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Continued: Minnesotans line up for a stimulus shot

  • Article by: KEVIN DIAZ , Star Tribune
  • Last update: December 29, 2008 - 6:09 PM

WASHINGTON - The first big wave of change in the new Obama administration, a roughly $850 billion economic stimulus package, has brought out a swarm of Minnesota officials, businesses and special interest groups vying for a chunk of the nationwide infrastructure buildup.

With President-elect Barack Obama and the Democratic-led Congress poised to embark on the nation's biggest building spree since the interstate highway system was built a half-century ago, road builders and building contractors from every corner of America are sharpening their pencils at the prospect of more work.

While the size of the stimulus is still being decided, some Republican lawmakers are sounding the alarm about growing costs, which some see rising to as much as $1 trillion. But with 1.2 million jobs lost nationwide this year, the uncertainty in Congress has lent only greater urgency to the pent-up demand for work.

"Minnesota contractors and our trained, skilled workforce are ready to build," said Dave Semerad, head of the Associated General Contractors of Minnesota, which projects as many as 21,000 new jobs in the state, depending on the size of the stimulus deal. "Now is the time to get going and build our infrastructure. There is absolutely no benefit to waiting."

Builders aren't the only ones looking for a piece of the action. States, cities and nonprofit groups are looking for help, along with a host of industries suffering from the sharpest business slowdown in decades.

Minnesota mayors are looking for more than $805 million for roads, schools, libraries and other development projects, and state officials have identified about 200 transportation projects worth $950 million, with the potential for 23,365 new jobs.

But the competing interests in the economic stimulus pie have already prompted divisions in Congress, where some free-market Republicans are raising the specter of a giant spending spree and a return to old-fashioned pork-barrel politics.

One of the most outspoken is Rep. Michele Bachmann, R-Minn., who has called for slashing corporate and capital gains tax rates instead.

"Reports are that a huge portion of this so-called stimulus will go to pork-barrel projects," she said. "And local officials, flush with bailout fever, already have their hands out."

Making snow

The U.S. Conference of Mayors recently gave Congress a list of 11,391 projects worth more than $73 billion, which could potentially create 847,641 jobs over the next two years. The wish list includes nearly 300 Minnesota projects worth about $805 million. Included is $1.3 million to rehab the 10th Avenue tunnel in Minneapolis, which was built before 1950. St. Paul is looking for $9 million for a "green learning" renovation at the Arlington Library and Recreation Center.

More than half of the request for Minnesota cities -- some $413 million -- is slated for projects in Duluth, in a district represented by Minnesota Democrat Jim Oberstar, chairman of the House Transportation and Infrastructure Committee. Oberstar is expected to have a large say in shaping the public works investments in the final stimulus package. He has recommended an "earmark-free" system that relies on federal aid formulas. That would direct just $208 million for Minnesota roads and bridges.

An aide to Oberstar said he had no hand in the mayors' wish list, which includes a number of road and highway projects in his district, including $5 million to paint Duluth's iconic Aerial Lift Bridge. Also tucked in are $2 million for a lake-walk extension at Beacon Point and $6 million for snowmaking and maintenance facilities at Spirit Mountain.

The potential larding of the stimulus package has galvanized opponents such as Bachmann, who notes that the mayors' "Main Street Economic Recovery" list includes such things as $4.8 million for a polar bear exhibit in Rhode Island and $1.5 million for a water slide in Florida.

But it is by no means certain that Congress will adopt the mayors' recommendations, which also include $41 million worth of projects in St. Cloud -- in Bachmann's district. Most are basic road, energy and water projects, such as upgrades to a major wastewater facility.

Asked about the mounting costs, Oberstar promises that the transportation investments in stimulus plan will be able to stand up to public scrutiny.

"It's going to be transparent, it's going to be accountable, and it's going to have benchmarks of reporting and measuring progress," he said. "If the rest of the stimulus initiative follows this pattern, we'll have broad support."

'Christmas tree'

Working on that support, Senate Democrats have vowed to make the stimulus package pork-free, meaning that as far as possible they will leave it up to state officials how to spend the money, rather than Congress.

However it's divided up, the massive investment in transportation and infrastructure projects remains the major selling point, along with tax cuts, extended unemployment benefits, food stamps and aid for state Medicaid programs, which the National Governors Association pressed for last year under the leadership of Minnesota Gov. Tim Pawlenty.

But Pawlenty, like some House GOP leaders, has recently taken a cool posture toward the stimulus package, noting that Washington -- which just pumped $700 billion into a Wall Street bailout -- is already headed for a trillion-dollar deficit.

Sen. Norm Coleman, a Republican, has warned against turning the stimulus plan into a "Christmas tree" for special interests.

Democrats say their main criterion is creating jobs to kick-start the stalled economy -- the sooner the better.

"We have to be prudent about what we do," said Sen. Amy Klobuchar, D-Minn. "We're not going to be able to fund every program somebody wants."

Minnesota Transportation Department officials say they have 200 road and transit projects that could be ready to start with 180 days. But nobody's taking anything for granted. Under some formulations of the Democrats' economic stimulus plan, the cutoff would be "shovel ready" projects ready to go in 90 days.

Given the length of the Minnesota winter, some Oberstar allies worry that a shorter deadline could reduce the state's cut to a fraction of the $950 million in projects that have been identified by MnDOT.

"It's a little tough to start digging up in Duluth in February," said Dennis McGrann, a Washington lobbyist who represents a number of Minnesota cities and counties.

But state transportation officials say they can be ready, whenever the Obama clock starts ticking.

"The shovel ready concept is a little vague," said Abigail McKenzie, who directs MnDOT's Office of Investment Management. "What's going to be a driving factor is project readiness ... Whatever they give us, we'll deliver on that amount."

Kevin Diaz • 202-408-2753

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