Jobs, education and water key to growth in Georgia: governor

ATLANTA (Reuters) - Georgia must focus on creating jobs, investing in education and resolving a tussle with Florida and Alabama over how to divide water resources, the state's new Governor Nathan Deal said on Tuesday.

The three issues are interlocking parts of a single effort to ensure that the southeastern U.S. state, which has a population of around 10 million, rebounds from recession, Deal, a Republican, told a forum of business leaders.

"It doesn't serve us in the overall scheme of things to spend our money educating our children ... and not be able to provide them with jobs that keep them in our state," he said at the meeting organized by the state Chamber of Commerce.

"Jobs and education, the two important ingredients for the future of our state, are inextricably linked together," said Deal, who was sworn in this month.

Georgia's economy contracted 3.1 percent in 2009 and its gross domestic product stood at $360.5 billion, according to U.S. government figures.

Deal announced a new competitiveness initiative to build public-private partnerships in a bid to make the state as friendly to business as possible as well as a school funding panel.

The state would also create a water supply development program charged with using $300 million allocated in funding to help local governments work out new sources of supply and storage, Deal said.

Access to water is an urgent problem for Georgia and Atlanta, its economic engine, because it shares the resources of a system of reservoirs and rivers in the north of the state with eastern Alabama and northern Florida.

A federal judge in 2009 ruled that Atlanta had three years to obtain congressional approval to keep using Lake Lanier, a reservoir north of the city, for drinking water, making it imperative for Georgia to resolve the decades-old dispute.

"Georgia can't wait on Washington," as it aims to resolve the issue through negotiation, Deal said.

Deal spoke as the $2.8 trillion municipal bonds market clawed its way back from a sell-off blamed in part on widening worries about the financial stability of state and local governments.

Deal made no mention of bond issues in his remarks.

(Editing by Padraic Cassidy)