A letter from United States Senator Claire McCaskill (Download PDF) asking state budget leaders what they would do without federal economic stimulus dollars has sparked a war of words between Washington and Jefferson City.

In a letter to Sen. Rob Mayer (R-Dexter), chairman of the Senate Appropriations Committee, and Rep. Allen Icet (R-Wildwood), chairman of the House Appropriations Committee, United States Senator Claire McCaskill asks what the state would do without the billion dollars in federal money it is using to make up for lost state revenue.

As always, I pay close attention to what is happening in Missouri and Jefferson City. I have noticed that you and many of your colleagues have been highly critical of some of the emergency spending that has gone on since the financial meltdown in September of 2008. As someone who has fought a sometimes lonely battle against bad spending habits in Washington, I certainly understand your sentiment.

However, as I consider your suggestions, especially regarding the stimulus program, I need additional information.

You are about to use almost a billion dollars in stimulus dollars in your current budgeting process. Please advise me as soon as possible what cuts you would recommend to your committees and the rest of the legislature to make up for these funds if we decided to rescind the unspent stimulus funds.

It would also be helpful to know what funds would be available for highway improvement and construction without the current and future stimulus money.

McCaskill mentioned the letter during her weekly conference call with reporters when asked if Congress would be open to passing another stimulus bill once states run out of the current federal money. McCaskill replied she would be more open to the idea if state lawmakers in Jefferson City expressed more gratitude for the money they have received from Congress in Washington.

“If the posturing on the stimulus is serious and sincere, if it’s not just political, then they should be prepared to balance the budget without the stimulus money,” McCaskill told reporters.

McCaskill, a Democrat, is upset that Jefferson City has harshly criticized the spending habits of Washington, considering it hypocritical to take the money on one hand and criticize the giver on the other. The state Capitol in Jefferson City is controlled by Republicans, while Democrats control Congress.

House Budget Chairman Icet, a Republican, insists the federal government hasn’t helped the states. Icet says Congress has only delayed painful decisions.

“It’s almost like, ‘You the state should be thanking us for saving you from this,’” Icet said, referring to McCaskill’s letter. “It’s like, you haven’t saved a thing. You have simply delayed what has to be done.”

Icet replied to McCaskill with a letter of his own.

You are correct in your assertion that the State of Missouri has used, and continues to use, Federal stimulus money for programs in our State budget.  The decision not to use this money was considered, and rejected since a rejection would mean Missouri tax dollars would simply be sent to another state.  Since the stimulus money has been received, Missouri has lost an additional 62,600 jobs and the unemployment rate sits at 9.6%.  The purpose and intent of these funds has not been met, even as you and your colleagues debate the possibility of another round of Federal stimulus spending.

States all across this nation are facing massive budgetary shortfalls on a magnitude we here in Missouri cannot fathom.  I have repeatedly called on Governor Nixon to meet with me and my Senate colleagues to work in a bipartisan fashion to address the critical financial decisions necessary to withstand this economic downturn.  These calls have been ignored.

Because of Missouri House Republican’s sound fiscal policies over the past eight years we are in much better fiscal shape than most of our 49 sister states.  The problem does not reside here Senator, it resides in Congress.  Because of this, I ask that you focus your concern on your profligate spending in Washington.

As for Icet’s Senate counterpart, Sen. Mayer is less confrontational, saying he appreciates the federal money, but noting that the discussion shouldn’t be about Congress’ money or the state’s money.

“It’s not Washington’s money, it’s the taxpayer’s money,” Mayer said in an interview with the Missourinet. “It’s not the US Senator’s money, it’s not our money as state legislators, it’s the taxpayers of the United States and the state of Missouri.”

Missouri state government is coping with drastically dropping tax revenue. Governor Nixon has had to cut nearly $700 million from the state budget approved by the legislature last year. Though there have been some signs that the economy is picking up, no one is predicting it will rebound enough to significantly turn state revenue around. The governor has proposed the state use the remaining $1.2 billion in federal budget stabilization money to keep from cutting state programs and services more in the fiscal year that begins July 1st. State lawmakers have agreed to the plan, pointing out that if the state doesn’t use the money it will lose it.

Icet Letter to McCaskill

AUDIO: Brent Martin reports [:60]

AUDIO: McCaskill on letter to legislators [2 min]

AUDIO: Rep. Allen Icet responds to Sen. McCaskill letter [14 min]

AUDIO: Sen. Rob Mayer responds to McCaskill letter [5:40]