Audit Finds Only 8% of U.S. Stimulus Funds for Energy Efficiency Spent

by | Aug 17, 2010

Only about 8.4 percent of the $3.2 billion that Congress voted in February as part of an economic stimulus package to provide energy and conservation block grants to states and cities has been spent by the beginning of August according to an audit (PDF) by the Energy Department’s inspector general, reports The New York Times. It also has only created or saved about 2,300 jobs as of the second quarter of this year.

As an example, the audit finds that New York City, which received the biggest funding at $80.8 million, spent only $1.5 million, or less than 2 percent, which was better than Chicago, which got $27.6 million and spent under $40,000, or 0.1 percent, according to the article.

The audit found that grant recipients, as of August 2010, spent $269.7 million for energy efficiency activities and/or projects, which was significantly less than the $675 million anticipated in the Department’s initial Project Operating Plans. In addition, three of the territories did not spend any grant money, even though funding had been awarded and was available for use, according to the audit.

Problems cited in the audit include a lack of regulations or staff to process applications at the Energy Department, and lack of staff at local governments to process applications or handle the money they received, says The New York Times. In addition, specific rules or provisions set by Congress to receive federal money has slowed spending at state and local governments.

The report found that spending delays were “prevalent and widespread throughout the Program,” particularly by those receiving the largest grants of more than $2 million each, reports The Hill. DOE officials said “spending rates have significantly increased since March 2010,” noting that recipient spending “was not a leading indicator” of the program’s overall performance.

However, The New York Times reports that the Energy Department has loosened up some rules such as increasing the size of contracts and subcontracts that states can approve without federal approval in advance from $1 million to $10 million.

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