Recovery Act Oversight Hearings Continue on Capitol Hill

Government Relations Update - Economic Stimulus

While “Transparency” continues to be the central theme of the American Recovery and Reinvestment Act (Recovery Act) on one end of Pennsylvania Avenue, “Oversight” is the theme on the other end—as the Senate Homeland Security and Government Affairs Committee (HSGAC) wrapped up its fourth hearing aimed at preventing the potential waste, fraud, and abuse of the $787 billion economic stimulus package.

On Thursday, the HSGAC committee turned its focus on the oversight capacities of state and local governments, receiving testimony from leaders at the Government Accountability Office (GAO), the National Governors Association (NGA) and the National League of Cities (NLC).

Following the release of a new GAO report recommending stronger federal guidance for states to oversee the estimated $280 billion in Recovery Act funds coming their way, Committee Chairman Joe Lieberman (D-CT) and Ranking Member Susan Collins (R-ME) stressed that state budget deficits require greater flexibility to utilize Recovery Act funds for administrative costs related to critical oversight functions.

According to Collins, states “must prepare themselves to handle the challenge of managing and overseeing these funds—a resource-intensive undertaking” that is “further compounded by the fact that many state and local governments are also facing major budget shortfalls that often leave them short-staffed.”

NGA Executive Director Ray Scheppach testified that along with additional oversight funding, the federal government can assist states by avoiding “duplicative or unnecessary reporting requirements,” granting additional time for states to coordinate and plan Recovery Act projects prior to disbursal, and enhancing communication with the individual governor’s offices.

On Thursday, Vice President Joseph moved quickly to heed the GAO recommendations, sending a letter to Congress stating that by early May, the Office of Management and Budget (OMB) will issue updated guidance allowing states to bolster oversight through Recovery Act funding; while also noting that national online forums will begin next week on the Recovery Act website in order to discuss technology solutions to improve Recovery Act accountability.

Department of Commerce

As part of the Obama Administration’s commitment to moving the nation toward energy independence, the U.S. Commerce Department’s National Institute of Standards and Technology (NIST) released a three-phase plan to expedite development of key standards for a Smart Grid, a nationwide network that uses information technology to deliver electricity efficiently, reliably, and securely. Recovery Act contains investments critical to spurring the Smart Grid development process.

NIST’s three-phase approach will:

  • Further engage utilities, equipment suppliers, consumers, standards developers and other stakeholders to achieve consensus on Smart Grid standards. This process will include a stakeholders’ summit scheduled for May 19-20 in Washington, D.C. By early fall, the process will deliver:
    • the Smart Grid architecture;
    • priorities for interoperability and cyber security standards, and an initial set of standards to support implementation; and
    • plans to meet remaining standards needs.
  • Launch a formal partnership to facilitate development of additional standards to address remaining gaps and integrate new technologies.
  • Develop a plan for testing and certification to ensure that Smart Grid equipment and systems conform to standards for security and interoperability.

After issuing the initial set of priorities, standards and action plans in early fall, NIST will initiate the partnership and complete a testing-and-certification plan by the end of the year.

Department of Defense (DoD)

Thus far, the DoD has obligated $46.3 million in Recovery Act funds ($24.2 million of which came this week), accumulating over 75 contracts to non-federal vendors. Within the individual military services, the Department of the Navy has obligated $32.4 million ($12.2 million of which came this week), with contracts being awarded for two Facility Sustainment Restoration and Modernization projects and one Research, Development, Test and Evaluation project.

Additionally, this week the Department of the Air Force awarded 34 contracts totaling $11.9 million, which include the following:

  • $4.4 million for paving, electrical infrastructure and repairs at Luke AFB, AZ. 
  • $3 million for painting and repairs at Vandenberg AFB, CA.
  • $2.7 million for painting, repairs and paving at Lackland AFB, TX.
  • $1.4 million for multiple projects at Sheppard AFB, TX.
  • $300,000 for projects at Tyndall AFB, FL.

It is expected that within the next two weeks, the Air Force will award an additional 133 Military Family Housing Operations & Maintenance contracts. The Department of the Army is also planning to award its first Recovery Act Military Construction project—components of a Warrior in Transition complex at Fort Bliss, TX—on or about April 30, 2009. Two Army National Guard Military Construction projects, a storm sewer at Camp Withycombe, OR and a Ready Building for a Weapons of Mass Destruction Combat Support Team in Brooklyn, NY will also likely be awarded by the end of April.

Department of Education

During the week of April 20, Education Secretary announced the availability of State Fiscal Stabilization Funds to several states. Department officials reviewed and approved State Fiscal Stabilization Fund applications for California, Illinois, and South Dakota, making $3.99 billion, $1.38 billion, and $85.4 million in funding available to these states respectively. The Department has begun the review process for Utah’s State Fiscal Stabilization Fund application, and is continuing to work on the review process for Maine. These funds are intended to be used to save jobs and spur education reform.

Department of Energy

The Department of Energy (DOE) has created a Recovery Act Clearinghouse intended to help increase the availability of information about DOE’s Recovery Act activities. The clearinghouse will provide initial consultations, and also make referrals when appropriate to other information sources (websites, documents, DOE staff, etc).

