198 State Papers and Addresses

ment of public welfare every $1, 000 of expenditures in a given month is divided
as follows: $100 for administration, and $900 for assistance to 100 families at
$9 per month. Thus the administration is 10% of total expenditures. But let
us assume that due to a sudden realization of how inadequate a $9 per month
grant is, this department increases the grant to $18 per month, or double what
it was before. It takes no more administrative money to care for the same 100
cases. But now, of a sudden, the agency spends not $900 for assistance but
$1800; it still spends its $100 for administration out of a new total of $1900, and
its percentage is now only slightly over 5% instead of 10% as before. Thus
the mere moving up or down of the average assistance grant so affects the
percentage that it is open to question and furnishes no basis of comparing one
state with another.

After weighing carefully, however, the complexities faced in attempting to
arrive at a mutally acceptable administrative cost breakdown, on the one hand,
as against the financial penalties incurred by states of very limited resources
under the 5% basis of payment, I am very definitely in favor of the Federal
Government's participation in administrative costs in all the categories of relief
on the basis of one half of actual cost. The percentage basis of total expendi-
tures still in effect in the field of old age assistance seems to me to be un-
realistic and unsound, and should be abandoned.

So much for Federal financial participation. What of the sharing as be-
tween states and local units ? Looking at the Country as a whole we find some
states in which the total cost is borne by the State. In others, the local com-
munity also pays its share. In Maryland we use the latter method. We believe
in some assumption of the cost by the local unit, by which the people are made
relief conscious, but there are numerous criticisms which can be made of the
present method, criticisms which are applicable to many other states.

At the present time, in Maryland, the laws governing old age assistance
and public assistance to the needy blind require the local units to contribute a
stated proportion of the total costs. In old age assistance for example, the local
units pay one-sixth, the State one-third, and the Federal Government one-half.
Now, it is a well-known fact that in every local community a one cent levy on
$100 of assessable property will raise varying amounts, depending on the
wealth of the community. In the poorer communities it will require a consider-
ably higher tax in order to raise a sum sufficient to provide assistance for
needy persons. In Maryland, for example, one local unit is taxing itself 8. 45
on real property in order to raise the necessary funds for old age assistance.
and doing it less adequately than another community which needs to tax itself
only 1. 41tf. It is also true that the poorer community will have a higher
incidence of need.

It would therefore seem wise to explore the possibility, where local units
are contributing to assistance costs, of equalizing this tax burden. This
could be done by establishing a standard levy upon each $100 of assessable
property, and requiring this, uniformly, of all local units. Other means
will then have to be found for supplying the difference. It would seem desir-
able to urge that the Social Security Board make a thorough study of the
different methods of financing and place at the disposal of the states factual
material which will aid in arriving at a sound basis of financial sharing.

Another shortcoming which one sees in the financial situation, viewing
the Country as a whole, is the disproportionate amounts appropriated for the