January 28, 2009 in Nation/World

State share of stimulus funds won’t be cure-all, Gregoire says

By CURT WOODWARD Associated Press

OLYMPIA – Washington’s share of a federal economic stimulus package – estimated at perhaps $4 billion – will have plenty of strings attached, and won’t be the economic cure-all that some people are hoping for, Gov. Chris Gregoire said Tuesday.

“I think the expectations we heard out there were, everybody was ready to spend boatloads of money – ‘I’m going to build this, and I’m going to build that,’ ” Gregoire said in an interview with the Associated Press.

But “that’s not how the money’s coming,” Gregoire said. “There’s not going to be a whole lot of discretion out there for spending the money.”

Gregoire’s special assistant for the stimulus package, Dick Thompson, said he is estimating Washington’s potential share of the federal package in a range from $3.5 billion to $4.5 billion. That estimate is fluid, Thompson noted, because the U.S. Senate is still working on its version of the bill, and the Senate and U.S. House have to negotiate a final package.

Once it arrives, the stimulus money will be channeled largely through a long list of federal programs with different rules and deadlines attached, Gregoire said.

One of the bright spots for Gregoire’s austere, no-new-taxes budget proposal is the proposed federal level of spending on Medicaid, the health program jointly financed by states and the federal government.

Gregoire counted on about $800 million in extra federal Medicaid spending in her budget, and said that was a conservative estimate. She appears to be correct, since the minimum Medicaid help Washington could receive under the House version of the stimulus package is about $814 million, Thompson said. The maximum, depending on where the state ranks in economic factors such as unemployment, could be about $1.9 billion under the House proposal.

Also on Tuesday, the Senate began releasing details about its version of the stimulus package. Sen. Patty Murray, D-Wash., said the package could contain about $6.4 billion for environmental cleanup projects nationwide, including spending on cleanup at the Hanford Nuclear Reservation.

Murray also said the Senate version could include about $3.25 billion of increased borrowing authority for the Bonneville Power Administration, and about $146 million in K-12 education money to help alleviate cuts from the state budget.

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