On Thursday of last week, the House leadership unveiled a preliminary version of the much anticipated stimulus package, the "American Recovery and Reinvestment Act of 2009." This $550 billion bill—to be coupled with a $275 tax cut bill—promises to "create jobs and promote economic recovery" by focusing spending in areas including science, technology, health, infrastructure and the environment.

The House is expected to vote on the full measure sometime in the week of January 26, and the Senate should be introducing a similar version of the bill soon. Many details of the plan must still be ironed out, but President-elect Obama hopes to sign the final version no later than mid-February.

The following text outlines parts of the lengthy House proposal, first with general information, and later, with a special emphasis on your area of interest. Should you see any proposed grant programs that might be relevant to you, please do not hesitate to contact Capital Partnerships to assist in your application for these generous, yet soon-to-be distributed, stimulus resources. Getting a head-start will be one of many factors that will be critical in your competitiveness for these highly coveted awards.

General Proposal Requirements:

"Shovel ready" remains a key focus of the bill, with the House emphasizing the "obligation" or assigning of grants in a very quick timeframe. Regardless of type, all funds must be obligated by September 30, 2010, but more specific terms apply to the various grants. For instance, formula grants, which often distribute funds to state and local governments based on pre-set demographic algorithms, must be obligated no later than 30 days after passage of the bill. Otherwise, competitively awarded grants must go out within 60 days under currently existing federal programs (e.g. the State Broadband Data and Development Grant program under the National Telecommunications and Information Association ("NTIA")) and within 90 days for newly created programs (e.g. the proposed Wireless and Broadband Development for Unserved and Underserved Areas program under the NTIA).

Recipients of most grants awarded under federal agencies must have 50% of the funds contracted within one year of the bill's passage (approximately 9 months after the award), and 100% within two years (approximately 21 months after the award). Otherwise, under the "use it or lose it" terms of the bill, the agency may withdrawal and re-obligate the funds to a more worthy private or state recipient.

Oversight Controls in Adherence to the "Public Benefit":

In addition to quick implementation, oversight is emphasized throughout the bill to ensure that "activities and projects selected by federal, state and local officials . . . must be of the highest quality in their public benefit." As the House Report on the bill stated, "[t]he purpose of this bill is to direct funding at projects that are primarily and clearly aimed at benefiting the economic conditions of communities and the public at large." Therefore, government entities "are directed to look with a skeptical eye at projects that don't meet that test."

With the "public benefit" test in mind, the House proposes oversight mostly in the form of transparency controls. Federal agencies receiving funds must post their spending proposals on the yet undeveloped Recovery.Gov website, including all "announcements for grant competitions, allocations of formula grants, and awards of competitive grants." Similarly, all activities coordinated through federal, state, and local governments must be disclosed with information of programs' costs, descriptions, and rationales. And, along with each of these disclosures, specific contact information must be provided for each project.

In addition, the bill provides the Inspector General, the General Accounting Office, and a proposed Recovery Act Accountability and Transparency Board with significant funds and power to ensure continued executive oversight. Even state governors must sign various guarantees to promise certain controls in exchange for Recovery Act funds.

Specific Broadband Proposals:

• Rural Broadband Infrastructure Development
• $2.825 billion is provided under the Department of Agriculture for rural broadband development
• The funding provided will significantly expand "openaccess" broadband networks and infrastructure in rural areas
• USDA is to prefer proposals that provide broadband service in unserved areas
• USDA estimates that approximately 119,000 new jobs will be created as a result of the initial investment, benefiting over 7,600 rural communities and 3.6 million residents and businesses

• State Broadband Data and Development Grants
• $350 million is provided through the Department of Commerce under the National Telecommunications and Information Administration ("NTIA") for the State Broadband Data and Development Grant program (established in the Broadband Data Improvement Act of 2008)
• The program provides competitive grants for eligible entities to develop and implement statewide initiatives to identify and track the adoption and availability of broadband services

• Wireless and Broadband Development for Unserved and Underserved Areas
• $2.825 billion is authorized under NTIA to subsidize the development of broadband and wireless services in unserved and underserved areas.
• $1 billion is for Wireless Deployment Grants for the deployment of wireless voice service or advanced wireless broadband
• $1.825 billion is for Broadband Deployment Grants for the deployment of basic broadband service or advanced broadband service
• Factors to be considered by NTIA in granting awards includes:
• public safety
• state reports on priorities
• increases in affordability and subscribership
• service enhancement for health care delivery, education, or children
• enhancement of computer ownership and computer literacy
• and state or local matching funds
• Recipients must also meet buildout requirements and adhere to open access principles

