withholding power provided in the health block grants, Representative Waxman stated that it was jntended to ". . . create a tool by which the Secretary and a11 beneficiaries of this program will assure that funds and allotments are spent appropriately and well and that these Federal 5/ dollars continue to provide quality care, whatever the funding mechanism." - 51 July Waxman, Henry A. p. ii5805. 71, 1981. Statement on the Floor. Congressional Record, v. 127, STATE-LOCAL RELATIONSHIPS Representatives of local governments and non-profit organizations operating Federal programs, especially in large urban areas that house relatively large proportions of the needy populations to whom many of the existing categorical grants were directed, traditionally have opposed block grants or special revenue sharing. A major factor in this opposition is the replacement of direct Federal- local relations, which has characterized some of the categorical grants, with Federal-State relationships in which the States assume the primary administrative responsibility. Opponents argue that the States traditionally have ignored the needs of cities and their residents, and that it was this State neglect that led to a Federal role in the first place. They argue that State governments lack the political will to allocate block grant funds to the targeted populations, areas, or functions which had benefited under the categorical system. Instead, according to this argument, States are more likely to spread out the money so that more districts or voters will benefit. Finally, these spokesmen contend that the available funds, already reduced from previous levels, will be further diminished as a result of excessive State administrative costs. In their view, block grants will simply result in moving red tape and administrative expenses from the Federal to the State levels of government. These opponents to block grants argue that if block grants are adopted, certain protective devices must be built in. R One proposal for State-local relationships is to require that local interests be consulted, or otherwise participate, when funding allocations and administrative procedures are acted on by the State. The Education and the Community Development Block Grants include requirements for some consultation with local levels of government. Title XVII, which applies to certain new block grants that replace Federal-local grants, provides for a participation and reporting process at the State level for the purpose of helping to assure that local governments, interested individuals, and groups within the State have an opportunity to comment on planning for expenditures. Some local entities are assured of continued funding, at least for a tine, under provisions of the Act. For example, the Community Health Centers in the Primary Care Block Grant will continue their Federal-local relationship at least through fiscal year 1 9 8 2 . After that time, if a State wishes to assume administration of this program it must contribute funds from its own sources and is required to fund every Community Health Center which was funded during fiscal year 1 9 8 2 . Community Action Agencies must be funded in fiscal year 1 9 8 2 ; beginning in fiscal year 1983, Community Services Block Grant funds will go to local governments, who are required to give "special consideration" to the funding of existing Community Action Agencies. A third device for protecting local interests is to place a cap on the amount of funds that the State can use to pay the costs of administering the program. For example, the Preventive Health and Health Services Block Grant stipulates that no more than 10 percent of a State's allocation may be used for administrative purposes. The Primary Care Block Grant requires participating States to match from their own funds a certain percentage of the Federal allocation, and to pay administrative costs out of the State contribution; Federal funds may not be used. Some of the block grants require that the State "pass through" a stipulated proportion of its allocation of funds to local recipients. For example, the Community Services Block Grant requires the State to use at least 90 percent of its allotment for grants to local governments. The Education Block Grant requires that State Education Agencies must distribute at least 80 percent of its allocation to local educational agencies. TITLE XVII Chapter 2 of Title XVII of the Reconciliation Act is a product of the House Committee on Government Operations and the Senate Committee on Governmental Affairs. It originally appeared as Title XVI in the House bill; the Senate bill contained no comparable provisions. 6/ The intent of Title XVI, according to its author, was to: - ... prohibit the State from discontinuing or drastically cutting programs or entities in the dead of night. Title XVII is a sunlight provision, and it provides that any discontinuance or change in program's entity must be done only after full public disclosure and publication of why the State is doing that. Title XVI would have required the States to establish a public review process and appeals process that would be triggered if the States defunded programs or administrative agencies that previously had been funded by categorical programs. The intent was to protect existing entities and programs such as the health services provided through migrant workers' health clinics. Title XVI was revised substantially in conference, and became Chapter 2 of Title XVII of P.L. 97-35. This Title sets forth procedural and administrative requirements relating to the distribution and audit of block grants. The distribution procedures are limited to block grants as defined in Title XVII: Sec. 1741(a)(l) block grant funds are funds which are received for a program-(A) which provides for the direct allocation of funds to States only, except for the allocation of funds for use by the Federal agency administering the program; and 6/ Pashayan, Charles, Jr. Statement on the Floor. v. 127, June 26, 1981. p. H3907. Congressional Record, ( 1 4 ) which provides funds tl1.1t n,ly he rised at the discretion of the :;t.1tt7,in whole or in part, for the purpose of continuing to support y Iwfore the date of thc enactment of activities frlnded, immediat1.1 this Act, under programs the authorizations of which are discontinued hy this Act rj~idwhich were funded, imme(li,~telybefore ~ : r ~ c . date h of tl~c. (,~~actment, by Federal Government allocations to c~nitsof local government or oihcr eligible chntities, or both; ing to the statement of the managers, the definition is not meant to inc that arc 1,nid to a State with the requil-c*airhntthat they automatically he through to sub-state entities ~lndera formula estahlished by Federal l a w , such as funds made available under the Er111cat ion Rlock Grant. The requirements for the establishement of an appeals process were dropped in conference. The procedural requirements now center on an annual report on the use of the funds and on public hearings relating to the use and distribution of the funds. The purposc of these procc>dc~resis as follows: 1741(a) To help assure tlint (1) block grant funds are allocated for progrms of special importance to meet the needs of local governments, their residents, and other eligible entities, and ( 2 ) all eligible urban and rural local governments, their residents, and other eligible entities are treated fairly in the distrihution oC such funds. SI.C,. ... Title SVII also contains two sections which apply to grant audits; they relate to access to records by the Comptroller General, and to required biennial ac~dits that must be performed by the States. According to the managers: 71 The conferees adopted Section 1745 to insure that State block grant and consolidated assistance programs established or provided for under this Act wtx~ld he audited effectively on a regular basis in accordance with well-recognized and clearly-established standards, and that the standards gowarning the audits would he uniform from State to State a n d among grant programs. The provision was adopted j n response to inquiries by conferees who were concernetl that the reconciliation legislation included a number of audit provisions and requirexents which differed from grant to grant. The conferc.cs agrced that without this section, the Act could impose unreasondllle hr~rdenson the States and would r~otassure maximum protection against 7/ Joint Explanatory Statement of the Committee of Conference. Con~ressionalrecord, v . 127, July 29, 1981, Part 11. p . H5697. possible waste, fraud and abuse in the expenditure of the funds provided to the states. Accordingly, Section 1745 establishes a single audit provision to govern all block grant and consolidated assistance programs in this Act. It supersedes any other audit provisions in this Act which do not explicitly provide otherwise, except that it is not intended to dilute or otherwise change the compliance requirements of any grant program. MAINTENANCE-OF-EFFORT, SUPPLEMENT-NOT-SUPPLANT, AND MATCHING RE\ Maintenance-of-effort, supplement-not-supplant, and matching requirements typically have been attached to categorical grants for the purpose of insuring that State or local funds, as well as Federal funds, are made available to the programs. The Administration would have eliminated all such requirements, on the ground that they usurped the right of State or local governments to set their own funding priorities. The block grants enacted in the Reconciliation Act took a varied approach to these requirements. For example, the Education Block Grant contains both maintenance-of-effort and supplement-not-supplant requirements. The Alcohol and Drug Abuse and Mental Health Block Grant contains a supplement-not-supplant requirement. Most of the block grants, hwoever, contain no such requirements. At least two block grants contain matching requirements. The Community Development Block Grant requires States to contribute an amount equal to 10 percent of its allocation for program purposes and requires them to match with their own money any Federal monies that are devoted to administrative expenses. The Primary Care Block Grant requires that each State must contribute, from its own funds, an amount equal to 1 1 5 of its block grant allocation in fiscal year 1983 and 113 of its allocation in fiscal year 1984, to be used for administrative costs and for grants. NONDISCRIMINATION In order to assure that Federal funds would be made available only to State and local recipients that comply with Federal prohibition against discrimination, seven of the block grants include specific nondiscrimination provisions. The Community Development, Community Services, Low-Income Energy Assistance, and all four health block grants refer to statutory restrictions prohibiting discrimination on the basis of age, handicap, sex, religion, race, color, or national origin. The provisions are to be enforced by the Secretary, who may call on the Attorney General to bring civil action against any recipient found not to be in compliance with non-discrimination provisions. TRANSFER OF FUNDS State and local recipients of Federal funds frequently have complained that Federal funds were too narrow in purpose and did not allow them sufficient flexibility to meet the particular needs of a particular jurisdiction. Fcr example, they argue that areas with a large populatior. of r ! a e r c l t j z w s n.;ght require more funds than were available through Federal Older Americans programs, but might not need funds from the Head Start Program. Several i:? :he new 9l.ock grants permit each State to transfer a stipulated percentage of its allocation from one block grant to another related grant program. For example, the Community Services Block Grant permits States to transfer 5 percent of its allocation to services under the Older Americans Act of 1965, the Head Start program, or the Low-Income Energy Assistance program. Up r o 7 percent of a State's allocation from its Preventive Health and Health Services allocation may be transferred to services funded under any of the other three health block grants. The Social Services Block Grant permits a State to tranafe; up to 10 percent of its allotment to the Eealth Services or Low-Income Energy Assistance programs. APPEKDIX A: COMPOSITION OF BLOCK GRANTS TABLE 1. Puerto Rico Food Stamp Block Grant 1/ (Title I, Sec. 116-117, p. 9-11) Program Administration proposal Puerto Rico Food Stamps Nutrition Assistance for Puerto Rico P.L. 97-35 Puerto Rico Food Stamp Block Grant 11 U.S. Congress. Conference Committees, 1981. Omnibus Budget ~econciliationAct of 1981. Conference Report to Accompany H.R. 3982. House Report No. 97-208, 97th Cong., 1st Sess. Washington, U.S. Govt. Print. Off., 1981. Two Books. 21 The sources for the block programs proposed for consolidation into block grants and the composition of the block grants as proposed by the Administration are as follows: U.S. Executive Office of the President. Office of Management and Budget. Preventive Health Block Grant: Legislative Summary. Washington, April 14, 1981. 2 p . Health Services Block Grant: Legislative Summary. Washington, April 16, 1981. 2 p. Education Block Grant: Legislative Summary. Washington, May 1, 1981. 6 p. Social Services Block Grant: Legislative Summary. Washington, May 5, 1981. 2 p. Energy and Emergency Assistance Block Grant: Legislative Summary. May 5, 1981. 2 p. Fiscal Year 1982 Budget Revisions. Washington, March 1981. TABLE 2. Community Development Block Grant Amendments (Title 111, Sec. 301-315, p. 30-45) P.L. 97-35 Program Administration proposal Community Development Block Grant Community Development Block Grant Urban Development Action Grant Community Development Block Grant Categorical Weatherization Community Development Block Grant Categorical Community Development 1/ Block Grant - 1/ The block grant characteristics of the existing grant were strengthened some application and reporting requirements and by converting tlw by re&ving Small Cities program from a Federal-local to a Federal-State program, if the State chooses to participate. Approximately 30 percent of program funds are allocated to the Small Cities program. TABLE 3. Elementary and Secondary Education Block Grants (Title V, Sec. 551-596, p. 115-135) .- Program Basic Grants to LEAS (Disadvantaged) Administration proposal Title I Block Grant -- P.L. 97-35 Categorical I J Concentration Grants (Disadvantaged) Title I Block Grant Categorical 11 State Agency Migrant Grant (Disadvantaged) Title I Block Grant Categorical 11 State Agency Handicapped Grants (Disadvantaged) Title I Block Grant Categorical 11 State Agency Neglected and Delinquent Grants (Disadvantaged) Title I Block Grant Categorical 11 Emergency Basic Grants to LEA Title I Block Grant Chapter IIBlock Grant Emergency Special Programs and Projects Title I Block Grant Chapter IIBlock Grant Emergency Magnet Schools, Title I Block Grant Pairing, Neutral Chapter IIBlock Grant Education for the Handicapped: State Grants Title I Block Grant Categorical Education for the Handicapped: Preschool Incentives Title I Block Grant Categorical Adult Education Title I Block Grant Categorical State Administration (Disadvantaged) Title I1 Block Grant Categorical 11 Evaluation (Disadvantaged) Title I1 Block Grant Categorical 11 1/ Retains its identity as a separate program. characteristics are those of a block grant. However, administrative TABLE 3. Elementary and Secondary Education Block Grants--continued (Title V, Sec. 551-596, p. 115-135) P.L. 97-35 Program Administration proposal Improving Local Education Practice Title II Block Grant Chapter 11-8 Block Grant Strengthening State Educational Management Title I1 Block Grant Chapter 11-B Block Grant Emergency Special Programs and Projects Title I1 Block Grant Chapter 11-I3 Block Grant Emergency Grants to Nonprofit Organization Title I1 Block Grant Chapter 11-B Block Grant Emergency Educational T.V. and Radio Title I1 Block Grant Chapter 11-C Block Grant Civil Rights Training and ;.dvisory Services Title 11 Block Grants Categorical Women's Educational Equity Title I1 Block Grants Categorical Scllool Libraries Title I1 Block Grants Chapter 11-B Block Grant Severly Ilandicapped Title I1 Block Grant Categorical Handicapped Early Childhood Title I1 Block Grant Categorical Handicapped Regional Vocational Title TI Block Grant Categorical Handicap1,ed Innovation and Development Title I1 Block Grant Handicapped Regional Resource Centers Title I1 Block Grant Categorical Handicapped Special Education Personnel Development "itle I1 Block Grant Categorical Career Education Tncentives Title I1 Block Grant Chapter 11-C Block Grant TABLE 3. Elementary and Secondary Education Block Gran:=- -~ontinuec' (Title V, Sec. 551-596, p. 115-135) -- -- Program - - , P.L. 91-35 Administration proposal -- --- - 7 --- ----.- Community Schools Title I1 Block Grants Chapter 11-C Block Gransf Consumer's Education Title I1 Block Grant Chapter 11-C Flock Grant Law-Related Education Title I1 Block Grant Chapter 11-C Block Grant Basic Skills State Grants Title I1 Block Grant Chapter II-A Block Grant Basic Skills Discretionary Grants Title I1 Block Grant Chapter 11-t'. Block Srsnt Follow-Through Title I1 Block Grant Chapter IIBlock Grant _2_/ Gifted and Talented Title I1 Block Grant Chapter 11-C Block Grant Alcohol and Drug Abuse Education Title I1 Block Grant Discretionary Fund Arts in Education Title I1 Block Grant Discretionary Fund Metric Education Title I1 Block Grant Chapter 11-C Rlock Grant Ethnic-Heritage Studies Title I1 Block Grant Chapter 11-C Block Grant 31 Cities in Schools - Title I1 Block Grant Chapter 11-C Block Grant Title I1 Block Grant Chapter 11-C Block Grant PUSH for Excellence 2/ - 21 To be phased in beginning in FY 1983. 3/ Not a specifically authorized program, but has been conducted as an activity. TABLE 3. Elementary and Secondary Education Block Grants--continued (Title V , Sec. 551-594, p. 115-135) Program Administration proposal P .L. 97-35 Teacher Corps Title I1 Block Grant Chapter 11-C Rl.ock Grant Teacher Centers Title I1 Block Grant Chapter 11-C Elock Grant Pre-College Science Teacher Training Title I1 Block Grant Chapter 11-B Block Grant TABLE 4 . Community Services Block Grant (Title VI, Sec. 671-683, p. 166-174) Program Administration proposal Community Services Administration (less economic development) Social Services Block 1/ Allows funding for economic development purposes. - P.L. 97-35 Community Services Block 1/ TABLE 5. Preventive Health and Health Service Block Grant (Title IX, Sec. 1901-1909, p. 191-199) P.L. 97-35 Program Administration proposal Rodent (Rat) Control Preventive Health Block Grant Preventive and Health Services Block Grant Fluoridation Preventive Health Block Grant Preventive Health and Health Services Block Grant Hypertension Preventive Health Block Grant Preventive Health and Health Services Block Grant Health Education/ Risk Reduction Preventive Health Block Grant Preventive Health and Health Services Block Grant Health Incentives Grants Preventive Health Block Grant Preventive Health and Health Services Rlock Grant Home Health Health Services Block Grant Preventive Health and Health Services Block Grant Emergency Nedical Services Health Services Block Grant Preventive Health and Health Services Block Grant TABLE 5. Preventive Health and Health Service Block Grant--continued (Title IX, Sec. 1901-1909, p. 191-199) Program A - Administration proposal -- -- P.L. 97-35 - -Preventive Health and Health Services Block Grant Rape Crisis Centers Veneral Pisease Preventive Yealth Block Grant Categorical Family Planning Preventive Health Block Grant Categorical Migrant Health Centers Health Services Block Grant Categorical Black Lung Clinics Health Services Block Grant Categorical Tuberculosis Preventive Health Block Grant Categorical -- - TABLE 6. Alcohol and Drug Abuse and Xental Health Llock Grac: (Title I X , Sec. 1911-1920, p. 200-210) Program Administration proposal Mental Health Services Health Services Block Grant Alcohol and Drug At:lsp ails Qental. Heal-th Block Grant Drug Abuse Project Grants and Contracts Health Services Block Grant Alcohal and Drug Abuse and Mental Health Block Grant Health Services Block Grant Alcohol and Drug Abuse and Mental Drug Abuse Formula Grants Alcoholism Project Grants and Contracts Health Services Block Grant Alcoholism Formula Health Services Block Grant p.1,. 9;-33 Health Block Grant Alcohol and Drug Abuse and Mental Health Block Grant Alcohol and Drug Abuse and Health Block Grant TABLE 7. Primary Care Block Grant (Title IX, Sec. 1921-1932, p. 210-221) Program Administration proposal Primary Care Centers Health Services Block Grant P.L. 97-35 Primary Care Block Grant TABLE 8. Maternal and Child Health Block Gra-t (Title XSI, Sec. 2 1 9 : - 2 1 9 4 , p. 4 9 1 - 5 3 i ) -- - -- - - . - Program -- ;.i q7-35 . Adrnr.A.~c L: : . L i ~ ~ lproposal -- - -- -?:ater~al and Lead-Based Paint Poisoning Prevention P r e v e n ~ i ~Health e Block Granc Genetic Diseases Preventive Health Block Grant Maternal and Child Health Block Grant 1/ Adolescent Health Preventive Health Block Grant 2/ Categ~rical- Maternal and Child Health Health Services Block Grant Yaternal and Child 3ealth Block Grant Suppleruental Security Income Health Services Block Grant Maternal and Chjld Wealth Block Grant Hemophilia Kealth Services Block Grant Maternal and Child Health 1/ Block Grant - Sudden Infant Death Syndrome Health Services Block Grant Maternal and Child Health Block Grant C t i i l d Health Block Grant The authority is repealed; however, this function is included in the that are to be funded out of the Secretary's discretionary fund, so it will continue as an identifiable activity. 1/ 2 1 Sec. 2 1 9 3 ( f ) repeals the existing adolescent health (pregnancy) program. P.L. q7-35 establishes a new Title XX, adolescent Family Life Demonstration Programs, under the Public Health Services Act for prevention and care services and research relating to premarital adolescent sexual relations and pregnancy. TABLE 9 . S o c i a l . S e r v i c e s Block G r a n t ( T i t l e 'XXIII, S e c . 2 3 5 1 - 2 3 5 5 , p. 5 4 4 - 5 5 2 ) Program Administration proposal --- ---- .- P.L. ?7-35 - - .