The new Gramm-Rudman-Hollings budget law, if triggered in fiscal 1987, would chop $10 billion from grants to states and localities for services to the elderly, the handicapped and the poor, and would threaten to pauperize state treasuries, three national organizations charged yesterday.
Virginia would lose $199 million in grants for these programs, Maryland $189 million and the District of Columbia $72.9 million, according to a study released by the National Council of Senior Citizens, the Service Employees International Union and the Villers Foundation.
The cuts would affect programs such as Head Start; education for the handicapped; school aid for educationally deprived children; sewage grants; highways; preventive, maternal and child health programs, and mass transit.
In addition to cuts in these programs, the District also could be affected by cuts in the annual federal payment, but the study did not spell out by how much.
"Rather than pull this trigger," said William Hutton, NCSC executive director, "we implore Congress and the president to enact tax revenue-raising measures right now and prevent these harsh cuts from ever taking place."
The study, prepared by Fiscal Planning Services Inc., calculated that another $2.4 billion would be lost through cuts in Medicare and student financial aid, or "programs many locally funded health care and educational institutions depend on."
The report said that while most state governments are now running surpluses, 39 of them, including Maryland and Virginia as well as the District, would run deficits if they attempted to make up the loss themselves.
Under the Gramm-Rudman-Hollings law, passed last year, the federal budget deficit for fiscal 1987 must not exceed $144 billion. If a greater deficit is projected at the start of the fiscal year, the president is directed to make a series of cuts in a various federal programs, based on formulas laid out in the law.
Half the cuts must come from the military and half from civilian programs. Social Security, food stamps, Medicaid, cash welfare payments and several other programs for the poor are exempted from cuts, and Medicare reductions are limited to 2 percent.
In the study released yesterday, Fiscal Planning Services assumed that the projected deficit would exceed the $144 billion target by about $45 billion, and that, under the formulas, budget authority for most domestic programs would have to be cut 22 percent to 25 percent below what would otherwise be allowed for fiscal 1987.
The study then studied the impact on a specific group of federal social service grant programs totaling about $43.3 billion, and calculated that they would have to be cut $10 billion under the formulas.
Here are the amounts states and localities would receive if there were no Gramm-Rudman-Hollings cuts, and the estimated amounts after the cuts:
Grants for educationally deprived children: $3.9 billion would be cut to $2.9 billion.
Highway aid: cut from $12.2 billion to $9.31 billion.
Urban mass transit: cut from $3.2 billion to $2.5 billion.
Airports: cut from $1 billion to $732 million.
Urban action grants: cut from $336 million to $261 million.
Sewage plant grants: cut from $2.3 billion to $1.7 billion.
Special educational block grant: base of $513 million cut to $395 million.
Education of the handicapped: cut from $1.3 billion to $985 million.
Community development grants: cut from $3.1 billion to $2.4 billion.
Fuel aid for the poor: cut from $2.2 billion to $1.7 billion.
Head Start: cut from $1.1 billion to $859 million.
Vocational and adult education: cut from $943 million to $726 million.
Job training: cut from $3 billion to $2.3 billion.
Work Incentive Program: cut from $222 million to $168 million.
Employment services: cut from $829 million to $627 million.
Health grants: cut from $1 billion to $781 million.
Child-support enforcement: down from $688 million to $505 million.
Community services: cut from $351 million to $265 million.
Rehabilitation services: cut from $1.23 billion to $1.19 billion.
Social Services: cut from $2.7 billion to $2.1 billion.
Services for aging: cut from $684 million to $529 million.
ACTION: cut from $104 million to $81 milliom.
Economic development: cut from $173 million to $137 million.