I had the opportunity to talk today with Martin Kaste of National Public Radio, who is working on a story for “All Things Considered.” I found out that I agree with Governor Schwarzenegger from California, who told him that the federal stimulus bill is not a state bailout bill!

Though we appreciate the speed with which Congress and the President are acting on this needed bill, it’s just not big enough to make up for the deep dive our state revenues have taken as businesses cut back on jobs and families cut back on spending. And, unfortunately, as it passed the U.S. Senate, the proposal actually devotes less funds to “fiscal stabilization” of the states and also allocates less to school construction.

The tax cuts in the bill are popular and everyone could use a little extra cash, but from an economic stimulus perspective, direct infrastructure investment would create more jobs and more flexible allocations to states would save more jobs.

I am guessing (with many pieces still moving) that flexible federal dollars will help us address about 1/3 of our 6-8 billion dollar operating budget gap for 2009-2011.

Kudos to Senator Patty Murray for working to include more funds for public transit in the bill. Unfortunately, due to decreased gas tax revenue (when gas prices were so high) and rising construction costs, our state transportation budget faces a $512 million shortfall. Under the U.S. House proposal, it is estimated that the our state would receive $395 million. In the U.S. Senate proposal, the estimate is $286 million.

With President Obama’s signature of the final bill expected by President’s Day and our state preliminary revenue forecast set for the next day, lawmakers in Olympia should soon have two important pieces of information about how much larger our budget-writing challenge is than the one facing the governor just two months ago.

That’s when our conversation with the public about a positive direction forward will begin in earnest.