Governors to press Obama for help

The meeting in Philadelphia comes as Obama and Democrats controlling Congress are fashioning economic recovery legislation that could cost $500 billion or so. The measure is virtually certain to contain help for states struggling with slumping revenues and difficult budget cuts as the recession deepens.

National Governors Association Chairman Ed Rendell, a Democrat from Pennsylvania, said the governors are also pressing for perhaps $136 billion in infrastructure projects like road and bridge repairs in the legislation, which Democrats hope to have ready for Obama's signature as soon as he takes office.

"We're going to be talking about what the elements of an economic stimulus plan will be," said Massachusetts Gov. Deval Patrick, a Democrat.

For states, the recession has meant big reductions in tax revenues, which has forced 43 of the 50 states into budget deficits. Since virtually every state has to live under a balanced budget, governors have been forced to cut services, lay off workers and consider tax increases.

Such moves only make the economic situation more difficult, the governors say.

"Without federal help ... what we will have to do is just make continuing cuts and/or raise taxes, both of which would have a further deleterious effect on our states' economy. We simply need help," Rendell told reporters on Monday. "When the economy is bad, the social service net demands grow."

Rendell said there are upward of $136 billion in infrastructure projects that are "ready to go," chiefly road and bridge repair projects that can get started especially quickly. Water and sewer projects and school repairs are other needs.

Rendell and NGA Vice-Chairman Jim Douglas, R-Vt., met Monday with House Speaker Nancy Pelosi, D-Calif., who said Democrats will work to have the economic stimulus measure ready for Obama's signature as soon as he takes office Jan. 20.

It's expected to blend funding for infrastructure projects and Medicaid aid to the states with tax cuts, a temporary increase in food stamp payments, as well as investments in renewable energy projects and other "green jobs" initiatives. The NGA has proposed $40 billion over two years to temporarily increase the federal government's contribution to the Medicaid program for the poor and disabled.