Senate passes $26.1 billion state aid package 

By Susan Ferrechio Chief Congressional Correspondent

A $26.1 billion aid package for states and teachers cleared a critical Senate hurdle on Wednesday despite overwhelming opposition from Republicans who say the legislation is fiscally irresponsible and a gift to labor unions.

A vote to block a Republican filibuster on the measure passed 61-38, clearing the way for final Senate passage as early as Thursday. The House is planning an emergency session next week in order to pass the money in time for the beginning of the school year.

Sens. Olympia Snowe and Susan Collins, both Maine Republicans, gave Senate Democrats the help they needed to stop a filibuster after weeks of failed attempts.

The bill includes $10 billion for local school boards to avert staff layoffs as well as $16.1 billion to temporarily increase Federal Medical Assistance Percentages, the program that reimburses states for Medicaid, whose rolls have increased in the recession.

Democrats were able to lure Snowe and Collins by finding cuts in the federal budget to pay for the new expenditures instead of increasing the deficit.

"Maine's hospitals, nursing homes and home health agencies are also struggling due to the economic downturn," the two senators said in a joint statement. "An extension of the enhanced FMAP with the gradual phase out included in this bill will help to ensure that these providers of critical health care services can continue to serve those who reach out to them for services."

Soon after passage, Democrats touted the bill as a job saver and slammed Republicans for opposing it.

"In the past few hours," an e-mail blast from the office of Senate Majority Leader Harry Reid, D-Nev., read, "Republicans have voted to fire 290,000 teachers, firefighters and police officers."

Senate Minority Leader Mitch McConnell, R-Ky., called the bill "a last-minute effort by Democrats in Washington to funnel more money to the public employee unions before an election."

Republican critics pointed out that the states already received $100 billion for education under the $800 billion stimulus and a third of that money remains unspent.

The bill does not specify how many teaching jobs would be preserved.

The jobs figures put forth by Democrats come from the Economic Policy Institute, a liberal think tank, which used a formula to come up with the numbers.

Economists at EPI say the $10 billion for teachers included in the bill would save 140,000 school jobs, though not specifically teaching jobs, while the FMAP funding would keep about 150,000 state employees in the work force.

"It's a little misleading when we say it's a teacher bailout," said Neal McCluskey, associate director of the Center for Educational Freedom at the Cato Institute, a libertarian think tank. "It's about overall school staff."

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