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funds. I think the primary purpose of the Federal revenue
sharing act was to share funds that did not exist and I op-
posed it strongly.

Four respondents viewed revenue sharing as the "antigrant" grant. The purpose of revenue sharing, according to this view, was so that "the present administration could use this revenue sharing device to curtail funding in many important areas." Another Member varied this theme; he wrote:

The political purpose, clearly, was to make it appear that we were leaving the decisionmaking to local communities as to the manner of spending dollars. Legislative history made it equally clear that the money was to be used for projects otherwise impossible or delayed for lack of funds. Another Member explained the purpose as follows:

Real purpose is to place less money in the community while publicizing the fact that the local governments and States now have the money and discretion to support the programs that are needed in the community. In this way the administration can effectively cut back on programs and on spending while the State and local government officials are left with the same problems but no money.

Summing up the case against revenue sharing, one Member provided the following description of its purposes:

The purpose of general revenue sharing was to return "power to the people." That purpose was acclaimed by such unlikely bedfellows as President Nixon and Abbie Hoffman. Appealing as it did to a broad spectrum, including mayors and Governors, in an election year, general revenue sharing received less scrutiny than it deserved. Its effect, I fear, is to break down accountability at all levels of government and make the States and local governments more than ever dependencies of the Federal Government. The Federal Government could grant financial assistance to the States and localities and at the same time fulfill Federal responsibilities by, for example, reforming the welfare system. It could through block grant programs, for example, for regional mass transit systems and community development, provide money and also incentive to reform. It could reduce Federal taxes and permit a greater tax effort by State and local units. While professing to grant power to the people, general revenue sharing has the reverse effect. It invites a breakdown of accountability and waste. Few public necessities are met by money alone. All general revenue sharing offers is money; it locks us into the status quo.

While several Members wrote letters indicating that it was their policy not to respond to questionnaires, other letters left no doubt as to the attitude of the respondents concerning general revenue sharing. One such letter stated:

The record will reveal that I opposed revenue sharing.

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I am convinced that it is destructive of responsible representative government and the democratic process. Hence, I could not conceive that my answers to the questionnaire you sent would contribute anything useful to your study or to knowledge generally.

Question 5.-Are Funds Thinly Spread Among Too Many Local Units?

When revenue sharing as a form of unconditional Federal assistance was originally proposed in 1964 by Dr. Walter W. Heller, then Chairman of the Council of Economic Advisers, and further refined by a Presidential task force headed by Dr. Joseph A. Pechman of The Brookings Institution, it was intended to help stimulate the economy by earmarking an anticipated Federal surplus for distribution to the States. Payments would be made only to State governments which, at their discretion, could allocate a portion of these funds to local governments.

It subsequently became evident that in order to enact revenue sharing legislation, provision would have to be made for payments to at least the larger local governments. When revenue sharing became law, payments were guaranteed to all States and to practically all general purpose local governments. The inclusion of virtually all units of general government in the revenue sharing program has given rise to complaints that administration is unnecessarily costly; that many small governments must spend disproportionate amounts for publishing planned and actual use reports; that nonviable units of government are sustained past their useful life; that defunct units are resurrected to an ailing life; and that government reorganization, consolidation, and reform are hindered or at least not aided.

Yet, those Members expressing an opinion rejected by a wide margin the idea that revenue sharing money is spread too thinly. There were sharp divisions however, between categories of respondents on this question. The Republicans strongly disagreed with the proposition, while the Democrats favored it by a small margin. The House Members strongly rejected the proposition, while the Senate Members were almost evenly divided. The Northeast rejected the proposition by an overwhelming margin and the South by a majority of two to one; the other two regions rejected it by smaller margins.

Several Members remarked in this connection that they knew of no fair alternative or politically acceptable alternative to distributing money to so many local units. Responses of this nature came from Members who checked "agreed," as well as from those who checked "disagreed," or neither.

Question 6.-Distribution of Funds Between State and Local Governments

In each State, a fixed one-third of the total State entitlement goes to the State government and two-thirds to units of local government. After this local share has been divided among county areas, it must then be subdivided between the county level and the municipal (city,

village) level, as well as the town or township level if one exists, in each county. This division between county and subcounty levels is based solely on the ratio of county government taxes to total county, municipal, and township taxes levied in that county.

Question 6 was designed to determine whether Members would approve a distribution of the funds between each State and its localities based on the ratio of State tax collections to total State and local tax collections.

State governments, on the average, raise more than 50 percent of combined State-local revenues; none raises less than 40 percent. Local revenue for educational purposes is excluded in computing the relative tax effort of units of local government under the present act and presumably would be excluded also under the arrangement contemplated in question 6. If State revenues were treated in the same way, it would then be necessary to exclude the portion associated with educational support.

