CHEYENNE - State government departments and agencies submitted nearly $1 billion in expanded budget requests for the next biennium, Gov. Dave Freudenthal said Wednesday.

During a news conference, the governor said nearly half the requests are for school capital construction and Department of Health programs, primarily the Medicaid program that pays medical bills for poor people.

Freudenthal again called for caution in spending despite a $200 million projected boost in revenue for the year.

The governor, who said he is averse to the word "surplus," noted the increase is largely from higher natural gas prices while other sources of income to the state's General Fund are flat or - in the case of interest income - down.

"I think we need to be careful to use these revenues to address things like the prison, capital construction, school capital construction," he said.

Freudenthal also announced how $19.8 million in federal welfare reform bonus money will be distributed to 23 non-profit agencies statewide. The state received the money from the U.S. Department of Health and Human Services for reducing the rate of out-of-wedlock births.

The one-time money will be spent on programs such as family counseling, parenting, fatherhood and reduced teen pregnancy rates.

In his discussion of the new budget, the governor said the $1 billion in expanded requests does not include money for a new prison, or prisons, or for water development projects.

It does include $250 million, or $125 million per year, for school capital construction and nearly $253 million for the Department of Health, much of it to go to the Medicaid program. It also includes $123 million in capital construction requests by various executive branch agencies.

Freudenthal said he expects more requests for educational funding out of four studies of the K-12 financing formula for vocational education and regional cost adjustments, among others.

The executive branch agencies, Freudenthal said, will spend the next 45 to 60 days deciding on recommendations that will be submitted to the Legislature on Dec. 1.

He said he is committed to getting more money transferred to local governments, either through the State Loan and Investment Board's competitive federal mineral grant program or by raising the caps on federal mineral royalties distributed on a population basis.

"We have asked the cities and the counties to give us their response as to how they think it should be done," Freudenthal said.

Wyoming was one of four states to share the federal bonus money for reducing out-of-wedlock births.

Department of Family Services Director Rodger McDaniel said 91 non-state agencies from around the state submitted proposals for $35 million.

"This money is a great windfall for the state," he said. "I use the term windfall although we earned it with significant work over the last few years in reducing out-of-wedlock pregnancies."

He said the selection committee looked at programs that can be sustained after the one-time money runs out.

State agencies and the local non-profits worked hard on their proposals without even knowing whether the state would receive any money.

Representatives of several of the agencies that received the money attended the news conference.

Dr. Ray Fleming-Dineen of Fleming and Associates in Cheyenne for 17 years has operated a young parent program for young mothers aged 16 to 21 who have dropped out of school.

"With the help of many in this room we've provided services to these young mothers with a particular strong component in work," she said.

Because of the bonus money, she added, this program can now be funded statewide.