Should Local Governments Ever Reject Obama’s Stimulus?

While cities across the country clamored for a share of federal stimulus dollars, this little railroad town told Washington, “No thanks.”

And it’s still paying a price.

Last month, the North Platte Housing Authority officially informed the federal Department of Housing and Urban Development that it would refuse nearly $600,000 from President Barack Obama’s American Recovery and Reinvestment Act.

By Leslie Eaton
The Wall Street Journal

Much of the $787 billion economic stimulus program will flow down to states and communities through well-worn government channels and formulas, but legislators on all levels still have to promise that they will spend the funds to create jobs. North Platte’s housing board refused to do that, saying it had plenty of money in the bank.

Weeks later, that decision reverberates, inflaming tensions between the board and the housing authority’s director, riling the City Council and dividing North Platte’s 24,000 residents. People here are debating a question that other communities will face during the program’s three-year span: Is it wrong to accept federal largesse when you don’t really need the money?

More than half a dozen housing agencies, including those in Dublin, Calif., and Racine, Wis., have refused stimulus funds for capital improvements, according to HUD, mostly because they are moving out of the public-housing business. Other places have rejected the stimulus out of political conviction. C. Michael Kilburn, a Republican commissioner for Warren County, Ohio, briefly achieved fame — or infamy — for turning down a $373,400 stimulus grant allocated by the state for new buses.

North Platte’s leaders are deeply divided over rejecting the stimulus. “This about split our community in two,” said Harry Spohn, a city councilman and longtime weatherman on local television.

On one side are people like Art Wills, a retired insurance adjustor. Over coffee at Roger’s Fine Foods on the south side of town one recent morning, he said he agreed with the housing board’s point of view about federal aid: “If we’re not down and out, we don’t want it.”

But sitting in a nearby booth, Patrick Keenan, who owns several motels along Interstate 80, disagreed. “If we don’t use it, it just goes down the line and gets spent and North Platte didn’t benefit,” he said. “And our grandchildren will still bear the same tax load.”

While cities across the country clamored for a share of federal stimulus dollars, this little railroad town told Washington, “No thanks.”

And it’s still paying a price.

Last month, the North Platte Housing Authority officially informed the federal Department of Housing and Urban Development that it would refuse nearly $600,000 from President Barack Obama’s American Recovery and Reinvestment Act.

Much of the $787 billion economic stimulus program will flow down to states and communities through well-worn government channels and formulas, but legislators on all levels still have to promise that they will spend the funds to create jobs. North Platte’s housing board refused to do that, saying it had plenty of money in the bank.

Weeks later, that decision reverberates, inflaming tensions between the board and the housing authority’s director, riling the City Council and dividing North Platte’s 24,000 residents. People here are debating a question that other communities will face during the program’s three-year span: Is it wrong to accept federal largesse when you don’t really need the money?

More than half a dozen housing agencies, including those in Dublin, Calif., and Racine, Wis., have refused stimulus funds for capital improvements, according to HUD, mostly because they are moving out of the public-housing business. Other places have rejected the stimulus out of political conviction. C. Michael Kilburn, a Republican commissioner for Warren County, Ohio, briefly achieved fame — or infamy — for turning down a $373,400 stimulus grant allocated by the state for new buses.

North Platte’s leaders are deeply divided over rejecting the stimulus. “This about split our community in two,” said Harry Spohn, a city councilman and longtime weatherman on local television.

On one side are people like Art Wills, a retired insurance adjustor. Over coffee at Roger’s Fine Foods on the south side of town one recent morning, he said he agreed with the housing board’s point of view about federal aid: “If we’re not down and out, we don’t want it.”

But sitting in a nearby booth, Patrick Keenan, who owns several motels along Interstate 80, disagreed. “If we don’t use it, it just goes down the line and gets spent and North Platte didn’t benefit,” he said. “And our grandchildren will still bear the same tax load.”

Read the rest:
http://online.wsj.com/article/S
B124139281750781563.html

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