March 06, 2006
Block Grants: From Brookings
The Brookings Institution has a new study out on federal block grants. The study is entitled "Block Grants: Flexibility and Stability in Social Services.'
The policy brief tracks the history of federal block grants in the area of social services and their underl ying philosophy. They're designed to give states and localities more flexibility and to increase efficiency. Proponents of block grants also see them as a way to reduce the interest of Congress in funding such services by limiting Congress' ability to "take credit" for the resulting services and thereby limiting the likelihood of expansion. They also anticipate lower federal expenditures in time (trading money for flexibility).
The brief also summarizes recent history with block grants, including the significant decline in purchasing power of social service block grants, experience under President Reagan, and President Bush (W)'s proposals for further changes for further reform (consolidating block grants for Head Start, Food Stamps, Child Welfare, Assisted Housing, and Job Training among other things, and providing for a "superwaiver"). The report concludes that "Many stakeholders desire the flexible ends of block grant funding, yet oppose using means that typically threaten the stability of services. Unfortunately, it is not yet clear how to achieve flexibility while ensuring federal funding levels and accountability for outcomes."
February 27, 2006
More Katrina & Governance
Brookings Institution recently held a major program to discuss "Forming the Federal-State-Local Government Partnership for Southern Louisiana" in the aftermath of Hurricane Katrina.
Here's the description:
As we approach the six-month mark of the post-Katrina recovery effort, the Brookings Institution will host leaders from the New Orleans area along with federal policymakers for a public dialogue on how best to rebuild the city of New Orleans and southern Louisiana. The program will assess the state and local progress on the ground, and then focus on the role the federal government needs to play in order to facilitate the re-building of communities and residents' lives. Participants include the co-chair of the Louisiana Recovery Authority and the federal coordinator for Gulf Coast rebuilding.
The forum is designed to be highly interactive. It will be comprised of two panels. The first will focus on the status of state and local plans for rebuilding southern Louisiana and New Orleans–honing in on details of the local and state visions for long-term rebuilding, whether these plans are complementary, and the extent of the challenges that remain. The second panel will consist of federal leaders who will discuss what the federal response ought to be, given what the people of Louisiana and New Orleans envision and need.
The transcript is available at the above link.
February 24, 2006
New Metro Politics
A new report by Robert Land and Thomas Sanchez of the Metropolitan Institute at Virginia Tech interprets recent presidential elections using a county-based regional typology. The authors focus on 417 counties in the top 50 metro areas in the US (including more than half of the nation's population), and considers five subsets: core, inner suburbs, mature suburbs, emerging suburbs and exurbs. The authors' analysis allows them to focus on the amount and nature of the "urbanized" population. That focus allows them to identify differences between "mature" and "emerging" suburbs that may have considerable significance, for example ("mature suburbs are adding more residents than emerging suburbs...[and include] more households with adults only compared to exurbs and emerging suburbs...[so that] the growing voting strength of mature suburbs is even greater than [their] poplations gains on their own would suggest."
The analysis leads them to posit that for the new metro politics "it's the density, stupid," and to note that the "big divide between the suburbs is newness." They conclude:
"much of older suburbia dates to the post war era of the 1950s and 1960s. On a superficial level these two areas may seem similar--perhaps old sprawl versus new sprawl...[y]et ...these places are now very much different. A key concern for the old sprawl areas is that they are in rapid transition to a quasi-city like character...[and] policies that smooth this change and provide reinvestment opportunities in upgrading aging infrastructure are favored by these voters. Voters at the metropolitan edge want policies that slow growth so that local service can catch up with demand.... The next several elections may be determined by who does a better job of addressing the new metro politics."
February 22, 2006
Mexican Migrants: Economic Transition and More
The Pew Hispanic Center has issued the third part of its extensive survey of Mexican migrants in Chicago, Los Angeles, New York, Fresno, Raleigh, Dallas and Atlanta. This part focuses on the economic transition of members of this important community. Other important studies document patterns of Hispanic and white youth into college and the New Latino South.
February 15, 2006
Brookings on "First Suburbs"
The Brookings Institute has just issued an interestig report on "first suburbs." The report gives important insights about the "urbanizing" aspects of these areas. It makes good reading for those interested in rethinking shapes of governments, regionalism, and the legal structures that shape decision making in areas such as these.
February 12, 2006
GAO report on Internet Access Tax Moratorium
States and localities continue to face budgetary challenges in part because of federal constraints on traditional sources of revenue. The federal Government Accountabliity Office has recently published a report on the impact of the federal Internet Access Tax Moratorium that suggests that there is more ambiguity in interpretation of the Moratorium's provisions than some states may now believe.
Here's an excerpt from the Report's Summary:
According to one report, at the end of 2004, some 70 million U.S. adults logged on to access the Internet during a typical day. As public use of the Internet grew from the mid-1990s onward, Internet access became a potential target for state and local taxation. In 1998, Congress imposed a moratorium temporarily preventing state and local governments from imposing new taxes on Internet access. Existing state and local taxes were grandfathered. In amending the moratorium in 2004, Congress required GAO to study its impact on state and local government revenues. This report’s objectives are to determine the scope of the moratorium and its impact, if any, on state and local revenues.
For this report, GAO reviewed the moratorium’s language, its legislative history, and associated legal issues; examined studies of revenue impact; interviewed people knowledgeable about access services; and collected information about eight case study states not intended to be representative of other states. GAO chose the states considering such factors as whether they had taxes grandfathered for different forms of access services and covered different urban and rural parts of the country. GAO is not making any recommendations in this report.
The Internet tax moratorium bars taxes on Internet access services provided to end users. GAO’s interpretation of the law is that the bar on taxes includes whatever an access provider reasonably bundles to consumers, including e-mail and digital subscriber line (DSL) services. The moratorium does not bar taxes on acquired services, such as high-speed communications capacity over fiber, acquired by Internet service providers (ISP) and used to deliver Internet access. However, some states and providers have construed the moratorium as barring taxation of acquired services. Some officials told us their states would stop collecting such taxes as early as November 1, 2005, the date they assumed that taxes on acquired services would lose their grandfathered protection. According to GAO’s reading of the law, these taxes are not barred since a tax on acquired services is not a tax on Internet access. In comments, telecommunications industry officials continued to view acquired services as subject to the moratorium and exempt from taxation. As noted above, GAO disagrees. In addition, Federation of Tax Administrators officials expressed concern that some might have a broader view of what could be included in Internet access bundles. However, GAO’s view is that what is included must be reasonably related to providing Internet access.
The revenue impact of eliminating grandfathering in states studied by the Congressional Budget Office (CBO) would be small, but the moratorium’s total revenue impact has been unclear and any future impact would vary by state. In 2003, when CBO reported how much states and localities would lose annually by 2007 if certain grandfathered taxes were eliminated, its estimate for states with grandfathered taxes in 1998 was about 0.1 percent of those states’ 2004 tax revenues. Because it is hard to know what states would have done to tax access services if no moratorium had existed, the total revenue implications of the moratorium are unclear. In general, any future moratorium-related impact will differ by state. Tax law details and tax rates varied among states. For instance, North Dakota taxed access service delivered to retail consumers, and Kansas taxed communications services acquired by ISPs to support their customers.