Q. What is your argument against federal mandates?
A: The argument on mandates is simply that we're not against clean water. We're for clean water, we're for clean air, we're for [the] Americans With Disabilities [Act], we're for all those things.
When we had a press conference in New York back in July about this issue, a young lady [representing Children's Express] asked why do I care whether the federal government pays for these things that I think are good or the state government pays for them or the county or the city. Why do I care?
Determining how to spend, let's say, $10 million of my money at the local level in the city of Louisville, then I am not able to spend that $10 million on lighting the tennis courts, picking up the garbage, cutting the grass on her soccer field, putting more police on the street.
And when you figure that 66, almost 68, cents on a dollar goes to the federal government in terms of taxes, we've only got 14% at the local level. That being the case, just because the federal government's bankrupt and has decided to do good and just and wonderful things, they shouldn't thrust it down to the bottom of the food chain on cities, who have no one else to lateral the ball to, and say, You either do this and implement it by this date, or the few morsels of dollars that we still send you, we will cut back, or cut off.
So the cities in the 90s are now saying to Washington, We understand your financial difficulty, we understand we can't expect any significant additional moneys from you, but at least get off our backs ... If government has been entrepreneurial anywhere in America, it has been at the local level. If government has been reinvented anywhere, it is at the local level, and we probably did it just to survive through the last decade, where we simply were receiving less and less support from Washington and yet being required at the same time to implement more and more mandates from Washington.
Q: The U.S. Conference of Mayors plans today to present a survey outlining the effect of federal mandates on several hundred cities. The event is a prelude to Oct. 27, which the group is proclaiming National Unfunded Mandates Day.
A: That's correct. We'll be putting out a survey on the 26th. We'll have a press conference in Washington where the National Association of Counties, the National League of Small Cities, the National Association of Governors will all stand together and we will, the U.S. Conference of Mayors, will submit to the public at that point a survey that Price Waterhouse is developing for us of about 400 to 500 cities.
And the National Association of Counties now has Price Waterhouse doing about 100 to 150 counties, so that we can literally look into the camera's eye, or into the reporter's eye, and say, This is what it's costing American cities on the average and in the particular, city by city, and this is what the mayors are saying they could have done with those funds had these mandates not been imposed upon us.
Q: What will happen?
A: On the 27th is when each of us in our hometowns will have press conferences. That's National Unfunded Mandates Day. The 26th is when we will put out the report to the public and send it to the local communities throughout America. When mayors and county executives stand up - and governors - on their respective courthouse steps or city hall steps, the mayors will have our report, our survey, [and] the county officials will have the National Association of Counties survey.
Q: Do you think this concerted effort will work on the 27th?
A: We have a lot of educating to do, so I would assume that starting on the 27th and from that point out, we will be using the media through talk shows and newspapers and editorials.
We put out a typical editorial that people can massage to the local newspapers and then submit them for mayors and county executives. So we've got a year or two, I think, of hard-charging work to be able to bring this to fruition.
Q: Tell me about the survey. Can you quantify or have a rough guess on what mandates are now costing cities around the country?
A: I'll give you the city of Louisville as an example. We're talking about anywhere from 5% to 9% of my budget.
It is tough to give you the firm figures [on a national basis] because Price Waterhouse is coming out. It seems to run anywhere from 5% to 15% percent of the budget. That's an annual fiscal year budget.
Q: Can you give me examples of how federal mandates affect cities?
A: Let me give you some of the weird examples.
Take Phoenix, Ariz., for example. They have developed a treatment plant that cleans the effluents in their water to the level of 97 1/2%. The EPA is now requiring them to spend another half a billion dollars to bring it to 99%. And the mayor is saying, How?
The mayor of Columbus, Ohio, called me the other day. He happens to be a Republican, and Greg [Lashutka] said, You're not going to believe this - EPA is requiring us to test our water for an insecticide that is only used in spraying pineapples. And he said, Hawaii might have that problem, but Columbus, Ohio, doesn't have any pineapple fields.
And it goes on and on. The mayor of Alhambra, Calif., who's been fighting EPA for six years now, spent over several millions of dollars in the fight, told the EPA administrator in my presence" "You win this suit" - he pulled out keys, and that's 65,000 people - he said, "here's the keys to City Hall." He said, "You know we can't afford all these things."
Q: And what is the outcome of all this?
A: You're sitting there saying to yourself, Now wait a minute, we're for public accessibility. We're for clean air, we're for clean water. But it's so easy when you're in Washington as a congressman or a senator and you're getting beat on by interest groups to pass a law without really ever stopping to think about the costs because you don't have to pay for it.
You know, if you've got to come up with the expense, then you're going to have to prioritize what's important because you have a finite amount of money to spend, which we have to do at the city level all over this country. We all must balance our budgets and as a result, we're not deficit spending and as a result, although there's a million things I'd like to do, I can't do them all, so I have to prioritize them. In Congress it's not like that, or in the White House. It's the executive branch and the legislative branch. They simply stand up and say, This is a good idea - let's pass a law.
They pass the law, they pass the buck. We've got to then implement it and we've got to pay for it. And you're saying to the guys in Washington, Did you know what it would cost? And they scratch their heads and say, Well no, we really didn't. We just thought it was a really important public policy. And it is important public policy, but without understanding the cost and without sending some money to defray the cost, we're the ones at the local level who have to pick up the tab.
Q: How does this affect capital programs, including bonding programs?
A: Putting it in the context of bonds, here we've gone over the last 10 to 12 years, neglecting infrastructure expenses, all throughout the cities and counties in America.
And now we're trying to develop mechanisms, trying to refocus and get back ahead of the curve on infrastructure, from parks to roads, from bridges to sewers.
And yet, when we prioritize how we're going to spend our local money? I've got to take 5% or 8% or 10% of that bottom line of my dollars and say I don't have a chance to decide those.
Q: It affects your capital budget?
A: It affects every - I mean the city of Louisville has got about a $200 million budget. I now have 5%, 10%, 12%, or 15% fewer bottom-line dollars of which to be able to float bonds, to repair infrastructure. Better yet, put police on the street. Better yet, provide opportunities for parks and fire and emergency medical service - those kinds of things are decisions that our local folks who pay local taxes want us to make.
Q: What about the effect on your credit rating?
A: It could have a significant effect because time and again we're required, as the rating agencies always check, you know, What's your revenue base, what's your cost base, what's fixed, what are you required to do in the future? They're watching the Clean Air Act in terms of what effect it's going to have.
Q: and A:
Most state and local governments are still crawling out from under the long and debilitating recession that crimped their budgets and wreaked hasoc on their fiscal plans.
At the same time, state and local government officials are grappling with burgeoning unfunded federal mandates, slicing budgets thinner and thinner to pay for more federally mandated services for a variety of constituents and to finance any improvements or testing required by federal regulations.
The burden is too heavy, according to many state and local officials.
Now, a groundswell of opposition is beginning to roll across the land. Tomorrow, Oct. 27, is National Unfunded Mandates Day. State and local officials across the nation will speak against the federal government's practice of piling on unfunded mandates but leaving the local officials to find ways to pay for them.
Leading the charge is Jerry E. Abramson, mayor of Louisville, Ky., since 1986 and the president of the United States Conference of Mayors, the group that created the unfunded mandates day.
In an interview with managing editor John. J. Doran, Abramson outlines his views on Mandates and the goals that the mayors' group hopes to accomplish in the coming years.