States and local municipalities have a simple choice: if they don't want Federal assistance, they don't have to accept those funds. Pure and simple. Don't accept those services, don't use them, and move on from there.
Of course, States rely on Federal assistance on many levels, and in order to make up for the shortfall in their budgets, they can either simply not offer those services, or raise their own taxes in order to fund their own programs.
Of course, citizens have paid into the Federal system, and thus, if the State decides not to accept their share of the pie, in essence, the State is then looking to tax the citizen twice for the same services. And across the board for a variety of services. Good luck with that. Tax twice. Smart.