Declining the stimulus

Tuesday - 5/5/2009, 9:09am EDT

WFED's Tom Temin

As heard on sister station WTOP

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By Tom Temin
FederalNewsRadio

Why are certain states are turning down economic stimulus money? And does that mean more money for this area?

Q: First of all, who is turning down the money and how much money are we talking about?

A: Governor Sarah Palin of Alaska did it. So did the Housing Authority of North Platte, Nebraska. So did the commissioners of Warren County, Butler County and Liberty Township, Ohio. The governors of Texas, Mississippi, Louisiana, Alaska, South Carolina and Idaho have all said they will at least question the money, or take less than is available. The federal government is going to be granting more than $250 billion dollars to the states, counties and cities throughout the U.S. As we know, the very first project funded by the transportation department is the resurfacing of New Hampshire Avenue in Montgomery County, which the federal government calls Route 650.

Q: Why would some areas turn down this kind of money?

A: The anti-stimulus movement is small, but vocal. Mostly the refusniks are in heavily conservative or Republican areas, so many state and local officials are simply philosophically opposed. Commissioner Mike Kilburn of Warren County told an Ohio TV station "I don't want any of this Obama stinking filthy stimulus money. Obama is spinning this money like it's gravy being poured out of a saucepan and it's a credit card of Chinese and Japanese money that are gonna own us and we have no idea how we're gonna pay it back." Commissioners there are turning down $373,000 for a transit system upgrade. But there are other reasons. Mississippi Governor Haley Barbour worries that stimulus dollars would require his state to pay welfare benefits to people who wouldn't have qualified if not for the stimulus bill. Others worry about the huge reporting and transparency requirements that come with the dollars. So difficult are they to meet, that Congressman Ed Towns of New York has introduced a bill to give money to states specifically so they can hire the capability of tracking and reporting stimulus money to the federal government. And still other worry that once they become dependent on the money, they will be in even worse shape once new programs are established and the stimulus money runs out.

Q: What happens to money that is refused by locals?

A: It will be spent, all right. The administration means to get this money out the door, if not this year than in the next two. So it just means there will be more available for the rest of our locales.

For stimulus spending details, see the Wall Street Journal's Stimulus Spending by State map and spreadsheets.

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