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http://thenewsdispatch.com/articles/2011/0...8f989812765.txt

Mayor: Obama budget would ‘hurt’ local neighborhoods

By Matt Field
Staff Writer
Published: Wednesday, February 16, 2011 2:53 PM CST

MICHIGAN CITY — The Obama administration’s new spending plan includes a deep cut, a $700,000 slash to local funding.

In an effort to cut the nation’s budget deficit, President Obama released his $3.73 trillion budget this week and on the chopping block is the Community Development Block Grant, slashed nationally by $300 million.

The federal grants help cities pay for programs that primarily benefit middle and lower income families.

Mayor Chuck Oberlie said the cuts would come at a time when many are still struggling in the fragile economy.

“I think it will hurt because it’s going to impact the areas that have the most need,” Oberlie said. “We can’t just go back into the areas of need when everybody’s doing well. Right now is when the critical issues are setting in.”

Locally the grants provide housing, improve neighborhoods and foster economic development, according to a report on the Planning & Redevelopment department’s Web site.

“That’s where we’ve been spending (Community Development Block Grants) is in our residential neighborhoods with rehabs, demolitions, acquisitions and things of that nature,” Oberlie said, “Yes it would be a significant blow.”

There is a growing recognition of the need to cut the gap between government revenue and spending. The Congressional Budget Office projects the “2011 federal budget deficit will reach $1.5 trillion if laws remain unchanged,” according to its Web site. Obama’s proposed budget would cut the deficit by $1.1 trillion over 10 years, the AP reported.

Oberlie suggested there were other places to cut spending, citing defense and foreign aid.

“I think you can find dollars that wouldn’t be as painful to the local communities and the citizens directly,” he said.

According to the White House Web site, the budget slows Pentagon spending.

Like Oberlie, the U.S. Conference of Mayors blasted the cuts.

“With the economic downturn forcing mayors and city governments to implement ongoing budget cuts, as well as rollbacks at the state level, this is the worst possible time to cut direct funding to cities like Community Development Block Grants,” President Elizabeth Kautz said.