WASHINGTON - State and local government officials told congressional lawmakers in two separate hearings yesterday that they need billions of dollars of direct aid from the federal government to combat the fiscal challenges they are facing.

The officials included Timothy Firestine, the chief administrative officer of Montgomery County, Md. He told House Ways and Means Committee members that "a perfect storm of bond insurance downgrades, the subprime mortgage crisis, the resulting global liquidity crisis and lack of confidence in the financial systems, has hit state and local governments, causing significant disruption in [the municipal bond] market, with no clear path to quick recovery."

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