Federal stimulus rules handcuff some agencies

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Congress enacted the $787 billion stimulus package through the American Recovery and Reinvestment Act last year.

Overall, five of 27 federal agencies contacted by GAO reported that Buy American rules were affecting project selection and startups. Other agencies encountered problems from different sets of government rules.

Four federal agencies and officials in 10 states and three local agencies told the GAO about delays related to compliance with the Davis-Bacon Act, which mandates prevailing wages for federally funded jobs.

The GAO said one such delay involved a program to weatherize homes: As of Dec. 31, work on about 9,100 homes, out of a planned 593,000, had been completed.

But Energy Department officials said the GAO figures are nearly five months out of date and that more than 125,000 homes were weatherized by the end of 2009.

“In fact, since September 2009, we have tripled the pace of Recovery Act-funded home weatherization,” said Energy spokeswoman Jen Stutsman, adding that the goal of the program wasn’t to weatherize 593,000 homes in 2009, but rather by 2012.

“We are on track to meet that goal,” she said.

Officials at the Texas Department of Housing & Community Affairs told congressional auditors of delays while they provided training to grantees on the Davis-Bacon Act requirements and hired enough staff to monitor compliance.

In addition, the U.S. Department of Transportation reported delays tied to clearance of projects by state historic preservation offices. The work included projects to improve security at train stations, bridges and tunnels.

The Department of Commerce also found that some state historic preservation offices were slow to issue clearances for projects because of the increased workload stemming from stimulus-funded projects, according to the GAO.

The town of Stanley applied for and received a stimulus-funded grant through the USDA for two police cars for $37,500, with the town matching $12,500. The town’s four-car police fleet included one car with 158,000 miles taken out of service for safety reasons and another car with 140,000 miles that wasn’t far behind, records show.

But as Chief Foster later wrote in a letter to Rep. Eric Cantor, Virginia Republican, the USDA told the town that the stimulus funds could not be released because of the “Buy American” language in the grant award.

In response, Mr. Cantor sent a letter to the USDA asking officials for help in September. Two weeks later, the USDA responded, saying a final legal interpretation of the Buy American provision hadn’t been completed.

“We share your concern about this matter which potentially impacts police departments across the country,” wrote Tammey Trevino, an administrator at the USDA.

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