Monday PM March 8th, 2010
by: Ed Mayberry, March 8, 2010 9:03:33 pm
The Houston Independent School District could receive as much as $89.4 million in school technology funding to improve the technology infrastructure, computer networking and Internet access this year through the federal e-rate program. HISD Superintendent Terry Grier signed an $850,000 settlement with the Federal Communications Commission after HISD's funding was frozen as a result of a federal investigation of three former HISD employees accepting meals from e-rate vendors. The restored funding can be used for telecommunications services, Internet access, internal connections and maintenance of internal connections. The federal e-rate program is designed to bridge the digital divide between more affluent suburban students and urban students at or below the poverty line. More than 78 percent of HISD students qualify for free or reduced price school meals.
A key state official says the Texas legislature will face a shortfall of at least $11 billion when they meet to write the next state budget in 2011. That's the projected difference between available revenue and the cost of maintaining services at their current levels. John O'Brien, director of the Legislative Budget Board, told a legislative committee that the estimate is conservative and could grow to as much as $15 billion. The shortfall is a result of several factors, including lower-than-expected sales tax receipts. State agencies have submitted proposals to cut their current-year budgets by five percent, as requested by Governor Rick Perry. Those savings will only amount to about $1.7 billion, O'Brien said.
American International Group will sell a second overseas life and health insurance unit for $15.5 billion to Metlife, part of an ongoing effort to repay billions in government aid. It's the second major deal AIG announced this month to raise cash. On March 1st, AIG agreed to sell Asia-based life insurer AIA Group to Britain's Prudential for $35.5 billion.
President Barack Obama accused insurance companies of placing profits over people. Speaking in Pennsylvania, he said Republicans ignored long-festering problems when they held power. He's pushing for support for swift passage of health care legislation stalled in Congress. It was the first in an expected series of trips to pitch his plan to remake the health care system. The president said that Republican critics in Congress contend they want to do something about rising health care costs but failed when they held power. Democratic leaders in Congress are working on a rescue plan for sweeping changes in health care that seemed earlier in the year to be on the brink of passage. The current two-step approach calls for the House to approve a Senate-passed bill despite opposition to several of its provisions, and for both houses to follow immediately with a companion measure that makes a series of changes.
The Obama administration is hearing a rising chorus of demands to steer more stimulus money to Hispanic and black businesses. Those businesses are getting a disproportionately small number of federal stimulus contracts. Latinos own 6.8 percent of businesses but have received only 1.7 percent of federal stimulus contracts recorded in U.S. government data. Blacks own 5.2 percent of businesses but have gotten only 1.1 percent of that money. Minority advocates are calling for the administration to be more inclusive on this front and to track more closely who receives the contracts. They say blacks and Latinos have been harder hit by the recession, and getting a fair share of stimulus contracts is key to the recovery of these communities.
The average price of regular gasoline has risen nearly ten cents in the last two weeks. The Lundberg Survey says it rose 9.58 cents to $2.73. Analyst Trilby Lundberg says the average price for a gallon of mid-grade was $2.86. Premium was at $2.97. Cheyenne, Wyoming, had the lowest average price among cities surveyed at $2.47 a gallon for regular. Honolulu was the highest at $3.33. According to HoustonGasPrices.com, average prices in Houston have risen 5.6 cents in the past week, averaging $2.55 a gallon. That's 79.2 cents higher than the same day a year ago.
A global trade union says women with children still face major career and pay obstacles. The International Trade Union Confederation says women with children earn almost a third less than men and still face too many career obstacles. Diana Holland, chair of the ITUC's women's committee, calls the report "a call to action at all levels." The publication of the report coincides with the United Nations Day for Women's Rights. The study says women with kids more often work part-time than men or women without children. The report also says employers often break laws by paying women less than men and by not giving them enough maternity leave. Women with kids can also be denied promotions or be illegally asked to take pregnancy tests before being hired.
Programs that help senior citizens live independently are facing budget constraints in several states, prompting new fees and waiting lists. The in-home services include personal care assistants, visiting nurses and meal deliveries. They're intended to help people age at home rather than move into more costly nursing facilities. In Connecticut, elderly clients say a new 15 percent surcharge for in-home services is cutting too deeply into their budgets. And in North Carolina, there's a dispute over creating a scoring system to determine how many hours of in-home care can be provided to the clients. Officials say the fees and waiting lists, while difficult, are necessary to preserve the home care programs from elimination altogether.
The Treasury Department is allowing the export of Internet communications services such as instant messaging, email and Web browsing to Iran, Sudan and Cuba to help people in those countries communicate. Deputy U.S. Treasury Secretary Neal Wolin said that the change to existing trade sanctions is intended to help people, "exercise their most basic rights." Protesters in Iran have used online tools, such as instant messaging and Twitter, to pass information about actions against the governing regime. The department has allowed the export of services to all three countries, while allowing the export of communications software only to Iran and Sudan. The treasury says the export of software to Cuba is governed by the Commerce Department.
The Federal Reserve is beginning a program to drain some of the unprecedented liquidity it added to markets during the credit crisis. The Federal Reserve Bank of New York says it will begin conducting reverse repurchase agreements. That's when the Fed sells securities from its portfolio with an agreement to buy them back later. The Fed launched dozens of programs to add liquidity to credit markets during the peak of the credit crisis in late 2008 after the market came to a standstill. The Fed is beginning to withdraw the measures now that the crisis has passed. The program is open to primary dealers as well as domestic money market mutual funds. The Fed first announced it would launch the reverse repurchase program on October 19th.
Environmental groups say there's a simple way to conserve water in Texas: get a new toilet. That's among the recommendations in a report evaluating water conservation in 19 cities around the state. The report from the National Wildlife Federation and the Lone Star chapter of the Sierra Club says replacing toilets manufactured before 1992 could save about 12,000 gallons a year per household. Older toilets use from 3.5 to 7 gallons per flush, but newer high-efficiency toilets only use 1.28 gallons per flush. The report also recommended changing utility pricing structure to reward conservation; restricting outdoor watering; offering local rebate programs for replacing fixtures and appliances; and more public education.
Federal regulators will begin holding hearings this week looking at competition in the agricultural industry. Some officials in the Obama administration have said they are uncomfortable with the increasing control a handful of corporations have over the nation's food supply. Christine Varney heads the Justice Department's antitrust division, and she says any time there's a lot of consolidation in an industry, it merits looking at. Regulators with the U.S. Justice and Agriculture Departments are scheduled to meet Friday in a suburb of Des Moines, Iowa, for their first hearing on the issue. Four other hearings will be held later this year. The meetings are expected to examine competition in the seed, dairy, poultry, beef and crop industries.
This is a fairly quiet week for economic reports. The government reports on the federal budget deficit on Wednesday, followed by the trade gap on Thursday. February retail sales are due Friday, with a modest gain of 0.2 percent expected. Business inventories are due Friday as well.