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Date: March 12, 2003
Contacts: Gene Rose 303-856-1518 / Michael Bird 202-624-8686

NCSL Supports Economic Stimulus Partnership
Between Federal, State and Local Governments

WASHINGTON, D.C. -- A bipartisan U.S. Senate proposal involves state and local governments as critical partners in national economic recovery efforts, the National Conference of State Legislatures said today.

NCSL joined five other national public interest groups in lending its support to S. 201, sponsored by U.S. Senators Olympia J. Snowe (R-Maine) and Charles Schumer (D-New York). The bipartisan bill provides $40 billion in direct aid to state and local governments.

"NCSL believes that an intergovernmental partnership to forge a short-term economic stimulus plan is essential," said NCSL President Angela Monson in a letter to Senators Schumer and Snowe. "With state governments facing their worst fiscal crises since World War II, strategies must be put in place to ensure that federal, state and local governments and the private sector are working together for economic recovery."

NCSL said federal mandates to states, such as the No Child Left Behind Act, special education and election reform -- as well as public expectations to meet homeland security efforts -- have left states with a $26 billion to $85 billion budget hole.

A February 50-state survey conducted by NCSL found that states have a projected $26 billion budget shortfall in the current fiscal year. With only two-thirds of the states able to provide information, the budget shortfall for fiscal year 2004 stands at nearly $69 billion.

"States want to work as partners with the federal government in national economic recovery efforts," said NCSL Executive Director William Pound. "The bill sponsored by Senators Snowe and Schumer recognizes that unfunded mandates and underfunded expectations generated by the federal government needs to be addressed in order to put our economy on the right track."

S. 201 would provide immediate, temporary revenue grants based on population and key employment factors for state and local governments. Revenue grants are one of several mechanisms NCSL has identified that would spur economic revitalization this year.

Also joining NCSL in supporting S. 201 are the Council of State Governments, the National Association of Counties, the U.S. Conference of Mayors, the National League of Cities and the International City/County Management Association.

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