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South Carolina's Governor vs. Obama, the Knockout

The White House once again rejected South Carolina Gov. Mark Sanford's request to use stimulus money to pay down school construction debt, so the governor is saying thanks, but no thanks, and rejecting $700 million in state stabilization fund dollars, which are intended primarily to prop up education budgets.

In a press release issued today, Sanford expresses a sentiment that others certainly share: "We simply cannot afford to base 10 percent of our state budget on money that will disappear in two years' time."

But he also takes aim at the White House: "We're obviously disappointed by the White House's decision, because it cuts against the notion of federalism and the idea of each state having the flexibility to act in a manner that best suits its needs."

Sanford also told lawmakers that if they decide to seek the stabilization money on their own, they should use the stabilization money for the intended purposes (education) but then use the state money that's freed up to pay down state debt. (There's some debate about whether legislatures can override governors on stimulus-related issues.) The legislature would have to be careful to steer clear of "maintenance of effort" requirements that are attached to the stabilization money that seek to keep states from replacing their own dollars with state dollars.

Joel Sawyer, the governor's spokesman, told me the White House's rejection applies only to state stabilization funds—and that Title I and special education funding will still flow through to the state.

Earlier this week, Alaska Gov. Sarah Palin also announced she was rejecting stimulus dollars, including Title I and special education funding.

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