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Why mayors rap New Federalism

No mayor publicly quarrels with the Reagan administration's desire to reduce Washington bureaucracy and bring government closer to the people.

But many mayors still argue loud and long against some of the specifics underlying that philosophy in the administration's revised urban policy and its newest version of the New Federalism. They continue to view both measures as well-disguised efforts to trim the federal budget at the expense of the nation's cities.

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Despite presidential assurances to the contrary, these critics see both policies as increasing local responsibility with no guarantee of Washington's help to do that larger job.

The President carefully redrafted his urban policy after a premature leak of its contents incurred the wrath of those attending the recent Minneapolis meeting of the US Conference of Mayors, an organization dominated by big-city Democrats.

The new language is less harsh. No longer are local leaders referred to as ''wily stalkers of federal funds.''

But to many mayors, the message seemed the same: Cities must learn to stand on their own and stop looking to Washington for help.

''My impression of the new urban policy is: cold, benign neglect,'' says Fort Wayne, Ind., Mayor Winfield Moses in a telephone interview. ''The administration has . . . has made a philosophical decision not to support the cities.''

The President's revamped New Federalism policy includes several new compromises. Washington would no longer turn the food-stamp program back to the states as part of its welfare swap. Fewer domestic social programs would be transferred to state control. The transition funding would come from general tax revenues rather than federal excise and windfall-profits taxes.

And to ease the concern of cities that have argued that rural, conservative state legislatures are less likely than Washington to award them their fair share of funds, the President insists that cities and towns will be guaranteed 100 percent of the money historically passed to them from Washington.

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''We don't feel confident that the guarantee is ironclad,'' counters Mayor Moses. ''Governors have different objectives than mayors and it's not clear what would really be passed through and what is negotiable.''

''Most federal money for cities will still be filtered through the states and that could hurt us a lot more than any of the cutbacks we've been feeling,'' says Memphis Mayor Wyeth Chandler in a telephone interview. ''When you talk (with state legislators) about transit and the need to revitalize the cities, it's not that they don't want to help. They just don't understand the problems . . . Our dealings tend to be much better with a lot of the federal agencies.''

Some mayors like George Latimer of St. Paul, Minn., take some comfort from the now widely held view that New Federalism is unlikely to win congressional approval.

''Politically I don't think the federalism package is going to fly,'' Mayor Latimer stressed in a phone interview.

Like many mayors, he admits that one of his chief concerns about New Federalism is a lack of built-in equity.

''Congress is going to have to recognize the fiscal disparities that exist - there are whole tiers of states suffering from revenue shortfalls,'' he says.

Indeed, the Advisory Commission on Intergovernmental Relations recently concluded in a report that the 10 states making the strongest welfare payment effort in relation to their fiscal ability to do so are from the older industrial states of the Northeast and Midwest.

Few cities so far are feeling any impact of the New Federalism. But every city is feeling the pinch of those congressional budget cuts proposed by the administration.

* Mayor Latimer says the cuts have brought his city's regional transit close to bankruptcy and have sharplyUFquote'Most federal money for cities will still be filtered through the states and that could hurt us. . . .'reduced housing maintenance subsidies, food stamp disbursements, and job training for the disadvantaged.

''It hasn't directly affected my city budget that much,'' he explains. ''We try not to rely on federal funds in our operating budget. But in terms of people effects, the cuts have been devastating.''

* Mayor Moses says the combination of federal cuts and the recession has plunged Fort Wayne into the ''worst economic downturn we've ever experienced.''

* Mayor Chandler says Memphis, too, has felt the federal cuts, particularly in transit, education, and job-training funds, but that advance warning helped ease the impact. Also, he says, fewer federal regulations have allowed the city to get more of the money to which it is entitled.

''We deserve a lot more money than we've been getting, but we don't live for it and spend all our time lobbying for it,'' he says. ''There's no question but that some of the most vehement critics of the President's urban policy have indeed become 'wily stalkers of federal funds.' I was semi-aghast at that language, but there's some truth to the allegation. Many cities have hired full-time lobbyists in Washington. . . . In the past your congressman did your lobbying. . . . I happen to be one of the few mayors who believe that if the federal government doesn't . . . balance its budget, the impact on cities is going to be much worse than it is now with the budget cuts. . . .''

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