Bush budget hurts cities, Schmoke tells Senate panel There's work to do, but no money, mayor testifies.

WASHINGTON — WASHINGTON -- President Bush's new budget would do little to relieve unemployment, homelessness, and other problems currently plaguing the nation's cities, Baltimore Mayor Kurt L. Schmoke has told a Senate committee.

"There are projects ready to go. There are people ready to work. There is work which needs to be done; let's do it," Mr. Schmoke told the Senate Committee on Banking, Housing and Urban Affairs here yesterday.


Mr. Schmoke testified on behalf of the U.S. Conference of Mayors. He is chairman of the group's Community Development and Housing Committee.

The mayors' conference last week presented a $35 billion economic stimulus plan to the administration and asked that the proposals be considered during budget preparations.


The plan calls for immediate distribution of $5 billion in federal funds for public works projects that are "ready to go" but are stalled due to a lack of funds. Baltimore would receive $114 million for such projects under the plan.

The mayors' plan also recommends quick action on housing, job training and apprenticeships and transportation projects.

But the president's budget, released Wednesday, offers no "economic stimulus proposal which addresses the immediate need to put America and Americans back to work," Mr. Schmoke said.

Mr. Bush's proposed budget represents a 65 percent drop in federal funding since 1981 for key urban programs, Mr. Schmoke said. In adjusted figures, funding would have fallen from $37.3 billion in 1981 to $13.1 billion in 1993, he said.

Baltimore is one of the cities that has suffered from the cuts, the mayor said. Federal funding has dropped from 34 percent of the city's operating budget in 1981 to 11 percent in 1991, he said.

The end of the federal revenue-sharing program accounts for most of the loss, according to Ed Gallagher, Baltimore's budget chief. In 1986, its last year of operation, the program provided $23 million to the city. "We never have been able to fully absorb that loss," Mr. Gallagher said.

To avoid running a deficit, 18.8 percent of city jobs have been cut, contributing to Baltimore's 9.5 percent unemployment rate, the city officials said. Local taxes on parking, hotels and property have been raised. Services provided by the fire department, recreation centers and libraries have been trimmed.

Increased state spending helped offset dwindling federal funds during the 1980s, but Maryland now has severe budget problems, Mr. Gallagher said. Recent state funding cuts have cost the city hundreds of jobs, he said.


In his State of the Union address, President Bush proposed eliminating 246 programs "that don't deserve federal funding. Some of them have noble titles, but none of them is indispensable."

Mr. Schmoke said cities need many of the projects.

Those of particular concern to the mayors include two housing programs for the homeless, funding for new public housing, grants for city parks, an improvement project for Amtrak's Northeast Corridor and funding for asbestos removal.

To fund its plan, the mayors want to use funds from the defense budget, which is undergoing post-Cold War reductions. Lawmakers should reverse a stipulation in last year's budget agreement that prevents the transfer of defense funds to domestic needs, Mr. Schmoke said.