ARRA funds create problems, set precedents for science programs

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The American Recovery and Reinvestment Act of 2009 essentially doubled science appropriations for fiscal 2011, but departments have had mixed results in managing the approximately $40 billion dedicated to science-related activities. During a Nov. 30 hearing of the House Science, Space and Technology subcommittee on investigations and oversight, department inspectors general said most of the problems stemmed from the need to ramp up financial management at the department and recipient levels.

The Energy Department received the greatest level of ARRA science appropriations. As of Sept. 30 DOE had obligated about 98 percent of its $35 billion, according to Frank Rusco, director of the Government Accountability Office's natural resources and environment team. DOE reported that it had spent about $19 billion or 54 percent of this funding, he said.

A combination of massive funding, high expectations and inadequate infrastructure resulted, at times, in less than optimal performance in executing ARRA funds for science programs, said Gregory Friedman, DOE inspector general.

 "The department's efforts to use Recovery Act funds to stimulate the economy has been more challenging than many had originally envisioned...A fairly consistent pattern of delays existed in the pace of which funds were spent by grant and other recipients," said Friedman.

Friedman said the short timeline for executing on ARRA funds "placed an enormous strain" on the DOE personnel and infrastructure. Federal, state and local government infrastructures were also overwhelmed, he said. A diverse set of departmental stakeholders complicated ARRA fund administration and the concept of "shovel-ready" projects was not realized, said Fiedman. Finally, recipients told DOE the reporting requirements overly-complex and burdensome.

The Commerce Department received the next most in science-related ARRA funding with $1.4, and as of Sept. 30 it had obligated almost all of it and had spent about $900 million or 64 percent, reported Rusco. Commerce had a more favorable outlook on managing ARRA appropriations, however.

Unlike DOE, Commerce's experience managing ARRA fund resulted in more diligent oversight by program offices and greater executive-level involvement than it had previously, said Todd Zinser, DOC inspector general.

"In our view, the emphasis on transparency and accountability has been a significant benefit of the recovery act. Going forward, a challenge will be to institutionalize that emphasis on transparency and accountability for all spending carried out by the department," said Zinser.

According to Rusco, NASA also received $1 billion and as of Sept. 30 it had obligated it all and had spent 95 percent. The National Science Foundation received $3 billion, obligated it all and had spent about 46 percent as of Sept. 30, he said.

It was generally understood that any funds remaining unspent by Sept. 2013 would go back to the Treasury Department, but IG panel did say they wanted more guidance from the Office of Management and Budget on the issue of leftover funds.

For more:
- go to the hearing page (includes archived webcast and prepared testimony)

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