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April 29, 2009

Stimulus Delayed Is Depressing

Some programs meant to be funded under ARRA (American Recovery and Reinvestment Act aka the stimulus bill) are dangerously delayed in getting under way. It is still not possible to submit applications for broadband or smart grid or e-health projects (just to name a few) because no final rules have been promulgated describing how grants for these programs will be awarded. The obvious problems caused by this delay are that we are going to miss some of the summer construction season and the promised jobs won't be delivered when they're most needed. Not so obvious but more serious is the danger that these promised but not delivered programs are helping to prolong the recession.

For example, planned alternative energy projects are being put on hold in the hope that there will federal money for them. If there were no promise of federal money, some of these projects would be underway. You can't blame the project organizers for seeing if they can get some of their costs defrayed; after all, they may have to compete with projects which do get federal funding. You can blame us in government for not moving fast enough to make the rules clear, end the uncertainty, and let the projects get underway. We're delaying the day Americans will have the benefits they deserve from these programs and, for the moment, we're discouraging job creation with our unfulfilled promises.

There are reasons, of course, for the delay; but there are no good excuses.

At the federal level, it is difficult to write regulations for competitive grants which make sense nation-wide and satisfy at least a majority of political constituencies. Typically regulations have to first be proposed and published in the federal register, then there is a comment period, finally there are final regulations. The proposed regulations have been slowed by the fact that the stimulus bill was passed at the very beginning of a new administration; most agencies didn't even have secretaries yet, let alone all the deputies and assistants who actually make the policy decisions which become regulations. When the regulations are final, grant requests will be written and submitted; then an evaluation period; and, at the end, awards; only then can work begin.

It doesn't have to be this slow. In many cases the agencies would have been well within the letter and intent of the law if they'd made preliminary allocations to the states by formula and allowed work to get underway; in other cases Congress can amend the law. Later allocations could be competitive and could depend, partly, on how well the states were spending the initial allocations. Vermont and other states ARE already doing highway projects because that money was deliberately allocated by formula. It's not too late to release some money for broadband, smart grid, e-health and other priorities by formula and get that work going now. With the help of our congressional delegation, we're urging that approach in Washington; you'll be able to read here whether or not we're successful. More important, you'll benefit from more jobs and better infrastructure sooner rather than later if we can get these processes underway.

It's fine to criticize the feds but are we moving qucikly enough in Vermont? See here for some of the answer to that.

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