By RAYMOND HERNANDEZ and PETER BAKER
Published: December 7, 2012
WASHINGTON — President Obama proposed a $60.4 billion emergency spending bill on Friday to finance recovery efforts in states pummeled by Hurricane Sandy, a sum White House officials called a “robust” investment in the region but that was far less than the amount the states had requested.
The spending plan would pay for most but not all of the $82 billion in damage identified by the governors of New York, New Jersey and Connecticut, helping homeowners and small-business owners rebuild, repairing subway and other transit systems, replenishing eroded beaches and reimbursing governments for the cost of police, firefighters and other services.
The president’s plan would not cover several big-ticket items sought by state governments. It would not pay for damage already covered by private insurance and would extend aid only to primary residences. While small businesses will be eligible for help, larger private firms like Consolidated Edison will not be. The plan also assumes that states will have to pay about 10 percent of the cost of any repair and mitigation projects that are approved, even though they asked the federal government to foot 100 percent of the bills.
The proposal now goes to Congress, where it is likely to become the focus of an intense fight between fiscal conservatives seeking to keep a lid on the federal spending and lawmakers from storm-battered areas bent on obtaining even more than what Mr. Obama proposed. Mr. Obama proposed no spending cuts elsewhere to pay the cost, arguing that such emergencies typically do not require offsetting measures.
Leaders from New York, New Jersey and other hard-hit states generally welcomed the proposal, even though it fell short of what they were seeking to clean up storm damage and brace for future storms. The White House increased the overall spending request from the $45 billion to $55 billion estimated earlier in the week, attributing the change to more information received about the extent of the damage.
Gov. Andrew M. Cuomo, Democrat of New York, and Gov. Chris Christie, Republican of New Jersey, who spent much of Friday negotiating the final package with the White House, issued a joint statement that praised the proposal, saying “it enables our states to recover, repair and rebuild better and stronger than before.”
Two New York House members leading a hurricane recovery task force, Nita Lowey, a Democrat, and Peter T. King, a Republican, expressed support for the White House proposal but left open the possibility that additional financing might be sought.
“While more may be needed in the long term,” they said, ``this robust package is a major first step that we will work to pass as quickly as possible in Congress to help devastated communities, families and businesses.”
The proposal comes at a politically inopportune time, as Mr. Obama and Congressional leaders in both parties try to reach an agreement intended to avert a possible fiscal crisis next month, when broad tax cuts are set to expire and automatic spending cuts are scheduled to go into effect.
As the White House finds itself locked in a showdown with Congressional Republicans over these broader budget concerns, it was seeking to present the storm spending request as a separate issue that does not affect the long-term health of the Treasury.
But it appears increasingly likely that the emergency spending measure will become entangled in the larger spending struggle between the White House and Republicans, who would like to maintain the upper hand on the deficit.
Some key Republicans have suggested that the aid requests should be taken up in phases, with emergency needs addressed now in the current Congressional session and longer-term requests left for the new Congress that convenes next year.
But that is a troubling prospect for regional leaders, who are pressing Congress to approve as much aid as possible before it adjourns in the coming weeks, partly because they fear there will be less urgency to act as the months pass.
The $60.4 billion plan includes $17 billion for the Department of Housing and Urban Development and the Community Development Block Grant program to provide help to homeowners and $11.5 billion for the federal disaster relief fund that provides checks to people, reimbursement for government services and assistance to rebuild public facilities.
The plan calls for $9 billion to repair and upgrade transit systems, $4 billion for the Army Corps of Engineers, which will be in charge of various projects including beach replenishment, $9 billion for national flood insurance, $2 billion to fix federal facilities and $1 billion for the Small Business Administration’s aid program.