Private sector key to local growth

LOCAL GOVERNMENTS must begin looking more toward private industry instead of the state or federal government for aid in economic growth. That was the fundamental message local officials received at a statewide conference on community development and economic revitalization in Chicago December 11 and 12. The conference — cosponsored by the Department of Local Government Affairs and the Illinois Committee to Strengthen Community Economics -featured state and federal policy briefings by cabinet level government agency officials, explaining programs affecting local economies. Local elected officials and workers got the word at these meetings that, while existing government programs will continue, no major increases in government effort or spending should be expected.

Federal speakers relayed the word from the Carter administration that next fiscal year will be one of restricted federal spending — about $30 billion will be sliced from the budget. Buzz words like "targeting" and "refocusing" were repeatedly used by U.S. agency administrators to break the news that there would be little or no new infusion of funds for housing, labor training, economic planning or most other federal programs that improve local economies. John Leslie of the U.S. Department of Agriculture's Farmer's Home Administration (FHA) said rural housing loans would demand "joint investment strategies to concentrate investments on the worst depressed areas." Judith Walker of the U.S. Department of Housing and Urban Development (HUD) said that in the next year HUD will "give priority to the revitalization of urban areas" - spending a larger portion of funds for housing projects for the needy rather than others. And Ernest G. Green of the U.S. labor department's Comprehensive Employment and Training Administration (CETA), said CETA funds would focus more upon combating "structural unemployment."

Predictably, the response from local officials was hostile. Steven Sargent, executive director of the Illinois Municipal League, wanted to know what the impact of "targeting" would be on funding in Illinois and how much control local governments will have of those funds. "Will you continue to encourage special purpose districts?" he asked, accusing the feds of arrogance in bypassing county, township and municipal governments in the past. "We have been guilty," admitted Lester Salamon, organizational studies expert for the U.S. Office of Management and Budget (OMB). Salamon explained that a fragmentation of development assistance and agencies at the federal level had created a fragmentation at the local level. Salamon said there are four options for structural change at the federal level: (1) a procedural reorganization, (2) a clean division between economic development and community development, (3) a split between urban and rural area projects, or (4) centralization of all development projects under a single agency with about 18,000 employees.

When the speeches were over, local officials voiced more complaints. "Why should local governments pursue federal money when all we get are 'great expectations'?" asked Joseph Tecson a member of the Cook County Board Tecson said novelist Charles Dickens must have had local government in mind when he wrote Great Expectations, about a boy who hears rumor a large inheritance due him but waits in vain for the money. And James T. Ryan an official from Arlington Heights, said all he wanted from both the state and federal government was for them to "stop mandating programs without funding them." When state officials from various agencies relating to Illinois localities told their story they were also greeted with dissatisfaction. William H. Muhlenfield, executive director of a regi planning group known as the Northwest Municipal Conference, was clearly hostile toward the Illinois Department of Business and Economic Development (BED) because he said there is "no business advocacy in the legislature" by the agency.

Robert L. Radmacher, deputy director of BED, replied to Muhlenfield's charges by saying the agency is starting to take on more of a business advocacy role in government meetings and interagency communications. But Radmacher said the most important thing for business is a balanced state budget, and the Thompson administration had made this a priority.

The keynote for the conference was voiced by Philip M. Klutznick, senior partner of Klutznick Investments. He spoke of the necessary interdependency between all sectors of our society - implying that one can no longer afford to be anti-labor or anti-business or
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February 1979/Illinois Issues/2