Governors Target Transportation Funding

The nation's governors are ratcheting up pressure on Congress and the White House to fix the country's crumbling roads, bridges, dams and sewers, an investment some governors tout would serve a dual purpose by boosting the slumping economy.

Governors on Monday (Feb.25) left the National Governors Association winter meeting divided over whether to push Congress to include transportation money in a second economic stimulus package. But the NGA gathering elevated bipartisan concerns about the nation's deteriorating infrastructure, landing the issue directly in front of President Bush amid vows to get the presidential candidates to also address the problem.

In a White House meeting with governors, Bush shot down the idea — pressed mostly by Democratic governors — of passing a second economic stimulus package with money for roads and construction projects, arguing it is premature. Congress just this month passed a package of tax credits and business deductions to try to keep the economy out of recession.

Pennsylvania Gov. Ed Rendell (D), vice chair of the NGA, argued that federal funding for transportation and other construction projects would upgrade the nation's infrastructure and provide well-paying jobs as a possible recession looms. "We think it's the best type of stimulus, even better than the first stimulus," Rendell said.

Rhode Island Gov. Don Carcieri (R) said all governors agree that they need money to invest in roads, bridges and other infrastructure. But that's a separate question from whether there should be another economic stimulus bill, he said.

Concluding three days of meeting, schmoozing and commemorating the NGA's 100 th anniversary, the governors also appealed for relief from the Democratic-controlled Congress from Bush administration rules affecting driver's licenses and Medicaid expenses.

Presidential politics also dominated much of the governors' private discussions. A number of Republican governors stepped forward in support of U.S. Sen. John McCain of Arizona after getting together with the presumptive GOP presidential nominee over the weekend.

The new emphasis on infrastructure arises as governors in at least 18 states are facing deficits in their state budgets this year and as most are scrambling to find funds to keep up with maintenance of roads, dams, bridges and other structures that are vital to U.S. commerce.

Governors in Pennsylvania and New Jersey are among those looking to privatize or add toll hikes to raise money to keep roadways maintained. The federal Highway Trust Fund, which pays for roughly 45 percent of the nation's road and bridge building, is expected to run out of money as early as next year, falling $3.3 billion short of needed transportation funding. The fund is paid for by the federal gas tax of 18.4 cents per gallon, which was last raised in 1993.

New attention was focused on infrastructure after a Minneapolis bridge collapsed in August, killing 13 motorists. But problems have been mounting nationwide for years. M ore than one in four of America's nearly 600,000 bridges are rated deficient, a third of major roadways are rated in substandard condition and may be contributing to traffic fatalities, 3,346 dams could fail, and aging sewer systems are spilling an estimated 1.26 trillion gallons of untreated sewage every year.

Washington Gov. Chris Gregoire (D) said more federal investment in the nation's infrastructure would give a bigger and longer-lasting boost to the economy than the one-time tax credits in the stimulus package already passed by Congress. "It's one thing for someone to get a $600 check and go out and spend it. It's another thing for them to get a job and add to the infrastructure in the state," Gregoire said.

But Transportation Secretary Mary Peters told governors that transportation projects take too long to get the economy moving.

Gregoire was one of 12 governors who over the weekend joined Rendell and California Republican Gov. Arnold Schwarzenegger (R) in support of the "Building America's Future" coalition launched last month with New York City Mayor Michael Bloomberg.

"Roads move people and goods. ... The governors are here to move the federal government," Schwarzenegger said at a Feb. 24 press conference joined by governors of both parties who support the initiative. The nonprofit is being funded by a $1 million grant from the Rockefeller Foundation.

Rendell said the coalition plans to lobby not only Congress, but also the parties' presidential nominees for a greater investment in infrastructure of all kinds. Rendell said the group plans to invite both the Democratic and Republican presidential nominees to participate in an infrastructure forum.

Indiana Gov. Mitch Daniels (R), the president's former budget director, said states should not be looking for a bailout. " My attitude all along has been: Do what is best for the national economy, whether it sends our state government any more money or not," he told Stateline.org following a conference at American Enterprise Institute. "This should not be an excuse for people to go and fix their state budget problems."

Mississippi Gov. Haley Barbour (R) said more government spending was not the answer. "I don't think spending is part of the solution," he said.  

NGA Chairman Minnesota Gov. Tim Pawlenty (R) said the disagreement wasn't a partisan one and that the issue of more transportation funding in a second stimulus package was just one of several ideas brought up. "The NGA position on all of that would be crystallized if and when we get to a point where Congress is actually going to consider a second stimulus package," he said.

The stimulus package Bush signed into law this month did not include a NGA plan to include $12 billion to help states pay for Medicaid expenses, which tend to rise as job losses mount, and to provide block grants to local communities.

The governors Feb. 25 adopted a policy without any dollar figure that would allow governors to negotiate more broadly for funds if Congress decides to pass a second package. The governors note in the new, interim policy that Medicaid and block-grant funds have helped states in the past during economic downturns and urged Congress to avoid policies that shift additional costs to the states.

Governors did, however, reach unanimous agreement on Medicaid and Real ID.

The governors plan to send a letter to Capitol Hill this week asking Congress for a one-year reprieve from a batch of new Medicaid rules that governors say will shift $13 billion in costs over five years to states at a time their own budgets are facing deficits because of the economic downtown. The Bush administration argues the new rules will better focus money spent on the health insurance program for the poor.

The governors also showed they still are frustrated with new federal standards to make driver's licenses more secure under a 2005 law called the Real ID Act. Despite changes designed to lower the cost of the law, governors voted to object to and continue to call for full funding of the driver's license measure, estimated to cost $4 billion

The official agenda of the NGA winter meeting was jam-packed with sessions devoted to "securing a clean energy future," the initiative of this year's NGA chairman, Pawlenty.

When governors weren't talking policy, the run for the White House was a popular topic. Democratic governors who already have backed either U.S. Sen. Barack Obama or U.S. Sen. Hillary Clinton for the Democratic nomination for president were quietly urging their 10 uncommitted colleagues to jump on board.

Meanwhile on the Republican side, McCain headlined a Feb. 23 dinner for the Republican Governors Association and during the weekend met individually with several governors.

At a news conference following their meeting with the president, several GOP governors also stepped forward to add their public support for McCain, including Alaska Gov. Sarah Palin, Mississippi's Barbour, Rhode Island's Carcieri , Vermont's Douglas and Missouri Gov. Matt Blunt, who initially endorsed Mitt Romney before the former Massachusetts governor dropped out of the race. Eight governors already had endorsed the Arizona senator.

Stateline.org staff writers John Gramlich , Eric Kelderman and Daniel C Vock and Stateline.org intern Kim Mendelsohn contributed to this report.