he president told representatives from the National Conference of State Legislatures last week that that he is putting out a directive that sets out guidelines for how state and local governments spend money they get from the legislation.
“This plan cannot and will not be an excuse for waste and abuse,” Obama said. “Whenever a project comes up for review, we will ask a few simple questions: Does it advance the core mission of the Recovery Act? Does it jumpstart job-creation? Does it lay the foundation for lasting prosperity?”
The law specifically excludes projects such as casinos, aquariums and zoos, golf courses and swimming pools, Vice President Joe Biden said in a letter sent separately to the U.S. Conference of Mayors as part of the president’s announcement. Biden, who appeared at the White House event with Obama, said the scrutiny will apply to projects not directly prohibited as well.
“There is the letter of the law and then there is the spirit of the law,” Biden said. “And we intend to make sure the spirit of the law is what’s actually followed here, in addition to the letter.”
Obama, a former state legislator from Illinois, said he was postponing plans to modernize electrical and heating systems in the East Wing of the White House because they don’t meet the standard of creating new jobs. “I don’t need to remind you that the American people are watching what we do,” Obama said. “They need this plan to work.”
States are struggling during the recession. Some 43 states report budget shortfalls of us$ 183 billion for fiscal year 2009, according to group’s recent fiscal survey in January. That gap is forecast to increase to more than us$ 200 billion for fiscal year 2010, the organization said on its Web site.
Most states are required to balance their budgets each year, resulting in reduced spending and rising taxes, which may deepen and prolong the recession, its leaders say. About us$ 575 billion in stimulus spending is earmarked for roads, schools and other infrastructure projects to create jobs and make up for tax revenue losses caused by the recession. That includes us$ 39 billion for unemployed workers in families.
While Obama’s stimulus plan aims to create or save 3.5 million jobs over the next 2 years, a Labor Department report this month said that the US has already lost 4.4 million jobs since the recession began in December 2007. The unemployment rate jumped to 8.1 % in February, the highest level in more than a quarter century.
The conference is a bipartisan group that serves the legislators and staffs of the states, US commonwealths and territories.