LINCOLN — Gov. Dave Heineman, whose criticism of the federal stimulus program has grown in recent months, may get to sidestep a particularly sticky political decision — whether to apply for a new round of stimulus funds.
Heineman said Friday that his reading of a new stimulus proposal is that Nebraska will get the stimulus funds whether he applies for them or not.
A summary of the Education Jobs Fund proposal recently passed by the U.S. Senate states that if a governor declines to apply for the money, the U.S. secretary of education would be required to send the money to “another entity or entities in the state” if the state met certain requirements.
“That’s not a choice,” Heineman said, following a speaking engagement Friday morning at Quarry Oaks Golf Club near Ashland. “We’re kind of forced into it.”
Nebraska is in line to receive $59 million in new stimulus funds for education, an amount that equates to about 1,000 teaching jobs in the state. Another $69 million would go to Medicaid, the health insurance program for low-income residents.
The proposal, passed by the Senate last week, is expected to receive approval Tuesday by the House and then be signed quickly into law by President Barack Obama.
The $26 billion measure is being portrayed as a salve for the still-hurting national economy, one that will prevent massive layoffs in schools across the country and stave off deep cuts in tax-funded health care programs for the poor.
But some have wondered whether Heineman, a Republican seeking re-election this year, would refuse the new stimulus funds to make a political point.
State Sen. Heath Mello of Omaha said the governor has been “hypocritical” about the stimulus packages in recent months.
In 2009, Heineman applied for and accepted about $1 billion in stimulus funds, which helped the state balance its budget and avoid deep spending cuts during the recession.
In February, Heineman signed a letter with 46 other governors asking Congress to extend additional stimulus funding for Medicaid, which provides health care for low-income people.
Two months later, he attended a tea party rally in Lincoln, telling that anti-stimulus group that he would have voted against the stimulus program had he been in Washington.
Mello said that if Heineman is truly against the stimulus program, he should just refuse the money — or take the money and send a refund check to Washington.
“This is a politician acting like a politician, and we wonder why Nebraskans don’t trust their government,” the Omaha senator, a Democrat, said later Friday.
Heineman earlier Friday didn’t say whether he ultimately planned to apply for the new stimulus money but did say that the nation has to “wean” itself off stimulus funds.
“This country has to get off deficit spending and credit card spending and balance its budget,” he said.
Heineman and Nebraska Education Commissioner Roger Breed said there are many unanswered questions about the new stimulus plan, which, they point out, hasn’t yet been approved.
One major question is whether Nebraska would be required to use the new stimulus money in the current fiscal year or the next one.
Next year, the money would help soften the “cliff effect” loss of $234 million in previous stimulus money used to bolster state education funding in 2009-10 and 2010-11.
Breed said if the state were required to use the $59 million in education funding this year, the Legislature would have to be called into special session to adjust the state’s school aid formula.
He said there appears to be a clause in federal law to allow the money to carry over a year, but state officials are trying to clarify that.
Breed said the state also is concerned about what state and local officials in Nebraska will be required to do to qualify for the new stimulus funds and account for them.
“We have great caution in this department ... until we get the official guidelines. Then we decide if we can celebrate or moan,” he said.
Jake Thompson, a spokesman for U.S. Sen. Ben Nelson, D-Neb., who voted for the new stimulus, said Friday it appears Heineman will not have to apply to get the new education stimulus funds, but that Nebraska must meet a “maintenance of effort” standard to qualify.
That standard requires the state to maintain state education funding at fiscal 2009 levels, Thompson said. That is about $840 million, according to state budget figures — about $30 million more than the state plans to spend this year on K-12 education.
Breed said the state is still trying to find out whether it has to come up with that money, and if it does, that could derail the state’s application. But the maintenance of effort requirement is just one of the qualification issues the state is looking at.
Karen Kilgarin, a spokeswoman for the Nebraska State Education Association, said she doesn’t expect Heineman to turn his back on the new stimulus money. He has been endorsed by the NSEA.
“We believe (taking the money) is the right thing to do. It’s going to save jobs, it’s going to help kids, it’s going to help state taxpayers ... ,” Kilgarin said.
World-Herald staff writer Joseph Morton contributed to this report.
Contact the writer:
402-473-9584, paul.hammel@owh.com
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