- - T i t l e XX S o c i a l Services S o c i a l S e r v i c e s Block G r a n t Social Services Block Grant T i t l e XX Day C a r e S o c i a l S e r v i c e s Slock Grant Social Services Block G r a n t T i t l e XX S t a t e and Local Training S o c i a l . S e r v i c e s Block G r a n t Social Services Block G r a n t Child Welfare S e r v i c e s S o c i a l S e r v i c e s Block C r a n t Categorical Child Welfare S e r v i c e s S o c i a l S e r v i c e s Block G r a n t Categorical Foster Care S o c i a l S e r v i c e s Rlock S r a n t Categorical Adoption A s s i s t a n c e S o c i a l S e r v i c e s Rlock G r a n t Categorical C l ~ lid Abuse S o c i a l S e r v i c e s Block G r a n t Categorical Runaway Youth S o c i a l S e r v i c e s Glock G r a n t Categorical Development D i s a b i l i t i e s S o c i a l S e r v i c e s Block C r a n t Categorical Rehabilitation Services (Department of Education) S o c i a l S e r v i c e s Zlock Grant Categorical Conlrnunity S e r v i c e s i',tl~ninistration S o c i a l S e r v i c e s Block G r a n t Com~nuni ty Services %lock Grant TABLE 10. Program Low-Income Energy Assistance B l . o r k (;rant (Titlc V I , p. 573-582) Administration proposal P.L. 97-35 -- . ---- -Low-Income Energy Assistance Energ>. and Emergency Assists:.- c Block Grant L:w--Income Emergency Assistance Block Grant Emergency Assistance Energy and Emergency Assistance Block Grant Categorical CRS-48 APPENDIX-B BLOCK GRANTS: TRANSFERRING POWER, MONEY, AND RESPONSIBILITY,,BY S A V D R A S . OSBOURS The biock grant, a long-standing but little known Federal aid instru- restructure the Federal aid system ment, became a headline item recently when it was identfied as a is not a l w a y s precise; t h i s lack of l i e component of the Reagan administration's drive for a reduced precision can obscure significant difFederal budget and a reduced Federal role in the operations of State ferences in the various approaches. Modifications to the existing sysand local governments. The budget reform plan proposes the creation tem run the gamut from minor adof approsimately2 block grants (which might be more accurately justments to total revolution. These characterized as special revenue sharing grants) by consolidating v a r i o u s c h a n g e s c a n b e s e e n a s appapprosimately 130 categorical programs. Funding cuts in the points on a continuum characterized range of 25 Dercent, estimated to exceed $4 billion. are associated by maximum F e d e r a l control and prescription at one end and maxiu l t i the blo& grant proposais. The basic issues in the block grant vs. categorical p a n t battle relate to the allocation of power between the Federal Government and State and local governments, between representatives of particular needs or int e r e s t s among t h e population and representatlves of the community as a whole. and between various interpretations of the proper role of government as compared to the private m a r k e t p l a c e . In many c a s e s , conflicting value systems are a significant factor in the debate. T h e fundamental philosophy of block grant supporters was summed up by the stated belief of a senior Reagan budget official quoted in the Washingto~cPost as saying, "I see no reason to believe that federal officials uill make these decisions [on funding allocation] more compassionately or conscientiously than our counterpans in State and local government." This element of bel~ef frequently looms large in the arguments of both sides of issues related to block grants. The block p a n t is one of a number of possible approaches to restructuring the existing system for providing grants-in-aid to S t a t e and local governments. The terminolog? associated with attempts to mum recipient discretion a t t h e other end. The components of t h e e s i s t i n g Federal aid system can be classified into one of three categories: cateporical grants, block p n t s , and generai purpose g r a n t s (e.g.. r e v e n u e sharing,. T'nere are approximate!y 5 0 0 c a t e g o r i c a l g r a n t s . 5 block g r a n t s . and one g e n e r a l r e v e n u e sharing grant ir. the current system. These components of t h e s y s t e m . plus proposed or achieved modifications, are described on a continuum r a n p n g from maximum Federal control (categorical grants) to maximum recipien: discretion (special revenue sharing). RESTRCCTCRlNG THE FEDERAL AID SYSTEM: A CONTINUVM Categoncal Grant: g r a n t s made for a specific purpose te.g.. m e t n c educat ~ o n )usually requiring t h e recipient t o match some porrion of the g r a n t . and usualiy accompanied by detailed administrative requlrements. The funds may be distributed according to a formuia or on a project-by-project basis. J o t n t F u n d z ~ i g .a procedure authorized by the Joint Funding Slmpiicatior, Act ( P . L . 93-510: extended through 19€4 by P . L . 9 6 - 3 4 ) . Thls approach leaves t h e e x i s t i n g c a t e e o r i c a i s y s t e m ir, place. but provides authority to expedite procedures for consolidation and a p p r o v a l of p r o j e c t s d r a w i n g upon more than one Federal assistance prog r a m . and to simplify requlrements for operauon of these projects. C o n s o i l d a t ~ o n mergmg two or more categorical g r a n t s lnto a larger categorical p i n t This reduces the number of p a n t s allevlatmg overlapplnp and fragmenta:ion, but does not affec. those aspects of p a n t form whlch relate to locatlon of power and responsiblllt? Block G r a n t s - a "hybrid" g r a n t form which mixes, in varying proponrons. e l e m e n t s of c a t e g o r i c a l g r a n t s a n d special revenue s h a n n g . The Advisor y Commlsslon on Intergovernmental Relations has defined a block grant a s "a program by which funds are prov i d e d chiefly t o a g e n e r a l p u r p o s e governmental unlt In accordance wlth a s t a t u t o v formula for use in a broad functional area. largely a t the recipien:'s djscretion." Blocit r a n t s usually invoive the consolidarlon of categonca1 p a n t s . At present. there a r e fire block g r a n t s In existence: P a r t n e r s h ~ pfor Health ( P . L . 89-749: enacted in 1966) S a f e S t r e e t s .4ct ! P . L . 90-351: enacted In 1968) Comprehensive Employment and Training Ac: fP.L. 93-203: enacted In 1973) Communir: D e v e l o p m e n t Block G r a z : ( P L 93-383, enacter! :E 1974) Scclal S e r v l c e ~f P . L . 93-6-17. "Ti:ie XI."enacted In 1974) 1/ CRS Review 9 7 t h Congress. - J u n e , 1981. Spectai Revenue S h a n n g : this t e r m was coined during the Nixon Administration, and described a series of l e p s l a tive proposals related t o his "New F e d e r a l i s m " p r o g r a m . L i k e block g r a n t s , special revenue sharing would consolidate existing categorical g r a n t s : h o w e v e r , block g r a n t s f r e q u e n t l y r e t a i n s o m e p o r t i o n of t h e Federal a d m l n i s t r a t ~ v econtrols ossoclated wlth the categoncais. Special p a n t for education might limn the use of :he funds to a r e a s previously f u n d e d by t h e c a t e g o r l c a l s : specla1 r e v e n u e s h a r ~ n gwould nor. Block grants generaily continue requirements related to matching and maint e n a n c e of e f f o r t : s p e c i a l r e v e n u e s h a r ~ n gwould not. Block g r a n t s may requlre an application for funds or the submission of a plan for t h e use of t h e f u n d s b e f o r e f u n d s would be m a d e available: specis! revenue sharing would not require prlor Federal approval. Accountability under speclai revenue sharing would take t h e form of pub!~shed plans and r e p o r t s available to the local public, r a t h e r than reports directed to Federai admlnlsrrators. Although complete details on the Reagan proposals are not yet available for all of the program areas. it would appear from what is knoun that the grant designs submitted to the Congress for consideration will match most closely the special revenue sharing model. The budding debate over the R e a g a n block g r a n t proposals reflects basic i s s u e s raised by t h e Reagan Administration's concept of the Federal system, including the question of Federal control over how federally-collected money is spent. Opponents of this philosophy may agree that the grant-in-aid process should be simplified and t h e "red tape" associated with it should be reduced, but they argue that the use of the funds cannot be entirely unrestricted if national goals are to be met. They argue further that the Federal Government, which is making the taxpayer's money available for these programs, has the responsibility to guarantee that the money is used wisely. program benefits that they might not get if they were forced to comp e t e w i t h m o r e politically p o t e n t groups a t the local level. WHO DECIDES? Acceptance o r rejection of t h e Reagan Administration's version of block grants will be decided in a variety of congressional arenas, and will almost certainly not result in a uniform response, as the accompanying chart suggests. There is not a single block grant entity, and there is not a single process for deciding the form of the block grant. The proposed reductions in fundi n g levels will be a c t e d on by t h e Budget Committees and. ultimately. the Appropriations Committees. T h e form t h a t t h e block g r a n t s t a k e , however, and t h e issue of whether there will be block grants at all will be decided by the legislative committees with jurisdiction over the programs proposed for consolidation. Since t h e Budget Committees will act f r s t , their proFinally, they contend that Federal posals and the ensuing votes by Conrequirements a r e necessary to as- gress as a whole will undoubtedly sure that certain underprivileged have a powerful symbolic value. However, it should not be forgotand underrepresented segments of the population receive a share of the ten that this is not Congress's last word on the subject and that there will be other opportunities for congressional impact as the proposals fiou. along t h r e e s e p a r a r e t r a c k s : budget, appropriations. and authorization. As indicated in t h e accompanying chronolog?r, the congressiond budget process places certain constraints on the decision process relating to block grants, it sets time limits on the activities of the authorizing and appropriations committees. Further timing constraints a r e inevitable bec a u s e of t h e i n t e r a c t i o n s of t h e various participants. As t h e H o u s e A p p r o p r i a t i o n s C o m m i t t e e h a s pointed o u t . "no appropriations can be made for block p a n t s until authorizing lepslation is enacted." The House Education and Labor Committee has noted that it would be unrealistic to assume that a consolidation bill could be received from the Administration in time to be considered by Congress and enacted and implemented before fiscal vear 1982 in order that that appropriations committee could fund the new p r o g r a m in i t s r e g u l a r fiscal year 1982 appropriations bills. The degree to which the funding track conforms with the program design track will be decided by the leg- WHO DECIDES? ACCEPT PROPOSALS: chnpr u a i a p laws or meet mlwi 3 AUTHORIZING COMMITTEES V m a n H . o n m d S u n Cocnmitms v&b I q i d n k prisdiction a r p m g n m REJECT PROPOSALS: n u i a a i a a a 6 g lrrn M O D I F Y PROPOSALS: e n a t bloch pam bat not in K t o r d rnth Pnudrot's propovls totals haidwit R u w n ' s BUDGET COMMITTEES H o w eod Srmtr C o m m i t a r tbn d d o p a d n p o n budget mdutions w t m p wmptc rpendinp, m r n u e a d debt totdr. A March 10th hopopls REJECT PROPOSALS: m n m i n or i n a e toms I MODIFY PROPOSALS: reduce t o o h to )rester or l a u r d q r r e than Praidrnt nsomnnndrd ACCEPT PROPOSALS prarde fradlnp at Idrrquated by R a t d e n t REJECT PROPOSALS rrulnutn c u m n t fundmg lads or t n v r n r fund~nglevel APTROPRIATIONS COMMITTEES H o w and Stnatc C o m m ~ n m that rpproprutt funds for p r o p m s t d u d r d la comol~dntonpropouls. 4 MODIFY PROPOSALS reduce h n d ~ a pto gnater or lawr dWw Prrwd*nt ncommmded n d t fundtng 1 4 s as spectf~rdtn arthor UlbOns, m8y reduce approprmnom mch our changes In authanzat~onsor runmem of new Imr j ib:a:ive committees, and t h e out- enm? d! not m e s P r i l y reflect dl ttle components of the Reagan Ad- ministration's package. For example, t h e Administration contends :hat reductions in funding will be offset by reduced a d m i n i s t r a t i v e costs if the block grant proposals are adopted as submitted, so that there need not be any reduction in service levels. I t is possibie, of course, that the committees and processes relatlng t o the funding reductions will result in adoption of the Administration's proposals without change. At the m e time, the legislative committees might refuse to adopt any of the Adrninistr~tion'spackage of block g r a n t proposals, t h e r e b y eliminating the claimed rdministrative mvings and leaving the States and localities facing severe funding reductions without the t r r d e off of reduced "strings" a n d increased flexibility. A more likely outcome, perhaps, would be a mix in which the Appropriations Committees would adopt some, but not all, of the funding reductions and the legislative committees would adopt mme, but not all, of the block grant propomis. Even if dl of the block g m t s are enacted, the design of the new programs m y vary from one to mothe r , reflecting t h e decisions of t h e various rubcommittees and eommittees, ro tbnt the degree of flexibility will not necessarily be nniform. S a n d r a Orbourn i s a n a n a l y r t in Amm'can l r o t i o ~ lpotvmment. Gmle r u m c n t Dtvtrton. D a k t e l P. S t n c k land, of the Iepalativc proccrr rcctton. rame diviston, prepared Lhc graphlca. CONGRESSIONAL BUDGET PROCESS: IMPACT IN BLOCK GRAKT DECISIONS May IS-FIRST BUDGET RESOLVTI0h'-Sets spending tsrgets to guide eornmittets and may inelude reeonciliation instructions to committees to reduce spending in legislation within their jurisdictions. Authorizations must be reported by May 15 but Congrens may waive the deadline. Appropriations cannot be considered before May 15 but Congress may w u v e th16 requirement. Committees are not bound by the figures in the fvrt n ~ l u t i o nm d m y or may not include grant progmmg among reductions to meet reconciliation instruct~ons. 7th D a y aflct l a b o r Day-Congress must cumplete action on spending lepslation. However, Congress may or m y not have completed action on authorizations by this date and consequently appropriations bills m y be delayed beyond the deadline. S E P T . 15- SECOND BUDGET RESOLCrTIOh'-Affiis or revises figures in the First Budget Resolution and may include recoacihtion instructions to committees to reduce spending in legislation within their jnridictlons. completes action on reconciliation bill or nmlution. Ruoneilkrjon S E P T . 05-RECONCILIAT1Oh'-Congrcss m e u u r e m y or may not have included reductions in grant programs. AFTER CONGRESS COMPLETES ACTION ON A SECOXD BUDGET RESOLUTION AXD RECONCILIATIOK MEASURE CONGRESS MAY NOT CONSIDER NEW SPEh'DISG LEGISLATIOK WHICH WOVLD EXC E E D T H E L E V E L S OF T H E SECOND BUDGET RESOLUTIOX. CONGRESS MAT ADOPT YET ANOTHER BUDGET RESOLUTION REVISING T H E L E V E L S O F T H E MOST R E C E X T BUDGET RESOLUTION. The Block Grant Story Consolidation Fared Poorly in The Reagan administration pmp d to consolidate more than 90 prognuns into seven huge "block grantsw to the staka fared relatively poorly in the budget bill. Funds for most of the programs were cut by as much as 25 percent, but a large portion remained under federal control with separate identities. Three of the proposed blocks, for social services programs, community development and low-income energy and emergency w e h e assistance, were dropped entirely. Moat of the programs continued as categorical P~ograms. In education, the administration's pro& two big blocks coilsolidsting more than 40 school-aid programs ended up as one b h k covering about 33 programs, but those that will continue as separate federal programs were the ones, containing about 90 percent of the federal education aid. Details of how each block grant proposal fared, except for the health p r o p a h , which were described in The Federal Report on Aug. 3: Budget Bill 10 Health Program Kept Out of Block Grants By Spencer Rich Wnl.11 W r Y n One of the toughest of the congressional budget battles involved President Reagan's p r o w to lump more than two dozen major health programs, totaling over S'2 billion in annual spending, into two huge block gmila to the statea with f w d ing sleshed to $1.4 billion. The presdent wid the pbn would give states more flexibility to decide where they money should go, instead of Congnss urmarklng how it should be spent. But opponents of the plan, kd by Rep. Henry A. Waxman (D-Calif.), chairmen of the Home submmmittee on public health, charged that submerging individual program into block grants with few federal controls would wipe out separate alloations for mme key program, such m family planning, mental health a d Ikoholism, and allow the money lo be diverted for other W t h pWaxmm, playing David to the Reegan's Goliath, succeeded in defeating a & portion d the praaident's plan. In the end. 10 program were kept out of ihe block grants and will remain as asparate categorical prog r a m with authorizations to a n y them through the next three years. About 20 other program were put into four block grante, with rather mvem mtrictions in m e uses on the statea' f d o m to shift money among program within the block, or lumped together in such a way that it will virluelly force the ntate to opend the m y the um way it did before. Overall, new authorizations were cut to about $1.6 bdlion for f w d 1982, a cut mveral hundred million dollan Ira than the prmident hed w h t Here are the detaib, with program authorization fylures: Family planning - Kept as a separata program with authorizations of $130 million for Twal 1982, $143 million for fiscal 1983 and $155 million for fiscal 1984 for services. Venereal disease control - Au. thorized as separate pro(lram; $40 million, 198'2; $46.5 million, 1983, $50 million, 1984. 0 Immunization - Separate at $29.5 million, $32 million and $34.5 million. Tuberculcaii control - Newly authorized m p a t e program, with $9 million, $10 million and $11 mil- lion. 0 Migrant worker health - Separate program with $43 million, $47.6 million, $61 million. Addescent pregnancy - New program, partially duplicating an exkting one that was put into one of the h e k granta, to provide health and nutrihn mrvicee to pregnant girb and to-brovide ehaetity cound i n g ; U O million for each of thm m. Dewbpmental diaabil~tiesSeprate program with $61 million for each of the yearn. 0 Specie1 mearch - $3 million in f w d 1982 wes authorized for rem u c h a d demonatration projects on primary health care, and $30 mil. lion in fvrel 1982 for r w c h on alcoholism and drug abuse. Black lung - Kept as separate program; no fixed authorization but funding has been $5 million a year. 0 Maternal and child health Seven programs were put into this block grant, with an authorization of $373 million a year from fwal 1982 to 1984. The seven: mnternal and child health, diaabled children's core, W-bmed paint poisoning, sudden infant death syndrome, hemophilia, genetic d b and a version of the adolescent pregnancy pmgram. Of the funds, up to 15 percent would be set aside for special maternal a d child health, genetic dieease and he. mophilia demonatration p r o m . No funds may be traderred fmm thb block. Preventive health ud health mrvices - Eight program were put into this block grant, with $95 million authorized for f d 1982, $96.5 million for 1983 and $98.5 million for 1 W . The eight home health, &ban rat control, fluoridation, emergency medical sewicee, health educatidrisk reduction, health incentive grants, hypertension and rape a b i s centers. Reatrictiorm: in the first year, states must set d e some money to provide emergency m e d i d services, perhaps lees than now, but something. In addition, in f i l 1982 states must spend at least 75 percent of what the federal government allccated to the hypertension program in 1981; in 1983 tJ-q fiure would be 70 percent and in 1984, 60 percent. A further restriction: $3 million mch year must be mt aside for rape crieis centers. Statea would be able to rhift up to 7 percant of tbh bbdr to anoiher block. Alcohol, drug abum and mental health block - Unites fwde for community mental health centem and d ~ abuue g and alcoholism control. for ml ~... ..~ f.~ ...~, with . . ~S491 million 1982. $511 milhon for 1983 and $532 million for 1984. Restrictions:' 1 percent of the money will be retained at the federal level for projects to retrain mental health hGpital employes loeing jobs as a result of shut. downs. States must fund existing communitv mental health centers at mme maonable leveL In 1982 ~~- atatea must apend the wme proportion of the overall hhck on mental health M they had been spending when the program were mperate. But in 1983 they could shift 6 permnt of the funds within the block and 15 percent in 1084. Thirtyfive p m n t of whatever amount ended up in the 'rutmtancs abum" category would have to go to alcoholism and 35 percent b drug a h , with the rmt diacrgtionuy. The :tam rtso would have the right to rhift 7 percant from the whok block inlo om dtheotherihreehealthbbcks. Primary cue bbck - Community h d t h m n t m would be the sole program in this block p a n t with funding at $280 million in 1982, $3025 million in 1983 and $327 million in 1984. For 1982, the program would remain under federal wpervision and redly wouldn't be a block grant at all. H k v e r , the states mld take over in 1983 as long as they m i n h i n existing m n m for one year. But a t a m m y dmply leave the canten ud funding &r aYrPIwpwLioa WASHINGTON -5T ~ w) & - .