I covered Gov. Chris Gregoire's speech to Tacoma City Club yesterday. Here's the story I wrote for Thursday's print edition. I'm posting it here because there are some items that probably won't make the cut (for space) in the print edition.

UPDATE (11:13 a.m. Thursday): A reader wanted me to take a look at what minority Republicans said some time back about the federal stimulus dollars and how majority Democrats are spending them:

“It’s not whether you take the federal money, it’s how you spend it. These are dollars we can only spend once – but this budget would use them to maintain programs and services. That is exactly the approach which started our state down the road to a deficit. Back out the one-time dollars and it’s clear how this budget sets the stage for a repeat of where we are now.” – Sen. Joe Zarelli, R-Ridgefield, March 30, 2009

BY Joseph Turner
The News Tribune
Washington state doesn’t need a second round of federal money to stimulate the economy right now, Gov. Chris Gregoire told a Tacoma audience Wednesday. But it will in a couple of years, she said.

The governor, who was speaking to about 150 people at a Tacoma City Club luncheon, said Washington has committed to spend less than one-fourth of the billions of dollars the state will be getting over the next two years. And it will take time to put the rest of that money to work.

However, “what keeps me up at night,” she said, is the thought that come 2011-13, all that federal money will have been spent, and the prospect of she and the legislature “having to make up the $4.5 billion that we got from the feds this time – and it won’t be there when it’s needed.

“So, we need a second round,” she said.

The governor was responding to a question by Kathleen Deakins, a partner in the Jacobsen Ray public relations firm, who noted state colleges had to absorb a 21 percent budget cut for 2009-11. She wanted to know what the state could do to fund higher education.
Gregoire said she has told President Obama’s administration and Congress that “if you abandon the states, then you’re going to see an economic crisis like you’ve never seen.”
The $4.5 billion that Washington is getting is for its two-year operating budget, largely for Medicaid and public schools. Overall, the state is getting close to $8 billion, which puts it at the top of the list in terms of how much money it is getting per person in the state, a fact that sets her up for “guff” from her fellow governors, she said. But $2 billion of that will be spend by the federal government at the Hanford Nuclear Reservation and won’t help state finances, she noted.
“The point is, we did get our fair share,” Gregoire said. “It has helped us end our economic slide.”
The total nationwide federal economic stimulus package was $787 billion.
Gregoire said Pierce County is getting about 20 percent of the $492 million the state got for transportation projects. The largest chunk of that money is the $70 million to build carpool lanes on Interstate 5 from the King County line to the Port of Tacoma interchange. The county also stands to get an additional $125 million for two rail projects that are part of the state’s application for $1 billion in funding.
The two projects will improve railroad tracks to speed up passenger and freight rail service, including partial funding for an overpass on Pacific Avenue for Sounder trains. The state will find out by Oct. 1 if it will get that money.
On other topics:
--Initiative 1033, to limit the growth of government tax collections: “If you don’t want to see us become California, defeat 1033,” she said. “Vote no.”
--Referendum 71, to extend more rights to same-sex and other domestic partners: “One thing my mother taught me was to treat everyone equally. I hope voters say this is a state that believes in equality. Vote yes.”
--State economic recovery: “I never thought I would cheer when they (her council of economic advisors) said they think we have hit bottom, but we did cheer.”
--More on recovery: “Our revenue is going to lag; our employment is going to lag. Those who hold the key to our recovery are the consumers. If they do not spend or buy, our recovery will take longer.”
--State credit rating: “It’s among the best in the country. When we borrow, we get good (interest) rates. California has a junk-bond rating.”
--Renewable energy and green jobs: “Today, we are the fifth largest producer of wind power in the nation.”
State taxes and spending: Today’s revenue forecast most likely will be lower. But what’s worse is the caseload forecast that comes out in November. That’s when the state finds out just how many people are expected to be on medical assistance, which the state must pay for, she said.
National health care reform: “I want the public option. Set the parameters at the federal level and then let the states run it, tailor it to their own needs.”

joe.turner@thenewstribune.com
Joseph Turner: 360-786-1826
blogs.thenewstribune.com/politics

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