Impacts of the American Recovery and Reinvestment Act’s federal economic stimulus package will ripple this year from Washington, D.C., to Washington State, where it could mean as many as 75,000 jobs will be created or kept from cuts.
Areas of Washington’s economy that may get the biggest boost from the package are construction, health care, workforce development, real estate and the energy sector, according to the office of United States Sen. Patty Murray.
In the workforce
At the Southwest Washington Workforce Development Council, Executive Director Lisa Nisenfeld hopes to see $3 million to $4 million.
The council will have two years to spend the money, but Murray has suggested spending it as quickly and responsibly as possible to get it into the economy, Nisenfeld said.
“We are all just working a million miles a minute,” she said. “It’s really an undertaking,”
Most of the council’s anticipated funds will go to a summer work program for youth, and she expects the federal package will help the region regain power in its engines of manufacturing, health care, transportation and science, technology and engineering.
“We know many of those jobs are not in demand at the moment,” Nisenfeld said. “We believe, for the most part, that they’ll come back.”
When they do come back, those fields are likely to need workers with higher levels of technology training, she said.
Nisenfeld also hopes for funds to help low-income and dislocated workers.
Helping health care
The most immediate cash infusion expected at Southwest Washington Medical Center will come in the state’s $87 billion boost in Medicaid payments, said Ken Cole, manager of public affairs and communications.
“We’re expecting to see a 6.2 percent increase in state and Medicaid payments,” Cole said. “States can receive and allocate that money quickly because there’s already a mechanism in place to distribute the funds.”
These days more SWMC patients rely on Medicaid and Medicare – a challenge for an organization that spent $14.3 million on charity care in 2006, before the economy bottomed out.
“We budgeted a 30 percent increase for charity care this year,” Cole said.
The hospital will also likely get part of $456 million nationwide for organizations that serve a high number of poor and elderly patients.
More cash is expected from $25 billion nationally to help unemployed workers extend their health insurance under the COBRA program, and from funds to develop health records technology.
Impacting construction
For Mike Zeman, president of Vancouver-based Scheffler Northwest Inc., the stimulus package could offer more work opportunities with its funding of public infrastructure projects, such as improvements to roads, highways and bridges.
Scheffler Northwest primarily builds drilled shafts and retaining walls, and, like many contractors, its focus has shifted from private to public projects in the last year. The company recently built a retaining wall for the Port of Vancouver’s railroad realignment, working as a subcontractor for Vancouver-based Nutter Corp.
While he welcomes more public project opportunities, Zeman said a public-heavy workload has its challenges, especially as more contractors compete for work in the public arena.
“A public job is much more competitive and it’s purely based on price, whereas in the private work, we have a lot of relationships,” he said. “We’ve built (the company) on providing good service and taking care of our clients. It becomes harder to do that when you’re on a shoestring budget to be so competitive.”
Looking ahead
Even with the federal package, there could still be slow consumer spending ahead, said Scott Bailey, regional economist for the state Employment Security Department.
“Credit markets are going to be tighter coming out of this than in the last 20 years,” Bailey said. “(Credit card rates) got lower over the years because credit card debt got bundled and sold like mortgages. That market’s kind of dead and I don’t know it will come back any time soon.”
Lower consumer spending could be tough on the retail and real estate markets, but Bailey said there could be economic plusses if the value of the United States dollar falls.
“We could see a resurgence of manufacturing in this country, which is sort of an offset of real estate,” Bailey said. “Instead of planning ahead for more commercial use of land, maybe we should be planning ahead for more industrial use.”
He said Southwest Washington could benefit from a national resurgence in manufacturing.
“We really don’t have a national manufacturing policy,” he said. “We can do more to encourage manufacturing in general.”
Track national recovery spending: www.recovery.gov
MAJOR IMPACTS OF THE FEDERAL STIMULUS IN WASHINGTON STATE
Washington gets $6.7 billion of the national package
Construction
• $493 million for improvements to Washington’s highways and bridges
• Part of $1 billion nationwide for upgrades of veterans’ care facilities
• $60.7 million for state home weatherization efforts
• $1.5 billion in nationwide competitive grants for highway projects of major regional or national importance
• $210 million in nationwide competitive grants to upgrade or build fire stations
Health care
• Part of $150 billion nationwide in increased Medicaid payments
• Part of $19 billion nationwide for health care information technology systems
• Part of $21 billion nationwide to help laid-off workers keep health insurance through the COBRA program
Workforce development
• Part of $10 billion nationwide for National Institutes of Health research, jobs and training
• $66 million for unemployed workers in Washington to get training for new careers
• Part of $150 million nationwide to hire veterans claims processors
Energy
• More than $60 million to help address Washington’s energy priorities
Real estate
• An $8,000 tax credit for first-time homebuyers closing deals between Jan. 1, 2009 and Dec. 1, 2009
• More than $100 million for prevention of homelessness in Washington
Transit
• $1.2 million for Longview transit projects
Source: The office of U.S. Sen. Patty Murray
Charity Thompson can be reached at cthompson@vbjusa.com.
