Mayors brace for bad news in budget

Federal funding looks in jeopardy

By Andrew Ryan
Globe Staff / February 14, 2011

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The budget President Obama will release today does not bode well for local governments and social service providers. His administration has already proposed cuts that would slash funding for homeless shelters, small business loans, and projects that fix streets and sewers.

Over the weekend, two local mayors mobilized against federal plans to scale back a grant program used since the 1970s to plug holes in the social safety net, jump-start construction projects, and help senior citizens on fixed incomes finance home improvements.

“We can’t balance our books on the back of the poor,’’ said Mayor Setti D. Warren of Newton, who chairs the community development and housing committee for the US Conference of Mayors. “This money goes directly to people who are most in need and has an immediate impact on job creation.’’

A 7.5 percent reduction in the Community Development Block Grant program is one of many proposed cuts in domestic spending the Obama administration will outline today as it releases its budget for the federal government’s next fiscal year, which begins Oct. 1.

The new Republican majority in the House of Representatives is pushing even deeper and more immediate cuts to the grant program, trying to enact what local officials said would amount to a 13.5 percent reduction over the next seven months, costing Boston $3 million. In the next fiscal year, some in the GOP have proposed eliminating the grants all together.

“I think this is the heart of working-class America,’’ Mayor Thomas M. Menino said yesterday. “These grants and funding really help put people to work immediately. It really cuts into the important things we do in government.’’

For decades, the community development grants enjoyed bipartisan support because the money allowed federal lawmakers to support bread-and-butter projects and small businesses back home directly. In Boston in recent years, grants helped jump-start the construction of housing for moderate- and low-income families on the site of the shuttered Blessed Sacrament parish in Hyde Square; build a new kitchen and job training center at the Pine Street Inn homeless shelter in the South End; and provide a $20,000 loan to Clover Fast Food so it could launch a food truck on the Rose Fitzgerald Kennedy Greenway.

“Last year at this time, I had seven employees,’’ said Ayr Muir, founder of Clover, which has another food truck in Cambridge and just opened a restaurant in Harvard Square. “Now I’ve got 70 employees.’’

Other federal programs targeted for steep reductions include home energy assistance to low-income families, a separate grant program for community service agencies, and money for states for airports and water treatment plants, according to a report in yesterday’s New York Times. When Obama’s full budget is released today, local governments and social service providers will be bracing for more bad news.

“Some of these cuts, especially HUD cuts, could set us back significantly,’’ said Lyndia Downie, executive director of the Pine Street Inn, referring to the US Department of Housing and Urban Development. “Everybody gets that we need to be more efficient, and we are clearly in a crisis because of the deficit. But it seems like it is really across the board without looking at the unintended consequences to this stuff.’’

Deep cuts in spending will probably remain in place for some time. The federal government must grapple with a soaring deficit, and states face staggering budget gaps as federal stimulus money dries up and other costs, such as municipal health care, continue to rise.

“I think this is not a one-year aberration,’’ said Michael J. Widmer, president of the Massachusetts Taxpayers Foundation, a business-backed budget watchdog group. “Programs that have been staples for years are now being cut. The ability of government to provide the level of service it has is fundamentally changing in this country.’’

Governor Deval Patrick has proposed slashing local aid next year by 7 percent, marking the fourth consecutive year that cities and towns have faced cuts in the money that helps pay for police officers, firefighters, and other core municipal services. To lessen the pain, Patrick has promised to give municipalities more money for schools and roads and greater power to curb health insurance costs.

“Here in the Commonwealth, we have made difficult budget decisions while keeping our commitment to job creation, education, health care, and combating youth violence,’’ Patrick’s budget chief, Jay Gonzalez, said yesterday in a statement.

In Newton, the city stands to lose roughly $515,000 in community grants if both the Republicans’ and Obama’s cuts take effect.

“There has to be a sense of shared sacrifice. I believe in deficit reduction, as does the president, but we have to look at all of our programs,’’ Warren said. “As we begin to see Wall Street taking off again and getting bonuses, we have to make sure that stretches to our Main Streets.’’

Andrew Ryan can be reached at