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US aid to states, localities slows

April 24, 1981



Washington

Federal aid to states and localities rose 10.4 percent in fiscal 1980, from $ 82.9 billion to $91.5 billion, according to a new US government report. This is not a large increase compared with gains in some years past. Between 1974 and 1978, for example, federal aid to states and lo" calities increased an average of 16 percent annually, causing aid to leap from $43.4 billion in 1974 to $77.9 billion in 1978.

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However, if the Reagan administration's proposed budget revisions are adoptted, aid to states and localities in 1981 will amount to $94.4 billion, an increase of only 3.2 percent -- the smallest percentage of annual increase since 1961 when such aid crept from $7.0 billion to $7.9 billion.

And in 1982, according to the administration's proposed budget, such aid will decline 8.5 percent, to $86.4 billion.

The 10.4 percent increase in 1980 was triggered by the growth of several federal programs -- a number of which are now slated for cutbacks. These include medicaid payments (up $1.5 billion); highway trust fund outlays (up $2 billion); urban mass transit assistance programs (up $738 million); and employment an d training assistance (up $804 million).