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Details emerge on plan for Missouri stimulus money

Friday, March 27, 2009 | 6:40 p.m. CDT; updated 10:30 p.m. CDT, Wednesday, May 20, 2009

JEFFERSON CITY — Ethanol plants, public defenders, police radios and public universities all could get a share of Missouri's federal economic stimulus dollars.

Those are some of the first potential beneficiaries to emerge as House budget leaders begin piecing together a special stimulus spending package expected to be unveiled in coming weeks.

Still under consideration by House Republican leaders is whether to give some of the federal stimulus dollars directly to Missourians in the form of a special tax rebate, income tax reduction or sales tax holiday.

The $22.8 billion state operating budget passed this week by the House uses hundreds of millions of dollars of federal stimulus money for the operation of Missouri's elementary, secondary and higher education institutions.

But that still leaves about $1 billion in stimulus funds — give or take a few hundred million — for lawmakers to decide how to spend. The rest of Missouri's estimated $4 billion stimulus share already is dedicated by federal law to specific purposes.

Icet's plans

House Budget Chairman Allen Icet, R-Wildwood, plans to place the discretionary stimulus dollars in one or more separate budget bills, much as the legislature typically approves spending for capital improvements separate from operating budgets.

Icet's goal is to reserve those special stimulus bills for one-time expenses. But the definition of one-time spending is flexible.

For example, Icet pledged during House budget debate this past week to use millions in stimulus dollars to pay subsidies due to ethanol plants under a state law that provides them up to $3.1 million annually for the first five years of production.

He also pledged to use $2 million in stimulus funds to hire more public defenders for a criminal defense system strained by heavy caseloads, and $10 million to expand the number of classroom slots for health care students at public colleges and universities.

Both programs would be expected to continue. But Icet explained the infusion of stimulus money as a one-time thing with no guarantee of future state general revenue funding.

Money for new radio system

Icet also pledged to use stimulus money for a disputed $82 million contract to replace the aging radio system used by the Missouri State Highway Patrol with one that could be used by emergency responders across the state to communicate with each other.

The contract has been awarded to Motorola Inc. but is under protest by rival Tyco Electronics Ltd. Without using stimulus funds, state officials have expressed concern about whether Missouri can afford to finance the new radio system.

Icet said his special stimulus spending package also likely will include money for repairs, maintenance or construction at state-owned buildings and public universities.

Missouri has a backlog of about $1.5 billion in needed design work, maintenance, repairs and construction at state buildings, said Jeff Schaeperkoetter, director of Missouri's Facilities Management, Design and Construction Division.

Additionally, tens of millions of dollars of planned university construction projects have been put on hold by Gov. Jay Nixon's administration because of concerns that their funding source — the Missouri Higher Education Loan Authority — cannot follow through on scheduled payments.

The money-back option

Some Republican lawmakers are proposing to use a portion of the discretionary federal stimulus money to provide a tax break to Missourians. Icet said that option is still under consideration by Republican House leaders.

Besides government spending, "another stimulative effect — in fact one that may work better than others — is to put money back in people's pockets, and they make the decision about where to spend their money, which in turn stimulates the economy," Icet said.

The much-awaited House stimulus spending plan still would have to be reconciled with the Senate's desires.

Earlier this week, senators endorsed a bill creating a method of distributing federal stimulus funds for school construction or repair. Senate President Pro Tem Charlie Shields, R-St. Joseph, said he hopes to put roughly $500 million from the stimulus package into the fund.

 


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