Schools, roads, get much of fed package

BISMARCK -- North Dakota is taking in about $573.5 million from the federal economic stimulus package, with much of it dedicated to education and transportation.

The total for schools will be $152.8 million, and about half of that will go directly to school districts, which can decide for themselves what to spend it on.

The $181.1 million total for the Transportation Department will include $114 million for statewide spending on highways and bridges and another $51 million for local governments' highway and bridge projects.

OMB's fiscal director, Sheila Peterson, who briefed the House Appropriations Committee Thursday, said the Transportation Department has already been talking to local governments about the transportation funds coming to the state and "they're ready to rock," she said.

Overall, the stimulus money could turn up everywhere from food pantries to bus shelters to water projects to household weatherization. Other possibilities include worker training for careers in renewable energy fields, crime victims' compensation, building of bike paths and park roads, aid for low-income housing programs and child support enforcement.

One part of the stimulus fund programs -- a 13.6 percent hike in food stamps -- takes effect on April 1.

Uses Proscribed

Though the windfalls reach will be widespread and state officials are clearly impressed, much of it will arrive strictly proscribed by the federal government for certain programs, state Budget Office officials told lawmakers at a presentation Thursday.

Only about $7.5 million is not pegged to a certain area of government spending. Gov. John Hoeven suggests it be used to renovate the University of North Dakota Education Building. That's not a bad suggestion, some lawmakers say, but it's up to them to decide on this and all other spending of the windfall.

"The one thing our (Senate Republican) caucus wants is we want our fingers on it," said Senate Majority Leader Bob Stenehjem. "That's what the constitution says we do."

House Majority Leader Al Carlson made a similar statement several days ago. If necessary, the Legislature will meet again in special session this year in order to appropriate the funds. He left Thursday for a meeting of the State Legislative Leaders Foundation in Philadelphia, where the main topic is the federal stimulus funds.

Rep. Frank Wald, R-Dickinson, believes expansion of the Dickinson State University library would be a good use for the funds. House Appropriations Committee Chairman Ken Svedjan, R-Grand Forks, said there's another building at North Dakota State College of Science in Wahpeton that could be rehabilitated.

UNIQUE CHALLENGE

North Dakota has a unique challenge in using the funds. Most states desperately need the federal money to ease or prevent drastic cutbacks in programs. North Dakota has a healthy surplus.

So where the federal government commands that the states first use the funds to restore funding where cuts were made, "in the state of North Dakota, we did not make any cuts," Peterson said.

In regular government spending areas such as human service programs and special education, North Dakota could afford to simply go on budgeting with the state funds they have available and sock away the federal windfall as part of the surplus -- except that's forbidden. Stimulus money can't be put in a reserve account or rainy day fund, Peterson explained.

Lawmakers even have to be careful about where they might simply plug the new federal dollars in to the budget they are currently building or they could violate the stimulus plan's rules.

"If it even smells like we're supplanting (state) dollars, then we've got problems," said Sen. Ray Holmberg, R-Grand Forks, chairman of the Senate Appropriations Committee.

But there are areas of the state budget where that is essentially what will happen. The state funds originally meant for those programs will be banked in the general fund and used in the 20011-13 biennium to maintain funding levels set in 2009-11.

DETAILS STILL EMERGING

Lawmakers and state officials are still learning details. For instance, the governor's and OMB's recommendations for the funds, as originally discussed this week up through Thursday morning, included a line saying Fargo's south side flood control project could receive $40 million in FEMA grant funds. But OMB determined later Thursday that wasn't the case.

Peterson said later Thursday the state had learned the flood control project isn't going to meet FEMA's competitive grant criteria.

FEMA grants is one of several areas of the stimulus package where no funds are outlined for the state, but North Dakota agencies, or businesses could compete nationally for grants. These include broadband infrastructure development, teacher recruitment programs and arts funding. In fact, the North Dakota Council on the Arts must apply by March 13 if it wants a crack at $290,000 in National Endowment for the Arts funding, Peterson said.