- The Washington Times - Wednesday, February 28, 2001

ASSOCIATED PRESS

The nation's governors proposed yesterday that they be allowed to expand Medicaid coverage to millions in their states by offering trimmed benefits to those being enrolled, and they agreed with President Bush's proposals for education testing and accountability.

They also renewed their typical request for the federal government to cover any costs required by federal rules, singling out the high costs of programs like special education, an area where the federal government contributes less than originally promised.

The governors avoided taking a position on Mr. Bush's $1.6 trillion tax cut. It prompted a constant backstairs debate at the National Governors Association winter meeting, breaking along party lines.

The group has 29 Republican governors, 19 Democrats and two independents, and it strives to avoid taking group positions that disrupt its bipartisan nature.

"We agreed to move ahead on a bipartisan basis on a number of the principles suggested by the Bush administration certainly accountability and testing, because the states have always done that," said Gov. Parris N. Glendening, the Maryland Democrat who heads the NGA. "But we're also saying if you're going to impose major new costs, then the federal government ought to pay a significant share of that. We're in terrible shape on special-education funding."

Mr. Glendening, who worked all weekend to balance his bipartisan role as national chairman and his more partisan role as future chairman of the Democratic governors, said: "We normally do not get into the tax issue as an association, in part because there is significant disagreement."

Along similar lines, while endorsing much of Mr. Bush's education plan, the governors declined to take a position on the divisive issue of school vouchers.

Also yesterday, the governors:

• Proposed significant changes in Medicaid rules that would allow states to expand coverage to millions of needy people, even if the benefits for some of the new enrollees are less generous than those currently guaranteed to the poor. That would require the federal government to ease regulations on how Medicaid is administered by states.

• Reaffirmed that Congress should not pre-empt a state's ability to tax goods sold over the Internet. Some governors want to prohibit taxing commerce over the Internet altogether, but most agreed states should be allowed to impose a state sales tax and want to encourage states to work together to create uniform practices that would make it easier for retailers to deal with state taxes.

• Backed the administration's call for education testing and assessments, adding a reminder that nothing should be federally mandated without providing the money to pay for it.

The governors, who were courted throughout last weekend by Mr. Bush, heard yesterday from Senate Minority Leader Tom Daschle, South Dakota Democrat. Mr. Daschle warned that if Mr. Bush's tax-cut plan passes "the way it's written now, you're going to have to make some painful choices."

Mr. Daschle offered the Democratic smaller tax cut as an alternative, noting it would leave money needed for domestic programs and emergencies.

Colorado Gov. Bill Owens, a Republican, reminded Mr. Daschle the governors are "a very bipartisan and many times congenial group" and usually don't engage in sharp debate at their meetings. But he wanted to go on record as disagreeing with Mr. Daschle's view of the tax cut.

Mr. Owens said the $1.6 trillion tax cut proposed by Mr. Bush is very reasonable.

"Many, many governors support what President Bush is proposing," he said. "With a little bit of fiscal conservatism at the congressional level, we'll have the opportunities to give back to the taxpayers some of the dollars they've earned."

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