Connolly Attacks Unfunded Mandates

Fairfax Board Chief Testifies to Effects On Local Taxpayers

Gerald E. Connolly wants unreimbursed federal mandates eased.

Fairfax Board of Supervisors Chairman Gerald E. Connolly called on Congress yesterday to relieve the burden on his county and other local governments of billions of dollars a year in unreimbursed federal costs.

The leader of Virginia's largest local government testified before a congressional committee that Fairfax spent $543 million last fiscal year complying with federal mandates to provide cleaner water and air, collect and dispose of solid and hazardous waste, incarcerate illegal immigrants, provide health care for the uninsured, implement new voting rules and pay for No Child Left Behind, President Bush's signature education law. But the government reimbursed the county for just $148 million, leaving taxpayers to shoulder the rest.

"You're asking local taxpayers to bear the burden of your good intentions," Connolly (D), also president of the Virginia Association of Counties, told members of the House Committee on Government Reform. "Anything you make us do that you don't fully fund is an unfunded mandate."

The committee is reviewing the effects of a 10-year-old federal law, the Unfunded Mandates Reform Act of 1995, which attempted to limit the fiscal burden of federal laws and regulations on local and state governments. The law set cost thresholds for complying in an effort to reduce the strain.

But it has many exemptions and loopholes, some officials and lawmakers said, and few state and local governments have gotten much of a break. Instead, many federal mandates are increasing, stretching budgets and jeopardizing property tax relief in a hot real estate market.

"We don't have a choice. We have to meet the mandates," Connolly said. "But we have to offset them by cutting other services or increasing taxes, neither of which is very palatable." Fairfax and several other Washington area local governments are considering cuts to their property tax rates this spring to soften the blow of soaring real estate assessments.

Maryland Del. John A. Hurson (D-Montgomery), president of the National Conference of State Legislatures, also testified that the law does little to protect states from increasing costs shifted from the federal government. He cited the Bush administration's proposed cuts to the Medicaid program, particularly for nursing home care, as his chief concern.

"Medicaid is eating away at state budgets," Hurson told the committee. "People act like it's a partnership people can choose to participate in. But it's not. It's a required expense."

Rep. Thomas M. Davis III (R-Va.), the committee chairman and a former chairman of the Fairfax board, said the law on unfunded mandates needs tweaking.

"We're looking at revisiting it to give state and local governments more protections," he said.

At Davis's request, the National Association of Counties released a study yesterday showing a snapshot of costly federal mandates across the country. To implement the Clean Air Act, Arlington County spent $13.1 million in 2003 and $20.6 million in 2004. This year, the county will spend $48.6 million more, the study showed.

Montgomery County will spend $1 million this year to comply with the Resource Conservation and Recovery Act, which regulates solid and hazardous waste and affects landfills and underground storage tanks.

Davis was sympathetic to the complaints from local and state officials, asking Connolly what the $395 million Fairfax spent to comply with federal mandates cost homeowners in property taxes, the only source of revenue that the county sets on its own.

"That would be 20 cents on the tax rate," Connolly replied, noting that additional mandates from Richmond take up hundreds of millions of dollars more in the local budget. Fairfax has proposed a property tax cut of at least 10 cents, to $1.03 per $100 of assessed value.

"That does bring it home," Davis said. "This makes you basically a tax collector."