In a historic meeting in Philadelphia today (Dec. 2), the nation's governors are expected to make their case to President-elect Barack Obama for a massive infusion of federal dollars to help states weather a national recession that they fear will last for another year and a half.
"We'll discuss our concerns and … and offer to help the new president and Congress sell [an economic stimulus] package to the American public," said Pennsylvania Gov. Ed Rendell (D), who chairs the National Governors Association and will serve as host to the meeting in the city where he was mayor in the 1990s.
Today's session in Independence Hall is the first time a president-elect will meet with 50 governors of the U.S. states and territories before he formally takes office, said NGA Executive Director Raymond Scheppach. "It's unprecedented."
While similar to the first gathering of the nation's governors 100 years ago called by President Theodore Roosevelt to discuss natural resource conservation, today's session was the NGA's idea. "We invited him and he accepted," Scheppach said.
Obama was scheduled to meet privately with the country's 29 Democratic governors at a reception Monday night (Dec. 1) at the Philadelphia Visitors Center.
"The state-federal partnership has been broken for the past eight years. The president-elect and the nation's governors are ready to come together and restore that partnership," said Brian Namey, a spokesman for the Democratic Governors Association.
Rising stars of the Republican Party who are expected include California Gov. Arnold Schwarzenegger, Florida Gov. Charlie Crist, Louisiana Gov. Bobby Jindal and Alaska Gov. Sarah Palin, who catapulted into the national spotlight when John McCain picked her as his running mate.
South Carolina Gov. Mark Sanford, newly elected chairman of the Republican Governors Association , is also coming. Sanford has been the most vocal opposition to states' plea for the economic stimulus package estimated to be as much as $700 billion borrowed by the federal government.
While it only became official on Dec. 1 that the U.S. economy is indeed in a recession, states have been feeling the squeeze over the past year, and governors are expected to share with Obama the cuts they've had to make and even tougher decisions they face this year.
"It's clear to all of us at the state level … that we are in this for the long haul. This is a downturn that will be with us for probably a couple of years," said Vermont Gov Jim Douglas (R), vice chair of the NGA at a Washington D.C. press conference where governors and state leaders laid out their wish list for a stimulus package.
At least 30 states have found more than $30 billion in shortfalls in their current budgets, while 25 are looking at deficits of $60 billion for fiscal 2010, which for all but four states begins July 1. Just before leaving for Philadelphia Monday, Schwarzenegger declared a fiscal emergency in his state, which has an estimated budget gap as high as $28 billion.
"Over the next two years, $140 billion of deficits will be facing state governments and that is a conservative estimate. We believe the number could go as high as $200 billion," Rendell said. He stressed states are not looking for a $200 billion bailout from the federal government, but financial help as growing unemployment increases demand for state services.
But states are clearly looking for more than the $20 billion that Congress gave states in 2003 to help patch budget gaps after the 2001 downturn. Half of that amount was in federal funds to cover Medicaid costs. Douglas said "the need is north of that" $20 billion figure because today's economic climate is worse than the 2001 recession.
Besides health care funds, states and governors are pressing for $136 billion of infrastructure projects that are "ready to go" within 90 days. While 70 percent of those projects are transportation-related, the list also includes school construction, renewable energy, and water treatment and sewage projects, Rendell said. He pointed to the 73,000 structurally deficient bridges in the United States that need repaired as an example of the project the federal government could help fund that would create jobs and stimulate the economy.
As NGA chairman, Rendell has picked infrastructure as his initiative that he will spotlight during the year. This is not Rendell's first foray into the issue of improving infrastructure. Earlier this year, he kicked off the " Building America's Future " campaign with Schwarzenegger and New York City Mayor Michael Bloomberg (I).
Douglas stressed that states weren't simply "holding out a tin cup" but were already cutting programs to balance their books.
Also at the press conference, North Carolina General Assembly Speaker Joe Hackney (D) said his state has done what most states have already done: implemented a hiring freeze, delayed capital projects and cut programs. But North Carolina is among a half dozen who have passed or proposed their own state stimulus packages. He said Gov. Mike Easley (D) recently released $700 million in building projects as a way to stimulate North Carolina's economy. "We need Congress and the president to stand as partners with us."
Governors expect to have a receptive audience in Obama who last month directed his economic team to draw up a two-year plan to create 2.5 million jobs patching crumbling infrastructure, modernizing schools and building wind farms, solar panels and fuel-efficient cars. Democratic leaders on Capitol Hill have pledged to have legislation ready for Obama to sign shortly after his Jan. 20 inauguration.
"We're optimistic," Vermont's Douglas said.
Energy issues also are likely to come up in today's session. Western governors in a recent, four-page letter to Obama urged swift action in adopting and implementing a national energy plan that includes making polluters pay for emitting greenhouse gases, bringing "near-zero emission" vehicles into the market and developing "clean" coal plants within the next 10 years.
This the second time this year that many of the governors are visiting Philadelphia. The NGA held its centennial celebration July 11-14 that brought 70 current and former governors together.