-J G , ~ , A13 LCED BY CONGRE'SSIONAL RESEARCH SERVICE LIBRARY OF CONGRESS WITH PERMISSION OF COPYRIGHT ClAlWNl Having survived a season of political storms, the President's grant consolidation proposals-in some form-now appear likely to win congressional approval. As that day approaches, however, the states confront a host of questions, including a very fundamental one: Is this a new era in federal aid-or is it the same old song and dance? The Reagan Administration appears to be on the verge of a substantial victory in its efforts to restructure the federal aid system, and the states are looking cautiously ahead in an effort to fathom what that victory will mean to them. As of early July, the likelihood was steadily increasing that Congress would approve some complex combination of revised block grants in the remaining stages of the budget reconciliation process, though some of the measures bore little resemblance to the original Reagan proposals to consolidate categorical grant programs. Until recently, the fate of the block grant proposal in Congress had resembled an old-time Saturday movie serial, as success followed defeat and the legislation's fate was ever in doubt. Propects dimmed in June when major congressional committees scuttled some of the proposed block grants and modified others. Later that month, however, the House of Representatives The Pu, /Ie of Dan Pilcher State LegislatureslJulylAugust 1981 -bypassing its own committees-dramatically breathed new life into the proposals as it passed the massive budget bill. Several major education programs, such as ESEATitle 1 compensatory education and P.L. 94-142 education for the handicapped which the Administration had proposed for consolidation, were excluded from the block grant legslati ion, and the National Conference of State Legislatures (NCSL) supported those particular exclusions. The block grant proposals have proven a particularly divisive issue, though generally supported, with some reservations,by most state legislators and governors. Last year, in a joint statement on federalism reform, NCSL and the National Governors' Association (NGA) called for the "consolidation of related federal categorical programs into block grants which provide flexibility for governments to target funds where they will do the most good." Now state legislators and governors across the country face the prospect that the block grant proposals will be passed-while, at the same time, they will confront sharp federal budget cuts that will diminish the flexibility they need to administer the grants effectively. A host of other concerns also await state and local officials as they look ahead to changes and possible transition problems: the timing of federal budget cuts and block grant passage; lead time for state planning and adaptation; program and funding responsibilities; accountability requirements; changes needed in state laws and administrative rules to comply with changes in federal law and regulations; caps on state administrative costs; funding mechanisms and formulas, and so forth. NCSL has pressed for inclusion of transition language in the block grant legislation allowing legislatures to make the statutory and administrative changes to minimize effects on program recipients. (See "Block Grants: How the States are Preparing," page 12). or the states, many of which are in shaky fiscal con. dition, the prospect of major cuts in federal aid i: superimposed on the uncertain path they mus: tread to implement block grants and phase out categorical grant programs. Effective October 1, they will likely confront federal budget cuts of 25 percent (less for some social services block grants) in the categorical grant programs selected by the Administration for consolidation. President Reagan's Fiscal Year 1982 budget calls for $13.6 billion less in federal aid to states than President Carter proposed, and $3.6 billion of this cut is associated with the block grant proposals. Thus, in the short run, the State LegislatureslJulylAugust 1981 budget cuts may have a greater initial effect on the states than if the block grant proposals are enacted with attendant transition problems. Whether or not the flexibility gained by the states from block grants will offset the cuts in federal aid remains to be determined. As the block grant legislation stood in early July, the dollar amount involved was less than half of what the Administration had proposed for consolidation, thus decreasing the amount of flexibility to be gained by the states in administering the programs. Perhaps more important for the states in the long run, the Reagan Administration proposes to freeze federal a p propriations for these grants through 1986. Assuming a 10 percent rate of inflation, this represents a 46 percent cut in the funds between 1982 and 1986, but, as some observers note, not a cut in the demand for services. The implication is that the states will have to pick up an ever-increasing share to maintain program levels. Sufficient lead time and technical assistance will be needed for the states to adjust to the federal grant changes. The alternative, some fear, could be intergovernmental chaos and disruption of the delivery of services to those who need them. As New York Assembly Speaker Stanley Fink stressed in a letter to his state's congressional delegation, "if and when [block grants] are enacted, the states must be given a reasonable amount of time to implement the new system." Sufficient lead time and technical assistance will be needed for the states to adjust to changes in federal grants. The alternative, some fear, could be intergovernmental chaos.. . CRS- 55 A n overriding concern for state legislators, however, is that they may be saddled with the responsiblities-but not the resources. Maryland House Speaker Benjamin Cardin, 1980-81 chairman of NCSL's State-Federal Assembly, told a congressional subcommittee that, in the transition from earlier, "sorting-out" messages, to the specific proposals, something had been lost from the President's Economic Recovery Program. It set out the steps "towards turning back a number of responsibilities to state and local governments, but no mention is made anywhere of possible future proposals for turning over funding sources for these programs," Cardin said, urging discussions between the states and the Administration "as soon as possible to support the added responsibilities." "Revenue sources turnback is very complicated," explained Robert Carleson, special assistant to President Reagan and chief architect of the block grant proposals, in an interview with State Legislatures. "We don't pretend to have all the answers," he said. Some of the questions, according to Carleson, concern types and distribution of programs that would be replaced with revenue authority and dispersion of the revenue sources across the country. The Advisory Commission on Intergovernmental Relations (ACIR) is studying the issue, he said, and the Administration has invited the states, organizations and academics to present their ideas. "Obviously, this is not the first step. Block grants are the first step." T he Reagan Administration originally proposed to consolidate all or part of 83 federal grant programs for FY 1982, along with a reduction in total funding from $14.2 billion to $10.9 billion, into six block grant programs: health services, preventive health services, social services, energy and emergency assistance, special education needs, and state programs for elementary and secondary education. Meanwhile, it also proposed that states administer the small cities and nonentitlement parts of the Community Development Block Grant (CDBG) program which now go directly to local governments from the U.S. Housing and Urban Development Department. In May, the Republicans scored a major victory with the Gramm-Latta substitute on the first budget resolution which, by cutting the budget, paved the way for later changes with block grants. The Administration's block grant proposals emerged late from the starting gate. They were submitted to Congress on May 8-only five months before the October 1st beginning of the new fiscal year for which they were to go into effect and four montnt d l ? rthe beginning of the session. In midJune, the Administration's prcjposais went aground in a major way when the Senate Labor and Human Resources Committee voted to exempt major prqrams from consolidation, and mandated that others be continued in their categorical form under a block grant rubric with reduced funding. With Republicans joining Democrats in opposition, the setback for the block grant proposals illustrated traditional congressional suspicion over relinquishing control of the categorical programs. President Reagan promised to push hard for passage of the consolidation proposals, and reportedly raised the possibility of vetoing block grants that do not suit him. At a midJune, private meeting with Kansas Senate President Ross 0 . Doyen, 1980-81 NCSL presidentelect, Reagan said that he had no intention of giving up on block grants. By the end of June, the House passed the massive, complicated budget reduction bill which provided for the consolidation of numerous categorical grants into several block grants while exempting some major programs. The hasty, dramatic manner of approval on the floor-the Administration effectively bypassing the congressionai committee system-left many initially confused over which programs were included for consolidation. This tactic of the Reagan Administration drew fire from some, including New York Speaker Fink, who sad there was "no justification for ramming these consolidaiions through as part of the reconciliation process." Nonetheless, with substantial differences between the House and Senate versions of the budget to be resolved first in conference committee and then on the floo: rf each chamber, the fate of block grants hung in the Dwance, though by early July tipping perceptibly toward passage. T he Administration lobbied hard for its block grant proposals against considerable congressional o p position from Democrats-and some Republicans. Presidential aide Carleson said that "the sooner Congress passes this legislation,the better it will be for everybody. . . . The Administration is urging the Congress to act as rapidly as possible because we do have the economic emergency and the states are going to need lead time to make these things work best." Said Carleson, "The President would have gone to a block grant concept even if the economy had been in excellent shape because he believes very strongly-as I do-that the states and local governments are best able to State LegislatureslJulylAugust 1981 make these kinds of [policy decisions]." "But with the necessary reductions in the growth of federal spending," he continued, "the block grants provide us [with] a very useful tool to ameliorate the possible harmful effects of a cut in federal spending. Since the [first] budget resolution, I think that point has become clear." But there are others, including some Democratic state legislators, particularly from the Northeast and Midwest, who take exception to this view. This perspective is represented by Colorado Senate Minority Leader Regis Groff. Groff, a Democrat and the only black in the Colorado Senate, represents a primarily black district in Denver. Block Grants: How the States Are Preparing As the states await congressional action on the Reagan grant consolidation proposals, some of them-on their own or through NCSL-have told Congress and the Administration what techncal requirements the legislation must meet to ease their transition difficulties. A number of states have also taken their own, unique steps in preparation for possible change in the federal grant system. A spot survey of 26 states by NCSL found that only five-Iowa, Kansas. Montana, Texas and Tennessee-had, by midJune, considered provisions in their budgets for possible federal grant consolidations. Some of the a p proaches the states are taking to prepare for grant consolidation found by the survey include: Iowa established a special fund for federal block grants with legislative appropriation required to spend money from the fund, except in the current year, when funds will be prorated among the previous uses. Kansas included in its budget a special line item for federal block grants in health and social services, with the funding level set at zero dollars. Since any changes in the funding level need the approval of the Finance Council, an interim body composed of the governor and legislative leaders, legislative a p proval can thus be given without calling a special session. Texas proposed that if two or more current federal categorical aid programs, now administered by separate state agencies, are combined Into a block grant by Congress, then the block grant funds will be divided pro rata among the agencies. State LegislatureslJulylAugust 1981 The Illinois General Assembly made provisions for the Intergovernmental Cooperation Commission to hold hearings from July to September in ordpr to, in the words of Commission Director John Lattimer, "find out the exact effect of the block grants on Illinois state government and to prepare a report and possible legislation to implement needed changes in how we handle federal dollars coming into the state." Added Latimer, "The legislature itself will call the shots, rather than leaving it up to the governor." A survey by the Council of State Governments (CSG) found that most states, including the largest, would not be able to adjust health and welfare programs to the original Reagan proposals by October 1, said staff member Dave Hurwitz. Estimates by the states for transition periods ranged from six months to two years. He said some states thought they could comply by October 1 if congressional action did not require them to revamp their budgets. In general, the larger states needed more time, the smaller, lesspopulated states, less time, Hurwitz said. Although some state health and welfare departments "have done a great deal of planning," according to Hurwitz, this is offset by a lack of cooperation between the executive branch agencies and the legislatures. This produced a "lot of inconsistencies on what the states actually think they can do" in implementing block grants. he said. Some of the concerns of the states for a transition period, according to CSG, included the need for additional or reassigned staff and training to handle block grants; need for lead time to adjust state-supervised, locallyadministered programs to meet federal and state requirements; need for lead time to program computer changes; and uncertainty over the political reaction to more cuts in government prcgrams following state program and budget cuts. State legislators have a wide range of concerns about the shift from categorical to block grants. On behalf of NCSL, New York State Senator Hugh Farley told the Senate Labor and Human Resources Committee that Congress should provide: Assurance that the federal block grant funds be allocated according to state law rather than by detailed reporting requirements; Latitude as to which state entity should develop a plan for the use of block grant funds, if such a planning requirement is imposed; Assurance that future block grant spending not be limited by current categorical functions; Technical assistance to foster the exchange of information on block grants among the states. Until the states devise their own distribution systems for federal block grants, Farley said, Congress should allocate block grant funds on a pro-rata basis according to the current categorical allocation. Another question is the role of the legislature in the planning and a p propriation of federal block grant funds. Several of the Reagan proposals included the requirement for the appropriation of the funds, as was done in the General Revenue Sharing law. After part~ctpatin~ in a June meeting between Reagan and members of NCSL'SExecutive Committee, Groff asserted that the minorities, cities and poor would suffer most under the Administration's proposals to consolidate domestic social programs. There are others, such as Speaker Fink, who hold the The challenge that this issue will put on state legislative planning and oversight is one consideration for state lawmakers. About 30 state legislatures now hold some degree of control over federal funds, and others may expect to see sharp differences between the legislators and the governor about who has authority over blcck grant funds. Another concern is the authority of the legislature over federal block grant funds in the interim. Some states already have provisions for interim action on federal funds, and the transition to block grants could force others to adopt similar measures. (For more information, see A Legislator's Guide to Oversight of Federal Funds, published by NCSL) A major, complicated question is a state's legal and financial obligation for state laws that incorporate existing federal performance standards, activity levels, or definitions-which may be changed by grant consolidation. The states have often adopted these guidelines "by record" into statute, along with their own specific state laws and regulations relating to federal programs. An extensive scrubbing of state laws and regulations thus may be necessary to operate newly consolidated federal programs. This will be especially important in the period between the effective date of a federal law and the modification of state law. Carleson agrees with NCSL's position, that one option would be for a state to request that the federal agencies now responsible for categorical programs continue to operate the programs at reduced levels for several months after grant consolidation, until middle ground. Fink sees block grants neither as a panacea to solve the problems of intergovernmental aid, as some advocate, nor as a rejection of the "truly needy rn the cities," as opponents argue. Fink, however, doesn't believe that consolidation justifies a 25 percent cut In federal aid: "There just isn't that much overhead. The 25 the state has organized itself to take on the block grant. One source of transition help may be the fedeiai agencies. "I know that it will be the policy of the secretaries of the affected [federal] departments to recognize that the states will have legitimate problems," Carleson said, "and . . . give [the states] quite a bit of administrative latitude in these programs during the initial transition period," and offer technical assistance from the departments." In addition, said Carleson, the "administrative cost-savings at the federal level that are realized because of these block grants are, by and large, being placed in the block grants for the states." "The block grants have been designed in such a way that block grant funds can be used to purchase technical assistance, either from the federal government, other states, private consultants, non-profit [organizations], or wherever this kind of technical expertise exists." Quick interchange of accurate, timely information on the consolidation proposals and congressional alterations and on the questions of transition and implementation is a major concern for the states. NCSL's Office of StateFederal Relations in Washington, D.C., monitors developments at the federal level, while NCSL's Fiscal Affairs Program in Denver follows developments in the legislatures. (See NCSL staff contact list, page 15). At the federal level, one source of information for the states is the executive Office of Management and Budget (OMBj, where the Intergovernmental Affairs Div~sionprovides a bridge be- . tween state, local and federal governments on the consolidation proposals. James F. Kelly, deputy director for intergovernmental affairs, said OM6 staff will meet with state and local officials to find out what they need to know about the block grant proposals, and what aspects of the proposals cause the most problems. As a part of its "catalytic" role, OM6 is developing a specific plan of assistance for state and local governments, including centralized information, to help expedite the regulatory process as the legislation emerges from reconciliation. This would include identifying the various steps the states are taking to plan for the transition, disseminating that information to the other states; and coordinating the executive branch agencies and departments in providing technical assistance to the states. "Information is key," Kelly said. Another possible role for OMB, according to Kelly, will be to broker a "dialogue" between state and local officials, who may sharply disagree on the block grants issue. But, as one OM6 staff member stressed, the federal role now will not be a dominant, overly instructive one, as it may have been in the past, but will be to help the states make the transition to consolidated grants. Dan Pileher State LegislatureslJulylAugust 1981 percent cut in funding really means service cuts or state and local tax increases." A key question for state legislators and governors will be to what extent they can live with watereddown block grants that may emerge from the congressional labyrinth. These grants might include various restrictions, such as exemption of major categorical programs, direct channeling of funds to local governments, administrative caps, targeting, maintenance-of-effort requirements, state matching provisions, and so forth. The block grants are an integral part of the Administration's threepronged strategy: deregulation, budget cutting and management improvements. "That's why they are really crucial to the President's strategy," said Carl W. Stenberg, assistant director of ACIR. If the Administration had waited, he continued, it would have been more difficult to get the attention of Congress. I t is the crucial matter of timing and transition, in particular, that concerns state legislators and governors. Only a few legislatures will be in session this summer and autumn; the others must either face special sessions-in addition to calling special sessions for reapportionment-to cope with federal aid reductions and added fiscal duties, or must somehow limp along until early 1982 when most will go into regular session. Even with passage of the block grants, say some state lawmakers and staff, the states still need regulatory reforms in the administration of the remaining federal categorical grants to provide more flexibility and reduce administrative costs. tarting a revolution in the intergovernmental aid system hasn't been easy. For years, analysts and state and local government officials have called for revamping the federal system of assistance to local and state governments now ensnared in the administrative web of almost 500 federal grant-in-aid programs. In its "Agenda for the Eighties," ACIR said the number of categorical grant programs should be "drastically reduced through consolidation, termination or devolution" to decongest the grant system. It noted that 420 small programs constituted only 10 percent of total federal aid to state and local governments. The prospect of revolution in the federal aid system stirred a predictable cauldron of debate among congressmen, state and local officials, government administrators, service providers and service recipients, and State LegislatureslJulylAugust 1981 Robert Carleson Ben Cardln various interest groups. The argumenk swirled with heated political rhetoric about technical, programmatic points along with broadbrushed generalizations and old arguments (see "Block Grants: The Questisn of State Capability," page 16). The context of the current debate, however, differs from those of earlier years when the federal government was expanding and the economy had not yet firmly settled into the stagflation rut. Thus, it is the "politics of retrenchment" that now prevails, not the "politics of more for everyone" which helped pass earlier block grants. The debate occurred on a number of different levels, as outlined by Stenberg of ACIR. The "hot potato" aspect is the jurisdictional one of whc will control the funds-channelling thegrants through the states to local governments, or bypassing them. Another is the substantive: What programs are in-and out of-the proposals?One is eligibility: Which service recipient groups will be included in-or excluded from-the grants? Yet another is the regulatory front: Which program strings and cross-cutting require ments will be removed or altered? Some state legislators believe that some programs proposed by the Administration for consolidation should be exempted from block grants. There are programs such as education for the handicapped, said Speaker Fink, that are "so important they must not be consolidated," adding that both Republicans and Democrats support this view. NCSL also supports this position. Some congressional opposition may have come from those who wanted to see the effects of the federal budget cuts before grant consolidation was undertaken, said Paul R. Dommel, an intergovernmentalaid scholar at the Brooki n g ~Institution. That possibility, however, began to diminish as the block grant proposals continued to progress through Congress. Another strategy of opponents was outlined by Carleson. He pointed out that groups with a specific, vested interest in keeping the categorical programs under federal control were willing to accept cuts across the categorical programs rather than see them included in block grants "where they'll lose control." Some observers also perceive a tactical dimension to opposition to the block grant proposals by interest groups representing service recipients and providers. It is far easier for an interest group to be effectively represented in Washington, D.C.