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President Bush’s FY09 Budget and Minnesota

The President’s 2007 Budget continues the successful pro-growth policies that have encouraged robust economic growth and job creation.  A strong economy, together with spending restraint, is critical to reducing the deficit.  The Budget builds on last year’s successful spending restraint by again holding the growth of overall discretionary spending below inflation, proposing to reduce non-security discretionary spending below the previous year’s level, and calling for the elimination or reduction of programs not getting results or not fulfilling essential priorities. Like last year, the budget proposes savings and reforms to mandatory spending programs, whose unsustainable growth poses the real long-term danger to our fiscal health.

Focusing On National Priorities

The Budget focuses taxpayer resources on National priorities like the War on Terrorism, health care, energy research, and strengthening our global competitiveness through improved math and science education and research.

• Fighting the War on Terror. To give our troops the resources they need to fight terror and protect our Nation, the Budget increases defense spending by nearly 7 percent. This funding will maintain a high level of military readiness, develop and procure new weapon systems to ensure U.S. battlefield superiority, and support our service members and their families.
• Defending the Homeland. Government-wide, non-defense homeland security funding, including fee-funded activities, increases by more than 8 percent. The Budget also provides resources to strengthen our borders with funding for 1,500 new border patrol agents, 6,000 new detention beds, 560 detention and removal personnel, and 257 attorneys to expedite removal of illegal immigrants.
• Reducing Health Care Costs and Improving Access. The Budget makes health care more affordable and available with improvements to Health Savings Accounts, health information technology, and medical liability reform.
• Reducing our Addiction to Foreign Oil. The Advanced Energy Initiative provides a 22-percent increase in research funding for cleaner, cheaper, more reliable energy: solar, wind, nuclear, zero-emission coal, batteries for hybrid and electric cars, hydrogen, and biomass – with the goal of replacing 75 percent of oil imports from the Middle East by 2025.
• Strengthening our Competitiveness. The American Competitiveness Initiative commits $5.9 billion in FY2007, and more than $136 billion over 10 years, to increase investments in research and development, recruit new math and science teachers, encourage American innovation, and strengthen our nation’s ability to compete in the global economy.
• Promoting Compassion and Strengthening Families. The Budget continues to advance compassionate programs that are effective in addressing social concerns, including $322 million in targeted Faith-based and Community initiatives. These efforts fund the Helping America’s Youth initiative, as well as other priority programs.

Budget Items of Special Interest to Minnesota

• $48.6 million in State Children’s Health Insurance Program (SCHIP) funds to help Minnesota provide health coverage to low-income, uninsured children who do not qualify for Medicaid. This funding is a 23 percent increase over 2006.
• $24.3 million for the HOME Investment Partnership Program to help Minnesota fund a wide range of activities that build, buy, or rehabilitate affordable housing for rent or homeownership, or provide direct rental assistance to low-income people. This funding is a 12 percent increase over 2006.
• On January 5, the Administration released $100 million in emergency contingency funds targeted to the areas with the greatest need, including $4.2 million for Minnesota. In addition, the Department of Health and Human Services made available up to 100 percent of states' remaining block grant funds – which total $633 million – for a combined total of $733 million in additional resources beyond the $1.35 billion allocated last fall.

President Bush’s Budget Also Includes:

• $2.782 billion will be available for the Low Income Home Energy Assistance Program (LIHEAP) in 2007, which includes resources provided in the 2006 reconciliation bill. The total resources represent a 28.7 percent increase over 2006 LIHEAP funding.
• $150 million for the Biofuels Initiative, which will help lower our dependence on oil in the long-term by accelerating the development of affordable, domestically produced bio-based transportation fuels and other products largely derived from oil today.
• $71 million for the Great Lakes, a $20 million increase over 2006, including $50 million to fully fund Great Lakes Legacy Act sediment remediation. These additional funds will allow the Environmental Protection Agency to begin work with State and local partners at approximately 4 to 6 sites in 2007.
• $66 million for the National Oceanic and Atmospheric Administration’s Coastal Zone Management Program which provides grants to participating coastal states to protect, restore, and responsibly develop the Nation’s coastal communities and resources.
• $27 million, a $7 million increase over 2006, for the Army Corps of Engineers to conduct restoration work and an important study needed to address damage to the Upper Mississippi River, the Illinois Waterway, and their floodplains.