Rep. Ryan's Budget Prompts Concern from Local Governments

Plan would freeze spending at 2008 levels for five years, remove transportation as a priority.
by | April 7, 2011
 

Sure, Congress may be headed toward a federal government shutdown over its disagreement about 2011 funding. But that hasn't stopped it from considering funding for 2012.

This week, House Budget Committee Chairman Paul Ryan released his 2012 budget. Its biggest highlight: a rollback of domestic, discretionary spending to 2008 levels and a five-year freeze on those levels.

Other notable facets: cancellation of the health reform law, a reduction of the top tax rate from 35 percent to 25 percent and the transformation of Medicare into a voucher program that would provide credit for seniors to purchase private health insurance.

The plan would also convert Medicaid into a block grant program, giving states vastly more flexibility in how they administer it.

Ryan's goal, he said in a video describing the budget, is to reduce federal spending to 20 percent of the economy as part of his stated effort to prevent the country from taking on a "crushing burden of debt."

Overall, the Ryan budget would cut $6.2 trillion more in spending over the next decade than the 2012 budget President Obama introduced earlier this year. The Republican-controlled House Budget Committee passed the measure Wednesday night.

The U.S. Conference of Mayors, the National League of Cities, and the National Conference of State Legislatures still haven't officially responded to Ryan's budget, likely because they're focused on the current 2011 budget battle.

But the National Association of Counties wasted no time and immediately presented a slew of concerns about how it could affect local governments. The organization opposes many of the major aspects of Ryan's plan and emphasized that cuts shouldn't be focused as heavily on non-defense spending. NACo argued against the rollback to 2008 funding.

"We believe that deficit reduction should not be accomplished by shifting costs to counties, imposing unfunded mandates, or pre-empting county programs or taxing authority," NACo executive director Larry  Naake wrote in his letter to Ryan and House Budget Committee Ranking Member Chris Van Hollen.

A Medicaid block grant would inevitable result in cuts, Naake wrote, leaving counties to carry the burden of care since they serve as the provider of last resort in about half the states, he added.

Ryan's budget also targets transportation funding, a priority of both President Obama and some state and local leaders. Ryan wrote in his budget plan that highway projects are not the job creators their advocates claim them to be, and some are simply the result of wasteful spending.

He also said that high-speed rail and other intercity rail projects "should be pursued only if they can be established as self-supporting commercial services." His budget eliminates those projects.

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