-where, obviously, many are already well-entrenched-than to have to deploy their forces to alien, unknown territory in 50 state capitols from Augusta to Honolulu and Tallahassee to Juneau to set up shop to lobby state lawmakers. One result of the politics of shrinkage is that the budget cuts and grant consolidation proposals have splintered the public sector lobby-mayors, county officials, state legislators and governors-a development that is said not to displease the Administration since the lobby, when united, had been a potent force on Capitol Hill in recent years. Another development is a schism among the regions and the states regarding the federal budget cuts and block grants. State legislators in the Northeast and the Midwest have generally expressed reservations about the effects on their states while state lawmakers in the South and West have been more supportive of the proposals. inally, there remains one overlooked point, suggested by a few observers and participants in the block grant debate. It is that local governments -which almost certainly face a bleak future for more federal aid because of pressures on Washington to cut the budget, increase defense spending, and maintain existing entitlement programs such as Social Security-will have to look to the states for a concerted partnership to solve mutual problems. It is, therefore, in the long-term interests of the local governments to see that state capacity is now expanded and strengthened, if necessary, to handle block grants. As Florida House Majority Leader Richard S. Hodes, 1980-81 president of NCSL, said after meeting with Reagan, ''We in the legislatures have a large task in convincing both our constituencies and our local government officials that our concerns for the needs of the people of the states are as great or greater than those of Congress or the city council." Moreover, state and local governments may soon have to consider a formalized relationship to ensure local governments an adequate role in state decision making, particularly on block grants, according to Carol Weissert, editor of AClR's Intergovernmental Perspective. ACIR's Stenberg agrees: "In a positive sense, the block grants are probably going to cause the forging of new intergovernmental relationships that should have occurred long ago." The states will have to, within difficult constraints, continue to forge innovative, vigorous efforts to help their distressed urban and rural communities, and people who may be really hurt by the loss of federal funds-a difficult Gordian knot at the very least for the 1980's. If the tensions and competition between state and local governments can be ended by the realization that their destinies are inseparable, then a new, more positive era of federalism may be in the offing. The unpleasant fate that each faces alone is reason enough for state and local officials to make the utmost effort now to forge a realistic, mutually beneficial partnership. Contacts on block grant developments at the federal level, NCSL Washington Office of State-Federal Relations: General-Tim Masanz, (202) 624-5408, and Gary Falle, (202) 624-5416; Education-Ron Field, (202) 624-5425; Human Resoyrces-David Riemer, (202) 624-5413; CDBG-UDAG-Susanne Hiegel, (202) 624-5418, and Joy Johnson Wilson, (202) 624-5410. Contacts on block grant developments in the state legislatures, NCSL Denver Office: Bill Kelly, Ken Kirkland and Steve Gold, NCSL Fiscal Affairs Program, (303) 623-6600. References Advisory Commission on Intergovernmental Relations. Block Grants. A Comparative Analysis. Washington. D.C., 1977. Busbee. George. "A Governor Responds: States Can Do the Job." The Washington Star, May 25. 1981 Conlan, Ttmothy J. "Back in Vogue. The Politics of Block Grant Legis!atlon," Intergovernmental Perspective, Advisory Comm~sslonon Intergovernmental Relat~ons,Summer 1981 Kailo, Andrea. "Reforming the Federal System: An Agenda from the States," State Legislatures, February 1981, pp 5-9. Pe~rce.Neal R. "New Panels to Move Quickly to Help Reagan 'Unbend' the Federal System." National Journal, May 2. 1981 Stanfield, Rochelle "Block Grants Look Fine to States; It's the Money That's the Problem," National Journal, May 9, 1981 Dan Pilcher is senior associate editor of State Legislatures. State LegislatureslJulylAugust 1981 As their performance has shown, the states are far better equipped than their critics acknowledge to handle the challenges of grant consolidation. BlockGrants: Most recent, objective studies conclude that the states have undergone a profound revolution-largely unnoticed at the national level-within the last 20 years. This transformation means that some old and persistent attitudes toward the states are no longer consonant with reality, but it does not mean that the attitudes themselves have disappeared. A negative image of the states persists in some quarters and bears directly on the block grant debate. ~articularlyamong those who are reluctant to see the federal government roll back power and programs, it is argued that the states have ignored the poor, the needy and the cities, and are responsible for the growth of the federal government's domestic programs. The underlying argument is clear: The states would be unable or unwilling to handle the responsibilities that grant consolidation would thrust upon them. "The biggest battle we have," said Florida House Majority Leader Richard S. Hodes, 1980-81 president of the National Conference of State Legislatures State Capability Dan Pilcher (NCSL), "is to convince those who are in need of urban, educational and sociai services that the state iegisiatures can behave responsibly in identifying and meeting their needs." In fact, a recent report by the congressional General Accounting Office (GAO) urged greater state legislative involvement in the allocation and administration of federal grants. The GAO said the skills gained by the legislatures in the last 20 years are underutilized in federal grant efforts, thus hurting federal program management. Recent analyses of the intergovernmental aid system conclude that the states now shoulder a large, generally overlooked share of the responsibility for aid-which most analysts agree has significantly increased in recent years-to state and local governments "Traditional arguments made about [the states], by and large, don't hold up very well,'' says Timothy Conlan of the Advisory Commission on Intergovernmental Relations (ACIR). I t is particularly ironic that the states, so often accused of neglecting local governments, actually provide more grant funds to localities than does the federal government, Of the $85.5 billion aid received by local governments in 1978, according to ACIR, about $50 billion was direct state aid. Federal direct aid was $20.5 billion while $15 biilion was federal aid passed through state governments to local governments.' Even under General Revenue Sharing, about 40 percent of the state GRS funds were passed through to local governments until Congress last year discontinued payments to the ~ t a t e s . ~ States-not the federai government-pioneered the block grant concept decades ago, according to analysis by NCSL, in providing general aid to schools, cities and counties. By 1977, 41 states provided general local support to counties and 46 states to municipalities. Today, all states except one provide general aid to schools. (Hawaii, the exception, treats the state as one school system supporied totally with state funds.) Many state categorical grants are, in effect, block grants because they lack the extensive restrictions placed on federal categorical grants. But dollar grants are only one way in which the states aid the localities, and thus give a misleading representation of the total state assistance effort toward local governments. The states have more flexible, reliable ways to aid localities-as they have during the last two decades in steadily removing service responsibilities, such as welfare and education costs, from local governments, grantlng local tax relief, and authorizing local tax revenue sources. Two recent studies, moreover,show that federai a n can be more responsive to local needs when worki:?~ in garr nership with the states instead of being funneled diractly lo local governments. Two professors at the University of Missouri (Kansas City), G. Ross Stephens and Gerald W. Olson, who studied intergovernmental aid flows for the National Science Foundation, concluded that "it appears the states do a much better job of placing these funds [state aid programs, including pass-through funds] with 'active' local governments than does direct federal to local formula all~cation."~ They concluded that federal formulas and the way in which federal grants ar9 awarded cannot deal rationally with the very complex system of state and local government. In addition, a study by the National Governor's Association's Center for Policy Research, Bypassing the States: Wrong Turn for Urban Aid, found state-federal aid more closely linked with distress than direct federal aid. May 1981 report by the non-partisan ACIR and the National Academy of Public Administrators concluded that "States have begun to develop and implement a variety of fiscal and functional reforms directea to meeting the needs of distressed urban and rural cornmunities-a distinct departure from their past quiescence in these fields."' The study highlighted the strength of the states in devising innovative approaches to their specific problems. The targeting of the states' local aid programs illustrates the It is ironic that the states, so often accused of neglecting local governments, actually provide more grant funds to localities than does the federal government. State LegislatureslJu!yiAugus! 1981 benefits of flexibility which could be further encouraged by federal block grants. The Northeastern states stressed functional aid, such as housing rehabilitation and economic development, for declining core-city areas. The states in the West, Midwest and South have taken the lead "to broaden local taxing capabilities, and to distribute revenue sharing funds and education aid to assist needier jurisdictions." While the Southern states emphasized rural development, the Western states sought to alleviate the negative side effects of rapid economic growth. 0 ne criticism of the states is that they lack the "capacity" to effectively administer federal block grants. While individual states may differ in structure, knowledgeable observers generally agree that the states, by and large, now possess the structural capabilities needed to administer federal block grants, having undergone in the last 25 years what the ACIR calls a "largely unnoticed revolution." As Utah Senate President Miles "Cap" Ferry told Rochelle Stanfield of the National Journal, "A few years ago, most states wouldn't have been able to take on new programs. But most states have beefed up their staffs so they are now able to handle these responsibilities." In the last two decades, the states have dramatically reorganized themselves and expanded local government powers. Between 1960 and 1980, 11 states overhauled their constitutions. Forty-six states now have four-year terms for governors. Threequarters of the states have state employee merit systems. Malapportionment disap peared with the "one person, one vote" ruling by the U.S. Supreme Court. Threequarters of the states have r e formed their statelocal judicial systems. And 36 states now staff their legislative standing committees. All states have community development departments, or similar agencies, and all have economic and industrial development agencies. Other improvements include stronger legislatures and governors; balanced fiscal systems; professionalized leg~slativeand executive branch staff and agency workforces; state planning mechanisms; and increased oversight of state and federal funds. The states are experienced in administering federal grant programs, both categorical and block, as well as state grant programs to local governments. The states already administer a number of federal assistance programs for individuals: Medicaid, welfare, State LegislatureslJulylAugust 1981 Carl W Stenberg George Peterson housing assistance, and nutrition for children and the elderly. In addition, they have played a roie in the administration of severs1 block grant programs such as CETA, LEAA and others. The states have made significant strides in improving their tax revenue systems, with the state share of the total state-local tax take now 58 percent. Between 1960 and 1979, 11 states adopted a personal income tax. By 1979,41 states had a broad-based income tax, 45 had a corporate income tax, and 45 had a general sales tax. In that year also, 37 states used all three tax revenue sources. Although state tax revenue systems are modernized, balanced and flexible, the reductions in federal aid will increase their fiscal stress. Cari W. Stenberg, assistant director of ACIR, points out that the states have largely met the challenges "laid at their doorsteps" by reformers since the 1930's. "I think that the record would show that most of the states have done virtually everyihing that the reformers said they should do," he said. he fiscal health of the states bears directly on the block grant debate. As important as they may be for restructuring the intergovernmental aid system, the original block grant proposals, in dollar terms, account for considerably less than half of the Administration's total proposedgrant cutbacks. Before the House and Senate reconciled the budget, the dollar amount of the programs proposed for consolidation amounted to less than half of that for which the Administration requested. Reagan's tax cut proposals, meanwhile, could have major effects on state tax revenue systems, such as lowering revenues from corporate business taxes or from personal income taxes. (For more information, see "Washington Report: What Federal Tax Cuts Would Mean to States," State Legislatures, June 1981.) To further complicate the picture, 18 states now operate under some form of tax or expenditure limit, political opposition to tax increases is widespread, and many states are struggling financially, in part, because of the 1980 recession ("The Struggles of 1981: Budget Actions in the States," page 22). One consequence of the fiscal problems of the states, however, has been a plateau in state assistance and, in some cases, reductions in state aid to local governments. Said the Urban Institute's George Peterson, "We're already seeing quite a retrenchment in local assistance from state governments as they go through their own budget adjustments, and [local governments] quite properly feel that anything that generally makes resources more scarce and gives the states more discretion is likely over a period of years to come out of state assistance to local governments." The cities, he adds wryly, "have more experience" when it comes to cutting budgets than the states or federal governments. A nother line of argument against the state role in federal block grants is the question of a state's political will. Although the era of malapportioned, rurally dominated legislatures has vanished, it is obvious that political splits exist in many state legislatures-as is inevitable with representative government-between rural, suburban and urban interests. That political competition would intensify in the legislatures because of consolidated federal grants and The states, by and large, now possess the structural capabilities to administer block grants, having undergone a 'largely unnoticed revolution.' federal program cuts seems apparent-and appropriate, given the constitutional duties of legislative bodes. The ACIR's Stenberg notes that "the states are going to &: asked to make some difficuit political as well as fiscalmanagement decisions. One is resource allocation and accountability." Assurances have been offered by state legislators and governors that the needy recipients of federal categorical grants will not be forgotten under state control of federal block grants. "The question really is, will the states r e spond to provide the kind of service the federal government says it peforms under the current program," Florida House Majority Leader Hodes told the NationalJournal, "I believe, by and large, they will. ' In Illinois, John Lattimer, executive director of the legislature's Intergovernmental Cooperation Commission, said he believed that a major attempt would be made by the state legislature to work with local governments, with the major political battles not over "who gets the money" but over policy grounds. With Chicago, the largest local government in the state and an important economic force, confronting problems in school finance and mass transit, "the needs of the city are inextricably tied to the needs of the state," Lattimer said, and ''we'll obviously have to work together." S upporters of categorical programs proposed for consolidation are understandably worried over how their programs would fare under state control when legislatures begin to set priorities for programs and budgets. Although not "totally opposed to block grants, per se," in a conceptual sense, Colorado Senator Regis Groff worries about the legislatures being given control of block grant funds for the cities and other programs. "The legislatures are extremely parochial," he says. "They get wrapped up in an awful lot of very petty, very individual kinds of concerns." These concerns are mainly rural vs. urban vs. suburban interests, and partisan Republican vs. Democratic interests. "Because of all that, I wouldn't want the legislature to determine whether [federal] dollars find their way to Denver," Groff said. The ACIR's Conlan observed, "With fairly severe budget cutbacks, both at the federal and state levels, it's understandable that groups [and] jurisdictions that in the past hadn't dealt with the states are very concerned." And the states may feel, in some cases, that establishing a relationship with some private service providers in the educa- State LegislaturesiJulylAugust 1981 Reviewing changes in state government at the executive, legislative and judicial levels, the Advisory Commission on Intergovernmental Relations (ACIR) has concluded that "a comparison of the states of 1980 with those of 25 or even 10 years ago uncovers a remarkable transformation in state government." Such IS the assessment summarized in "The State Role and State Capability," a forthcoming chapter in the ACIR's major study, The State and Local Roles in the Federal System. "Since the Kestnbaum Commission criticized them in 1955," the AClR repart explains. "the American states have undergone changes that have transformed both their capacities and their roles in the federal system. Every state participated in the most extensive wave of state institutional reform in history, and governments at all levels contributed to a marked shift in emphasis in the states' role. The resulting alterations are so extensive that the structurally