Cities May Have to Wait Longer for Stimulus Money

February 17, 2009 - 8:15 AM
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Philadelphia (AP) - Ever since Barack Obama was elected, Mayor Michael Nutter and his big-city counterparts nationwide have held out hope that a promised economic stimulus package would inject much-needed cash directly into their battered municipal budgets.
 
But most of the funding in the $787 billion package approved by Congress is being filtered through federal, state and county programs -- not directly to cities. That leaves Nutter and other city leaders worried about how much they will get -- and how long it will take after Obama puts his signature on the stimulus bill.
 
"The concern about that is when dollars go up into state Capitols and get kind of subsumed into the vortex of state politics," Nutter said in an interview with The Associated Press. "The dollars end up getting spread wide and thin."
 
Cities are destined to benefit once the money trickles down, but officials predict it will take longer for them to see funding for things like police officers, infrastructure improvements and health programs.
 
"We can't rely or plan on any specific amount we may be getting," said David Edwards, senior policy adviser to Atlanta Mayor Shirley Franklin. "We're just going to operate as if we aren't getting anything. We can't pencil in any money."
 
Last month, Nutter testified before Congress about the need for cities to get direct funding in the massive package. Facing a $1 billion shortfall over the next five years, Nutter has asked departments to find ways to cut 10 percent to 30 percent from their budgets.
 
Nutter also went to Washington in November to deliver a letter to then-Treasury Secretary Henry Paulson pleading for direct federal aid for cities. The letter, which was also signed by the mayors of Atlanta and Phoenix.
 
Atlanta, which is projecting a $70 million to $80 million deficit for the current fiscal year, hopes to use stimulus money for things like an airport expansion, water projects and police salaries. Phoenix wants to move forward with a light rail project.
 
In Philadelphia, the nation's sixth-largest city, Nutter would like to put money toward items such as surveillance cameras, energy-efficient vehicles and public works projects.
 
Cities had pushed to be able to get stimulus money directly, giving them more discretion, as opposed to having to get it through the states or federal grants. But that idea met with resistance.
 
The National League of Cities had lobbied to get stimulus money for big cities and says they will definitely benefit from the stimulus package. But it is hard to tell how much any particular city will get from the bill, and city leaders have valid concerns about not getting funding more directly, said Carolyn Coleman, the league's director of federal relations.
 
"We recognized that there would be an inherent tension in getting the resources directly to cities and getting the resources out quickly," Coleman said.
 
The league will strive to help them get the aid they need, whether it's through competitive grants, food stamp money, unemployment funding, Medicaid, funding for roads and bridges or other types of assistance in the bill.
 
"These are all new resources," Coleman said. "Our job really now turns toward helping city get in a position to access the resources."