City Leaders Elect New NLC President and Adopt 2012 National Municipal Policy

Congress Repeals Three Percent Withholding Requirement

Spending Agreement Hits Local Programs

Senate Committee Passes Transportation Authorization Bill

EPA Consults with Local, State Governments on Rulemakings

At the conclusion of its Congress of Cities Conference last week in Phoenix, Arizona, during the 88th Annual Business Meeting, voting delegates elected Mayor Ted Ellis, Bluffton, Indiana, President of the organization. To view President Ellis' acceptance speech, click here. Congratulations, Ted. 

Voting delegates also approved policy statements for the coming year at the business meeting. The policy statements will help shape and guide NLC's advocacy efforts in Washington in 2012. For a complete list of policy, policy amendments, and resolutions that were adopted at the Conference, click here.

This week, the House passed legislation to undo a law that would require federal, state, and local governments to begin withholding three percent of their payments to contractors in 2013 and to remit those monies to the Internal Revenue Service. The "Three Percent Withholding" law was enacted several years ago as a way to close the gap between the taxes contractors owed to the federal government and the taxes the federal government collects from contractors. The Senate voted to repeal the law last week. 

Since it became law in 2006, NLC has fought to prevent this law from going into effect, arguing that it would pose significant unfunded financial and non-financial burdens on cash-strapped local governments and would have disadvantaged smaller businesses competing for contracts that have less margin to absorb increased costs. 

In a rare showing of bipartisan agreement, no House or Senate member voted against repealing the law. The bill now awaits President Obama's signature, which is expected.

With the November 23 deadline quickly approaching for the Joint Select Committee on Deficit Reduction ("Super Committee") to make recommendations on $1.2 trillion in budget cuts, and no agreement in sight, the House and Senate passed a $128 billion agreement that combines agriculture appropriations with commerce-justice-science and transportation and housing appropriations. The agreement (also known as a Mini-bus) also contains a continuing resolution to avoid a government shutdown and continue funding for the federal agencies not covered by the ageeement until December 16. 

The agreement is the first spending law enacted for the current fiscal year, which began on October 1. To see the reaction of mayors, county executives, and city leaders to the agreement, click here. 

Here are a few highlights of the bill:

Housing

Unfortunately, nearly every program that falls under the U.S. Department of Housing and Urban Development, which provides essential seed funds for improving housing and neighborhoods in cities and towns, large and small, across the country, will be cut under the agreement. Overall, the agreement calls for cuts in total spending for housing and development programs to $37.3 billion, $3.8 billion less than last year. 

The Community Development Block Grant program, formula grants to cities and states, is reduced to $2.9 billion, a $420 million cut below last year's level. The HOME program, which supports affordable housing activities, is reduced to $1 billion, nearly 40 percent below last year's level. The agreement calls for the elimination of funding for the Sustainable Communities Initiative and the HOPE VI grant programs for fiscal year 2012, the Choice Neighborhoods initiative, which the Administration has been championing as a successor to HOPE VI, is funded, albeit on life-support, at $120 million.

Transportation

In the transportation section of the agreement, Congress provides $500 million for the popular Transportation Investment Generating Economic Recovery (TIGER) program and $39.9 billion for the federal highway program, the same as last year. It funds the Federal Aviation Administration at $12.5 billion, an increase over last year; Amtrak at $1.4 billion; and transit at $2.1 billion, which is $515 million over last year. As cities and towns seek to improve the infrastructure in their communities and create jobs, funding for these programs will continue to be a top priority. 

Public Safety

In the public safety and crime prevention section of the agreement, Congress approved calls for cuts in funding for programs that help state and local governments keep their communities safe and provide services to those who have served their time. It provides $370 million for Byrne Justice Assistance Grants (Byrne JAG); the program received $424 million in fiscal year 2011. It allocates $166 million for the Community Oriented Policing Services (COPS) Hiring program, $71 million less than last year but good news for a program that was slated for complete elimination in earlier versions of the spending bills. Programs to support ex-offender reentry initiatives are also slated to receive less this year with funds for the Second Chance Act program reduced to $63 million, $20 million less than last year.

Last week, the Senate Environment and Public Works Committee passed a two-year transportation authorization bill (S. 1813) known as Moving Ahead for Progress in the 21st Century, or MAP-21. Senators Barbara Boxer (D-CA), James Inhofe (R-OK), Max Baucus (D-MT) and David Vitter (R-LA), who comprise the bipartisan leadership on the transportation committee, had introduced an outline of this bill back in July but were waiting for the Senate Finance Committee to identify additional funding to keep surface transportation programs at current spending levels.

MAP-21 does keep funding at current levels; it also consolidates transportation programs by two-thirds and expands the Transportation Infrastructure Finance and Innovation Act (TIFIA), a loan program providing federal credit for transportation projects of national or regional significance, by $1 billion per year. The Committee passed the legislation only after a compromise was reached on a program requiring states to use 10 percent of federal funds on transportation enhancements. The bill must now be considered by three additional Senate committees (Banking, Commerce, and Finance) before it can be brought to the full Senate for consideration. No timetable has been set for those committees to consider the legislation.

In the House, Transportation Committee Chairman John Mica (R-FL) has indicated that a House bill could be introduced in coming weeks. 

NLC continues to monitor action in both chambers and to call on Congress to enact a new, long-term comprehensive federal surface transportation program that recognizes the central role of transportation in metropolitan and regional economies, includes local voices in planning and project selection and allows the best mix of transportation options to fit regional needs.

EPA Consults with Local, State Governments on Rulemakings
Carolyn Berndt, berndt@nlc.org, 202.626.3101 

The U.S. Environmental Protection Agency (EPA), as required under Executive Order 13132: Federalism, recently held two consultation meetings for local and state government groups on upcoming rulemakings changing the definition of "waters of the U.S." and revising the Lead and Copper Rule. 

The former, a formal consultation with state and local governments, was initiated in response to a request NLC made over the summer to clarify the specific definition of "waters of the U.S." - a definition that will determine whether a waterway, water body, or wetland should be protected under the Clean Water Act (CWA). EPA had issued draft guidance earlier this year; NLC, together with additional groups representing local and state governments, submitted comments urging EPA to proceed with a rulemaking and urged the agency to evaluate the full impact such a rule would have on all programs under the CWA. Click here to view the Federalism consultation waters of the U.S. presentation. EPA may also soon provide a second briefing to present an economic and cost-benefit analysis. 

The second consultation pertained to possible revisions to the EPA Lead and Copper Rule (LCR), a drinking water regulation that requires monitoring and treatment techniques to control lead and copper corrosion in drinking water systems. EPA is currently evaluating potential regulatory changes to the existing LCR, including changes to the sample site selection criteria for lead and copper, changes to tap sampling procedures, changes to requirements for lead service line replacement, public education requirements for copper, and modifications to corrosion control treatment requirements. The agency plans to issue a proposed rule in fall 2012 and to promulgate a final rule in 2013. The LCR revisions could become effective in 2016. Click here to view the EPA LCR Federalism consultation presentation.

EPA will accept comments on the waters of the U.S. consultation material through December 15, 2011 and on the LCR consultation material through January 16, 2012. NLC is currently reviewing both proposals and may submit comments. If your city or town files comments, please be sure to share them with NLC.