Daniels: Federal stimulus package won't bail out local budgets

BY PATRICK GUINANE, Times of Northwest Indiana
pguinane@nwitimes.com

INDIANAPOLIS | Just days after Gary officials shopped a $400 million stimulus wish list, Gov. Mitch Daniels warned that local government won't see a big chunk of the federal economic package.

"People better get their expectations right. There's not going to be a whole lot of money flowing through to local communities. Congress, as it is wont to do, has tied up most of this money," the Republican governor said Friday. "One piece of good news is I think we are going to be able to move a meaningful amount of the highway money to locals, something like $160 million."

While estimates remain somewhat fluid, Daniels said the $787 billion stimulus package nearing final passage in Congress appears to hold nearly $4 billion for Indiana, down from roughly $5 billion in earlier versions.

The state is anticipating about $1.3 billion in education dollars that would flow directly to school districts and roughly $1.4 billion to bolster Medicaid health care programs for the poor, disabled and elderly.

Indiana would get less than $200 million in discretionary budget relief, down from $500 million in an earlier version of the federal proposal. And the state would receive roughly $700 million for road and bridge construction and repairs.

Last week, the Indiana Department of Transportation began seeking bids for $44 million in projects that the federal money would accelerate, including a resurfacing of Ind. 149 in Porter County from U.S. 20 to Industrial Boulevard. The state also announced a dozen clean water projects that immediately will be eligible for $36 million in no-interest loans, including a $5 million wastewater treatment plant in Rensselaer.

Gary officials, who have not responded to The Times' requests for a copy of their wish list, reportedly want $105 million to expand public housing, $19 million for a marina and $18 million to build six new fire stations. It's not clear whether any of the projects have undergone engineering and planning work needed to meet "shovel ready" criteria for spending the federal rescue dollars in an expedited fashion.