spending

Through a Glass Darkly: On the Need for Greater Transparency Regarding Federal Funds Going Directly to Texas Local Governments

The Texas Legislature needs to know the amount of federal funds that go directly to political subdivisions of Texas, and this with the view to enhancing the Legislature’s knowledge of and ability to deal with the effects of these funds on the Texas economy.

Federal funds are never “free.” They come with federal requirements, e.g., matching components, which build spending requirements into the system. These programs are tailored to the federal government’s priorities, which may or may not be the priorities of the citizens of the local government recipients and/or of the state as a whole. Moreover, federal funds that go directly to local governments can produce budgetary redundancies.

Therefore, through monitoring and evaluating federal funding to local governments, the state of Texas will have at its disposal the information available to be more strategic in its partnerships with the federal government. The need for this information is vital, because the national debt now stands at over $19 trillion. In order for local governments to avoid a nightmare scenario in the future, they need to quantify the funds received from the federal government and determine how they are spent. In this way, Texas and other states will be better able to plan for any coming contraction in federal spending.

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