and procedurally stonger, more accountable, assertive states of today, performing a major intergovernmental management and financing role, bear little resemblance to the generally poorly organized and equipped and unresponsive entities of a quartercentury ago. The mind set of the states is different. They have lost their reluctance to change and to act." This finding, heartening at the best of times, is particularly so at a time when some view states as incapable of handling the responsibility of block grants and insensitive to the needs of their citizens. The facts-today's, rather than those of 25 years ago-belie the contention. According to ACIR, the states have reacted to past criticism about their recognition of urban problems by taking positive steps to assist localit~es.Referring to states as currently the "senior financial partners" in the intergovernmental arena, the Commission study points out that state financing of statelocal expenditures from their own funds rose from 46.8 percent in Fiscal Year 1957 to 57 percent in FY 1979. Toward the end of this period (1972-1977), state aid to localities went up 72 percent. from $27.8 billion to $48 billion. (During this time, the GNP deflator, one measure of inflation, increased by 38.7 State LegislatureslJuly/August 1981 percent.) "States are moving to alleviate the local financial burden by paying a greater share of the costs, and they may be providing more equality in the provision of public services in the bargain," the AClR report observes. "States are the dominant service providers," ACIR continues, "providing more than 55 percent of the expenditures in most of the states in six functional areas: highways, statelocal public welfare, hospitals, health, natural resources and corrections." More specifically, state expenditures for public welfare and education have risen significantly over the past 25 years: in 1957, states provided 71.8 percent of the funding for public welfare, compared to 84 percent today; local school funding has gone from 41.2 percent to 51.9 percent. Although education is viewed as primarily a local function. AClR notes that "states now provide more than half of local school costs in a majority of the states." In addition to providing financial s u p port for localities from their own funds, states also pass through 27 percent of the monies they receive from the federal government. Thus, AClR says, states are the "principal external prcviders of funds to local governments." (Despite the concern of many cities that they will lose funds if states administer block grants, a recent survey by the National Governors' Association shows that more than 80 percent of the funding in the noneducation programs which the Administration proposed to fold into block grants already goes to state governments, with only 5 percent going directly to localities.) Moreover, as the AClR study points out, state aid to localities is not limited to financial assistance. While acknowledging that "state efforts to improve local government capability are too numerous to chronicle," the report cites several instances of such activity. In the area of technical assistance, for example, a 1978 AClR survey showed that when local officials looked outside for technical help (as about half of them did), the state was contacted more than any other outside organization. States have taken a positive role. AClR notes, in helping local governments upgrade their personnel practices, accounting systems and financial management. "To a substantial degree, states are the ensurers of 'good' government at both the state and local level," the Commission says. "Their legal controls over local units allow them to improve responsiveness of local institutions and to ensure accountability and openness of and access to governmental p r e cesses." Regarding urban problems in particular, the report cites the recent AClR and National Academy for Public Administration study showing that "state governments are making encouraging, if somewhat incremental, progress toward recognizing and grappling with community issues," especially in the area of improving housing opportunities for low- and moderate-income individuals. Although mechanisms for allocating state aid are not currently skewed toward communities of greatest need, the AClR study notes that, nonetheless, the "observed effect is for greater equalization [targeting]." "We should not assume," the report cautions, "that states which do not target their aid allocations are not dealing with the problems of their urbanlcentral cities. State centralization and functional transfers may represent alternative means for states to assist fiscally distressed and needy cities." As the AClR study details, states have upgraded their capacity to perform at all levels-executive, legislative and judicial-and, importantly, they show a continued willingness to make positive, innovative changes. While not all efforts to date have won unanimous applause, the Commission found that "on balance. . . most of the changes improved the capacity of the states to provide effective, efficient, responsible and accountable government at the state level." "Despite the need for further improvements," AClR concludes, "the states emerged as transformed entities, retooled and capable of undertaking an expanded role in the federal system at the same time that they discharge their traditional responsibilities." Andrea Kailo much of the authority and responsibility as they can to local agencies of government," said Carleson. "To this end, we would certainly be sympathetic to requirements that there be local consultation and involvement in the decisionmaking process as it relates to funds being passed on to local governments." Some local government officials are worried that the states, if given program responsibility for administering consolidated grants, would not be restrained in the amount of federal block grant funds used for "administrative costs," giving short shrift to the funds to be passed on to local governments and service recipients. NCSL policy supports a 3 percent cap on the amount of federal funds that could be used by the states for administrative costs. "Sony, but all my power's been turned back to the states " tion and health areas may have been, in Carl Stenberg's words, "a little late in coming." As the once seemingly infinite flow of manna from Washington to states and localities has shrunk, local governments would be ignoring political realities to expect state governments to step in and fill the federal vacuum completely. Instead, the rare opportunity presents itself for a new alignment of state and local governments to develop a fresh working relationship to solve mutual problenis. L ocal governments, which have developed a "special relationship" with the federal government through direct categorical grants and do not wish to see it disturbed, are also concerned over their role in the development of state plans for block grant use. Noting that one of the Administration's problems with its consolidation proposals is "the distrust that local governments seem to be exhibiting towards state government," Robert Carleson, special assistant to the President for policy development, said, "it's our goal to strengthen state government at the expense of the federal government, not to strengthen state government at the expense of local government, because the President and I feel very strongly that local governments should, wherever possible, be the level where most of these kinds of [policy] decisions and authorities should reside." "We would encourage state governments to do everything they could to pass on, or delegate in turn, as et another charge-heard frequently in Congress-is that the Reagan block grant proposals fail to provide accountability. "[This] is one of the toughest things we have to defend the states on," said Carleson. "There's a typical Washington charge that you can't trust the states, [and] particularly can't trust the states to audit themselves." Carleson added quickly that "we disagree with that; we believe that the audit function can be delegated to the states." The Administration has stipulated that the audits have to be done in accordance with accepted accounting practices, as is done in business. The audits would have to be done on a periodic basis, and publicly reported by an agency or unit of state government independent of the functional program unit being audited. "We feel, with those kinds of safeguards, that the states will be just as accountable [as the federal government]," Carleson said. He noted that the states "certainly have proven basically accountable for their funds." Y Notes 'Dan Pilcher. "State Aid tocities: Hard Times Ahead." State Legislatures, June 1980. pp 5-12. 2Dan P~lcher,"General Revenue Sharmg. Year of Decis~on." State Legislatures, January 1980, pp. 6-1 5. 3G Ross Stephens and Gerald W. Olson, "Pass-through Federal Aid and Interlevel F~nancein the American Federal System 1975-77," KansasCity. Univers~tyof Missouri, 1979. 'Advisory Commission on Intergovernmental Relations and the National Academy of Public Administrators, "The States and Distressed Corn munittes, The 1980 Annual Report," Washington, D.C.. May 1981. Den Pilcher is senior associate editor of State Legislatures. Andrea Keilo is editor of Dateline Washington and Washington editor of State Legislatures. State LegislatureslJulylAugust 1981 EXCERPTS : GOVERNORS' GUIDE TO BLOCK GRANT IMPLEMENTATION August I . 1981 ** m E COUNCIL or STATE CLAWMING AGENCIES Council of State Planning Agencies and National Governors' Assocation 400 North Capitol Street. N . W . Washington, D.C. 2000 1 *+**4 * * '=+*** 4 National Governors' Asrociado~ H A U OF VHt 5TATF.S 444 North Capltol Street Washington. D.C.ZOO01 ( 2 0 2 )624-5300 Reproduced w i t h p e r m i s s i o n o f N a t i o n a l G o v e r n o r s ' A s s o c i a t i o n by t h e C o n g r e s s i o n a l R e s e a r c h S e r v i c e , L i b r a r y o f C o n g r e s s , S e p t e m b e r 7 , 1981. GOVERNORS' INITIATIVES TO IMPLEMENT BLOCK GRANTS The following section contains individual state descriptions summarizing responses derived from efforts currently underway in each state to prepare for block grants and federal funding reducThe survey was conducted in late July 1981 by staff members tions. of the North Carolina Division of Policy Development, the Council of State Planning Agencies, and the National Governors' Association. The brief summaries were either prepared by the state contact person for block grants designated by each respective Governor's office, or were checked for accuracy by them. In contacting state officials, interviewers posed questions to determine what was currently being done to prepare for pending reductions in federal grant-in-aid funding, adjust to proposed adrninistrative reforms, and implement the block grants when they become law. Attention was given to soliciting information about executive- legislative agreements being shaped, state and local relations, citizen participation strategies, government-private sector accords under development, innovative approaches to minimize the impact of major changes in federal assistance, and any unique contingency plans or legislation that might be under consideration within each state. Some general observations about the responses are in order. First, it is significant that few of the persons contacted had information about what other states are doing to prepare for federal funding reductions and block grant implementation. Without exception, interviewees were extremely interested in finding out about initiatives underway in other states. I t i s c l e a r t h a t t h e r e i s keen i n t e r e s t among s t a t e o f f i c i a l s i n h a v i n g a c c e s s t o p e r i o d i c r e p o r t s which p r o v i d e i n f o r m a t i o n on t h e s t a t u s o f b l o c k g r a n t p r e p a r a t i o n and management i n t h e states. Second, s u r v e y r e s p o n d e n t s were e x t r e m e l y c o o p e r a t i v e , o f f e r i n g a wealth of useful information. These d e s c r i p t i o n s o f s t a t e i n i t i a - t i v e s c o v e r a wide r a n g e o f i d e a s and a p p r o a c h e s f o r management o f b l o c k g r a n t s and a l t e r n a t i v e s i n d e a l i n g w i t h f e d e r a l b u d g e t r e d u c tions. T h i r d , i t i s a p p a r e n t t h a t t h e Governors' i n i t i a t i v e s a r e w e l l underway. S t a t e o f f i c i a l s have t a k e n i m p o r t a n t p r e l i m i n a r y s t e p s t o k e e p c i t i z e n s , l e g i s l a t u r e s , l o c a l government o f f i c i a l s , p r o v i d e r a g e n c i e s , g r a n t e e s , and i n t e r e s t g r o u p s i n f o r m e d a b o u t r e c e n t developments. Through a v a r i e t y o f f o r m a l and i n f o r m a l mechanisms, Governors, p o l i c y o f f i c e r s , and a g e n c y d i r e c t o r s a r e s e e k i n g t h e comments and recommendations o f c i t i z e n s . Working r e l a t i o n s h i p s a r e b e i n g e s t a b - l i s h e d among e x e c u t i v e a g e n c i e s w i t h s t a t e l e g i s l a t u r e s , l o c a l o f f i c i a l s , and o t h e r s w i t h i n s t a t e s . F i s c a l and program a n a l y s e s a r e b e i n g c o n d u c t e d , i s s u e p a p e r s p r e p a r e d , and i m p a c t s t a t e m e n t s developed. I n many s t a t e s , a l t e r n a t i v e c o n t i n g e n c y p l a n s have been o u t l i n e d , b a s e d upon v a r i o u s r e p o r t s on t h e c o n t e n t o f f i n a l f e d e r a l legislation. F o u r t h , a l t h o u g h e a c h o f t h e Governors h a s d e v e l o p e d a n a p p r o a c h that i s u n i q u e l y t a i l o r e d t o t h e n e e d s of h i s s t a t e , t h e r e a r e many s i m i l a r i t i e s among t h e s e i n i t i a t i v e s . The m a j o r s i m i l a r i t i e s a r e d e s c r i b e d below. 0 Governors have u t i l i z e d i n t e r a g e n c y t a s k f o r c e s , work g r o u p s , and commissions i n o r g a n i z i n g t h e i r vii block grant implementation initiatives. Wherever possible, they are making use of existing state mechanisms and established committees to address the new issues involved in federal funding reductions and block grant management. 0 Most of the Governors have named a lead agency for managing block grants. The agencies named are typically either the state budget and/or planning office or the department which will administer the block grant. 0 Governors are requiring coordination of activities among executive agencies to respond to budget cuts and block grant proposals. 0 Governors are using these new federal changes as opportunities to complement agendas they have established within their states to improve the management and delivery of services. One notable difference is found among the different strategies Governors are taking to involve citizens in the transition effort. Although each Governor is actively seeking public participation in his initiative, two basic approaches are being employed. In one approach, the Governors have preferred to have preliminary work (e.g., impact analyses, policy options, issues papers) prepared by state officials and released for public comment through mechanisms such as hearings, publications, and retreats. Other Governors have chosen to involve representative local officials, citizens, and/or legislators from the beginning in these analyses and impact assessments. viii The following section of the Guide contains a compi- pare for block grant implementation in the states. lation of reports describing each Governor's initiatives to pre- The It may The state legislature These have been discussed with the Governor. is: State Administrative Officer State Capitol Montgomery, Alabama 36130 (205) 832-3306 MR. BOB DAVIS The contact point for block grant implementation in the state Final recommendations to the Governor will be made in a few weeks. on block grants. The Planning Office has developed a series of working papers will play a key role in allocation decisions. serve as a holding agency for block grant. The State Planning Office will not make decisions. allocation decisions. legislature, and developing principles and strategies to govern assuring appropriate input from local government, the public, the focus upon the difficult questions of establishing priorities, State Planning Office will provide the necessary policy analysis to nical advice to the Governor for block grant implementation. The Office of State Planning will serve as a source of tech- ALABAMA five Four m l l l l o n d o l l a r s h a s T h e r e w l l l be one m l l l l o n d o l l a r s w l l l h e a d r n l n l s t e r e d programs. remaining T h i s would g i v e ' t h e b a s i s t o determine whether s t a t e s t a t e is: CAROL BURGER S p e c i a l h s s l s t a n t t o t h e Governor O f f l c e of t h e Governor Pouch A J u n e a u , Alaska 99811 (907) 465-3500 MS. The c o n t a c t p o r n t f o r b l o c k g r a n t l m p l e m e n t a t l o n w l t h l n t h e funds w i l l be u t r l i z e d t o make up f o r f e d e r a l reductions. t o be looked a t on a c a s e - b y - c a . e L e q i s l a t i v e and g u b e r n a t o r i a l s e n t i m e n t seems t o p e r m i t programs L e g i s l a t u r e t i m e t o a d d r e s s t h e f o u r t h q u a r t e r a s needed. f i r s t t h r e e q u a r t e r s f o r human s e r v i c e s . been g r a n t e d t o t h e Governor t o spend f e d e r a l d o l l a r s d u r i n g t h e Alaska h a s a t r a n s i t i o n y e a r p l a n under which a u t h o r i t y h a s regarding t h e u s e of t h e s e f u n d s . executive and l e g l s l a t i v e b r a n c h collaboration a r o u n d d e c i s i o n s used t o a s s i s t n o n - s t a t e l s t e r e d programs w h l l e t h e been earmarked t o a l d w l t h a s h o r t f a l l I n f u n d s f o r s t a t e admin- t h e lmpact I n t h e l o s s o f f e d e r a l f u n d l n g . m l l l l o n d o l l a r s t o be used a s a contingency fund t o h e l p mlnlmize The Alaska S t a t e L e g r s l a t u r e h a s set a s l d e a t o t a l of ALASKA The Governoi h a s announced t h a t h e b e l i e v e s t h e Weekly i n f o r m a t i o n b u l l e t i n s a r e b e i n g p r e p a r e d The Governor h a s met privately t o l n f o r m them o f s t a t e p l a n s and t o e l i c i t r e s p o n s e s from them Thls group To 1s: 3 MR. ANDY HURWITZ Chief of S t a f f O f f i c e o f t h e Governor S t a t e House P h o e n i k , A r l z o n a 85007 (602) 255-4331 The c o n t a c t p o i n t f o r b l o c k g r a n t l m p l e m e n t a t l o n I n t h e s t a t e t i o n and d i f f e r e n t d e g r e e s o f f l e x i b i l i t y u n d e r t h e b l o c k g r a n t s . p r l o r i t l e s under s e v e r a l different l e v e l s o f f e d e r a l b u d g e t r e d u c - d a t e , much s t a f f work h a s b e e n d e v o t e d t o r e - a n a l y s l s of s e r v l c e a process f o r e s t a b l l s h l n g fundmg p r l o r l t l e s f o r block g r a n t s . w i l l be c h a r g e d w i t h r e s p o n s i b i l i t y f o r recommending t o t h e Governor i s composed o f d e p a r t m e n t h e a d s and l o c a l o f f i c i a l s . The Governor h a s r e c e n t l y a p p o i n t e d a 21-person p a n e l whlch on key c o n c e r n s . etc. U n i t e d Way Community C o u n c i l s , board c h a i r m e n f o r p r o v i d e r a g e n c i e s , on s e p a r a t e o c c a s i o n s w i t h g r o u p s s u c h a s c o u n t y managers, mayors, w l t h t h e s e alternative p r o p o s a l s . f e d e r a l l e v e l a s w e l l a s p r o b a b l e s t a t e strategies f o r d e a l l n g I n t e r e s t e d p a r t l e s on changes i n b l o c k g r a n t p r o p o s a l s a t t h e by t h e S t a t e P l a n n i n g O f f i c e t o i n f o r m l o c a l o f f i c i a l s and o t h e r of f e d e r a l funds. t l m e h a s a r r l v e d f o r l e g l s l a t i v e involvement i n t h e a p p r o p r l a t l o n administration. a f f e c t i n g budget r e d u c t i o n s , , s e r v i c e p r i o r i t i e s , and b l o c k g r a n t s h l p between t h e e x e c u t i v e and l e g i s l a t i v e b r a n c h e s o n d e c l s l o n s The s t a t e of A r i z o n a i s moving i n t h e d i r e c t i o n o f a p a r t n e r - ARIZONA The However, slnce most If Included in this analysis were many of the large health Governor White plans to present his recommendations The Legis- The next regular session 1s scheduled for January 1983. state is: MS. LINDA GARNER Aide to the Governor Room 250 Governor's Office State Capitol Llttle Rock, Arkansas (501) 370-5712 72201 The contact point for block grant implementation within the can call. that he call a Special Legislative Session, which only the Governor lative Committees will either accept his recommendations or request mendations on whether legislative action will be needed. to the Legislative Interlm Committees in September mcluding recom- get changes. I The task force is chaired by the Deputy Legislative Offlce of Statewide Health Plannlng and Development Department of Aging Department of Alcohol and Drug Programs Department of Health Services Department of Finance Health and Welfare Agency Office of Planning and Research Employment Development Department Department of Rehabilitation Department of Social Servlces and agencies: Secretary to the Governor and involves the following departments possible. to prepare for their implementation in the most efficient manner grant implementation to analyze the impact of block grants and The Governor's Office has organized a task force on block Congressional Delegation and chairmen of the policy committees the Legislature is not in session. Tentative plans are being developed based on the proposed bud- positions have been transmitted to members of the California These The Administration has taken positions on several key and social services programs administered at the local level. budget. of the fiscal impacts of the federal budget cuts on the state The State Department of Finance has prepared an analysis accompanying budget cuts. state to accept federal grant funds durlng