LAS VEGAS -- City leaders say they must work more closely with state policymakers -- increasingly the conduit for federal mandates and money -- but that politics often gets in the way.

As the 68th annual Congress of Cities concluded here yesterday, local officials agreed that finding new revenues while dealing with under-funded federal mandates continues to be their most pressing problem and that state government could help them solve it.

But tackling the problem can be dangerous Gov. Jim Florio's tax reforms gave New Jersey cities property tax relief, but taxpayers angry over the $3 billion cost voted out legislators who championed the bill -- now threatened by proposed rollback legislation.

"The right decision was made to reduce the tax burden," said Cardell Cooper, mayor of East Orange, N.J., during a discussion here last weekend. "The people who made those decisions got thrown out of office."

In fact, city and state leaders agreed that their two layers of government often move in conflicting directions while trying to please taxpayers who want more services and lower taxes. The result is often strained relations and little progress.

"Governors are not all that popular with mayors," said Gov. George Sinner of North Dakota.

Throughout the five-day conference hosted by the National League of Cities, local officials agreed in panel discussions and interviews that as the federal government continues to mandate programs without providing funds to pay for them, state and local officials will be more pressed than ever to work together.

Gov. Robert Miller of Nevada suggested that states could leave some decisions on how to use federal programs and monies to local officials. For instance, he said that funds under the federal surface transportation act might be better spent with local guidance.

"The cities know what roads need the most work," he said.

Others say that with the federal government delegating funds and programs to the states to administer, there are few direct benefits for local government.

"I think what we're trying to do is trade one set of problems at the federal level for another set of problems," said Florence Shapiro, mayor of Plano, Tex. "I thing what we like to say to the state is that if you leave us alone, we'll leave you alone."

Still, others say that cooperation means only so much without money to pay for mandates.

"The relationship is that everyone has problems and no one has money," said William Hudnut, the retiring mayor of Indianapolis. "The cities have become the dumping ground where everything just gets off-loaded."

Leaders say the worst kind of mandate is one that only money can solve. Not much funding was needed for Nevada to handle its prison-crowding problem, Gov. Miller said. At the same time, he said, the federal government gives states problems, such as a change in the Medicaid funding system.

"That can only take money," he said.

Not all local officials spoke of cooperation, though. They said state lawmakers are often guilty of passing down mandates without money. Dan Pearl, mayor of Sunrise, Fla., said cities in Broward County were so tired of the practice they persuaded the state's voters to pass a referendum curbing it.

"Now they have to have two-thirds of the Senate and the House to pass mandates," he said. "We stopped those rascals."

Aside from mandates, just paying for operations is increasingly difficult.

"How many of you can remember when working in local government was fun?" asked John Manaux, city manager of Oceanside, Calif. "It isn't fun anymore because the money just isn't there."

Facing pressures to balance budgets without new taxes, Mr. Manaux said the city was raising fees on many of its enterprises, such as the city-owned golf course. Oceanside is hardly alone, many local officials agreed that fee-based revenues are gaining greater acceptance as the antitax backlash grows.

William C. Goodman Jr., a member of the Goldsboro, N.C., city council, said his city has not raised property taxes since 1978. Now, user fees account for 23.6% of the city's $21 million operating budget, which is slightly less than property taxes pay for.

After a dozen years of raising user charges, the city is now studying the possibility of new fees for police escorts for funerals and charging businesses for false alarms by silent burglary systems.

But fees have their limits, Mr. Goodman said. "People usually think that all the costs of government should be absorbed in the taxes they pay," he noted.

Still, others say taxpayers must be tolerant.

"Somewhere along the line, the American people are going to have to be told that if you want the services, you are going to have to pay for it," Mr. Hudnut said. "They have to be told that there is a difference between wise spending and wild spending."

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