Here Comes the Bonanza

I think revenue sharing is a great thing.

--Mayor Hobby Stripling of Vienna, Ga.

Revenue sharing is a bunch of bull and a mass of red tape.

--Mayor Jerry Hancock of Mitchell, Ind.

Delight, anger, confusion and skepticism are only some of the reactions of local politicians to the Government's landmark program to kick back to states and municipalities a portion of the tax money that it collects. The first Treasury checks, retroactive to January, will go in the mail next month, in time to arrive for Christmas. Already, from the grandest statehouse to the meanest village hall, officeholders are planning, wrangling and pontificating on how best to use the windfall.

Revenue sharing will pay out $5.3 billion for this calendar year and $30 billion over the five-year life of the program. One-third of the money will go to states, the rest to communities. They can spend it as they like. Funds will be doled out on the basis of an exquisitely complicated formula based on population, tax collections, and per capita income. The formula will result in some quirky distribution. Mayor Hancock of Mitchell, Ind., which will receive about $17,000, thinks that his town of 4,000 residents is being so scandalously shortchanged that he is threatening not to accept the money. Big cities and generally poorer small communities and Southern states will get proportionally more than well-heeled towns and suburbs. Yet a part of the formula that would have provided hard-pressed cities with bonus money was knocked out by rural Congressmen.

The funds are intended to subsidize needed public facilities and services. Officials in Danville, Ill., for example, will probably spend their $504,000 on raising policemen's and firemen's wages and building a new jail; two weeks ago, a prisoner escaped by simply bending his cell bars apart. Many states, cities and towns will use the money to cut property taxes. Though the Administration welcomes this move, which would ease pressure on Washington to provide tax relief, it is far from what revenue-sharing supporters in Congress hoped for. Atlanta will devote at least part of its $4.5 million to paring property taxes. Oregon will funnel all of its $22 million into aid for schools as a means of cutting local taxes.

Christmas Gift. In some wealthy suburbs, where the need for services and facilities is slight, revenue-sharing cash will build swimming pools and tennis courts. Edina, Minn., will use part of its $160,000 to carve out bicycle paths. Less affluent North Little Rock, Ark., is badly in need of improved drainage and sewerage facilities, but its mayor, William Laman, is determined to invest part of the city's $500,000 in Christmas decorations. In Los Angeles, which gets a $35 million share, Mayor Sam Yorty wants to use some of the money to build a huge maintenance center to house such municipal property as police cars, printing presses and school supplies; critics call it a "monument to the mayor."

Though big-city managers welcome revenue sharing, they are worried about losing an even richer source of money: federal grants that are targeted for specific projects such as pollution control and housing. Some Administration officials have charged that these grants have scattered money wastefully, and city administrators see the criticism as a prelude to a cutback in these funds, which total $41 billion this fiscal year. If the grants are clipped appreciably, many communities might have to start raising taxes within a year or two. For all the benefits of revenue sharing, it is highly doubtful that it can effectively substitute for the patchwork of grants in meeting the nation's public needs.

This file is automatically generated by a robot program, so reader's discretion is required.