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With Need For Renewal By Congress Federal Revenue Sharing Northwvrt Ariumat TIMCS, Sun, June AKKANCA* Face Legislative Battle By RICHARD J. MALOY TIMES Washington Bureau WASHINGTON _ The federal r e v e n u e sharing program, which has been a fiscal bonanza for s t a t e and local governments, comes up [or renewal next year amid indications it may be in some trouble. Battle lines are already forming and Ihere was a preview of Ihe forthcoming fight during a recent scries of congressional hearings on revenue sharing held by Sen. Edmund Muskie's Intergovernmental Relations Subcommittee. The program, which has already showered $13 billions on slate and local governments, drew strong support from witnesses representing governors, mayors and county commissioners. Hut spokesmen for cili/ens groups and organizations representing the poor and minorities had words of criticism. - Muskie, a supporter of the program, nevertheless acknowledged, during the hearings thai "revenue sharing appears lo be in political trouble and will be in for some rough sledding when it cotics up for renewal in the next Congress." Bolstering his remarks were the results of a survey made by Rep. L. H. Fountain's House Subcommittee which asked congressmen how lliey felt about the five-year $30.2 billion program. Many of them e x p r e s s e d reservations about how'revenue sharing is working, with'Demo- crats being more critical [nan Republicans. For example a m a j o r i t y of the Democrats who responded fe 11 it was wrong to use the federal funds to cut local taxes and a majority also felt the money was spread too thinly a m o n g too many units of government. The Democrat's reservations are important, because Watergate is expected to result in Lhe election of an overwhelmingly Democratic Congress in November. It will be this new Congress which will decide on the future of the program. The r e v e n u e sharing program, which hands out about $6 billion annually to 38,000 slate and local governments, is now scheduled to expire at the end of 1976. However congressional action to extend the program must he taken next vear. There is liltle or no likelyhood thai the program will be terminated. But the prospects are good that some major changes will be made in it. Muskie has called for changes in the distribution formula, and end to revenue sharing grants to certain local units which 'a'rc not viable general purpose governments." Two other witnesses before his hearing said the 13,000 midwes tern township governments, whose main purpose is keeping up local roads, should be eliminated from the program. Muskie, backed up by the mayors and governors, also insisted that safeguards be written into any extension of the program to prevent a repeat of; the situation which allowed the Nixon Administra tion to curtail o t h e r federal grants to state and loca governments at the time the revenue, sharing program got underway. "We, must insist that revenue sharing truly be new assistance." he said. Tht most significant criticism of the program voiced by wit nesses during the hearing w a s that little of the money had een spent to help the needy. They demanded that new legation tie some strings on the money to force some spending on social programs. Graham Watt, director of the Office of Revenue Sharing, pre-, sented before the subcommittee ,he results of a private survey which showed only three per :ent of the revenue sharing funds had been spent on social services for the poor. The survey showed that 30 ser cent of the money went for jolice and fire departments, 13 aer cent for sewage disposal, 14 per cent for street repair and construction, 11 per cent for recreational purposes and three per cent for tax relief. Elmer B. Stalls, head of the General Accounting Office, testified that about two thirds of the money was used for statL and local government operations and one third for capital outlay. He said the majority of officials surveyed by his office said revenue sharing had helped ease the pressure for local tax increases. It was also Staats who said his investigators h a v e concluded that the effort of Con gress to force spending of the money for certain priority purposes was "illusory." Mayors and governors got around the law by juggling their budgets, he said. Some of the most significa.nl testimony came from Richard Nathan, who as a top Budget B u r e a u official in the first Nixon Administration was principle architect of tiie revenue sharing program. He is now a senior fellow in the pretigious Brookings Institution and is conducting an intensive study of how the program rorking. So far, according to, Nathan, has found "no surprises" n how the program is actually vorking. It is doing exactly t h a t Congress intended; wiping state and local governments cut or stabilize their tnx ites while continuing to rovide the same or increased service to the public. FISCAL. BIND Nattian acknowledged mayors nd governors got caught in a seal "pincer" when the Nixon Administration cutback federal unds for other programs at the ime revenue sharing went into ftect. T h e chief changes he recommended, in response to lucstions from Muskie, were to Foul Weather Friends Nothing To Laugh About That Serious Soviet Humor MOSCOW (AP) -- Wielding screwdriver, the waiter screws eating utensils into the restaurant table. "Nov 1 hope our forks and spoons will stop disappearing," he says to Hie cook. --The kerchiefed woman contemplates the coat her hushand is trying on in a store. It's Area Students Get Perfect Harks At UA Fifly-three students in the University o! Arkansas College of Education made straighl-A's for their course work during the spring semester, according to Dean Fred Vcscolani. They were among 164 students who were named to the Dean's honor roll for the semester. Area students who made