The Clearinghouse also lists every Recovery Act related Funding Opportunity Announcement (FOA) released by the DOE thus far in the department’s implementation of the Recovery Act. FOAs published by DOE include:

Electricity Delivery and Energy Reliability Announcements

Smart Grid Demonstrations (Reference Number: DE-FOA-0000036)
Smart Grid Investment Grant Program (Reference Number:DE-FOA-0000058A)

Energy Efficiency and Renewable Energy Announcements

Clean Cities FY09 Petroleum Reduction Technologies Projects for the Transportation Sector (Reference Number: DE-PS26-09NT01236-04)

Electric Drive Vehicle Battery and Component Manufacturing Initiative (Reference Number: DE-FOA-0000026)

Energy Efficiency and Conservation Block Grants - Formula Grants (Reference Number: DE-FOA-0000013)

State Energy Program Formula Grants (Reference Number: DE-FOA-0000052)

Transportation Electrification (Reference Number: DE-FOA-0000028)

Weatherization Assistance Program Formula Grants (Reference Number: DE-FOA-0000051)

Science Announcements

Applications of Nuclear Science and Technology (Reference Number: DE-PS02-09ER09-13)

R&D on Alternative Isotope Production Techniques (Reference Number: DE-PS02-09ER09-14)

Department of Health and Human Services

On April 17 the Department of Health and Human Services (HHS) published guidance regarding technologies and methodologies to secure health information. The guidance was developed through a joint effort by the HHS Office of Civil Rights, Office of the National Coordinator for Health Information Technology, and the Centers for Medicare & Medicaid Services. The guidance is intended to reduce the likelihood of the accidental release of private medical information and protect patient privacy in the event of such a breach.

Department of Homeland Security (DHS)

On April 20, DHS Secretary Janet Napolitano announced United States Coast Guard (USCG) projects slated to receive a slice of its $240 million in Recovery Act funding, including $142 million for bridge alterations projects on the Mobile Bridge in Hurricane, Alabama., the EJ&E Bridge in Devine, Illinois, the Burlington Bridge in Burlington, Iowa, and the Galveston Causeway Railroad Bridge in Galveston, Texas.

Additionally, $88 million will be used for USCG building construction in Corpus Christi, Texas, and Jacksonville, Fla., along with shore infrastructure projects in Oregon, Washington, Alaska, North Carolina, Virginia and Delaware. The USCG fleet of 12 high-endurance cutters will also receive upgrade components worth $10 million ($459,000 has thus far been obligated using Acquisition, Construction and Improvements funding).

Additionally, Customs and Border Protection (CBP) is planning to issue multiple Request for Proposals (RFPs) by June 25, 2009 for port of entry building and construction projects.

Department of Labor (DOL)

On April 21, Secretary Hilda Solis appeared before the Senate Health, Education, Labor, and Pensions Committee to provide testimony on green job training skills. The Secretary made the case that green jobs will play an important role in the recovery of the economy as well as secure America’s energy independence and suggested that the Recovery Act was “the most significant single investment our nation has ever made to ensure our future economic success.” She outlined actions taken, and to be taken, by the department, which included:

  • The Office of Apprenticeship within the Employment and Training Administration announced funding on February 17, 2009, to support 10 to 20 grants to fund the development and/or adaptation of national guideline standards for apprenticeships which included green jobs as an eligible activity.
  • The Veterans' Employment and Training Service (VETS) will soon release a Solicitation for Grant Applications, which will highlight green jobs for the purposes of training and employment.
  • The Bureau of Labor Statistics is currently developing approaches to measure green jobs, including surveying workplaces in industries where green activity is expected to occur to identify both the extent to which they are performing green activities and the occupations of the employees who are doing such work. Occupational research specialists within the Employment and Training Administration have also begun to define green jobs, review current green investments, and understand how new green technology materials will affect occupational requirements.
  • Future construction and repair of Job Corps facilities will incorporate green technologies. Job Corps will also develop and implement green jobs training into the curricula at all centers, beginning with automotive maintenance, construction and manufacturing.

Department of Transportation

President Obama released a strategic plan outlining his vision for high-speed rail in America on April 16. The president identified the $8 billion provided in the Recovery Act as a down payment on a future high speed rail passenger network. The strategic plan will be followed by detailed guidance for state and local governments and it is expected that the Federal Railroad Administration will begin awarding the first round of grants by the summer. While the plan is ambitious, rail experts believe it will be decades before a true high-speed rail system is implemented in the U.S. and stakeholders believe more incremental and modest speed increases are more likely to be the result of the Obama administration’s efforts.

In addition to the recent focus on high-speed rail, the Department of Transportation continues to obligate Recovery Act funds. As of April 20, FHWA authorized 2,163 projects in 48 states/territories totaling $6.7 billion in obligations, the FTA has awarded 5 grants for a total obligation of $48.6 million and the FRA has approved 52 Amtrak projects worth $938 million.

Moving forward, DOT continues to develop criteria for the $1.5 billion TIGER grants program and to create an organizational framework for administration and oversight of the grants.

U.S. Army Corps of Engineers (USACE)

Currently, USACE has set a timeline of May 1, 2009 to complete its draft Recovery Act spending plan.

Environmental Protection Agency

The Environmental Protection Agency (EPA) announced that it will distribute $600 million of Recovery Act funds to communities across the nation for Superfund site restoration. The money will accelerate or expand cleanup ongoing cleanup operations at fifty sites, creating jobs and boosting local economies, according EPA Administrator Lisa P. Jackson.

Notice: The purpose of this newsletter is to identify select developments that may be of interest to readers. The information contained herein is abridged and summarized from various sources, the accuracy and completeness of which cannot be assured. This alert should not be construed as legal advice or opinion, and is not a substitute for the advice of counsel.