Unfunded mandates drain local coffers

A decade after the 1995 Unfunded Mandate Reform Act (UMRA) passed, the federal government is being sued by opponents of the No Child Left Behind Act (NCLBA), and local associations are drafting new legislation that could potentially give state and local governments greater protection from the long arm of federal law.

After Connecticut Attorney General Richard Blumenthal declared in April that his state was suing the federal government for requiring states and communities to spend millions of dollars more than the federal government provides to meet NCLBA guidelines, many other states and school districts jumped onboard. Plantiffs now include Connecticut, Illinois, Indiana, New Hampshire, Ohio, Pennsylvania and Utah, and nine school districts and 10 National Education Association chapters in Michigan, Texas and Vermont. “Continuing unfunded mandates require us to randomly replace successful programs without new, necessary resources — illegally imposing hundreds of millions of dollars in costs to states and municipalities,” Blumenthal says.

In March, the Washington-based National Association of Counties (NACo) released a survey that had asked counties to estimate direct costs from federal mandates in fiscal years 2003, 2004 and projected 2005 under 10 common federal mandates. In Connecticut’s case, the state’s education department estimates that NCLBA will cost $41.6 million over the next three years. NACo found that of the 30 counties highlighted in its study, the average three-year total of unfunded mandates for each was $1.5 billion.

The problem, according to Alysoun McLaughlin, a NACo legislative director, is that UMRA, enacted to provide greater oversight of federal mandates, has no real means to protect state and local government. The act only requires the congressional budget office to investigate mandate-associated costs. McLaughlin says that the act also allows a point of order to be raised in the House or Senate if an authorized bill creates a mandate that would cost state and local government more than $62 million to implement. Associations such as the Washington-based U.S. Conference of Mayors and others, hope to close some of the loopholes in future legislation, which is currently being drafted based on the study.

McLaughlin says UMRA does not apply to NCLBA or the Help America Vote Act, which are grant legislation and, therefore, technically not considered mandates. In addition, Congress does not conduct extensive investigation into costs of a mandate nor does it follow up on actual costs. “The HAV Act, for example, Congress did a back-of-the-envelope estimation on what it might be to purchase new voting equipment across the nation based on assumptions about a lot of different variables in that equation,” McLaughlin says. The actual cost appears to be much higher than the amounts authorized and appropriated by Congress, she says.

Scott County, Iowa, listed HAVA as its highest unfunded mandate in the NACo study. Just five years ago, the county purchased $500,000 worth of new voting machinery. Ray Wierson, county administrator, says now Scott County will have to purchase HAVA-compliant equipment with $200,000 out of local coffers though its machinery has not had any problems. “To some degree, this is what gives government a bad name,” he says, “to throw out adequate newer equipment with this broad-based directive that everything has to be replaced.”

Another study participant, Montgomery County, Md., with a population of 918,000, has seen its unfunded mandate expenditures decline from roughly $13 million in 2004 to $9 million in 2005. “We support the public policy underlying these mandates,” says County Executive Joseph Beach. “We just believe there’s a need for increased federal funding to help us implement these policies.”