More Bad News for Locals

City and county officials will want to take note of a small item (third story) buried on page 5 of today's Washington Post. Local officials have ...
by | June 30, 2006

City and county officials will want to take note of a small item (third story) buried on page 5 of today's Washington Post.

Local officials have been able to stave off the Bush administration's attempts to squeeze funding for Community Development Block Grants and to move them from HUD into the Commerce Department.

But remember that after governors resisted the administration's plan to turn Medicaid into a block grant, the administration attempted to force their hands by becoming much more aggressive about auditing their Medicaid books. Now it appears they'll try a similar tactic with CDBG recipients.

Kenneth Donoghue, HUD's inspector general, told the Senate yesterday that the CDBG program was rife with problems, having found abuses in a survey of just 35 out of 1,200 grant projects. "Donohue said five types of fraud schemes have become 'common' in the program," the Post reports.

Imagine what he'll find when turned loose to examine the other 1,165 programs. The mini-story's headline provides ample warning of how the administration is going to play this story: "Fraud Grows in Urban Grant Program."

Local officials have defended CDBG precisely because it offers them so much flexibility. (Not to mention the fact that it's practically the only source of direct funds that they get from Washington.) But that flexibility may soon be lost, if not through direct legislative or budgetary means, then through executive intimidation.