As the American Recovery and Reinvestment Act moves past the 18-month point, some of its key construction programs have nearly all their funds awarded or under contract. As sectors—for example, highways and wastewater treatment—dry up as sources of future ARRA work, a few other programs, such as high-speed rail, are in their early implementation stages and still present prospects for design and construction firms in months to come.
The House Transportation and Infrastructure Committee’s latest monthly ARRA update, released on Aug. 26, shows that of the $38 billion ARRA allocated for highway, transit and wastewater-treatment programs under the committee’s jurisdiction, $34.1 billion, or 90%, was under contract as of July 31. That figure represents an uptick from the $33.4 billion under contract on June 30.
In highways, the largest sector for which the committee is responsible, $24.5 billion, or 93%, of ARRA road and bridge funds distributed to states by the federal-aid formula was under contract on 12,124 road and bridge projects on July 31. The July figures are up from $23.9 billion, or 90%, from the month prior.
Ken Simonson, the Associated General Contractors’ chief economist, says the stimulus has been “very helpful for highway construction.” But in other ARRA programs, he says, “It certainly has been a mixed bag. It has been helpful, though not as helpful or as [quick] as many had been counting on.”
The $814-billion stimulus measure, enacted in February 2009, includes about $130 billion in construction-related spending. Simonson says, “The notion that the stimulus has all been spent, I think, is really inaccurate. … There’s still going to be quite a bit more in various categories,” such as high-speed rail. On Aug. 20, Federal Railroad Administration chief Joseph Szabo said the agency had obligated only $585 million of the $8 billion the stimulus provided for high-speed rail.
But in many other ARRA programs, far more than half of the stimulus dollars are committed. In public transit—which excludes intercity passenger rail—71% of the ARRA formula dollars were under contract by July 31 on 4,247 projects valued at $5.1 billion, according to the House panel; that figure is up from 70% one month earlier.
Amtrak has work under way on projects representing almost all of its $1.3 billion in stimulus funds. The Federal Aviation Administration has been another leader among agencies responsible for distributing stimulus aid, with work ongoing or finished on 362 airport-improvement projects, accounting for all of the $1.1 billion ARRA provided for such work.
Among non-transportation programs, the General Services Administration has awarded contracts for 532 ARRA federal-building projects valued at $4.5 billion, or 81%, of its stimulus funds, as of July 31. That amount compares with 425 GSA projects with contract awards totaling $4.4 billion one month earlier. ARRA requires GSA to award a minimum of $5 billion by Sept. 30.
In water infrastructure, all $3.8 billion that the Environmental Protection Agency received for Clean Water State Revolving Funds has been allocated to states and is under contract on 1,957 projects.
The Dept. of Energy’s home weatherization program, which the House transportation committee doesn’t oversee, started slowly, with work completed on only 30,376 homes from February through December 2009. But the pace has accelerated. DOE reported that, as of Aug. 20, it had awarded $4.8 billion, or 97%, of its ARRA weatherization allotment.
Vice President Joe Biden traveled to Manchester, N.H., on Aug. 26 to announce the 200,000th home to get an ARRA-financed energy-efficiency upgrade. Biden said more than 80,000 homes are being weatherized this summer, compared with 3,000 in summer 2009.
Biden’s trip is part of the administration’s “Recovery Summer” effort, in which top officials have traveled around the country for groundbreaking ceremonies and other events promoting the benefits of the stimulus.
Congressional Republicans continue to blast the stimulus and other elements of the administration’s economic policy. House Minority Leader John Boehner (R-Ohio) said in an Aug. 24 speech, “All this ‘stimulus’ spending has gotten us nowhere, but it comes from somewhere. We are now borrowing 41 cents of every dollar we spend from our kids and grandkids.”
The administration got some validation from a Congressional Budget Office report, released on Aug. 24, which said that, through the quarter that ended on June 30, ARRA had boosted the number of people on the job by 1.4 million to 3.3 million and cut the unemployment rate by up to 1.8 percentage points.
But CBO’s report also notes, “The effects of ARRA on employment and unemployment … are expected to wane gradually in 2011 and beyond.” AGC’s Simonson says, “Some contractors will continue to see benefits from the stimulus, but it’s clearly not enough to offset the steep decline in either private [construction] spending or state and local government-funded spending.”
|STATE||AMOUNT ($ mil.)|
|New York|| |
|North Carolina|| |
|Source: U.S. Dept. of Energy Link |
Note: Funding amounts are rounded.
|NUMBER||AMOUNT ($ bil.)||SHARE |
|July 31|| |
|June 30|| |
|May 31|| |
|April 30|| |
|March 31|| |
|Feb. 28|| |
|Source: House Transportation and Infrastructure Committee, based on reports from states|