Turning Down Stimulus Money

Filed under Infrastructure, by Peter Elstrom on May 4

When does it make sense to turn down stimulus money?

Several Republican governors have made headlines by suggesting that their states won’t take stimulus money from Washington. Today, the Wall Street Journal has a story about a town in Nebraska that is turning down money from the federal government over concerns about taxes.

The North Platte Housing Authority has told the federal government that it doesn’t want the roughly $600,000 that it has been allocated as part of the American Recovery and Reinvestment Act. Ed Rieker, chairman of the housing board, is quoted as saying that he is rejecting the money because of his concern for taxpayers.

“If we don’t need it, we don’t spend it,” he said.

He says that the housing authority has about $1.8 million already that it is planning to use for operations and investments. But the decision has split the community. The housing authority looks after about 150 small houses and duplexes, as well as a large apartment building for the elderly. The agency’s executive director, Debra Morgan, has said that the money would go to replace and repair sidewalks, among other things. The Journal quotes one local resident who says that if North Platte doesn’t spend the money, any town will.

So is it responsible for states and municipalities to reject stimulus money or irresponsible?