Utah Refuses $61 Million in Federal Aid
There has been a lot of attention given to Gov. Mark Sanford (R-SC) for his request to divert stimulus money to pay off the state’s debt instead of paying for government programs; the request has since been rejected by the White House.
And yet, Utah lawmakers are also temporarily “turning their backs” on some of the stimulus money.
From the Salt Lake Tribune:
Utah lawmakers are turning their backs — at least for now — on more than $61 million in federal stimulus money targeted at helping the state’s surging unemployed ranks.
To snag the money, the Legislature would have had to change state law, extending benefits to about 4,200 jobless Utahns — part-time workers, those who quit jobs to accompany a spouse who is changing employment, or others — who don’t qualify now.
But Utah legislators, pinched for time in the 2009 session, balked at changing the law, fearing that employers, already grappling with a poor economy, would get hit with more unemployment taxes to cover the costs.
“Any time you have to run legislation and change your state policy and code for one-time money, that doesn’t make a lot of sense,” said Senate Majority Leader Sheldon Killpack, R-Syracuse. Lawmakers have to either kill the program when the money is gone or find a way to fund a benefit “you don’t want in the first place.”
Legislators explored whether they could include a sunset date in the revisions, to have the expanded benefits expire when the federal money runs out, and were told they could not. It was unclear whether they could come back and just repeal the program later on, so they did nothing this session.
While it may not be popular with many on this site, I see the wisdom in approaching this stimulus money cautiously. What needs to be acknowledged is that when the flow of federal money stops, this state will be required by the provisions established through acceptance of the stimulus money, to continue funding these expanded benefits.
It is also interesting that South Carolina’s appeal to pay off the state debt was rejected. What happens when the money stops coming in? Will different states be able to handle paying for these benefits? I think that it is worth investigation.
- Marc
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Mar 18th 2009 • 12:03
by Jason Williams
Admittedly, Utah may be one of the few states insulated enough from the economic downturn to get away with this. I still bristle at the idea though, as I feel many are turning down the money for purposes of political grandstanding, rather than forward thinking rationale.
Refusing aid to the unemployed can be approach with caution, I agree, but we also need to be realistic about the fact that we are doing exactly that at a time of high unemployment. Also, unemployment benefits are usually spent directly back into a state’s economy, very quickly. That’s real stimulus, not theoretic.
I understand the legislatures hesitancy, but it was a lack of revenue that led to a gigantic budget hole this year (and next). Refusing the money could avoid a bigger challenge in a few years, or it could simply lock us in to reduced revenue and a shrinking state economy still at that time.
I’m simply hoping for a rational, rather than blindly ideological approach, and admittedly, I’m hesitant to place faith in many of our representatives, who showed during the 09 session they aren’t above posturing as pretend limited government ideologues while many Utahn’s face real financial challenges to life and prosperity.
Mar 19th 2009 • 07:03
by Jonathan Ellis
This law seems less about stimulus and more about extortion. Utah shouldn’t buy into the racket if it can help it.