What is the significance of block grants

The concept of consolidating federal assistance programs with similar or overlapping statutory purposes dates back to the late s. The earliest block grant programs were comparatively narrow in scope and aimed primarily at enhancing state-local flexibility. During the Reagan Administration the focus changed, and block grants became a vehicle for shrinking the role of the Federal Government and devolving responsibility for financing and administering domestic assistance programs to state and local jurisdictions.

Over the past 40 years, there have been three major waves of federal block grants. The first wave occurred during the early s when President Nixon proposed that federal domestic assistance programs be consolidated into six block grant programs. Unlike earlier block grant programs, funding for the Reagan-era block grants were significantly below the aggregate level of the categorical programs they replaced. Passage of this legislation marked the first and to date the only time that Congress has agreed to transform an open-ended entitlement into a state block grant authority.

Over the past 30 years, periodic attempts have been made to convert the federal-state Medicaid program into a block grant authority. In , the Republican-controlled Congress passed legislation that would have capped federal Medicaid payments to the states and transformed the program into a block grant authority, only to have the legislation vetoed by President Clinton.

Congress failed to act on a Medicaid block grant plan advanced by President George W. Bush as part of his proposed FY budget. More recently, a plan to block grant federal Medicaid spending was approved by the Republican-controlled House in both and as part of broader blueprint for reducing federal spending, lowering tax rates and slicing the deficit.

The U. Senate, however, refused to act on the House budget plan and it died at the end of the th Congress see Appendix A for additional information on the history of federal block grant programs and proposals. What can we learn from examining past experience with federal block grants?

First, the real value or purchasing power of block grant funding tends to decline over time after adjustments are made for inflation. In a study of five Reagan-era block grant programs, Peterson and Nightingale found that the real dollar value of four of the programs declined between and It is harder to rally Congressional support for your particular cause if you know that the ultimate decision on how funds will be used rests with state or local officials.

Second, once block grants are authorized, the degree of flexibility afforded to state and local officials tends to erode over time.

In a process sometimes referred to as "creeping categorization," Congress adds new restrictions, set-asides for particular purposes, or new categorical programs with similar or overlapping aims. As Feingold and colleagues point out, "[a] common explanation traces this phenomenon to members of Congress,. The Partnership for Health Act retained its original flexibility, but its impact waned when Congress, concerned about state administrative performance, created more than 20 new categorical grants for health services outside the block grant.

Third, implementation of new block grant programs tends to be smoother when states administered the categorical programs replaced by the block grant. About Toggle Submenu. News Toggle Submenu. Press Releases. Legislation Toggle Submenu.

Sponsored Legislation. Issues Toggle Submenu. Airplane Noise. These grants give less flexibility to state governments than block grants. The federal government places few restrictions, allowing states to spend funds within broad programmatic areas. National government imposes standards and requirements. Federal assistance is an ongoing entitlement. States are free to tailor program and impose added restrictions on recipients. States expect recipients to move off welfare on a state-determined schedule.

States must match 25 percent of federal funds. States must match 10 percent of federal funds. Answer the following questions:. Federal policy maker goals: How does the use of categorical grants help federal policy makers control the policy activities of state and local governments and benefit federal policy makers politically?

Examining the Policy Principle The Policy Principle: political outcomes are the products of individual preferences and institutional procedures.

Notably, the proposal to turn Medicaid into a block grant program was seen as endangering the federal government's ability to guarantee a standard level of service.

Three of the better-known block grant programs are earmarked for social services delivered at the local level:. The CDBG program, administered by the Housing and Urban Development agency, says it "aims to viable urban communities by providing decent housing and a suitable living environment" with a focus on "low- and moderate-income persons.

The grant amounts are awarded according to a formula based on a community's need, including its extent of poverty, overcrowding, and population growth. The Mental Health Block Grant, established in , has disbursed millions of dollars to states to assist in the treatment of mental illnesses. The grant was amended in to require that states develop its services based on the advice of Mental Health Planning Councils comprised primarily of family members and non-treating professional citizens.

The Social Services Block Grant Program SSBG is a broadly defined program that allows states and territories to tailor social service programming to the needs of their populations. Administered by Health and Human Services, the program is intended to "reduce dependency and promote self-sufficiency; protect children and adults from neglect, abuse and exploitation; and help individuals who are unable to take care of themselves to stay in their homes or to find the best institutional arrangements," according to the department's Office of Community Services.

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