Agenda - Council - 07/22/1980 - Laserfiche WebLink

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better targeting of state aid, Elsewhere, Hawaii since 1961 has used criteria for designating distressed areas for special state aid. Other states, such as Iowa, New 3'ersey and Ohio identify distressed localities in the context of specific redevelop- ment and renewal projects. State revenue sharing programs are one way for states to directly aid localities. Michigan provides $600 million in this manner, said Eugene Farnum, director of the Senate Fiscal Agency. Detroit receives over $100 million in this manner, plus a $20 million equity package for provision of area-wide services, such as transportation and libraries. bodies, the MDS performs existing regional services, with the potential for additional services, should voters endorse new tax measures, in such areas as libraries, correctional facilities, water supply, human services, pm ks and cultural and sports facilities. The list of ways in which states have been able to help distressed cities and other local governments is long: Over- sight and funding of local government pension systems; fiscal notes and greater attention to state mandates on localities; land use planning; housing authorities; neighborhood improvement and community develop- ment; and so forth. Specific actions have included antireclining statutes. "Unlike earlier recessions, this one will be accompanied by political and eether restraints on the ability of deral and state governments to respond to the problems of localities." In Kansas, cities and counties receive aid from a state revenue-sharing fund financed by the state sales tax. Massachusetts helped Boston by increasing its state aid tre by half for fiscal 1979, modified school aid to the state contribution and assumed ,the costs of county court operations which had been funded by the city. In Virginia, a state revenue sharing plan disburses about half of the state's $2.6 billion revenues to local governments. Although the General Assembly recently stopped the practice of urban expansion into the suburbs n~anCrease urban tax bases, the legislature recognized that eased state aid will be needed to offset the cities' ncial troubles. As Will Myers, senior analyst at the ACIR in Washing- ton, D.C. points out, one obvious area of funding where the states have increased their contribution is education, in an effort to reduce reliance on the property tax and provide more equal funding of schools. There are of course, many ways for states to enhance the fiscal resources of localities. Myers said they include allow- Lng local governments to piggy-back a local sales tax on the state sales tax, or letting them impose other, non-property taxes. Several urban reform policies initiated in Minnesota have been adopted or have been considered in other states. One path-breaking effort was the creation of a local tax- base sharing district in the Minneapolis-St. Paul metropolitan area which tries to reduce the urbana suburban fiscal disparity. In a similar vein is the three-county metropolitan service district (MSD) which voters approved in 1978 for the Portland, Oregon area. By combining existing regional Economic Development One major area of state activity has been in the economic growth and development of localities, specifically the big cities in some states, but also in smaller communities and rural areas in other states. The ACIR study last year found that "states have become increasingly attentive to local growth and economic and community development con- cerns-particularly over the last two years." The report noted that state efforts are usually aimed at "fostering public-private cooperation, and employ a variety of state powers to influence local growth and development patterns." But, in the last two years, the states have undertaken new "spending programs and fiscal reforms to effect positive change." Not surprisingly, regional variations turned up in the study. ACIR found Southern and Western states concern- ed about the problems of small towns and rural areas, while Western states also were specifically concerned over the effects of rapid economic expansion. Midwestern and Northeastern states were more likely to take action on cen- tral city problems, according to the study. One example of a state's initiative on urban policy is Massachusetts' 1977 Growth Policy Report, which urged revision of state purchasing procedures and public siting Will .Myers Ad,,a~oO- Cornmissuan on Intergovernmental Rdauor~ Miles Friedma~ National Council for Urban Economic Devetopmem