Washington Watch for Sunday, Sept. 30, 2012

Funding controversy rises again

While the push for more federal government cost sharing in the recovery from Hurricane Isaac continues, the state government is implementing a plan to divert federal disaster funds from the aftermath of hurricanes Gustav and Ike in 2008 into the state’s early childhood education program.

Wait, what?

Although the matter is much more complicated than that single fact, some are criticizing the appearance of the shifting of the federal dollars, while others are pointing at the state’s continued reliance on one-time federal dollars for recurring expenses of state programs.

U.S. Sen. David Vitter, R-La., who has occasionally butted heads with Gov. Bobby Jindal on state budget matters, said he is concerned about the timing and appearance, although he praised the Cecil J. Picard LA4 Early Childhood Program.

“I certainly understand the magnitude of the state budget challenge,” Vitter said. “But this is not a hurricane recovery expense in any way, shape or form.

“It really risks alienating our federal allies exactly as we’re going back to them (after Isaac),” he said.

This particular matter is about the state planning to reallocate $20 million in disaster community development block grants from the U.S. Department of Housing and Urban Development. It should be noted this will only be done with federal HUD approval and that it would represent the 17th such amendment to the overall allocation of more than $1 billion in CDBG funds received.

Also, the Louisiana Legislature originally approved the request back in June — although there was some griping then — well before Isaac struck on Aug. 29.

Jindal’s chief budget architect, Commissioner of Administration Paul Rainwater, emphasized that the Gustav and Ike funds have nothing to do with anything being done after Isaac. The state is seeking a greater cost share of Isaac recovery funds from the Federal Emergency Management Agency — at least the same 90 percent federal share authorized in 2008 — while the CDBG funds are a completely different pool of dollars coming from HUD, Rainwater said.

“They really don’t have anything to do with each other,” Rainwater said.

Rainwater argued that the funding diversion is directly related to the Gustav and Ike recovery efforts because the LA4 program will help many low- to moderate-income families impacted by the storms to enroll their children in much-needed pre-kindergarten education programs.

“It has everything to do with hurricane recovery,” Rainwater said. “It just makes sense to take the dollars that are available and to use them where they’re needed.”

The Louisiana congressional delegation even helped ensure there was more flexibility in the CDBG funds, he said.

State Rep. Simone Champagne, R-Jeanerette, has been critical that the dollars are not instead going to issues like home elevation, but Rainwater countered that such HUD dollars are not allowed to go to FEMA-related projects such as home elevation without additional congressional action.

Rainwater said the state is continuing to work closely with the parishes on elevation issues and that a record amount of $1.75 billion has gone toward the overall mitigation effort.

The LA4 problem though is that the $20 million funding diversion will not expand the program to help those families in need. The money will simply plug a gap in the program’s roughly $75 million total budget. That gap was previously filled with federal dollars authorized through the 2009 federal stimulus under President Barack Obama and those dollars are now gone.

LA4 represents “completely unrelated recurring expenses,” Vitter said. The state’s junior senator said he fears the disaster funds going to LA4 “may foster this narrative … that we’re sort of using and abusing these (federal) opportunities.”

“And it’s another use of one-time money for reoccurring expenses and that’s a practice I think we should avoid,” Vitter added.

The state has had its share of revenue issues, Rainwater countered, and that includes a substantial cut from Congress this summer in federal Medicaid dollars for the state that is still being worked out.

Although it is not a finished effort, Rainwater said, the state is continuing to reduce its reliance of such federal, one-time dollars for recurring expenses.

Jordan Blum is chief of The Advocate Washington bureau. His email address is jblum@theadvocate.