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New York lawmakers, responding Sunday to the failed car bomb found in Times Square overnight, challenged the rest of the federal government to keep homeland security dollars flowing to the nation's largest city -- calling the incident a "stark reminder" that New York City must be protected.

Federal authorities are calling the incident a possible "act of terrorism," though they are not saying whether foreign or domestic forces were behind it. It comes after the Obama administration has proposed funding cuts for certain counter-terror programs in the region.

State officials say no matter what the Times Square investigation uncovers, the attempted attack underscores the reality for New Yorkers that their city is a prime target.

"New York City is the number one terror target in the world, which is why we always have to keep in mind that New York has to receive the homeland security funding that it needs," Rep. Peter King, R-N.Y., ranking Republican on the House Homeland Security Committee, told Fox News.

The Department of Homeland Security in December announced that it was increasing the New York City region's urban security funding to $151 million, up from $145 million the year before, drawing praise from state lawmakers. The Obama administration is increasing the funding after the Bush administration slashed grant money for New York and Washington in 2006 in favor of mid-sized cities elsewhere, drawing outrage from Empire State officials.

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However, those officials have since criticized President Obama for pursuing cuts in other areas. Sen. Charles Schumer, D-N.Y., Sen. Kirsten Gillibrand, D-N.Y., and King all criticized the administration for announcing in December that local funding from two Department of Homeland Security programs would be reduced.

The Transit Security Grant Program funding was cut from $153.3 million to $110.6 million. The Port Security Grant Program funding was cut from $45 million to $33.8 million. Administration officials reportedly said at the time that stimulus funding helped make up for the grant cuts.

Schumer also called on the administration in February to scrap a plan to transfer a Coast Guard unit from New York City Harbor to Boston.

The proposed cuts came as new details emerged about a foiled bomb plot aimed at the city's subway system. Najibullah Zazi has pleaded guilty to federal terrorism charges in the case.

Gillibrand on Sunday released a written statement saying the Times Square bomb once again should sharpen focus on the continuing threat to New York City.

"This is yet another stark reminder that we must remain vigilant in investing federal homeland security resources to protect New York City and the nation," she said. ""While we continue to gather all the relevant information, one thing is certain -- more homeland security dollars are critical to prevent the worst case scenario -- a dirty bomb or nuclear attack on our city. I will continue to work with my colleagues in Congress to bring these resources to bear."

She said that she and King have urged Congress to include $20 million in the upcoming Homeland Security spending bill for the Securing the Cities Initiative -- a program aimed at thwarting possible nuclear and radiological attacks.

President Obama, briefly addressing the Times Square attack during a visit to the Gulf Coast to monitor the oil spill there, pledged Sunday to find out who is responsible and bring them to justice.

"We're going to do what's necessary to protect the American people," Obama said.

Though officials are still combing through evidence in the Times Square attempt, a monitoring group has reported that the Pakistani Taliban are claiming responsibility. Fox News has not confirmed the authenticity of the claim -- New York police also said they have "no evidence" linking the group to the bomb.

King said that New Yorkers ultimately "lucked out," since the bomb did not properly detonate and a lot of evidence was left behind.

He said that since the Sept. 11, 2001, attacks, terror groups have adapted to U.S. efforts to keep foreign militants out of the country. He suggested U.S. counterterrorism efforts will have to adapt with them.

"We do see the phenomenon of homegrown terrorism," King said. "We have to preempt the terrorists. We can't wait until they get here."