Gregoire says federal money in doubt, calls on business to help with streamlining

Before Tuesday's Massachusetts Senate vote, it looked like Washington state could be in line for as much as $1 billion in federal funding, Gov. Chris Gregoire told AWB members today.

But the election of Republican Scott Brown puts that in jeopardy.

"We don't know now what we can look at," Gregoire said during the first Lobby Lunch meeting of the 2010 legislative session.

Gregoire repeated calls for streamlining state government as one way of addressing a $2.6 billion budget shortfall, and she called on the business community to help persuade lawmakers who she fears are "losing their stomach" for aggressive change.

After she proposed shutting down several state institutions, Gregoire said she began hearing from lawmakers who opposed closures of the ones near them. If lawmakers continue protecting programs in their own districts, "we'll never get things done," she said.

"There isn't a business today that' can't survive without rebooting," Gregoire said. "It should be no different for government."

The governor also:

• Emphasized the need to create new private-sector jobs, and shift more work from the public to private sector. "We can't do it anymore," Gregoire said.
• Offered support for a plan to attract new data centers -- a statement that came at the same time that Facebook received publicity for its new data center in Prineville, Ore.

UPDATE: Video of the governor's remarks after the jump

• Said she was open to new ideas from anyone on solving the budget problem. "If you have a better idea, pass what I've put forward," she said.
• Said as bad as things are here -- the worst in 80 years -- we are not as bad off as California or Oregon. "We are predicted to come out swifter and better than most states," she said, largely because of our import and export markets.
• Confirmed that charter schools are not part of Washington's application for federal Race to the Top school funding. Voters rejected them three times, she said, and only account for a small -- 40 points -- portion of the overall application.
• Said she wanted to protect the state's bond rating, which is currently in good shape.
• Said the best news that could come from the state's next revenue forecast is that it's flat. Additionally, she is concerned about potential increases in caseloads for state social services.

Our Lobby Lunch series continues next week with Rep. Lynn Kessler, D-Hoquiam.