an interim period when 1 Governor Jerry Brown's administration has taken a number of preparatory actions relating to federal block grants and the provisions of federal legislation and budget cuts. I I I cellaneous Federal Grant Act w h ~ c hwas established to allow the Arkansas chose to combine or expand programs, it can use the Mis- that these would exceed appropriation levels now authorized. programs will receive some reduction in funding, it is not likely continue to utilize current appropriations. If block grants become a reality, the state believes that it should state agency may then contract with providers as authorized by law. which has responsibility to administer the federal program. In Arkansas federal money is appropriated to the state agency ARKANSAS CALIFORNIA state is: MR. BEN WILLIAMS Chief, Administrative Servrces 1400 Tenth Street - Room 150 Sacramento. California 95814 (916)322-3170 The Contact polnt for block grant implementation withln the under block grants. changes, publlc partlclpatlon, and opportunltles and constraints includmg flscal Impact, necessary state statutory and regulatory The agenda Included an update on federal block grant leglslatlon-- The first meetlng of the task force was held on August 3,1981. has also been asked to partlclpate. Governor's Offlce and administered by a separate elected 0fflclal) The Department of Education (whlch is Independent of the Department of Industrial Relatlons Department of Houslng and Community Development Department of Developmental Services Offlce of Economlc Opportunlty Business, Transportation and Houslng Agency Department of Buslness and Economic Development Among the matters o n which the Commission will make The membership of the Commis- The Criteria for evaluating state is: MR. LEE WHITE Executive Dlrectpr Offlce of State Plannlng and Budgeting State Capitol Room 102 Denver, Colorado 80203 (303) 866-3386 The contact polnt for block grant implementation in the may chose to allocate available state funds. and low administrative costs, were used to determine how the state reduced programs, including such issues as need, cost efficiency, cut by the federal government this year. In addition, the state is reviewing options for replacing funds for input into state block grant decisions. by categorical programs and are designed to give them an opportunity committees are representative of the constituent groups now served on block grants have been established in cabinet agencies. To complement the work of the Commission, advisory committees business community, five legislators, and eight local officials. sion includes five cabinet officers, five representatives of the Legislature reconvenes in January. These recommendations are scheduled to be submitted before the recommendations is how the state's block grants should be allocated. in Colorado. Finance to study a range of issues affecting the government sector The Governor has established a Commission on State and Local COLORADO A task force on regulatory reform A number of regulatlons were identified and A The subcommlttee An lnterlm report on these efforts 1s belcg prepared and should br avallable by early August 1981. speclflc needs of cltlzens. to establish a new prlorlty-setting process to better address the The prlmary thrust of the block grant work thus far has been ellclt input from cltlzens on block grants. to both Inform cltlzens of Issues in block grant adminlstratlon and on publlc partlclpatlon wlll be worklng to ldentlfy better mechanisms tlon and dellvery to better address changlng needs. servlces for the purpose of recommending changes In servlce deflnl- wlll study the needs of the population In relatlon to avallable allocation of block grant fundlng. The demographlcs subcommlttee mlttee on allocation models wlll Identify a varlety of optlons for The subcorn- 1) allocation models; 2 ) demographlcs; and 3) publlc partlclpatlon. formed three subcommittees In the following areas: force 1s devoted to analysls of the proposed block grants and has The thlrd task second state task force 1s studylng the Impact of both budget cuts and block grants on munlclpalltles. Rellef. submitted in a report to the Presidential Task Force on Regulatory gran or service. not deemed essential to carry out the intent of a particular pro- that create an unnecessary burden on state government and are was formed to review existing and proposed federal regulatlons and the proposed block grants. forces to address issues surrounding upcoming federal budget cuts The state of Connecticut has established three separate task CONNECTICUT MR. STEVE HEINTZ Under Secretary for Comprehensive Plannlng State Offlce of Pollcy and Management 80 Washlnqton Street Hartford, Connecticut 06115 (203) 566-4298 The contact point for block grant implementation in the state The task force will continue to While not enacted during the current legisla- the state is: 10 MS. JORENE JAMESON Executive Assistant for Operations Office of the Governor State Office Build~ng 820 French Street Wllmington, Delaware 19801 (302)571-3210 The contact point for block grant implementation wlthin input must be structured into the decision-making process. the Governor concurred that under a block grant system, community Other community organizations have also expressed concerns and to discuss their concerns about implementation of block qrants. Governor du Pont has met with the United Way of Delaware the fall of 1981. tive session, some form of this legislation may be considered In funds budgeting. proposing a piece of legislation which would implement total interest in future involvement wlth block grants in the state by The Delaware General Assembly recently expressed strong assess the impact of budgetary cuts as they become finalized. million dollars to the state. The task force prepared a report which estimated a loss of 50 President Reagan's proposed budget cuts in state government. force of several cabinet secretaries to assess the impact of In the spring of 1981, Governor du Pont appointed a task at the federal level toward the implementation of block grants. The state of Delaware has been closely monitoring progress DELAWARE crlcltal part of this process will include rece~'rng .In addition, state is: MR. DAVID PINGREE Deputy Chief of Staff Offlce of the Governor State Capitol Tallahassee, F l ~ r l d a 32301 (904) 488-4441 The contact polnt for block grant ii~plenrcntatlonw ~ t h ~ rt hr i tions to more fully investigate the lmpllcatlons of block grants ture and the state's Advlsory Commission on Intergovernmental Rela- Florlda wlll work closely wlth representatives of the state legisla- zens, community leaders and other Interested parties. mony from local government officials, mmority groups, senlor ~ ~ t i - A irsi the prlorlties whlch have been established to allow Florida to plan for its future. size spenoing levels,assess the impact of funding reductions, and empha- Preliminary plans wlll be developed which will respond to past torlcal block grant activities and their successes and failures. An interagency task force will investigate and evaluate his- grants and minimize the impacts of substantially reduced funding. a process to take advantage of the flexibility offered by block The Governor's Office of Planning/~udgeting has established FLORIDA The G o v e r n o r ' s p o s l t r o n h a s b e e n t h a t t h e s t a t e S t a t e o f f i c i a l s h a v e b e e n m e e t i n g w ~ t hM e d ~ c a l d providers s t a t e is: W I N P O K D POITEVINT Dlrector G e n e r a l Government D ~ v i s i o n O f f i c e of P l a n n i n g and Budget 270 Wnshlngton S t r e e t Room 613 A t l a n t a , G e o r g i a 30334 (4041 656-4311 MR. The c o n t a c t p o i n t o f b l o c k g r a n t i m p l e m e n t a t i o n w l t h l n t h e t o g e t s u g g e s t i o n s o n ways t o r e d u c e c o s t s I n t h l s a r e a program. A malor c o n c e r n h a s been t h e p r o p o s e d c u t s i n t h e Medlcaid t a x i n c r e a s e w i l l b e imposed. w i l l use e x i s t i n g resources f o r t h i s purpose, b u t t h a t no s t a t e w i d e g e t reductions. r e v e n u e s h o r t f a l l o f $85 m l l l r o n w h i c h w i l l h e l p o f f s e t f e d e r a l bud- The s t a t e h a s a s u r p l u s o f $100 m i l l i o n f r o m FYI981 a n d a f e d e r a l changes and have p r e p a r e d p e r i o d i c s t a t u s r e p o r t s . s t a f f s have been r e v i e w i n g a l l i n f o r m a t i o n a v a i l a b l e on proposed G e o r g i a ' s P l a n n i n g and Budget and I n t e r g o v e r n m e n t a l R e l a t i o n s GEORGIA (health, educatron and s o c l a l s e r v i c e s ) I n a d d i t i o n , o v e r t h e p a s t two I t is expected t h a t The ind c u t b a c k s I n I c rdl 13 fundinq l t nccessdry. a n o t h e r s p e c l d l s c T s s l o n t o t a k e up t h e m a t t e r of h l o c k g r a n t s L e g l s l a t u r e h a s l r ~ d i c a t e di t s w l l l l n g n e s s t o r e c o n v e n e I n l s s u c of e x p e c t e d f e d e r a l c u t s l n e d u c a t ~ o ng r a n t s . A p r l l , r e t u r n e d f o r a s p e c l a l s e s s l o n I n May t o a d d r e s s t h e The S t a t e L e y l s l a t u r e , w h l c h e n d e d l t s r e g u l a r s ~ s s l o nI n t h e l m p l e m e n t a t l o n of b l o c k g r a n t s . t h i s mechanism w l l l b e u t i l l z e d t o c o p e w l t h p r o b l e m s c a u s e d by h e l d t o d l s c u s s i t e m s o f mutual c o n c e r n . D e p a r t m e n t s o f i l e a l t h , Education and S o c l a l S e r v l c e s h a v e b e e n t w o y e a r s , interagency m e e t l n g s l n ~ o l v l n gt h e directors o f t h e v a c a n t a l s o have been t a k e n . cautionary s t e p s , such a s holdlng f e d e r a l l y fundlng p o s l t l o n s Pre- A l l f e d e r a l programs a r e b e r n g r e n e w e d and analyzed wlth r e s p e c t t o expected reductlon I n funding. program a r e a s . ordinate t h e l m p l e m e n t a t l o n o f b l o c k g r a n t s f o r t h e l r respective h a v e e a c h established B l o c k G r a n t Committees t o m o n l t o r a n d c o - of t h e block g r a n t proposals, The s t a t e a g e n c l e s w h l c h w l l l experience t h e g r e a t e s t l m p a c t grants. w i l l p r o v i d e t h e b a s i c f o u n d a t i o n f o r t h e i m p l e m e n t a t i o n of b l o c k b u d g e t i n g p r o c e s s e s which i n c l u d e l e g i s l a t i v e and c i t i z e n i n p u t , p r o g r a m on a u n i q u e l y c e n t r a l i z e d b a s i s , e x i s t i n g p l a n n i n g a n d B e c a u s e t h e S t a t e o f Hawaii a d m i n i s t e r s i t s human services HAWAII s t a t e is: CARL TAKAMURA S p e c i a l A s s i s t a n t t o t h e Governor O f f i c e o f t h e Governor State Capitol Honolulu, Hawaii 96813 (808)548-2335 MR. The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n i n t h e o r p o s s i b l e with- These " f u n d s s h l f t " c a t e g o r i e s a r e I n f o r m a l c o n s u l t a t i o n s , now t a k i n g p l a c e w i t h l o c a l s t a t e 1s: MR. LAWRENCE C . SEALE Administrator D r v l s l o n o f Financial Management S t a t e House, Room 122 B o i s e , I d a h o 83720 (208) 334-3900 The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n w i t h i n t h e a formal l e v e l a t t h a t time a s w e l l . government o f f i c i a l s and t h e l e g l s l a t l v e b r a n c h , w l l l be r a l s e d t o and O c t o b e r . w i t h p u b l l c h e a r i n g s on t h e o v e r a l l b u d g e t t o be h e l d i n September C i t i z e n i n p u t on b l o c k g r a n t s w i l l be o b t a i n e d I n c o n ~ u n c t i o n some program g u i d a n c e I n d e v e l o p i n g b u d g e t s f o r f i s c a l y e a r 1983. I n t e n d e d t o p r o v i d e d e p a r t m e n t directors and program managers w i t h d r a w a l of s t a t e s u p p o r t . s t a t e f u n d s , p a r t l a l r e p l a c e m e n t , non-replacement s . programs l o s i n g f e d e r a l f u n d s c o u l d anticipate f u l l r e p l a c e m e n t by p r e l l m l n a r y p o l l c y d e c i s i o n s have been made t o d e s i g n a t e w h e t h e r I n t h e p r o c e s s of s e t t l n g FYI983 b u d g e t t a r g e t s f o r e a c h program, Impact of r e d u c e d f e d e r a l f u n d m g a n t i c i p a t e d w i t h b l o c k g r a n t s . Governor Evans h a s r e s e r v e d s t a t e f u n d s t o partially m l t l g a t e t h e I n p r e l i m i n a r y p l a n n i n g f o r I d a h o ' s f l s c a l 1983 b u d g e t , IDAHO The State of Illinois and the United Way of Illinois State agency newsletters are all being Finally, MR. TOM BERKSHIRE Assistant to the Governor State House, Room 202 Springfield, Illinois 62706 (217) 782-8639 The contact point for Illinols block grant implementation is: by the task forces. allocation of funds will reflect substantive decisions recommended. administration of services. The budget process as well as the block grant system, to increase efficiency in the organization and subcabinets are reviewing whether it is now possible, under the readers on changes due to block grant implementation. coordinated to provide as much information as possible to the changes which must occur. recelve public reaction and to facilitate program and management are jointly holding regional workshops on block grant transition to mentation. citizens, is overseeing the Community Development Block Grant imple vices subcabinet, composed of state and local public officials and Office program staff. An advisory group, chosen by the human ser- conducted by a series of task forces, directed by the Governor's In Illinois,the block grant implementation process is being ILLINOIS In steps taken to date, the Governor has esta- A block grants management policy committee -- composed -- is charged The groups, chaired by They will hold public hearings and working closely with the policy committee and the Governor's Budget state legislature as needed, the Indiana State Planning Service, Once policies are adopted by Governor Orr and considered by the as part of the reviews. develop recommendations for consideration by the policy committee of programs within the state. private citizens, are conducting extensive, cross-cutting reviews mation being gathered by four task groups. with making these recommendations to the Governor, based upon infor- the Director of the Indiana Office in Washington, D.C. state Superintendent of Schools, the legislative leadership, and of the Governor's Executive Assistant, the Lieutenant Governor, the options. process through which they will provide him with recommended policy The Governor has structured several groups and outlined a community development for purposes of recommending needed changes. possible in the areas of health, education, human resources, and appointed officials are examining the broadest number of programs blished a formal process by which citizens and state elected and within the state. tion and to recommend needed changes in servlce delivery systems framework and action plan to prepare for block grant implementa- Governor Robert D. Orr has established an organizational INDIANA K a n s a s 1s As t h e v a r l o u s s t a t e a g e n c i e s work s t a t e is: STEPHEN E. HOLSTEEtJ S p e c i a l A s s i s t a n t f o r Legislative Matters O f f i c e of t h e Governor State Capitol T o p e k a , K a n s a s 66612 ( 9 1 3 ) 296-3034 MR. The c o n t a c t p o i n t f o r b l o c k g r a n t i r n p l e m c n t a t i o n w i t h i n t h e t h e budget process. The f i n a l r e c o m m e n d a t i o n s o f t h e G o v e r n o r w i l l b e made t h r o u g h w l t h c l i e n t s and a l l o t h e r i n t e r e s t e d p a r t i e s h a s b e e n m a i n t a i n e d . t h r o u g h t h e b u d g e t f o r m u l a t i o n p r o c e s s f o r FY 1 9 8 3 , c l o s e c o n t a c t s o l i c i t i n q t h e i r input. i d e n t i f y i n g v a r i o u s p u b l i c i n t e r e s t g r o u p s a f f e c t e d and a r e I n conjunction w i t h t h i s p r o c e s s , s t a t e o f f i c i d l s have been t i o n t o t h e r e c e l p t and a d m i n i s t r a t i o n of block g r a n t s funds. loping a f o r m a l p r o c e s s by which K a n s a s c a n make a s m o o t h t r a n s i - managing b l o c k g r a n t s , t h e G o v e r n o r ' s O f f i c e i s c u r r e n t l y d e v e - I n c o n l u n c t i o n w i t h t h o s e s t d t e a g e n c i e s which w i l l b e blllty. o r d e r t o I s o l a t e a r e a s of f l s c a l l m p a c t a n d a d d l t l o n a l f l e x l - p r e s e n t ly lnvolvcd I n analyzlny s e v e r a l p o s s l b l e o p t l o n s In recommendations and r n o d l f l c a t l o r i s h a v e e m e r g e d . K m s a s h a s been c l o s e l y rnonltorlng C o n g r f s s l o n a l a c t l v l t y a s I n preparation f o r d n l i n l s t c r l n q t h e f r d e r a l b l o c k g r a n t s KANSAS travel The s t a t e h a s c u t T h l s 1s exclusive of f e d e r a l A moratorlum on h o s p l t a l Seven w a l v e r s have been consequently reduced s e r v l c e s . s e n s l t l z e Kentucky c l t l z e n s t o t h e r e a l l t y o f r e d u c e d f u n d l n g a n d b e f o r e t h e l n t e r l m c o m l t t e e s of t h e Kentucky G e n e r a l Assembly t o Over f l f t y p u b l l c h e a r l n g s h a v e b e e n h e l d a r o u n d t h e s t a t e dnu hospitals. K e n t u c k y p l a n s t o s h l f t t o a prospective r a t e s e t t l n g p r o c e s s f o r r e q u e s t e d t o e n a b l e Kentucky t o f u r t h e r r e d u c e h e a l t h c a r e c o s t s . been t a r g e t e d f o r p o s s l b l e e l l m l n a t l o n . Some o p t l o n a l s e r v l c e s I n t h e s t a t e ' s M e d l c a l d p r o g r a m h a v e G o v e r n o r Brown. g r o w t h I n t h e L o u l s v l l l e a n d Lexington a r e a s h a s b e e n Imposed by has been I n e f f e c t f o r over s ~ m xonths. I n t h e human s e r v l c e s a r e a , a M e d l c a l d c o s t containment p l a n funds . ~ n FY1982 I n t h e s t a t e g e n e r a l f u n d s . s p c n d l n g by $ 1 8 5 m l l l l o n I n TY1981 a n d w l l l c u t o v e r $ 2 0 0 m l l l l o n and on most c a p l t a l c o n s t r u c t l o n p r o l e c t s . c l ~ m l n a t e d . There h a s been a moratorlum on o u t - o f - s t a t e Most p e r s o n a l s p r v l c e s c o n t r a c t s h a v e b e e n r e d u c e d a n d / o r F u r t h e r reductions l n t h e s t a t e w o r k f o r c e a r e I n p r o c e s s . l n 19 months t h r o u g h a c o m b l n a t l o n o f a t t r l t l o n and l a y o f f s . The number o f s t a t e e m p l o y e e s h a s b e e n r e d u c e d b y o v e r 1 0 % reduced Fcderal p a r t l c l p a t l o n I n o t h e r programs. December 1 9 7 9 d u e t o l o w e r s t a t e r e v e n u e s a n d I n a n t ~ c l p a t l o no f Kentucky h a s b e e n r e d u c l n g s t a t e government programs s l n c f KENTUCKY s t a t e is: ROY 1 , ~ ~ l I O U X Deputy Department of Human R e s o u r c e s 275 F a s t Maln S t r e e t F r a n k f o r t , Kentucky 40621 ( 5 0 2 ) 564-7130 MR. The c o n t a c t p o l n t f o r b l o c k g r a n t l m p l e m e n t d t l o n w l t h l n t h e Unfortunately, There- 1) t h e Legis- Depending upon s t a t e is: DENNIS DAUGHTRY Director Federal Relations Governor's Office S t a t e Capitol P . 