(AP) -- The Obama administration has put the brakes on a plan to build a new lab that studies contagious animal diseases, a decision that has pitted disappointed Kansans hopeful about growth against New Yorkers fighting to keep about 200 jobs at a Cold War-era facility on a tiny island.

Proponents say the new lab, estimated to cost $650 million, is needed to protect the nation's livestock industry, while skeptics argue that such an investment in an economic crisis is unwise.

"The prospect of taking a wrecking ball to a multimillion-dollar Homeland Security investment in the study of at to accommodate another several hundred million-dollar research lab right in the middle of cattle country has always seemed like the height of irresponsible government spending," said Bob DeLuca, president of the Group for the East End, which focuses on environmental issues on eastern Long Island.

Adrienne Esposito, executive director of the New York-based Citizens Campaign for the Environment, gushed when told that this week that President recommended no additional funding for construction of a new lab. Obama also directed the U.S. to reassess the viability of the National Bio- and Agro-defense Facility planned near Kansas State University.

"If nothing is broken, why are they trying to fix it?" Esposito asked of the Plum Island laboratory, which sits on an 840-acre island about 100 miles east of New York City. "I think even the president realized it would be a big mistake to move. This is nothing but a boondoggle, a money grab that the president has stopped."

Homeland Security Secretary Janet Napolitano told a House appropriations subcommittee on Wednesday that the lab remains necessary and that Obama's for the next fiscal year includes $8 million for research in Kansas. She predicted the project will move forward.

Kansas Sen. Pat Roberts said the state's delegation has been "working overtime, across party lines" on the lab project with federal agencies. Spokeswoman Sarah Little said Roberts remained focused on shepherding the lab through the appropriations process, calling it a "critical national security priority."

On the other side of the country - and the political aisle - Democratic Rep. Timothy Bishop, whose eastern Long Island district includes Plum Island, countered that Republicans would ordinarily be pleased that the president was halting potentially wasteful spending.

"In the fiscally constrained environment that we are in, I don't think there is the need to spend upward of $1 billion on a new facility when there is a perfectly good one, doing perfectly good work already here," he said.

Homeland Security, which took control of operations at Plum Island after the federal agency was formed in the wake of the Sept. 11 attacks, has spent $35 million on improvements at the lab in recent years, including an expansion of large-animal research rooms, renovation and expansion of the necropsy facilities, and infrastructure and security upgrades.

The department has argued that a modernized lab in Kansas that could study diseases affecting both animals and humans is needed and that the Cold War-era Plum Island center, which studies only animal diseases, is approaching the end of its usefulness. Officials in New York point to the recent upgrades - and the fact that dangerous human diseases are already being studied at places like the Centers for Disease Control and Prevention in Atlanta - as arguments opposing a new facility.

Dr. Ron DeHaven, vice president of the American Veterinarian Medical Association and former administrator of an Agriculture Department agency that performs research at Plum Island, said the improvements on Plum Island in recent years were intended as a stop-gap measure until a new facility was built.

"Five years ago, there was no doubt in anyone's mind that the facility at Plum Island was outdated," he said. "From the get-go that money was intended to be a temporary fix; there was never an expectation the improvements would be do anything more than be a bridge to a new facility."

Recruiting scientists to work at the remote island - which played a role as the ruse to get fictional serial killer Hannibal Lecter to cooperate with FBI trainee Clarice Starling in "The Silence of the Lambs" - has been a problem, DeHaven said.

"When you mix the high cost of living and the remoteness or where it is, we had problems with recruiting the best scientists," he said. Like others, he said concerns about contamination leaks at a new facility are overblown. "Bio-containment has improved greatly," he said, pointing to the CDC in Atlanta.

He said a new facility is needed somewhere, despite the cost. Of $650 million or more. "An outbreak of foot-and-mouth would impact our economy by that much in the first six hours," he said.

Besides the Homeland Security review, the National Academy of Science is amid a second review of the proposed Kansas site, focusing on concerns that the nation's heartland may not be a suitable location to study infectious animal diseases because of its proximity to so many cattle farms. When it was opened in the 1950s, the federal government chose Plum Island - the site of a former Army fort - because it was off the mainland.

In an earlier study, the academy identified a 70 percent chance that a release of foot-and-mouth disease could occur at the new lab during its projected 50-year lifespan. Damage to the livestock industry could total as much as $50 billion, officials have said.

Foot-and-mouth virus is so contagious it has been confined only to the Plum Island lab, where accidents have already happened.

The Bush administration acknowledged in 2008 that a release of the virus into cattle holding pens on Plum Island in 1978 triggered new safety procedures. The release was one of about a half-dozen accidents that have occurred at the lab, but the only one in which pathogens escaped into the atmosphere; the others were all confined. There was no known environmental impact, and there are no cattle farms on eastern Long Island.

The AP has previously reported that a simulated outbreak of the disease in 2002 - part of a government exercise called "Crimson Sky" - ended with fictional riots after the simulation's National Guardsmen were ordered to kill tens of millions of farm animals, so many that troops ran out of bullets.

In the exercise, the government said it would have been forced to dig a ditch in Kansas 25 miles long to bury carcasses. In the simulation, protests broke out in some cities amid food shortages.

The General Services Administration, which is charged with selling the island to defray the costs of building the Kansas lab, has repeatedly delayed its release of a draft environmental impact statement originally promised in summer 2010 and most recently expected at the end of January. No sale can take place until an environmental review and public hearings are held.

An administration spokesman did not respond to inquiries Tuesday to explain the latest delay.