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Econ 4040 1st Edition Lecture 9 Outline of Last Lecture No Class Outline of Current Lecture I Review for the Exam Current Lecture ECON LAW REVIEW SESSION I Matthews v Massell 356 F Supp 291 N D Ga 1973 Facts mayor of Atlanta plans to use federal Revenue Sharing Act funds to pay firemen s salaries and use resulting savings in the general fund for politically motivated tax refund Claim of Plaintiffs proposed use of federal funds violates requirement that funds be used only for priority purposes misuse will render city liable for repayment of funds and penalty Defense restrictions on use of funds are illusory and unenforceable as recognized by Congress Matthews v Massell 356 F Supp 291 N D Ga 1973 Holding proposed use of funds a violation enjoined Reasoning no restrictions on the use of freed up funds on the fact of the Act but shifting funds from one account to another constitutes a misuse of funds as it would violate the spirit of the restrictions Economic theory budget curve of the city and new year spending problem result is illogical from a single budget perspective allocation of budget contingent on the new funding is indistinguishable from These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute next year s budget presupposing the funding intent is only relevant here because the budget was preannounced Tilton v Richardson 403 U S 672 1971 Facts Higher Education Facilities Act of 1963 allocates funding for new buildings to universities Claim of Plaintiffs taxpayers grant funds to religiously affiliated colleges as a violation of the First Amendment Holding no violation problem of entanglement between the federal government and religious institutions is mitigated because 1 collegiate institutions prioritize education and college students are cynical 2 non ideological character of the aid provided 3 no continuing financial relationship Douglas Dissent one budget money



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