By a margin of more than two to one, the respondents opposed changing the present distribution formula. Republicans opposed the change by a wider margin than Democrats, and the Senate by a greater margin than the House. However, an unusually large number of respondents had "no opinion" on this question. The question, it should be noted, related to a relatively technical matter which Members may have been reluctant to consider without determining how the change would affect their districts and States.

Question 7.-Appropriate Mix of Various Types of Grants

By adoption of various grant instruments, the Federal aid system has come to consist of three elements: categorical grants, broaderpurpose block grants, and general revenue sharing. Question 7 sought to determine the attitudes of Members on the current use of these three types of aid mechanisms.

Only 12 percent of the respondents thought the Federal aid system as presently constituted has the right balance.

By a margin of greater than 3 to 1, the Members who responded supported the view that the Federal Government relies too heavily on categorical grants. However, while this was overwhelmingly the position of Republicans, only a small majority of Democrats thought that categorical grants are overutilized.

Over three times as many Members thought that too little use is made of block grants as thought that block grants are used too intensively. This preference for block grants was indicated by all categories of respondents.

In the aggregate, Members were almost evenly divided on the question of whether too much or too little use is being made of general revenue sharing. Democrats, on the whole, felt there is too heavy reliance on general revenue sharing, while Republicans felt there is too little. By less decisive margins, Members of the House felt there is too little use of general revenue sharing and Senators felt there is too much. On a geographical basis, a majority of respondents from each region except the West thought there is too little reliance on general revenue sharing.

Question 8(a).-Remove Restrictions on Purposes of Local Expenditures

The act requires that local governments spend revenue sharing funds for ordinary and necessary operating and maintenance expenditures within eight functional areas: public safety, environmental protection, public transportation, health, recreation, libraries, social services for the poor or aged, financial administration, or on any type of capital expenditure permitted by State or local laws. State governments, however, are not subject to these restrictions. Parts (a) and (b) of question 8 asked Members whether they felt this situation should be changed, either by eliminating the aforementioned restriction on local governments (part a) or by imposing a similar restriction on State governments (part b).

By a margin of 90 to 77, the Members favored eliminating the specification of high priority expenditure areas for local governments. Republicans decisively favored this change, while Democrats, by a lesser margin, opposed it. Representatives indicated a preference for the change, but Senators were opposed. Members from the South, and to a lesser extent the North Central States, favored the change. Members from the West and Northeast opposed it by small margins. Question 8(b).—Restrict State Expenditures to High Priority Purposes

Members decisively rejected the idea of the Federal Government specifying high priority uses of revenue sharing funds for the States, as it does presently for local governments. Republicans overwhelmingly opposed the change while Democrats supported it. Strong opposition was evident in both chambers and in all regions except the West, where this change was opposed by a more narrow margin. Question 8(c).-Remove Prohibition Against Using Funds To

Match Federal Grants

Both State and local governments are subject to a statutory prohibition against using revenue sharing money as a source of the funds required in some programs to match Federal dollars. This question asked whether that restriction should be eliminated. Elimination of the prohibition against using revenue sharing funds for matching was generally opposed by all categories of respondents. Three Members, however, commented that this prohibition is meaningless, since State or local governments can simply rearrange the designated source of funding for various programs so as to be in technical compliance with the law.

Question 8(d).-Exclude Local Governments Which Provide Few Public Services

The idea of excluding from revenue sharing participation those smaller units of general local government that provide limited public services was opposed by all categories of respondents; almost every category rejected it by a very decisive margin.

In this connection, four Members expressed concern that local governments receiving very small amounts of revenue sharing are required by law to spend a disproportionate part of their assistance for publishing reports on the uses of these funds.

PART 2.-RESPONSES TO INDIVIDUAL QUESTIONS, BY RESPONDENT CATEGORIES

Question 1

The initial reports on the uses of revenue sharing funds indicate that the payments have enabled some recipient governments to reduce taxes (or avoid tax increases) as permitted under this legislation. Do you regard this as a desirable use of revenue sharing funds?

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1 Total for each category does not add to total responses because 2 Members did not identify themselves.

Question 2

Some State and local officials have expressed concern that Congress may not renew revenue sharing because of reports that some localities have used funds for "frivolous" purposes. Please indicate by checkmark which, if any, of the following uses of revenue sharing funds you would regard as "frivolous" or undesirable:

(a) Purchasing land for bike and hiking trails

(b) Constructing a public golf course

(c) Sharing with private enterprise the cost of free off-street parking

in central business district

(d) Increasing salaries of State or municipal employees (e) Making contributions to an employee pension fund

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