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Governors Cold-Shoulder Federal Fiscal Fight

The Budget

From The Post
  • GOP Governors Flex Muscles (Aug. 10)

  • Clinton Is Optimistic on Budget Accord (Aug. 9)

  • Good Times for Governors (Aug. 8)
  • By Dan Balz and David S. Broder
    Washington Post Staff Writers
    Wednesday, August 11, 1999; Page A4

    ST. LOUIS, Aug. 10—The nation's governors warned Congress and President Clinton today not to let their impasse over tax cuts and the budget lead to reductions in federal funding for key health and social services programs administered by the states.

    The governors' resolution reflected fears that the states will be the victims in the battle between Clinton and the Republican Congress over the size of the tax cut and the financing of domestic programs.

    The governors are particularly alarmed by proposals in Congress to try to recapture excess welfare funds that have built up in the states because of savings from the success of the 1996 welfare reform act. But the governors also pointed to possible cuts in commitments to the states for such programs as children's health insurance and Medicaid.

    Wrapping up the summer meeting of the National Governors' Association, Utah Gov. Mike Leavitt (R) said the resolution "calls on Congress to maintain its agreement with the states."

    "We have made great gains," Leavitt said, "but the difficult half remains. It is a daunting task."

    The governors concluded their meeting by installing Leavitt as the association's new chairman. He announced an ambitious agenda for the coming year that includes the first meeting between all 50 governors and the 100 U.S. senators.

    The session, which will be held at the Capitol during the governors' winter meeting in Washington next year, will focus on the state of federalism. "We will have a highly symbolic but substantive meeting to talk about the status of the states," Leavitt said.

    Leavitt said he would use his chairmanship to focus on ways to strengthen the states by helping them adapt to the demands of an information age global economy. "I believe that adapting to that change will clearly be the most challenging period that states as institutions have ever faced," Leavitt told his fellow governors today.

    He cited issues ranging from regulation and taxation to education and the environment as areas that he said require new models if states are to prosper in the changing economy. Leavitt said he is particularly interested in helping governors understand how the Internet and electronic commerce will affect states. He said the changing economy would require a "radical simplification" of the tax and regulatory systems.

    Many governors are concerned that the growing amount of commerce on the Internet will erode their sales tax base, but the computer industry has been successful so far in heading off efforts to tax transactions on the Internet.

    The governors today also installed Maryland Gov. Parris N. Glendening (D) as vice chairman, marking the first time since the early 1970s that a Maryland chief executive assumed a leadership role in the NGA. Glendening is in line to become chairman when the governors meet next summer at Pennsylvania State University.

    Glendening said education and the environment, particularly the issue of growth and sprawl, would be his major areas of interest. Glendening, who is a student of federalism from his days as a university professor, said he hoped the governors' association could again become a forum for leadership, not partisanship. "I think there will be an opportunity to build consensus and also to lead," he said.

    © 1999 The Washington Post Company

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