U.S. money fills N.H.'s stocking Politicians cry foul, citing Feb. primary

January 01, 1992|By Bob Hohler | Bob Hohler,Boston Globe

CONCORD, N.H. -- In the 15 days before Christmas, New Hampshire received an unexpected federal windfall of more than $240 million, a boon that lawmakers from Portland, Maine, to Portland, Ore., portray as a partisan effort by the Bush administration to influence the nation's first presidential primary.

The money, which comes as the president braces for a pivotal Republican showdown in New Hampshire against conservative commentator Patrick J. Buchanan, will, among other things, obliterate the state's $200 million budget deficit, create as many as 400 federal jobs and save countless small businesses from the vagaries of the state's troubled economy, according to Gov. Judd Gregg and other party leaders who announced the allocations.

But while Bush supporters describe the massive cash flow as a virtual coincidence, Buchanan backers and some politicians in other states are crying foul.

"The people of Maine are keenly aware of what's going on in New Hampshire," said state Representative Dan A. Gwadosky, D-Fairfield, majority leader of the Maine House. "Their perception is that the people of New Hampshire are getting special treatment because of the simple fact that they have the first primary. They know Washington hasn't shown the same interest in Maine as it has in New Hampshire."

The vast majority of New Hampshire's windfall was $234 million in Medicaid reimbursements, for which the state applied under a provision that 36 other states have used to try to close budget gaps. Maine, which has a larger population than New Hampshire's, received about $100 million less than the Granite State under the provision.

Although Governor Gregg, who is chairman of President Bush's re-election campaign in New Hampshire, joined the state's Democratic leaders in supporting the Medicaid strategy, one leading Democrat saw ulterior motives in the arrival of such a large sum at this time.

State Representative Peter Burling of Cornish, a member of the New Hampshire House's state-federal relations committee, said, "I think there is clearly a relationship between the primary and all the money coming our way."

Mr. Gregg could not be reached Monday for comment, nor was anyone available at the Bush campaign headquarters in Manchester.

On Dec. 12, more money came New Hampshire's way. Three days after Mr. Gregg announced the Medicaid reimbursement and the same day that Bush supporters opened the president's campaign headquarters, Sen. Warren B. Rudman, R-N.H., informed voters that the State Department had selected the former Pease Air Force Base in Newington as the site for a $6.2 million visa- and passport-processing center.

Mr. Rudman, a key Bush supporter, said the facility would employ as many as 400 workers and would have a payroll of up to $10 million. But the senator, who is considering running for a third term next year, denied that the project or the timing of his announcement was related to the Feb. 18 presidential primary. He billed the center instead as evidence of his clout as the ranking Republican on a subcommittee that oversees the State Department budget.

Of all the help that New Hampshire received in recent weeks, however, none has prompted a greater search for the president's fingerprints than a pilot loan program aimed at sparing small businesses from the credit crunch created by New Hampshire's banking crisis.

No sooner did Governor Gregg announce Dec. 11 that the Small Business Administration had selected New Hampshire to test its New England Lending and Recovery Project than Sen. John Kerry, D-Mass., decried the choice as "blatant politics." Mr. Kerry said his neighboring state was equally, if not more, worthy of giving the program its debut.

Mr. Gregg appeared to fan the flames by replying in a news conference: "Well, senator, if you were in the right party, you would have done better."

That prompted Representative Ron Wyden, D-Ore., to call on the Small Business Administration to divulge to a House committee how New Hampshire was selected for the highly coveted program.

"The governor's comments alone warrant Congress' being able to see how this process resulted in the grant award," he said Monday in a telephone interview. "Anyone walking around with their eyes open would suggest that this sort of semiflood of dollars into New Hampshire should be questioned."

Representative Bill Zeliff, R-N.H., raised additional questions about possible White House involvement when he said in an interview with WMUR-TV in Manchester that "George Bush had his hands on it," referring to the pilot program in New Hampshire.

Mr. Zeliff said Monday that he meant only that the president was supportive of the SBA and helping New Hampshire.

SBA spokesman D. J. Caulfield said Monday that the agency had narrowed its list of candidates for the pilot program to New Hampshire and Massachusetts, and that New Hampshire won because of its great need and small size.

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