The economy-minded 95th Congress demolished central elements of President Carter's proposed urban aid program - those aimed at creating jobs - and, as a result, many cities are facing budget cuts.
The proposals that failed would have continued extra aid to cities with high jobless rates, created a program of public works maintenance jobs, set up a national development bank and given the states incentives to help their depressed cities.
But other sections of the urban package, which Carter announced in late March, were passed along with a reduced Comprehensive Employment and Training Act (CETA) program and a beefed-up highway and mass-transit measure, both of which provide sizable aid to cities.
So urban strategists are not as disappointed as they might have been.
"We won some and we lost some," said John Gunther, executive director of the U.S. Conference of Mayors, "but the truth is that most of us in the urban lobby realized that much of the president's new program would not be enacted this year."
The most painful loss, and the one that came as a surprise to the lobby, was Congress' failure to complete action on the fiscal aid bill. Under a similar anti-recession program that has just expired, states and localities received $1.3 billion in the last year.
Carter orginally sought a revised program costing $1 billion for each of two years, and he wanted to discontinue aid to states. The reduced measure that finally passed the Senate would have provided $485 million the first year and $360 million the second year, and it included some aid to states.
Rep. Jack Brooks (D-Tex.), chairman of the House Government Operations Committee, strongly opposed the measure, but urban forces succeeded early Sunday morning in getting the Rules Committee to agree to let the measure come to the floor for a vote.
At 1 p.m. that day, after a meeting with Speaker Thomas P. (Tip) O'Neill Jr., the bill's supporters understood that it would come up later in the afternoon. But after the tax bill was passed, O'Neill read a list of measures still to be approved, and the aid bill was not among them.
Conservatives led by Brooks and Rep. Robert E. Bauman (R-Md.) had threatened a "mini-filibuster" if the measure came up. Some sources said O'Neill already had bargained away the bill in the early morning to avoid a logjam that could have further delayed adjournament.
Mayor Coleman A. Young of Detroit said the House performance on the measure was "ridiculous - it means that hundreds of cities will find themselves in deep deficit." Young added that "on the whole Congress has pretty well mangled the President's program."
He said the loss of the $1 billion maintenance jobs proposal "was a major blow. That program would have hired the long-term unemployed youth to fix up public buildings and would have broken the rigid exclusion of minorities by the building trades. It was the most imaginative plan out of Washington this year, and its loss is a disastrous defeat."
The other innovations in the Carter program - a national development bank that would guarantee loans for businesses willing to locate in depressed areas and a two-year plan to funnel $400 million in incentives to states that aid their distressed cities - never got out of committee.
Both came to Congress relatively late and neither had strong, coordinated support from mayors or governors.
The CETA measure, which at one point almost failed in the House, will cost more than $10 billion a year to provide jobs and training for about 600,000 workers in the coming year. This year the program costs $11 billion and funds 725,000 public-service jobs.
George Gross, director of federal relations for the National League of Cities, called the four-year CETA extension "an important victory. It provides three to four times [more] aid to cities" than all other programs put together.
Goss and Gunther cited the four-year, $51 billion highway and mass-transit authorization bill as another urban victory even though, like CETA, it was not considered an urban program.
The transportation measure contains the largest amount Congress has ever approved for urban mass transit. A section of it, which was part of the president's urban package, provides up to $200 million to help cities link bus lines with subway routes.
Among the smaller portions of the president's urban program, the only proposal to fail completely was one calling for $40 million for ACTION, the federal service agency, to give small grants to community fix-up campaigns and to set up an Urban Volunteer Corps.
One proposal that passed in a changed - and urban lobbyists say improved - form was the investment tax credit. Carter wanted to give businesses a 15 percent credit for building or expanding in troubled areas. Congress left the credit as its current 10 percent level but extended it to cover rehabilitation of old buildings, not construction of new ones.
"That means there will be an incentive for businesses to stay in the city and not build new plants in the suburbs," Gross said. "I don't think the cities would have fared well under Carter's original proposal."
Another urban gain resulted from Congress' expansion of Carter's proposal to give businesses a $2,000 tax credit the first year for hiring out-of-work youth and a $1,500 credit the second year. Congress increased the first-year credit to $3,000.
Congress also passed these additional parts of the Carter package: $230 million in 3 percent loans for housing rehabilitation: a tripling of the current program: a five-year, $750 million urban parks program: $50 million for inner-city health clinics: a two-year, $30 million neighborhood self-help program: a two-year, $15 million program for neighborhood art and cultural projects, and a $200 million increase , to $209 million, to expand social services such as day care and meals for the elderly, in poverty areas.
In the Elementary and Secondary Education Art, Congress added $400 million for school districts with large numbers of poor students, a program Carter proposed before announcing his urban plan.
Localities also will be affected by several measures included in the omnibus housing bill authorizing about $20 billion for the Department of housing and Urban Development.
HUD fought off an effort by Rep. Garry Brown (R-Mich.) to amend the bill to include a one-house veto power over its regulations. Instead, Congress required the agency to keep it informed of pending new rules and set up procedures for HUD to follow in doing so.