Gregoire says state needs $600 million economic stimulus

WASHINGTON — Gov. Christine Gregoire says Washington state needs at least $600 million in federal money for short-term road and bridge projects to help kick-start the state's struggling economy.

The state has at least that much in projects ready to go as soon as Congress approves an economic stimulus plan, likely by the end of January, Gregoire said Tuesday.

"Priority No. 1 is how we can get the economy up and going again," she told a news conference in Washington, D.C., following a meeting in Philadelphia with President-elect Barack Obama and many of the nation's governors.

"All of us are facing draconian cuts," Gregoire said. "Something has to be done."

Gregoire, a Democrat who was elected to a second four-year term last month, said she met privately with Obama to talk about her state's needs and to pledge her help on issues such as health-care reform and education.

Obama, in his Philadelphia speech to the National Governors Association, pledged quick work Tuesday on an economic recovery plan to include tax cuts and increased federal spending. He also said he wants the governors' advice in designing a stimulus package to help their hard-hit states.

In Washington state, Gregoire said, "We're looking at $5.8 billion in cuts" over the next 2 ½ years, unless economic conditions change.

State economists have predicted a shortfall of about $5.1 billion over that period, but Gregoire is assuming an even larger deficit as she prepares her next state budget proposal. The larger figure assumes greater demand for state services and extra money to protect against worsening economic conditions, Gregoire's staff said.

Asked how much money she would like to see the state receive as part of the proposed federal stimulus package, Gregoire said she hopes for "something short of $1 billion" for infrastructure projects, Medicaid reimbursement and other assistance.

While she ruled out a job in the new administration, Gregoire said she told Obama and his top aides, "I'm ready for assignment." Specifically, Gregoire said she and Obama talked about the need for electronic medical records, to bring down costs and increase efficiency, as well as changes in Medicaid reimbursement rates for the states.

Gregoire endorsed Obama in the state's presidential nominating contest and is considered a key Obama ally in the Pacific Northwest. She said she told Obama and his aides, including Chief of Staff Rahm Emanuel, that it was important Washington state have top-level representation in the Obama administration.

Rep. Jay Inslee, D-Bainbridge Island, has been rumored as a possible Interior secretary, while Rep. Adam Smith, D-Tacoma, is said to be a candidate for sub-cabinet level job at the State Department. Former Gov. Gary Locke also is considered a possible candidate for U.S. trade representative.

Locke, the nation's first Chinese-American governor, is a partner in the Seattle-based international law firm, Davis Wright Tremaine, which has an office in Shanghai. His specialty is China trade and investment.

The recession and the accompanying increase in joblessness have translated into higher health-care costs for the poor, greater use of food stamps and added strain on welfare programs, and the governors are seeking help in coping.

They have asked for at least $40 billion to help pay for health care for the poor and disabled and perhaps $136 billion more in infrastructure projects such as road and bridge repairs. Democrats hope to have legislation ready for Obama's signature soon after he takes office on Jan. 20.

Obama has said he will make an economic stimulus his top priority, and his aides and congressional leaders have been discussing outlines of a measure that could exceed $500 billion over two years. The president-elect has said his goal is to secure 2.5 million jobs.