0 . Box 44004 Baton Rouge, L o u i s i a n a ( 5 0 4 ) 342-1943 MR. 70804 The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n w i t h i n t h e e a r l y November on r e a p p o r t i o n m e n t . c a l l f o r a n e x t r a o r d i n a r y l e g i s l a t i v e s e s s i o n a l r e a d y planned f o r t h e Governor may i n c l u d e m a t t e r s r e l a t i n g t o b l o c k g r a n t s i n h i s t h e a d v i c e o f t h e l e g i s l a t i v e l e a d e r s h i p and s t a t e d e p a r t m e n t h e a d s , block g r a n t s within t h e i r a r e a s of j u r i s d i c t i o n . l a t i v e c o m m i t t e e s w i l l soon b e g i n h e a r i n g s o n i m p l e m e n t a t i o n o f been p r o v i d e d u n d e r t h e programs p r o p o s e d f o r c o n s o l i d a t i o n . t a n c e t o l o c a l g o v e r n m e n t s and community b a s e d o r g a n i z a t i o n s h a v e a f f e c t e d by b l o c k g r a n t s , and 2 ) l e a r n i n g t o d i r e c t f e d e r a l a s s i s - i m p a c t o f f u n d i n g r e d u c t i o n s on t h e i r programs which m i g h t b e To d a t e , l i n e d e p a r t m e n t s have f o c u s e d a t t e n t i o n on: a t l e v e l s commensurate w i t h t h a t o f F i s c a l Year 1981. J u n e 30, 1982 which assumes f e d e r a l f u n d i n g f o r c a t e g o r i c a l p r o g r a m s f o r e , a s t a t e budget h a s been adopted f o r t h e f i s c a l y e a r ending b e f o r e t h e L o u i s i a n a L e g i s l a t u r e a d j o u r n e d J u l y 1 3 , 1981. f i n a l a u t h o r i z i n g l e g i s l a t i o n f o r t h e b l o c k g r a n t s was n o t i n p l a c e f u l l y monitoring Congressional a c t i v i t y i n t h i s a r e a . G o v e r n o r ' s O f f i c e and t h e v a r i o u s l i n e d e p a r t m e n t s h a v e b e e n c a r e - S i n c e t h e P r e s i d e n t proposed b l o c k g r a n t s i n F e b r u a r y , t h e LOUISIANA t h e S t a t e Housing A u t h o r i t y , t h e S t a t e Plannlng T h i s g r o u p ~ d e n t ~ f i ef do u r b a s i c i s s u e s a n d w h a t s h o u l d b e t h e l e v e l o f s t a t e p a r t i c l p a t l o n i n l'Y1982; They Staff f o r t h e group prepared infor- the T h i s l a r g e r group is c u r r e n t l y scheduled t o meet t o c o n s i d e r t h e i s s u e o f fund a l l o c a t i o n . C o u n c i l o f Maine. t h e Maine M u n i c i p a l A s s o c i a t i o n , a n d t h e I n d u s t r i a l D e v e l o p m e n t r e g i o n a l p l a n n i n g c o m m i s s i o n s , t h e community a c t i o n a g e n c l e s , r e p r e s c n t a t l v e from e a c h o f t h e f o l l o w i n g o r g a n i z a t i o n s : The w o r k l n g g r o u p h a s r e c e n t l y b e e n e x p a n d e d t o i n c l u d e a action. f i n a n c i a l requirements, and necessary e x e c u t i v e and l e g i s l a t i v e matlon f o r each policy option I n t h e a r e a s o f personnel and program f u n d s be a l l o c a t e d . s h o u l d b e e l l g l b l e t o r e c e i v e p r o g r a m f u n d i n g ; a n d , how s h o u l d w h l c h s t a t e a g e n c i e s s h o u l d administer t h e p r o g r a m ; w h a t e n t i t i e s were: a l t e r n a t i v e a c t l o n s he could t a k e w i t h r e s p e c t t o each. p r e s 2 n t e d a r e p o r t t o t h e Governor o u t l i n i n g t h e l s s u e s a n d C l t l e s Program. S e r v l c e s t o c o n s l d e r t h e s t a t e administration o f t h e CDBG S m a l l t h e O f f i c e of E n e r g y R e s o u r c e s , a n d t h e D l v i s l o n o f C o m m m l t y O f f l c e , t h e S t a t e Development U f f l c e , comprised o f representatives from h l s o f f l c e , I n May, G o v e r n o r Ulennan c o n v e n e d a n i n f o r n l a l w o r k l n g g r o u p Communlty Development Block ( . r a n t MAINE Commissioner p r e s e n t e d h i s a n a l y s l s a n d r e c e i v e d p u b l l c comment. xx Thus, T h i s information w i l l be fessional organizations. It w i l l include setting priorlty provided t o t h e Governor, l o c a l education agencies, and pro- s t a t e and l o c a l education systems. e v a l u a t i n g t h e impact o f t h e proposed budget r e d u c t i o n s on t h e The D e p a r t m e n t o f E d u c a t i o n a n d C u l t u r a l S e r v i c e s i s now Education Block G r a n t and i n t h e p r e s e n t a t i o n of t h o s e p r i o r i t i e s t o t h e L e g i s l a t u r e . b o t h t o a s s i s t i n t h e p r e p a r a t i o n o f s t a t e p r o g r a m priorities t h e information generated i n t h e planning process can be used o f c o n t r o l o f any f o r m e r l y f e d e r a l c a t e g o r i c a l program. t h a t a department o b t a i n l e g i s l a t i v e approval p r i o r t o assumption Department m e e t a newly e n a c t e d s t a t e r e q u i r e m e n t which demands f e d e r a l s u p p o r t , t h e p r o c e s s d e s c r i b e d above a l s o h e l p s t h e I n a d d l t i o n t o helping t h e Department t o plan f o r reduced Program. u s e d f o r s e t t l r l g s o c i a l s e r v l c e Priorities w l t h l n t h e T i t l e T h i s p r o c e s s 1s basically a n e x p a n d e d v e r s l o n o f t h e p r o c e d u r e t h e D e p a r t m e n t h a s d e v e l o p e d tentative p r o g r a m p r l o r l t l e s . B a s e d o n t h e s e m e e t l n g s a n d o t h e r s w i t h s o c l a l s e r v l c e providers, h e l d a s e r i e s of p u b l l c meetings t h r o u g h o u t t h e S t a t e a t whlch t h e I The D e p a r t m e n t t h e n I each of i t s programs and program r e c i p i e n t s . assessment o f t h e e f f e c t s o f t h e proposed budget r e d u c t i o n s on The M a l n e D e p a r t m e n t o f Human S e r v i c e s c o n d u c t e d a n l n t e r n a l e d n S e r v i c e s Block G r a n t s The Department is also recommending The state's program in response to proposed federal budgetary The the Congressional delegation. The Department will then seek Executive and Legis- the state is: MR. RICHARD BARRINGER, Director State Planninq Office 184 State Street Augusta, Maine 04333 (207)289-3261 The contact point for block grant implementation within or eliminated due to the federal block grants. lative branch support for priority programs that will be reduced federal cuts. ance to local education agencies to minimize the impact of Department will examine means of fmancial and technical assist- a contingency plan. The plan was to include priority In Action on items in the latter plan would funds for federal funds. of program cutbacks in high priority areas by substituting state orderly reduction of state-federal programs or reduclng the impact to provide either the transitional state funding necessary for be activated in whole or part by the Governor if funds were needed inq by three percent. mended program adjustments necessary to reduce general fund spend- addition, contingency plans were to be devcloped describing recom- the reduced federal support and existinq state revenues. approved 1982 budget that would enable the state to operate within ranking of recommended program adjustments to the already develop In May 1981, the Governor directed each state agenc;. to impact, and development of impact analyses for presentation to provision of greater technical assistance. Specifically, the proposals, the consolidation of material to determine statewide state role as less regulatory and more supportive through the Planning were charged by the Governor with monitoring federal Washington office and state's Department of Budget and Fiscal Information gathering and analysis began in February. employees facing layoff, and block grant management planning. a statewide contingency planning program, an assistance program for actions have included an intensive information gathering effort, responsibilities. This assessment will be used to redefine the and new federal responsibilities and how they mesh with state An internal departmental assessment will examine both old funding. the establishment of an advisory committee for block qrant impact at the local level. needs at the state level and analyzing fiscal and programatic MARYLAND At t h e P a r t l c l p a t l n g were Governor's s t a f f , r e p r e s e n t a t i v e s P e r i o d i c r e p o r t s were forwarded t o t h e departments Planning budget has been completed, depart- MS. LINDA SLOTSEMA S p e c l a 1 A s s i s t a n t t o t h e Governor State Capltol Room 2164 L a n s l n g , Michigan 48909 ( 5 1 7 ) 373-0569 The c o n t a c t p o i n t f o r b l o c k i m p l e m e n t a t i o n w i t h l n t h e s t a t ? i s : S t a t e Legislature. m e n t s w i l l a n a l y z e w h a t , l f a n y , f u r t h e r a c t i o n i s r e q u i r e d by t h e a c t i o n o n t h e s t a t e ' s FY1981-1982 a n d management s y s t e m s a r e b e i n g p r e p a r e d f o r ~ m p l e m e n t a t i o n . When r e c o n c l l i a t l o n b i l l a r e now u n d e r r e v l e w by t h e G o v e r n o r . S t r a t e g i e s f o r implementing t h e block g r a n t s c o n t a i n e d I n t h e on t h e p r o g r e s s o f block g r a n t p r o p o s a l s . w a s discussed. A f e d e r a l lobbylng s t r a t e g y Common p o s i t i o n s o n legislation w h l c h a f f e c t e d more t h a n one department were developed. cipation. i s s u e s a s transition l a n g u a g e a n d r e q u i r e m e n t s f o r p u b l i c p a r t l - These m e e t l n g s f o c u s e d o n s u c h c r o s s - c u t t i n q b l o c k g r a n t H e a l t h , S o c l a l S e r v i c e s , E d u c a t i o n , a n d Management a n d B u d g e t . o f t h e s t a t e D e p a r t m e n t s o f Commerce, L a b o r , M e n t a l H e a l t h , P u b l i c and June. Governor's r e q u e s t , e v a l u a t i o n s e s s i o n s were convened i n A p r l l s a l s immediately a f t e r t h e y w e r e p r e s e n t e d t o C o n g r e s s . ments began a r e v l r w o f t h e l m p l l c a t l o n s of t h e b l o c k g r a n t propo- The M l c h i g a n G o v e r n o r ' s o f f i c e a n d e x e c u t i v e b r a n c h d e p a r t - MICHIGAN a s t . a t c d q e n c y t'lik. t ~ c ,~ , i8 r i 11 The t a s k f o r c e f i r s t m e t i n m i d - J u l y S t a t e d e p a r t m e n t s a n d a g e n c i e s w i l l work system. The D e p a r t m e n t I n mid-August, s y s t e m w l l l be prt.?er~trxd t o t he G o v e r n o r on DEAN HONETSCHLAGER Dlrector fiuman R e s o u r c e s P l a n n i n g S t a t e Plannlnq Ayewy 101 Capitol S q u a r e B u l l d l n g S t . P a u l , M i n n e s o t a 55101 ( 6 1 2 ) 296-3865 MR. The c o n t a c t p o l n t f o r b l o c k g r a n t ~ r n p l t ~ ~ n t a l l~on n t h r 7 s t a t , September 1 0 t h . on t h e grant-ln-dld C C I C I The r e p o r t o n b l o c k g r a n t strategies a n d recommended r e s p o n s e s t o f e d ~ r a l~ w l l l meet i n e a r l y September f o r a f i n a l review. r e p o r t w i l l be prepared f o l l o w i n g t h i s meeting and t h e t a s k f o r c e A written t h e t a s k f o r c e w i l l meet t o r e p o r t on t h e information generated and s t r a t e g y o p t i o n s discussed. grants. i n g t h e s i g n i f i c a n c e o f t h e f e d e r a l budget r e d u c t i o n s and block s t a t e departments and a g e n c l e s and l o c a l governments i n understand- o f E n e r g y , P l a n n i n g a n d D e v e l o p m e n t w i l l p r o v i d e assistance t o Minnesota l o c a l governments and i n d i v i d u a l s . needed i n f o r m a t i o n t o a n a l y z e t h e meaning o f f e d e r a l a c t i o n s on c l o s e l y w i t h l o c a l governments, and t o g e t h e r they w i l l g a t h e r t o begln discussions. lng t h e grant-in-aid s l d e r t h e impact on t h e s t a t e of pendlng f e d e r a l a c t i o n s a r r e c t - Minnesota h a s e s t a b l i s h e d MINNESOTA m w a l m a c u ~ m c u Y 0 u .L f f .d l m w r 3 3 .J "1 'I) ill f i m 3 3 GI a m .. t) + 'I) 3 m 0 a 20. 4 c m Oi Y b -4 3 a c m 4 0 IU : .i I- m a m a C 0 J 11 W m C 10 U tr a, v 3 m C 2 m Y ii m3 C i E v . mi u 0 w m u W m u m 0) -4 C C m 3 a b 0 ;.ri -,a m m 3 i . Y m U Y - n C .1 4 a, x 1 r: 3 C ' I ) " + "O r : i) & 3 Y r Y u . C The advisory council has established The commit- Recipients of these reports include Once the reconciliation process is complete, the It is expected that other committees will be established later to focus on both possible alternatives, and proposals for follow-up. tion on fiscal impact and recommendations on needed legislation, The advisory council will report to the Governor with informa- public input and advise the appropriate groups. advisory council committees will develop outlines of key areas for citizen input. Public hearings are planned in each area of the state to obtain thing for state allocation to determine what the impacts will be. When block grant legislation is approved, the state will do the same grants to identify the source of funds and how they are expanded. The state fiscal offices are now cross-referencing all present legislators, government sub-division heads, county officials, etc. the development of regulations. commonly used terms, descriptions of the Congressional process, and to be prepared on the status of block grants such as definitions of The advisory council has arranged for periodic detailed reports informing Congressional delegates. tees will make recommendations to the council in addition to and assess the impact of these proposals on the state. eight committees to study changes in various block grant proposals ~~propriations Committee. posed of agency heads as well as the chairman of the Legislative The Governor has appointed a six-member advisory council com- NEBRASKA I I i I Such planning will be done in close state is: MR. JOHN KNIGHT Lirector State Department of Public Welfare 301 Centennial Mall South 5th Floor Lincoln, Nebraska 68509 (402) 471-3121 The contact polnt for block grant implementation within the cooperation with the Legislature. short and long-range planning. Any s u b s t a n t i a l s t a t e is: MR. HOWARD BARRETT Director of Administration Budget D i v i s i o n C a p i t o l Complex Room 205 Blasdel Building C a r s o n C i t y , Nevada 8 9 7 0 1 ( 7 0 2 ) 885-4065 The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n w i t h i n t h e u n d e r a s t a t u t e p a s s e d by i n t h e r e c e n t s e s s i o n o f t h e L e g i s l a t u r e . b u d g e t changes and a l l b l o c k g r a n t s w i l l r e q u i r e L e g i s l a t i v e a p p r o v a l t i v e I n t e ~ ~Fm i n a n c e Committee f o r ~ t asp p r o v a l . amended 1981-82 b u d g e t w h i c h w i l l t h e n b e s u b m i t t e d t o t h e L e g i s l a - The B u d g e t O f f i c e , o n b e h a l f o f t h e G o v e r n o r , w i l l p r e p a r e a n Representatives of l o c a l governments a l s o a f f e c t e d w i l l be i n v i t e d . t h a t w i l l be a f f e c t e d b y b l o c k g r a n t s a n d f e d e r a l f u n d c u t b a c k s . Nevada p l a n s t o s c h e d u l e b u d g e t h e a r i n g s f o r a l l s t a t e a g e n c i e s NEVADA lnformal l o c a l o f f i c i a l s , and c i t i z e n groups. E x i s t i n g s t a t e mechanisms w i l l be u s e d f o r p o l i c y the State Legislature i n special session, will I f adjustments require a is: MS. TAMA HAMILTON Director Constituent Services S t a t e House C o n c o r d , New H a m p s h i r e ( 6 0 3 ) 271-2121 03301 The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n i n t h e s t a t e p r i o r t o r e v i s i n g t h e budget. r e c e i v e t h e Governor's recommendations and h o l d p u b l i c h e a r i n g s budget revision, t o t h e b l e n n i a l FY1982-1983 s t a t e b u d g e t . d e v e l o p m e n t , t o r e c e l v e p u b l i c comment, a n d t o make n e e d a d j u s t m e n t s forward r a p i d l y . o f f e d e r a l a s s i s t a n c e f o r FY1982, s t a t e t r a n s i t i o n e f f o r t s w i l l move A f t e r Congress t a k e s d e f i n i t i v e a c t i o n on t h e e x t e n t and shape with legislators, communication a b o u t f e d e r a l a n d s t a t e d e v e l o p m e n t s i s t a k i n g p l a c e f e d e r a l a c t i o n s upon a f f e c t e d s t a t e a g e n c i e s , a n d r e y u l a r , continuing r e s e a r c h h a s b e e n u n d e r w a y t o d e t e r m i c e t h e i m p a c t o f A t h i s direction, a t a s k f o r c e o n b l o c k g r a n t s h a s b e e n e s t a b l i s h e d , key, developmental approach t o a v o i d unnecessary c o m p l l c a t ~ o n s . a n d b l o c k g r a n t legislation, G o v e r n o r Hugh G a l l e n h a s t a k e n a low- I n preliminary p r e p a r a t i o n s f o r p e n d i n g f e d e r a l b u d g e t c u t s NEW HAMPSHIRE The state has actively participated through These positions This office, in conjunction with the Division of Budget and staff analysis. programs on the basis of submissions by individual departments and programs, and that he will evaluate the respective merits of the final decisions relating to the allocation of resources among Departments have been advised that the Governor intends to make all ities of programs which may be consolidated within block grants. series of meetings with the affected departments to develop prior- Accounting in the state's Department of the Treasury, has held a ning. grants be coordinated by the Governor's Office of Policy and Plan- The Governor has instructed that all decisions relating to block state's Congressional delegation. have been reviewed with the Governor, and communicated to the incorporated in potential block grant legislation. debate over the level of funding and the conditions which should be the Washington office and its Congressional delegation in the grant legislation. a series of updates on the status of budget proposals and block The New Jersey Washington office has provided the state with of federal funds. begin planning for potential changes in the level and distribution Governor Byrne directed his cabinet several months ago to NEW JERSEY It is expected that similar efforts state is: MR. DONALD LINKY, DIRECTOR Governor's Office of Policy and Planning State house Trenton, New Jersey 08625 (609) 282-3287 The contact point for block grant implementation within the posals in the Congress. be commenced tollowing final approval of pending block grant pro- and to obtain public comment on resource allocation decisions will to advise the public of the revised program conditions and standards the decision-making process. hearlngs and meetings in efforts to solicit public involvement in the Department of Human Services have conducted a series of public Certain depart~nents,including Departments have been encouraged to seek public participation in potential block grant decisions. f e d e r a l budget c u t s The t a s k f o r c e 1s s t a f f e d by t h e F l n a n c e and A d m l n l s t r a t l o n , Key p l a n n l n g They h a v e w o r k e d c l o s e l y a d o p t l o n o f t h a t s t r a t e g y by Governor K ~ n g . b y t h e t a s k f o r c e o f a s t r a t e g y t o I m p l e m e n t b l o c k g r a n t s and l h l s e f f o r t w l l l c o n t l n u e a n d culminate w k t h t h e d e v e l o p m e n t g r o u p s including Legislative c o m m i t t e e s c o n c e r n e d w l t h t h l s I s s u e . w l t h a f f e c t e d s t a t e a g e n c l e s a n d h a v e made presentations t o v a r i o u s on t o p o f p a r t i c u l a r b l o c k g r a n t p r o p o s a l s . d l v l s l o n s t a f f e r s have been a s s l g n e d t h e r e s p o n s i b l l l t y of keeping h a s b e e n designated t h e l e a d a g e n c y o n b l o c k g r a n t s . I n c o n l u n c t l o n w l t h t h e s e e f f o r t s , t h e S t a t e P l a n n i n g DlVlSlOn s t a t e t o r e c e l v e more I n p u t . o f p u b l i c h e a r l n g s on b l o c k g r a n t s a r e b e i n g s c h e d u l e d a c r o s s t h e I n addition, a s c r l e s Numerous l e t t e r s a n d p h o n e c a l l 5 h a v e b e e n r e c e i v e d detailing individual c o n c e r n s . on t h e b l o c k g r a n t p r o p o s a l s . comments f r o m s t a t e a n d l o c a l g o v e r n m e n t o f f l c i a l s a n d p r l v a t e g r o u p s The t a s k f o r c e h a s , f o r t h e p a s t s e v e r a l m o n t h s , b e e n s o l l c l t l n g lncludlng thc S t d t e Plannlng Dlvlsion. s e v e r a l u n i t s o f t h e D e p a r t m e n t of o f t h e New Mexlco W a s h l n q t o n O f f i c e . o f t h e D e p a r t m e n t o f F l n a n c e a n d A d m l n ~ s t r a t l o n ,a n d t h e I l l r e c t o r The t a s k f o r c e 1s comprised o f G o v e r n o r ' s s t d i f , t h e S e c r e t a r y f ~ v e - m e m b e r t a s k f o r c e t o o v e r s e e t h e s e a r e a s o n May 1, 1 9 8 1 . b l o c k g r a n t s , New Mexlco G o v e r n o r B r u c e h l n g appointed a s p e c l a 1 and proposals f o r c o n s o l l d a t l o n o i c a t e y o r l c d l g r a n t s l n t o t h e As a r e s u l t o f t h e Reagan A d m l n l s t r a t l o n ' s NEW MEXICO MRS. ANITA HISENRERG S t a t e Planning Director 5 0 5 Don G a s p a r S a n t a F e , New M e x i c o 87503 ( 5 0 5 ) 827-2073 The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n i s : is: occur. That process is c u r r e n t l y i n progress. a r e d u c e d b u d g e t a n d i d e n t i f y how p r o g r a m c h a n g e s w o u l d c a s e " s c e n a r i o s upon w h i c h e a c h p r o g r a m a r e a m u s t d e v e l o p and b u d g e t a r y p r o c e s s , h a s i n c o r p o r a t e d v a r i o u s "worse- F i n a l l y , t h e Department a s p a r t of its i n t e r n a l planning commissioners. EMILY YOUNG Director O i f l c e of Program P l a n n i n g A n a l v s i s and Develorment 4 0 ~ o r t hP e a r l s t r e e t ' 16th Floor A l b a n y , New York 1 2 2 4 3 (518) 473-3263 MS. The c o n t a c t p o i n t f o r b l o c k g r a n t implementation I n t h e s t a t e 5. Such d a t a a r e b e l n g a n a l y z e d and t h e n w i l l be s h a r e d w i t h l o c a l s o c i a l s e r v i c e s could p o t e n t i a l l y occur. Exceptions w i l l b e An i m p o r t a n t I n a d d i t i o n , t h e Governor h a s promised t o look a t s t a t e C o m l s s i o n e r s and t h e League o f M u n l c l p a l i t i e s . T h e s e two g r o u p s met w i t h t h e b o a r d s o f d i r e c t o r s o f t h e Association o f C o u n t y s t a t u t e s and r e g u l a t i o n s t h a t impede d e l i v e r y of s e r v l c e s and h a s grants. contact with l o c a l o f f i c i a l s t o o b t a i n t h e i r input regarding block The S e c r e t a r y o f t h e D e p a r t m e n t o f Human R e s o u r c e s i s maklng b e h e l d by s t a t e a g e n c i e s . p r l n c i p l e provides f o r c i t i z e n input through public hearings t o e x i s t i n g s t a t e budgeting and p l a n n i n g procedures. The p r o c e s s p r i n c i p l e s r e c o g n i z e t h e i m p o r t a n c e o f u t i l i z i n g made o n l y w h e r e c r l t i c a l c i r c u m s t a n c e s a r e d o c u m e n t e d . s h a r e e v e n l y t h e b u r d e n s b r o u g h t by t h e c u t s . make up f o r t h e f e d e r a l c u t s , b u t r a t h e r w i l l c a u s e e v e r y o n e t o g r o u p s and l o c a l g o v e r n m e n t s o n n o t i c e t h a t t h e s t a t e w i l l n o t The a l l o c a t i o n p r i n c i p l e s p l a c e t h e c a b i n e t members, p r i v a t e level. and e n c o u r a g e f l e x i b i l i t y t o a l l o w f o r d i f f e r e n c e s a t t h e l o c a l r e g u l a t i o n s and requirements; hold i n l l n e a d m i n i s t r a t i v e overhead; zt- administration, allocation, The a d m l n l s t r a t i o n p r i n c i p l e s a r e d e s l g n e d t o m i n l m i z e and p r o c e s s . a r e categorized under t h r e e headings: The principles principles, now ~ n d r a f t f o r d i s c u s s i o n by c a b i n e t a n d o t h e r officials, w i l l g u l d e t h e s t a t e ' s r e s p o n s e . A s e t of c h a n g e s made d u r i n g t h e first y e a r o f o p e r a t i o n u n d e r b l o c k g r a n t s . implementatLon, North C a r o l l n a p r o b a b l y w i l l rninlmlze t h e program B e c a u s e t h e r e i s a l l m i t e d amount o f t m e available b e f o r e The committee has been Necessary legislative action. reactlon 1s The tentative date set for ln~tlal Auqust 31, 1981. steerlng commlttee. wrltten comments for further d~scusslonby the block grant The O f f l c e of Budget and Management wlll sumidrlze all 0 Accountability including reporting, monitoring and 0 regulation. Sub-state allocation of funds. are not federally mandated. Matching and maintenance of effort requirements i f they policies. Transition to long term block grant administration and before long term policies are developed. Preparation for short term administration of block grants Some of 0 0 0 the issues to be considered are: on an initial set of