MONTPELIER - Today Governor Jim Douglas testified before the House Appropriations Committee in Washington, DC on the Impact of the Recession on States and Local Communities. As the Vice Chair of the National Governors Association, Governor Douglas has been instrumental in facilitating a national dialogue on the need to deepen partnerships between the federal and state governments.
Every day, states across our nation continue to experience the effects of the economic downturn. Governor Douglas testified that states have a responsibility for making changes to reduce government spending at all levels, to ensure better positioning for a speedy recovery. "We're working hard to address this downturn and are currently looking at all options to reduce expenditures," said Governor Douglas. "These reductions, however, will undoubtedly impact state services, including those services supporting Vermont's most vulnerable citizens. That is why support from the federal government is so critical," the Governor said.
The Governor called for increased funding to Medicaid to protect our most vulnerable people. "An enhanced FMAP (Federal Medical Assistance Percentage) is most effective as a countercyclical measure if implemented at the onset of an economic downturn and for at least 24 months, which allows states to meet anticipated increases in Medicaid costs for the duration of the downturn," said Governor Douglas.
Governor Douglas requested consideration be given to infrastructure projects such a road construction, water systems and broadband. "Investments in ready-to-go infrastructure projects are a cost effective creator of high paying jobs. It's estimated that every $1 billion in transportation infrastructure spending generates approximately 35,000 jobs and $5.7 billion in additional economic activity," he said.
The Governor also stressed the need for systemic shifts to include changes to the tax code, the temporary lifting of matching fund requirements for road projects, and unemployment insurance programs.