Today's Article
Transportation
Department heads are
failing to give "priority
to economically
distressed areas"
states a recent GAO
study.
Department heads are
failing to give "priority
to economically
distressed areas"
states a recent GAO
study.
The American Spark
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Stimulus Funds Not Always Invested In Needy Areas
By Cliff Montgomery - Aug. 4th, 2009
The Recovery and Reinvestment Act of 2009 is an economic stimulus plan intended to re-start America's
faltering economy. But in allocating the Recovery Act's highway infrastructure funds, Transportation
Department heads so far have failed to "develop clear guidance on identifying and giving priority to
economically distressed areas," according to a recent report by the Government Accountability Office (GAO).
Katherine Siggerud, the Department of Transportation’s Managing Director for Physical Infrastructure Issues,
on July 31st delivered testimony regarding President Obama's Recovery Act before the House Transportation
and Infrastructure Committee.
Below The American Spark offers quotes from the GAO's introduction of Siggerud's instructive testimony:
"The American Recovery and Reinvestment Act of 2009 (Recovery Act) included more than $48 billion for the
Department of Transportation’s (DOT) investment in transportation infrastructure, including highways, rail, and
transit.
"This testimony—based on GAO report GAO-09-829, issued on July 8, 2009 and updated with more recent data,
in response to a mandate under the Recovery Act—addresses (1) the uses of Recovery Act transportation
funding including the types of projects states have funded, (2) the steps states have taken to meet the act’s
requirements, and (3) GAO’s other work on transportation funding under the Recovery Act."
"A substantial portion of Recovery Act highway funds have been obligated, with most funded projects focusing on
pavement improvements. In March 2009, $26.7 billion was apportioned to 50 states and the District for highway
infrastructure and other eligible projects. As of July 17, 2009, $16.8 billion of the apportioned funds had been
obligated for over 5,700 projects nationwide.
"About half of the funds has been obligated for pavement improvements such as reconstructing or rehabilitating
roads; 17 percent has been obligated for pavement-widening projects; and about 12 percent has been obligated
for bridge projects. Remaining funds were obligated for the construction of new roads and safety projects, among
other things.
"States have generally complied with the act’s three major requirements on the use of transportation funds:
(1) Fifty percent of funds must be obligated within 120 days of apportionment. All states have met this
requirement.
(2) Priority for funding must be given to projects that can be completed within 3 years and are located in
economically distressed areas, as defined by the Public Works and Economic Development Act.
(3) State spending on transportation projects must be maintained at the level the state had planned to spend as
of the day the Recovery Act was enacted. With one exception, the states have certified that they will maintain their
level of spending.
"GAO will continue to monitor states’ use of Recovery Act funds for transportation programs and their compliance
with program rules. In the next report, in September 2009, GAO plans to provide information on the use of
Recovery Act funds for transit programs and for highway programs.
"GAO [recommends] that the Secretary of Transportation develop clear guidance on identifying and giving
priority to economically distressed areas. DOT agreed with this recommendation and is consulting with the
Department of Commerce to develop additional guidance on criteria to classify distressed areas for Recovery
Act funding."
Like what you're reading so far? Then why not order a full year (52 issues) of the The American Spark e-
newsletter for only $15? A major article covering an story not being told in the Corporate Press will be
delivered to your email every Monday morning for a full year, for less than 30 cents an issue. Order Now!
By Cliff Montgomery - Aug. 4th, 2009
The Recovery and Reinvestment Act of 2009 is an economic stimulus plan intended to re-start America's
faltering economy. But in allocating the Recovery Act's highway infrastructure funds, Transportation
Department heads so far have failed to "develop clear guidance on identifying and giving priority to
economically distressed areas," according to a recent report by the Government Accountability Office (GAO).
Katherine Siggerud, the Department of Transportation’s Managing Director for Physical Infrastructure Issues,
on July 31st delivered testimony regarding President Obama's Recovery Act before the House Transportation
and Infrastructure Committee.
Below The American Spark offers quotes from the GAO's introduction of Siggerud's instructive testimony:
"The American Recovery and Reinvestment Act of 2009 (Recovery Act) included more than $48 billion for the
Department of Transportation’s (DOT) investment in transportation infrastructure, including highways, rail, and
transit.
"This testimony—based on GAO report GAO-09-829, issued on July 8, 2009 and updated with more recent data,
in response to a mandate under the Recovery Act—addresses (1) the uses of Recovery Act transportation
funding including the types of projects states have funded, (2) the steps states have taken to meet the act’s
requirements, and (3) GAO’s other work on transportation funding under the Recovery Act."
"A substantial portion of Recovery Act highway funds have been obligated, with most funded projects focusing on
pavement improvements. In March 2009, $26.7 billion was apportioned to 50 states and the District for highway
infrastructure and other eligible projects. As of July 17, 2009, $16.8 billion of the apportioned funds had been
obligated for over 5,700 projects nationwide.
"About half of the funds has been obligated for pavement improvements such as reconstructing or rehabilitating
roads; 17 percent has been obligated for pavement-widening projects; and about 12 percent has been obligated
for bridge projects. Remaining funds were obligated for the construction of new roads and safety projects, among
other things.
"States have generally complied with the act’s three major requirements on the use of transportation funds:
(1) Fifty percent of funds must be obligated within 120 days of apportionment. All states have met this
requirement.
(2) Priority for funding must be given to projects that can be completed within 3 years and are located in
economically distressed areas, as defined by the Public Works and Economic Development Act.
- "Officials from almost all of the states included in GAO’s review said they considered project readiness,
including the 3-year completion requirement, when making project selections. However, due to the need to
select projects and obligate funds quickly, many states first selected projects based on other factors and
only later identified whether these projects fulfilled the economically distressed area requirement.
"Additionally, some states identified economically distressed areas using data or criteria not specified in
the Public Works or Recovery Act. In each of these cases, states told us that DOT’s Federal Highway
Administration (FHWA) approved the use of alternative criteria but it is not clear under what authority it did
so as FHWA did not consult with or seek the approval of the Department of Commerce.
(3) State spending on transportation projects must be maintained at the level the state had planned to spend as
of the day the Recovery Act was enacted. With one exception, the states have certified that they will maintain their
level of spending.
"GAO will continue to monitor states’ use of Recovery Act funds for transportation programs and their compliance
with program rules. In the next report, in September 2009, GAO plans to provide information on the use of
Recovery Act funds for transit programs and for highway programs.
"GAO [recommends] that the Secretary of Transportation develop clear guidance on identifying and giving
priority to economically distressed areas. DOT agreed with this recommendation and is consulting with the
Department of Commerce to develop additional guidance on criteria to classify distressed areas for Recovery
Act funding."
Like what you're reading so far? Then why not order a full year (52 issues) of the The American Spark e-
newsletter for only $15? A major article covering an story not being told in the Corporate Press will be
delivered to your email every Monday morning for a full year, for less than 30 cents an issue. Order Now!
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