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Cash-Strapped States See More Help in House Version of Rescue Bill

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By BILLY HOUSE

Media General News Service

Published: February 11, 2009

WASHINGTON - Cash-strapped states like Florida could lose out on millions of dollars if Congress' final version of a massive economic stimulus bill ends up reflecting the $838 billion Senate bill passed Tuesday, rather than one the House approved last week.

Congressional leaders and President Barack Obama are working to resolve the differences with the House's earlier passed $819 billion approach to carrying out the president's rescue plan.

Although the more-moderate Senate Democrat plan contains an additional $19 billion, it provides less in federal spending and more in tax breaks.

Whether a final compromise can be reach by the end of the week for the president to sign into law is uncertain. Obama has said that's what he wants. Senate and House leaders say they'll try to accomplish that.

The negotiations could get contentious, however.

The three Republicans who were crucial in helping get the Senate bill passed – as well as some moderate Senate Democrats – say they are prepared to drop their support if their Senate version is significantly altered, or much spending is added.

But Speaker Nancy Pelosi says she wants some of the Senate cuts from the House version restored. Obama has said he also wants to restore funds for schools and hard-hit states restored.

"Usually (House-Senate negotiators) go to conference and split the difference between the two Houses – that may not be the case here," said Pelosi. "We have a clear idea of what the differences are and hope to resolve them as soon as possible."

Appearing with Obama at an event in Fort Myers Tuesday, Florida's GOP Gov. Charlie Crist told the crowd he is siding with Obama on the bill, adding that governors, "understand our economic crisis in a way that sometime folks a little bit more removed don't understand … they know what it means to balance a budget when revenues are short and more and more people are asking for help.

For states like Florida that are facing deep drops in revenue and budget-deficits, a key issue will be the fate of a decision by senators to cut a $79 billion fiscal stabilization fund for the states contained in the House bill in half, to $39 billion.

While much of that fund's aid to local school districts remains intact, the cuts included a $25 billion discretionary fund aimed at helping governors balance their budgets.

Florida's share of that overall fund would have been $3.5 billion, but could drop to as low as $1.7 billion if the Senate version prevails.

For another reason, even that lower amount of federal budget stabilization money for Florida remains in jeopardy.

Florida is one of several states that have reduced what they spend on education in recent years. Under both bills, as now written, that means the state won't qualify for any of the stabilization money.

House-Senate negotiators are being asked by Florida lawmakers to amend that in the final two-house bill to allow states to use some of the federal funds allocated in the stimulus package to meet the required levels of education funding.

Here's how other funding categories for Florida in the House and Senate bills stack up:

-- The Senate eliminated money for K-12 school construction. Under the House bill, Florida would receive about $961 million for school modernization, renovation and repair statewide;

-- Also gone entirely in the Senate bill is money for higher education construction; the House bill would provide $306 million;

-- a $674 million increase in food stamp benefits for the state in the Senate bill, compared to a $879 million hike in the House bill;

-- $624 million for Title I schools (schools with large numbers of students from struggling families) in the Senate bill, compared to the House's $654 million for Florida;

-- $14.7 million for Head Start programs in the Senate bill, compared to the House's $29 million for Florida statewide;

-- $134.3 million in the Senate bill through a Clean Water revolving fund for water infrastructure needs, compared to $189 million for the state in the House bill;

-- $1.7 billion for transit and highway needs in the Senate bill, compared to $1.8 billion in the House bill;

-- $727 million for in special education state grants, compared to $729 million in the House bill;

-- $105 million for Florida in Child Care & Development Block Grants in both bills;

-- $20.6 million in employment and job training funds in the Senate bill for the state, compared to $24 million in the House bill.

But while the House bill generally drives more funding to Florida, the Senate bill offers a variety of tax cuts to Floridians.

For instance, there's a one-time $300 per person payment to Social Security beneficiaries, elderly and poor persons, and disabled veterans. There are also tax credits, such as for people who buy a house or new car.

Reporter Billy House can be reached at bhouse@mediageneral.com or (202) 662-7673.

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