Baldacci wants varied stimulus efforts

Posted Dec. 01, 2008, at 9:56 p.m.

AUGUSTA, Maine — Gov. John Baldacci is joining most of the nation’s governors in a closed-door meeting with President-elect Barack Obama in Philadelphia today, with the economy at the top of the agenda.

“You have to have a stimulus package that is both short- and long-term,” Baldacci said in an interview. “I am going to try and focus on not only the roads and bridges and the broadband transmission work that needs to be done, but also in health and education.“

Obama announced the meeting last week at a news conference in Chicago. He worked with the National Governors Association to set up the meeting, which started with a dinner for the governors and members of his transition team last night.

“We’re going to be working very closely with governors; we are going to be working very closely with mayors of towns large and small across this country,” Obama said at the news conference. “This economic recovery plan will require their input, their participation.”

The meeting’s hosts are Democratic Gov. Ed Rendell of Pennsylvania, chairman of the National Governors Association, and Republican Gov. Jim Douglas of Vermont, the co-chairman. More than 40 governors and governors-elect are expected at the meeting.

Rendell, Douglas and leaders of the National Conference of State Legislatures held a news conference in Washington on Monday to urge swift adoption of a stimulus package. They listed increased federal funding for Medicaid, increased investments in infrastructure and increased support for unemployment benefits and the food stamp program as basics for a package.

“These investments should include a broad array of infrastructure projects including airports, bridges, highways, transit systems, ports, rails, clean water, sewers and broadband,” Rendell said.

Baldacci said he believes there needs to be a long-term recovery plan, not just a stimulus package for 2009.

He said many governors are seeking a package of short-term programs to help states weather the recession. He said more federal funds for the Medicaid program and for education should be part of a long-term plan. He said Medicaid would help states with their revenue problems while helping to maintain the “safety net” provided by the program.

“The proposals for greater federal funding for roads and bridges would help both in the short term by putting people to work, but also in the long run by doing the repairs and projects that are already planned, but which the states do not have the revenues to do on their own,” Baldacci said.

He said there also needs to be a commitment to federal investment in programs and not just the one-time stimulus measures. He said he would push for the Dirigo Health program to get a waiver for Medicaid funding, which would stabilize its funding and allow more to be covered by the plan. Under current Medicaid match rates, the state gets roughly two federal dollars for every state dollar it spends.

“We tried this with the Bush administration,” Baldacci said. “They rejected our effort but approved similar waivers for Massachusetts and Vermont. We are going to try again.”

The governor said using the premiums paid by employers and individuals to Dirigo as a match for Medicaid funding would allow the program to cover more Mainers. Enrollment is now frozen.

Employers and individuals are paying about $22 million a year in premiums and the state is providing subsidies of about $25 million through the savings offset payment, so a federal match would mean a significant expansion of the health insurance program.

With most economists saying the recession will affect state revenues at least through all of 2009, it is important that the federal government invest in long-term efforts to help state economies, Baldacci said.

“I think moving to energy independence is a way to grow our economy,” he said, “It is important that the federal government help with that effort.”

Baldacci said that could take the form of increased federal grants through programs such as the Community Development Block Grant program and increased tax credits for such alternative energy sources as wind, solar and tidal.

“We have a lot to discuss,” he said.

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