issues developed by the committee. contained in the block grants are now preparing written comments Agencies which will be included in administering programs regarding implementation of block grants in Ohio. areas and develop specific recommendations for the Governor charged to exchange information, identify concerns and problem surrounding federal block grants. agency block grant steering commlttee to address the issues The Offlce of Budget and Management has convened an inter- OHIO the state is: MR. MATT F I L I P I C Dt puty Director for Budget State Office Tower 38 East Broad - 39th Floor Columbus, Ohio 43215 (614) 466-6561 The contact point for block grant implementatiun wlthlr, At t h l s t i m e h e and h l s p o l l c y a d v l s o r s a r e s t u d y i n g fie d o e s n o t f a v o r " t a r g e t e d " b l o c k is: MR. ROBERT WHITE Deputy C h i e f o f S t a f f 2 l i s t a t e Capitol Oklahoma C i t y , Oklahoma ( 4 0 5 ) 521-2345 73105 The c o n t a c t f o r b l o c k g r a n t i m p l e m e n t a t i o n w i t h i n t h e S t a t e among p r o g r a m s a f f e c t e d by f e d e r a l b u d g e t c u t s a n d b l o c k g r a n t s . t a t i o n s and recommendations t o h m r e g a r d i n g t h e a l l o c a t i o n o f f u n d s m e n t a t i o n t o a w a i t f i n a l f e d e r a l a c t i o n b e f o r e making t h e i r p r e s e n - v a r i o u s s t a t e groups w i t h s p e c i a l i n t e r e s t s i n block g r a n t imple- To smooth t h e t r a n s i t l o n p r o c e s s , G o v e r n o r Nigh h a s a s k e d t h e withhold f i n a l declslons u n t i l f e d e r a l guidelines a r e established. a l t e r n a t e a p p r o a c h e s f o r d l s t r l b u t ~ n gb l o c k g r a n t f u n d s , b u t w i l l grants. have "no s t r i n g s attached." G o v e r n o r G e o r g e Nigh f a v o r s b l o c k g r a n t s t o t h e S t a t e w h l c h OKLAHOMA This w l l l be done t h e f i r s t year. The s e c o n d y e a r t h e r e is: MR. LEO HEGSTROM Director D e p a r t m e n t o f Human R e s o u r c e s 318 P u b l i c S e r v i c e B u i l d i n g S a l e m , O r e g o n 97310 ( 5 0 3 ) 378-3034 The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n i n t h e s t a t e s t a t e f e e l s c o n f i d e n t t h a t it is ready f o r block g r a n t implementatic There a r e documents which s p e l l o u t Oregon's p l a n s , and t h e process. of t h e impact o f t h e c u t s w i l l be h a n d l e d t h r o u g h t h e p r i o r i t i z i n g Minimizing T h i s i n p u t w i l l b e u s e d by t h e G o v e r n o r i n p r e p a r - i n g h i s priorities f o r t h e L e g i s l a t u r e ' s c o n s i d e r a t i o n . organizations. w i l l b e i n p u t from l o c a l governments a n d p r i v a t e c i t i z e n s and grants. g r a m s I n a manner c o n s i s t e n t w i t h t h e f e d e r a l c u t s i n t h e b l o c k The G o v e r n o r p r e s e n t e d a p l a n t o t h e L e g i s l a t u r e t o c u t p r o - OREGON his group has been directed to convene a task A human The Governor's position has been that the state will Innovative approaches, including attempts to reduce cuts on essential programs. administrative costs, will be considered to minimize the impact of federal cuts. maintaln its own level of effort but will not make up for the completed. that body later in the fall when Congressional deliberations are federal dollars, so the Governor's recommendations wiil be made to Pennsylvania's Legislature must approve the expenditure of all resource block grants. dinating responsibilities to work out an approach to the human resources committee of the cabinet has been assigned overall coor- explanation and justification by individual program. tions on the distribution of the block grants, including a narrative representatives of impacted constituents; and (6) make recommenda- comment and participation from other interested groups, including previous years; (4) identify problems and other issues; ( 5 ) invite level; ( 3 ) estimate budget figures for FY81-82 in cornparision to present programs to assess the need to continue them and at what included or proposed for inclusion in the block grants; (2) review force for each block grant which will (1) identify programs cabinet member. assigning lead responsibility for each block grant to a particular Pennsylvania's Governor has issued an administrative circular PENNSYLVANIA is: MR. WALT PLOSILA Director Governor's Office of Policy and Planning Room 506 Finance Building Harrisburg, Pennsylvania 17105 (717) 787-2086 The contact point for block grant implementation in the state In the short term, an advisory task force will be esta- The advisory group will be comprised The Committee review will extend beyond state is: MR. '7,VIN N. JOHNSON Federal Coordinator Office of the Governor State House Providence, Rhode Island (401) 277-2214 02903 The contact point for block grant implementation within the sis provided by the Governor's policy staff and the budget office. ings will be presented to the Governor along with additional analy- Completed departmental reports and advisory task force find- agencies. that time would effect services and staffing provided by state a state departmental analysis of how the budget cuts proposed at Several months ago, the Governor's Policy Office commissioned ing priorities. the block grants and consider the advisability of realigning spend- hearings around the state. advisory committee wlll seek community involvement by conducting liar with the groups and services the cutbacks will affect. of citizens in non-governmental leadership positions who are fami- best deal with the cutbacks. and setting forth recommendations as to how Rhode Island could blished by the Governor and charged with analyzing budget Impact Island. affect a great number of state programs and services in Rhode Block grant enactment and federal budget reductions will RtlODE ISLAND The process will continue until the Governor and the is: MR. JOE MURRAY Director of Community and Intergovernmental Affairs Office of the Governor P. 0. Box 11450 Columbia, South Carolina 29211 (803) 758-3261 The contact point for block grant implementation in the state Committee reach an agreement. changes. rejects the plan, it is returned to the Governor with recommended If the Joint Appropriation Committee Otherwise the Committee submits the plan to both Houses for approval. tee may approve the plan. Assembly is not in session, the Joint Appropriation Review Commit- If the General This 12-member committee has six members from each the House and Senate. the Joint Appropriation Review Committee. Governor approves the plan, he will submit his recommendations to Once the After the plan has been developed, it will be reported to the Governor for approval. for administering block grants. First, the Governor will designate a state entity to develop a plan to the block grants, federal budget reductions and program reform. The state has developed a six-stage procedure for responding SOUTH CAROLINA These analyses identify special problems South Dakota In his letter to President Reagan which accompanied Based on -- Give it a Whirl, also contains an appendix which briefly over- In the appen- by South Dakota's health, social services, and state economlc dix each existing categorical program, currently being administered intends to group the affected categorical programs. views the state government structure and outlines how South Dakota ism The South Dakota proposal, entitled A Renaissance for Federal- assistance). (youth and family, elderly, food and nutrition, health, and energy combine over 30 current federal programs into five generic groups indepth analyses, members of this Cabinet Subgroup have proposed to Subgroup is prepared to manage the proposed block grant. administer it efficiently. The South Dakota Human Resources Cabinet and also allow federal law and regulation waivers necessary to the state with a block grant for human services geared to its needs, South Dakota has proposed that the federal government provide "Our grant proposal i s unorthodox. I t does not look or read l i k e the grant proposals o f which we have s e n t too man2 i n t h e past. The r e q u z s t i t s a l f i s s h o r t . I t i s u r i t t c n i n English -- as spoken i n South Dakota. The body of supportive evidence i s long and well-researched. We mean what we say. " the proposal, Governor Janklow indicated that structures. MR. HARRY CHRISTIANSON Commissioner State Planning Bureau State Capitol Pierre, South Dakota 57501 (605)773-3661 block grant proposal is: The contact point for further information on South Dakota's with necessary regulatory adjustments that should bc made streams can be matched to existing state program organizational Opportunities for change arc recommended along service delivery. has had relating to program eligibility, administretlve systems, and analyzed. opportu~~ity agencies (along with selected energy programs), is requesting the opportunity to demonstrate that federal funding unsolicited human services block grant proposal to President Reagan On March 20, 1981 Governor William Janklow submitted an SOUTH DAKOTA Individual mem- Additional Plans are currently The Governor has met regularly At present, it appears MR. KEEL HUNT Special Assistant to the Governor Governor's Office G4 Capital Building Nashville, Tennessee 37219 (615) 741-3621 The contact point for block grant implementation in the state is: in the Legislature for approval. these will be reviewed by the Joint Finance Ways and Means Committee datlons on fundlng cuts and service priorities for the Governor and that executive state departments will make initial decision recormnen- maklng process for block grant allocations. with leadership in the State Legislature to identify a decision- private non-profit service providers. delivery system in the state as well as increased contracts with bring considered to place greater emphasis on the regional service the block grants and minimizing cuts in service. firm fl zisions regarding the best approach to take in administering proposals in Congress has made it difficult for the state to make legislation caused by the introduction of a variety of alternative Uncertainty surrounding the final form of federal block grant determined. meetings will be held once the final content of the block grants is they reported this information back to the task force. interest groups to discuss their concerns on these issues and then bers of the task force met with several representative special and identify options in block grant administration. istrators was established to study the impact of federal budget cuts An interagency task force composed of sub-cabinet agency admin- TENNESSEE The Governor The task force has The Texas Office of State-Federal Relations in Washington That office has worked closely The Governor's Budget and Planning Office analyzed this fiscal impact of the federal funding reductions. Management and Budget and prepared an estimate of the state level information along wlth information obtained from the Office of operations. nor's Office indicating the expected impact of federal funds on their In May 1981, state agencies submitted informatlon to the Govcr- with the task force on the monitoring process. proposals on a day-by-day basis. has been directed by Governor Clements to monitor the block grant grants. final decisions are made concerning the administration of block The task force will continue to serve in an advisory capaclty until ments needed in any state plan developed as a result of block grants. to track block grant developments in Congress and to identify ele- worked diligently to gather necessary federal and state funding data, mendations about their administration in Texas. grants to revlew the proposed block grant concept and to make recom- In April 1981, Governor Clements created a task force on block expenditures. planning by identifying appropriate reductions in staffing and stressed the need for each governmental agency to begln contingency cipate an overall reduction of federal funding. universities to begin the development of operating plans which antl- In March 1981, Governor Clements directed state agencies and TEXAS i create a State ]VIIIL ILL;- Novernbcr 1981. Thls proposed commlttce, Cltlzens of Texas will vote on this ttl d Depending MR. PAUL WROTENBERY Director Governor's Budget and Planning Offlce Sam Huston Building 14th and San Jacinto Austin, Texas 78701 (512) 475-8491 The contact point for Texas block grant implementation IS: slon convcnes in January 1983. the Texas Leglslature may be required since Texas' next regular ses- on the exact form of block grant legislation, a special session of block grant funds and determine proper administration. chalred by the Governor, would hdve the authority to distribute the proposed 3mendnrent Finance ?landqflllc'ntConlmlt tee. l u t ~ o nproposln~ja cortst~tutlonalamendment Also In Ndy 1981, the l'cxas I.eglsl,~t~iit. passed The Governor has been State agencies and departments have been working to deve- IL is antici- The Governor has been meeting with the leadership While the state is moving forward 1s: MR. PATRICK J. JOHNSON Human Resources Coordinator Office of the State Planning Coordinator Room 124 State Capitol Salt Lake City, Utah 84114 (801) 533-6321 The contact point for block grant implementation in the state decisions. Instead to wait until the blocks are passed before making final engage in a piecemeal response to block grant proposals but alternatives, there is a strong sentiment in the state not to to consider a variety of administrative and decision making regardlng the block grants. of the Legislature to eytablish an ongolng communication process block grants. setting regardlng posslblc revlsed allocations for fundlng under pated that such a reclassification Frocess will ald in priority categorical programs, but rather are crosscutting. lop new defin~tionsfor services that are not llnked to particular atLon. has directed members to develop recommendations for his consider- actively involved with the establishment of the committee and impacts of federal budget reductions. options for administration of block grants and to discuss the A joint state-local committee has been formed to consider UTAH Revisions a r e now b e i n g made t o assessing Both pro- T h o s e p r o p o s a l s t h a t a r e a c c e p t e d w i l l b e incorporated I n S t a t e 1s: JOHN SIMSON Director of S t a t e Planning Pavllion Office Build~ng 109 S t a t e S t r e e t Montpelier, Vermont 05602 ( 8 0 8 ) 828-3326 MR. The c o n t a c t p o l n t f o r b l o c k g r a n t l n l p l e m e n t a t i o n w i t h i n t h e P l a n f o r Economic R e c o v e r y . i n t h e f u r t h e r d e v e l o p m e n t o f s t a t e r e s p o n s e s t o t h e President's r e g u l a t o r y r e l l e f , i s a l s o b e i n g c i r c u l a t e d i n Vermont t o a s s i s t g r a m s by s t a t e g o v e r n m e n t a n d p r o p o s e s r e c o m m e n d a t l o n s t o a c h l e v e w h l c h a r e s e r i o u s b a r r l e r s t o t h e e f f e c t i v e a d m l n i s t r a t ~ o no f p r o - V e r m o n t ' s G r e e n b o o k , w h i c h i d e n t i f i e s f e d e r a l regulations lature. t h e FY1983 p r o g r a m p l a n s a n d b u d g e t s s u b m i t t e d t o t h e s t a t e L e g l s - ment. a t i o n s w i l l b e d e v e l o p e d f o r r e v i e w a n d b e s u b j e c t t o c i t i z e n com- A f t e r t h e s e a n a l y s e s a r e c o m p l e t e d , a c t i o n p l a n s f o r program a l t e r - p r o g r a m s a f f e c t e d by t h e b u d g e t r e d u c t i o n s a n d t h e b l o c k g r a n t s . government a r e j o i n t l y e s t a b l i s h i n g f e d e r a l f u n d s b a s e l r n e s f o r The G o v e r n o r ' s O f f i c e a n d o p e r a t i n g d e p a r t m e n t s o f s t a t e responses, and implementing t h e needed changes I n t h e s t a t e recommending s t a t e t h e impact of proposed f e d e r a l budget c u t s and b l o c k g r a n t l e g i s l a t i o n , c e s s e s include methods f o r f o r t h e FY 1983 p l a n a n d b u d g e t a r e a l s o t a k i n g p l a c e . t h e FY 1982 b u d g e t , a n d a t t h e same t i m e , i n i t i a l p r e p a r a t l o n s reductions and b l o c k g r a n t s . s t a t e p l a n s t o t h e s t a t e b l e n n i a l budget and t h e f e d e r a l fundlng Vermont h a s two c o n c u r r e n t l n i t i a t l v e s underway t o a d l u s t VERMONT sector. The t a s k f o r c e 1 s d e s i g n a t e d t o I s s u e p a p e r s a r e belng prepared by Toplcs f o r A major s t a t e r e t r e a t is b e i n g p l a n n e d f o r agency evaluation, a n d In addltlon, the RAY SORRELL Actlng Director D e p a r t m e n t o f P l a n n i n g a n d Budget Room 427 Ninth S t r e e t O f f i c e Bulldlng Richmond, V ~ L - g l n l a 23219 ( 8 0 4 ) 786-8755 MR. The c o n t a c t p o i n t f o r b l o c k g r a n t l m p l e m e n t a t l o n ~ n t h e s t a t e these block g r a n t s w i l l be established. Followinq t h e r e t r e a t , an lmplementatlon p l a n f o r admlnlsterlng obtaining i n p u t r e g a r d i n g t h e b l o c k g r a n t s f o r human s r r v l c e s r e t r e a t w i l l provide an opportunity t o d l s c u s s a s t r a t e g y t o r i s s u e p a p e r s i n h e a l t h a n d s o c l a l services. h e a d s i n t h e a r e a o f human s e r v i c e s t o d i s c u s s t h e c o n t e n t o f t h e management. organization a n d legislation, a n d m o n i t o r i n g , t h e s e i s s u e p a p e r s ~ n c l u d e : p l a n n l n g and b u d g e t i n g , d e p a r t m e n t a l i s s u e s i n t h e t r a n s i t i o n t o b l o c k g r a n t management. t h e t a s k f o r c e w h i c h w i l l a s s i s t it i n l d e n t i f y l n g I m p o r t a n t c u t s and block g r a n t funding. o b t a l n I n p u t f r o m a l l g r o u p s l i k e l y t o b e a f f e c t e d by b o t h b u d g e t a s t h e p r i v a t e non-profit composed o f r e p r e s e n t a t i v e s o f s t a t e a n d l o c a l g o v e r n m e n t a s w e l l The G o v e r n o r i s now i n t h e p r o c e s s o f f o r m l n g a t a s k f o r c e VIRGINIA A document which outllnes the process He/she will reduce his/her budget to 6 0 % h Means Committees and Local Govern- the Commissioner of the Department of Social and Health Services. ment wlll review this entire process and make recommendations to the Office. Senate and House Ways Public Instruction, Employment Security, State Budget, Governor's An interagency committee composed of representatives from nor's consideration. The department will then package results for the Cover- He/she will then return to citizen groups for comments. of the current level, and then build back as needed. and 2 above. Each program director will consider the input from 1 ing to the agency's perspective. non-essential and least important will be ranked accord- Services, listed from the basic and most important to shared with citizen advisory committees. This information will be Each agency will assess impact on services and clients. up federal shortfalls. Assume cuts in servlces because the state will not pick officials. There are four elements: has been widely circulated to providers, citizen groups, and local Social and Health Services. grant implementation under the leadership of the Department of The state of Washington has developed a process for block WASHINGTON STATE MR. ALAN GIBBS Secretary Department of Soclal and Health Services Mall Stop 0 8 4 4 Olympia, Washington 98504 ( 2 0 6 ) 753-3395 The contact point for block grant implementation in the state g u i d e l i n e s w i l l n o t b e p u b l i s h e d i n time f o r t h e annual budget reductlon. I n s t e a d t h e legislative l e a d e r s h i p T h l s D e p a r t m e n t h a s established a w o r k i n g tern is: BRUCE FAULKNER Deputy A d m i n i s t r a t o r D i v i s i o n o f P o l i c y and Budget One West W i l s o n S t r e e t Madison, Wisconsin 53702 ( 6 0 8 ) 266-1741 MR. The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n i n t h e s t a t e o f n e c e s s a r y legislative p r o p o s a l s a n d administrative a c t i o n . P u b l l c Instruction a n d i s a s s i s t i n g t h e G o v e r n o r i n t h e d e v e l o p m e n t o f H e a l t h and S o c i a l S e r v i c e s w i t h r e l a t e d work i n t h e D e p a r t m e n t o f The S t a t e B u d g e t O f f i c e i s c o o r d i n a t i n g t h e work o f t h e D e p a r t m e n t whlch is a d d r e s s i n g p o l l c y o p t l o n s a n d t e c h n i c a l c o n s i d e r a t i o n s . and S o c i a l S e r v i c e s . c e n t r a t e d I n t h e p r o g r a m s a d m i n i s t e r e d by t h e D e p a r t m e n t o f H e a l t h F o r Wisconsin, t h e l m p a c t o f f e d e r a l b l o c k g r a n t s w i l l b e c o n - g e t changes l n t h e scheduled October l e g i s l a t i v e s e s s i o n . l n d l c a t e d l t s i n t e n t i o n t o d e a l w i t h t h e l m p l l c a t i o n s o f f e d e r a l bud- t a k e a c t l o n on t h l s r e q u e s t . Final t h e s t a t e is: DON NELSON A d m i n i s t r a t i v e Aide O f f i c e of t h e Governor S t a t e Capitol C h e y e n n e , Wyoming 82002 ( 3 0 7 ) 777-7930 MR. The c o n t a c t p o i n t f o r b l o c k g r a n t i m p l e m e n t a t i o n w i t h l n NGA n i e c t l n g . c o n c e r n i n g how a g e n c i e s a r e t o d e a l w l t h b u d g e t c u t s . The L e g l s l d t u r e i n a d o p t i n g t h e b u d g e t d i d n o t Those guidelines w i l l i n c l u d e s p e c i f i c d i r e c t i v e s t o s t a t e a q e n c i e s agency g u i d e l i n e s f o r t h e coming b i e n n i a l b u d g e t c y c l e . Wyoming G o v e r n o r Ed H e r s c h l e r i s c u r r e n t l y d e v e l o p i n g s a r y t o a d j u s t t o t h e proposed f e d e r d l b l o c k g r a n t s and f e d e r a l p r o p o s e d a m a j o r c h a n g e i n s t a t e community s e r v i c e s a s s i s t a n c e n e c e s - D u r i n g d e l l b e r a t i o n o n t h e 1981-83 b i e n n i a l b u d g e t t h e G o v e r n o r WISCONSIN YYOMING