perfect marks include: Freshmen --i Gwen L. Rogers of Springclalo. Sophomores -- Lisa H. Prier of Fayctteville and Marilyn S. Allen and Gary W. Hutcheson of Bentonville. Juniors -- Lee A. Bair, Jama- lee P. Her/man, Otis S. Watson and Minnie Jane Wolf, all of Fayetteville; Karen S. Ward of Springdale; Donnie A. Smith of Farmington and Mary E. Matthews of Rogers. Seniors -- Carolyn Lcchten- bergor, Richard D. McWhorter. Linda R. Merrill, Donna J. Nauman, Patrick L. Patton, and Melissa J. Walker, all of Fayetlcvilln and Teresa Turnbo;v and Martha A, Walker of Springdale; Charlotte Hamilton of Farmington. much too large but the only one available to him. "Don't worry that the sleeves are too long," she says. "You won't need any gloves." --The owner of a tavern watches an old babushka spreading sand on the bar's ice- covered stoop. "Spread more sand," he orders, indicating the factory across the street. "It's pay day." These three cartoons, taking respective potshots at the omnipresent Soviet problems of theft, unavailability of consumer goods and drinking, ap peared recently in Krokodil tCrocodile), the Soviet Union's humor newspaper. Featuring brightly colored cartoons and satirical articles and poems, Krokodil appears three times a month on newsstands, selling for 15 kopecks (20 cents) a copy. CRITICISM CONFINED At first glance, the tabloid- sized paper appears to be a diverting relief from the heavy ideological prose of the rest of the Soviet press. But Krokodil is published by party newspaper Pravda, and Life Savers Higher NEW YORK (AP) - Life Savers, "the candy with the hole," will cost five cents more beginning Monday, the company has anounced. The price increase from 10 to 15 cents a roll was announced Friday. The last hike came in 1970, when the suggested retail price rose to 10 cents from 7 cents. "The increase has been justified since January, but we hung on hoping that the price of sugar would com* down," said William Morris, president of the company. Jls criticism is carefully con fined to subjects approved b' Ihe Soviet regime. The foibles of minor bureau cracy are fair game for satire but criticism of high govern ment officials is forbidden The stories and cartoons o Krokodil are meant not just ti amuse, but also to teach a les son. The newspaper, for ex ample, has a continuing car loon series depicting as an mals some personality type* displeasing to the government U s called "Krokodil Zoo." Soviet citizens who covet costly fur coals are warned b the cartoon of a mink stoK wrapped like a snake around the neck of ils unsuspecting owner. "The mink is soft an* mild, but it also has the fea lures of a python," Krokodi says. Krokodil throws darts at multitude of Soviet short comings, but some of its favor ite targets are drunkenness, the lack of consumer goods anc their shoddy workmanship. Ion hair and sloppy habits of youni people, and the corruption anc inefficiency of government an trade workers. FAMILIAR PROBLEMS Some of the problenv; sati rized by Krokodil are familia, ones to Americans. Like gra- fHti. Krokodil's light pricks of sat ire directed toward the Soviet Union's own problems ire ba anced by iU sharp, often bitter attacks on Western capitalist The energy crisis in the West Has come m lor ils share c sniping. A cartoon shows ; masked cowboy bandit ridhi B off on his horse with a gasoKne can after shooting down the employes of a gas station. It'i called: "Western '74." revise the distribution formula to provide more moeny for densely populated cities with numerous social problems 3nd less for the 13,000 midwest township governments. Testimony from the nation's mayors and governors strongly supported a continuation of revenue 'sharing. Speaking for the National Governors Conference. Gov. James Holshouser of North Carolina called the program a "giant - step." He said the governors want the program made permanent, with safeguards to bar cutbacks of other federally-funded programs. Testifying for the League of Cities-Conference of Mayors, Mayor Moon Landrieu of New Orleans said the mayors are united "100 percent" behind the revenue sharing program. When Congress enacted revenue sharinig, it also appropriated a flal $30.2 billion to finance it for five years. Both the mayors and Ihe y.tyernors, noting that inflation nas eaten up much of this money, called in their testimony for a different approach to funding the program. PERCENTAGE SOUGHT They want the revenue sharing funds to be a flat percentage of annual federal income tax collections; the idea being that as inflation and economic growth increases tax collections the size of the annual revenue sharing pie will also be increased. Governor Holshouser aho opposed any effort by Congress to tell stale and local governments how to spend their revenue sharing funds. "Congress must resist the temptation to add an array of restrictions or priorities to the funds," he said. But other witnesses called for new rules to force more spending on social programs. Such a request came in testimony from Mary 'Whitehcad ol the League of Women Voters in Wcstchesler County. N.Y., which monitored the program in that community of 900,000 people. Carl Holmpn, president of the Urban Coalition, said revenue sharing was not meeting ghetto problems because it has faded to replace social programs cut back by the Nixon Administration. An entire afternoon of the Muskie hearings was devoted to complaints that there had been inadequate enforcement of anti- discrimination provisions in the revenue sharing law. Harold Himmelman of tho Lawyers Committee for Civil Rights Under Law cited cases in Chicago and near Monroe, La. where there are pending complaints atxut civil rights violations. He and other witnesses said the 12-man civil rights enforcement staff of the Office of Revenue Sharing should ba beefed up. 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