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Unformatted text preview: otecting programs than initiating them. There were
sporadic instances of presidential initiation of grant programs, such as Johnson’s Great Society, and bureaucratic
momentum to sustain programs in place. But Congress was clearly the major player, with interest groups and
bureaucracies integral parts of the “iron triangle.”
The grant system that existed in the early 1970s involved for the most part categorical grants for designated purposes,
and included requirements for strict supervision by the federal government. Categorical grants are grants that "require
that federal funds be expended for specified purposes only and have quite specific planning, record-keeping, and
reporting requirements as well."14 The following provisions are typical of categorical grants:
♦ statements of permitted uses of funds (such as specifying by law how the funds are to be used or requiring the grantee to
submit detailed plans of how the funds are to be used); ♦ expenditure constraints (such as that the money 'supplement, not supplant' local funds); 6
14 26 See US Advisory Commission on Intergovernmental Relations, The Federal Role in the Federal System: The Dynamics of Growth, Volume II
(Washington, DC: ACIR, 1981), chapter four.
Ibid., chapter three.
Calculated from Table 18, US Advisory Commission on Intergovernmental Relations, Significant Features of Fiscal Federalism 1994 (Washington,
DC: US Advisory Commission on Intergovernmental Relations, 1994).
The Federal Role in the Federal System, chapter three.
Significant Features of Fiscal Federalism 1994, Table 10.
US Advisory Commission on Intergovernmental Relations, The Federal Role in the Federal System, Vol.X.
Richard D. Bingham, Brett W. Hawkins, and F. Ted Herbert, The Politics of Raising State and Local Revenue (New York: Praeger, 1978), p. 56. Commission on Fiscal Imbalance ♦ requirements that the grantee match the federal contribution with own-source funds; ♦ record-keeping and reporting requirements (for example, that grantees maintain accounting records of how they spent
federal money); ♦ and requirements that non-accounting data be supplied (such as reports on planned and actual resource use). Most categorical grant programs also require the preparation of state or local plans as a condition of receiving aid, and
most also require reports of program activities and accomplishments.15 Clearly, while providing state and local
governments with new revenue, categorical grants did not come free.
The preference of Congress for categorical grants was the result of many forces. Congress likes the categorical
approach chiefly because it allows members to take direct credit for the programs. Members love being able to appear
at ribbon cutting ceremonies opening, for example, a new park financed by federal funds. The connection is direct, and
is one that the member hopes his or her constituents will recall at re-election time. Further, internal Congressional
norms suggest that the more dolla...
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