Recovery Update – Unbelievable

  1. Less than 10% of the available recovery funding for infrastructure projects has been paid out.
  2. I guess in a way it is good news since the economy has not felt the benefit of this stimulus.
  3. The DOI has spent less than 3% of their stimulus funding.

recovery logo

I hope that someone reading this can provide a better explanation of what I am seeing at the Recovery website. It appears to me that if you subtract out the funds allocated by Education, Health and Human Services, Labor and Social Security, none of which I would consider infrastructure spending related, that the remaining Federal agencies have paid out a total of $4.2 Billion dollars to date. This represents less than 10% of the money available to these agencies.

Someone please tell me I am wrong about this. Am I the only one who is checking on the status of this so-called stimulus funding program? Take the Army Corps for example.  They have spent $43 billion out of $380 B. The Department of the Interior has spent $3 billion out of $93 B – that’s less than 3%. Maybe there are a lot invoices out there waiting to be paid, but somehow I doubt it.

I suppose one can look at it as a positive in that all of this money is yet to be spent. Tell that to the firms who could be doing the work, and to the people that they could be employing.  I know about a couple of procurements that have been delayed for months.

I would recommend that everyone contact a statewide newspaper where they live and make them aware of this. This is unbelievable, and don’t tell me it takes time to get these projects going. They were supposed to be shovel ready.

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4 Responses to Recovery Update – Unbelievable

  1. bob says:

    Um. Assume a “shovel-ready” project – all approvals in place, but no funding. No contracts in place, because no prudent organization contracts without an identified funding stream. (Congress/President don’t contract directly, so are not subject to this definition of prudent.) HR 1 passes 2/17/09. Final Agency plans submitted (meaning the Feds have decided how they want to spend the money) 5/15/09. Painful, yes, but lightspeed for the government.

    At that point, they can either send out the money to states/other intermediaries, or can start a direct contracting process. Assume for a moment (probably not a valid assumption) that RFP – request for proposal – development has been proceeding in parallel so the RFPs can hit the street 5/15/09. Typically, there’s a 30 day response time. (Shorter periods are possible, but too much corner-cutting risks being tied up in legal and adminstrative challenges.) So, roughly 6/15/09, the procuring organizations are just getting the bids back. It’ll take at least 30 days to evaluate – more typically 90, I’d guess. That would suggest that contracts would be let 9/15/09 or so – and then the contractors have to roll trucks, shift/hire people, etc. I’d say that having 10% under contract in 120 days is amazingly good, no matter how frustrating it seems. I’d think that August/September is a better time to check – especially with the government fiscal year ending 9/30/09.

  2. Bill says:

    According to the New York Times this morning, all states receiving aid have managed to meet the deadline on spending. See: http://www.nytimes.com/2009/06/26/us/26states.html?ref=us

    This means that there is a “commitment” to spend the money ($15.8billion) on some 4700 projects.

    How this impacts our industry remains to be seen.

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