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1 Federal Expenditures for Grants-in-Aid 1 (1966)

handle is hein.tera/feexgrina0001 and id is 1 raw text is: *; SECIAL REPORT 1966 - 4 FEDERAL EXPENDITURES FOR GRANTS-IN-AID Aids to State-Local Governments will Total Almost $15 Billion in 1967 Federal expenditures for grants-in-aid to Stlate and local governments have increased sharply, and have risen in recent years at a much faster rate than total Federal spending. Total Federal aid to State and local governments (from administrative budget and trust funds), astimated at $14.7 billion for fiscal 1967, will have more than tripled over the past ten years. The estimated 1967 total represents an increase of $3.5 bil- lion over actual grant expenditures in fiscal 1965, largely reflecting the impact of new Federal programs. Moreover, on the basis of Congressional actions to date it appears probable that total Federal spending for grants in 1967 may exceed the $14.7 billion estimated in the budget. That estimate takes into ac- count proposed reauctions in such programs as Federally-impacted area school aids, the school lunch and special rilk progrmns, aids to land grant colleges, and others, which are encountering strong oppo- sition in the Congress. While as recently as 1960 highway construction and public assistance grants accounted for almost 70 percent of total grant expenditures, recently enacted new programs have brought a significant shift in the direction of these Federal -ids to State-local governments. Addi- tionally, there is a growing trend toward direct Federal aids to localities, often bypassing the States. Federal grant programs also have a history of strong resistcnce to termination, which was among the factors which led the Advisory Commission cn Intergovernmental Relations to recoAmend in 1961 that the Congress establish a procedure for requiring periodic review of these programs. The pattern usually has been toward extension and expansion of these programs. Examination of the trends in Feder-l spending for grants-in-aid to State--local governments is of timely interest not only in the light of their impact on the Federal budget, but also because such grants significantly affect State-local finances. In 1965 Federal grants to the States (either for direct expenditure or for distribution to local governments) accounted for almost one-fourth of the total gen- eral revenues of the States. Further, since State-local matching in