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V.O. Key, The Matching Requirement In Federal Grant Legislation

V.O. Key, The Matching Requirement In Federal Grant Legislation

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Published by Kevin R. Kosar
This is a preliminary study written by V.O. Key for the Federal Security Agency in February 1942. The full title is "The Matching Grant Requirement in Federal Grant Legislation In Relation to Variations In State Fiscal Capacity."
This is a preliminary study written by V.O. Key for the Federal Security Agency in February 1942. The full title is "The Matching Grant Requirement in Federal Grant Legislation In Relation to Variations In State Fiscal Capacity."

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Published by: Kevin R. Kosar on Feb 18, 2011
Copyright:Public Domain

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11/04/2013

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:t:
FOREWORD
~he present study
has been prepared by Professor V
. O. Key
of Johns Hopkins Universi
ty, a consultant of the Bureau of Research
and Statistics.
It is made available in tentative form at this timeboth because its preliminary findings may be useful to others andin order to secure comments and suggestions which can be used in its
revision. The
present report will be revised when companion studies
now in preparation have also reached a form which wi
11 permi t thei r
ci rcula tien.
Thi s
report is one of a series of monographs being prepared
in the Di
vi sion of
Finance and Economic Studies in the course of acomprehensive study and review of the major fiscal and economicrelations involved in the grant-in-aid programs established by the
Soc~.
al Securi
ty Act.
These studies
, being conducted under the
immediate direction of Eleanor
L. Dulles
, Chief of the Division ofFinance and Economic Studies
, and Daniel
S. Gerig, Jr., Chief of theGeneral Economics Section, bear closely upon proposals for theamendm~nt of the grant-in-aid policies embodied in thlS and related
legi sla tion.
In preparin~ this document Professor Key has conferred fre-
quently wi
th others working on related problems in the Division ofFinance and Economic Studies and elsewhere in the Bureau of Research
and Statistics. He
has utilized knowledge and experience which hebrought to this study from earlier undertakings
, and he has
illus-
trated and summarized his conclusions in a manner which should beuseful to many who are engaged in the study of intergovernmental
ft seal relationships.
The relation of variations in State fiscal capacity to theallocation of Federal grants-in-aid has been studied from variou~
points of view.
Analysi s of the
comparative burdens occasioned bythe raising of funds to be used in
matcMng Federal grants,
however,
has been a somewhat neglected area.
The relatiOiships examined hereby Mr. Key will be of particular interest to those concerned wi
th the
method of alloea
ting grants under the social aecuri
ty program and
the problems of rai sing State
funds, especially because of the largeamounts of money disbursed to the States on a matching basis under
thi s
program.
Thi s report
should be regarded as tentative and preliminary.It is not an official publication of the Board and has not been sub-
mi tted
to the Board for formal com:
 
ration. It is hoped
, however
that i ts ~irculation in
the preser:t form will
encourage interest in
the stlldy and the
development of effective Federal-
State fiscal
relationships and will invite comments which will be helpful in
bringing the repo
rt into fj
nal form.
I. S. Falk
, Director
Bureau of Research and Statistics
ebruary 1942
 
Introduction
CONTENTS
Page
General Principles of the Grant System
The Differential Effects of Matching Requi
rements .
. 10
The 1imi ts of the Match!
ng Principle
. 35
The Federal Grant System and Equali
zation . .
. 55
Policy Al
terna ti ves and Considerations
Direct Federal Administration
Unmatched Grants
The Variable Gran
. 63
Appendix
. . 67
III

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