Governor accepts stimulus

By APRIL CASTRO and JIM VERTUNO

Associated Press
Published Thursday, February 19, 2009 6:05 AM

AUSTIN, Texas -- State leaders are beginning to learn exactly where Texas' $17 billion share of the federal stimulus money is slated to go, including millions to educate homeless children and help poor families pay for child care.

Now lawmakers have to figure out how to get it here. With an array of deadlines and federal restrictions, some state officials are in a frenzy trying to make sure no available money gets left behind. Republican Gov. Rick Perry said he objected to the stimulus package, but he said in a letter to President Barack Obama on Wednesday that he would accept the money.

Texas' share of the $787 billion stimulus bill is divided among education, health and human services, transportation, labor, criminal justice and housing and infrastructure. Education gets the largest share with more than $6 billion, closely followed by health and human services programs, which are slated to get about $5.8 billion, according to a state analysis.

While detailed numbers emerged, Perry and other fiscal conservatives earlier questioned whether Texas should take all the money, even as the state faces a $9 billion revenue gap.

Without the stimulus, Texas lawmakers would be faced with cutting government services and dipping into the state's so-called Rainy Day Fund.

But meeting federal requirements to receive the money is becoming its own quagmire.

For example, some transportation money must be spent within 120 days on projects ready to go. But $5.4 billion in money for Medicaid would be divvied up through the end of 2010. Lawmakers must fit each puzzle piece into the 2010-11 budget that they're now writing and that goes into effect this year.

Lt. Gov. David Dewhurst, Republican leader of the Senate, said he had concerns about the growing federal debt but wanted to make sure Texas got its "fair share" of the stimulus package.

"On first blush, we all think this package has fewer strings attached" than earlier versions of the bill, Dewhurst said. "Right now we're trying to decipher" the 1,100-page package, he said. "We're trying to read it and understand what we can do with the money."

A special committee, the House Committee on Federal Economic Stabilization Funding, is set to meet Thursday to pore over the details.

Perry has urged caution in how Texas uses the federal money.

For weeks, he opposed the stimulus package while going on the offensive against political rival Sen. Kay Bailey Hutchison, who voted against the bill and has challenged him for the GOP gubernatorial primary in 2010.

Perry's camp has criticized Hutchison for her support of President George W. Bush's initial financial industry bailout bill last fall. Perry's spokesman dubbed Hutchison "Kay Bailout," and she has opposed Obama spending packages aimed at spurring the economy.

Now Perry says he's willing to take some of the $17 billion for things such as building roads and hurricane reconstruction. But in a plea to his conservative base this week, he said that Texas might want to leave some of the federal money on the table if taking it committed the state to long-term spending once federal funds run out.

"In Texas, we know it actually is a good idea to look a gift horse in the mouth. We may end up with an old nag. All we get is an opportunity to pay vet bills and feed and not get any work out of it," Perry told a group of small business leaders Tuesday.

Texas Democrats fired back, calling Perry an "obstructionist" to an economic rebound.

Perry "is more concerned with political recovery for the Republican Party than economic recovery for Texas," said Texas Democratic Party Chairman Boyd Richie.

"If the governor's political agenda allows our tax dollars to be shipped off to other states, 'Ripoff Rick' will cost Texans an important investment in job creation, schools, health care and transportation."