NCJ Number
129571
Date Published
1990
Length
54 pages
Annotation
This report examines the impact on the States of President Bush's proposed Federal budget for fiscal year 1991.
Abstract
The budget increases aid to State and local governments in nominal-dollar terms. Total grant outlays are budgeted to increase $10.1 billion in current dollars. Most of the increased spending, however, is not the result of new initiatives but rather a continuation of service levels provided in the past adjusted for normal caseload and cost increases. Maintaining the current level of services for four major programs -- housing, medicaid, family support payments, and unemployment administration -- consumes all of the budget authority increase of $10 billion from 1990 to 1991. The budget also affects the States in several indirect ways. Some of the aid reductions that are targeted at local government would cause States to consider replacing at least a portion of the lost aid. Administration proposals to increase personal savings may affect State and local borrowing costs. The higher interest rates that result from the large budget deficit and accumulated debt increases State and local borrowing costs, and the potential for economic instability caused by the deficit threatens the fiscal health of State and local government. 6 tables, glossary, and 4 references