Specific Job Training and Workforce Development Proposals:

• Funding under the Workforce Investment Act ("WIA") and Other Training
  • $4 billion is allocated under the House bill for various job training programs under the Department of Labor
  • These include both formula and discretionary grants to States for adult, youth, and dislocated worker service
  • Under the WIA formula programs, the distributions will be as follows:
    • $500 million for services for adults to reach up to 175,000 disadvantaged individuals
    • $1.2 billion for youth services to stimulate 1 million summer jobs for youth, with money available to those up to the age of 24
    • $1 billion for States and localities to provides training and reemployment services for upwards of 270,000 dislocated workers
  • Discretionary funding is also provided under the Secretary of Labor for the following:
    • Dislocated Workers Assistance National Reserve: $500 million is available to alleviate worker dislocations, with emphasis on areas of high unemployment or poverty
    • YouthBuild: $50 million is available to expand this current program for at-risk youth; this will allow 3,200 more individuals to gain education and occupational credentials while constructing or rehabilitating affordable housing
    • High Growth and Emerging Industry Sectors: $750 million is allocated for a new program of competitive grants for worker training
    • $500 million of these funds are dedicated to projects that prepare workers for green jobs in renewable energy sectors
    • The remaining $250 million is prioritized for training in the health care sector
• Training for Primary Care Physicians and Nurses
  • $600 million will be available under the Department of Health and Human Services
  • It will double annual funding for training primary care doctors and dentists and double the support for nursing programs such as nurse scholarships, nurse faculty loans, and advanced nursing.

Specific Health and Technological Research Proposals:

• Manufacturing Extension Partnership and Technology Innovation Program
  • $100 million will be available under the Department of Commerce's National Institute of Standard and Technology through two programs
    • $30 million of these funds is for the Manufacturing Extension Partnership ("MEP"), which consists of a network of centers that provide business support and technical assistance services and helps improve the productivity and competitiveness of small manufacturers
    • $70 million of these funds is for the Technology Innovation Program ("TIP"), which speed the development of high-risk, transformative research targeted to address key societal challenges
  • The TIP funds are available to small and medium-sized businesses, institutions of higher education or other organizations, such as national laboratories and nonprofit research institutions
  • TIP is a competitive grants program that has recently awarded its first grants, but this new funding will allow for additional projects
• Research Science Building Construction Grants
  • $300 million will be available under the Department of Commerce's National Institute of Standard and Technology through a competitive construction grant program for research science buildings
  • The grants are awarded to colleges, universities, and other nonprofit, science research organizations on a merit basis
  • The first three awards were made in November 2008, out of 90 applications
  • The additional funding will allow for another competition and the funding of approximately 30 research science buildings
• Research and Related Activities
  • $2.5 billion will be available through the National Science Foundation ("NSF") for various research and related activities
  • $300 million is provided for the Major Research Instrumentation ("MRI") program
    • This program increases research and training in institutions of higher education, museums and science centers, and non-profit organizations
    • MRI assists with the acquisition and development of shared research instrumentation that is, in general, too costly and/or not appropriate for support through other NSF programs
  • Another $200 million is to restart the NSF facilities program covering physical and other sciences and engineering at the Nation's institutions of higher education, museums and science centers, and non-profit organizations
  • Much of the remainder of the funds is for other NSF projects, including renovations of research spaces at academic institutions and other capital plans
• Construction and Development of Major Research Equipment and Facilities
  • $400 million will be provided under the NSF to accelerate the construction and development of major research facilities that provide unique capabilities at the cutting edge of science
  • The funding will be used for previously approved investments and those nearing their completed design reviews.

Specific Aviation Proposals:

• Airport Improvement Grants (AIP)
• $3 billion of the House plan is allocated for ready-to-go airport improvement projects under the FAA's "Grants-in-aid for Airports" program
  • These funds are to be awarded on a discretionary basis for ready-to-go projects
  • The projects are anticipated to create over 75,000 jobs
  • For the funding, all of the usual restrictions and requirements of subchapter 1 of chapter 417 of title 49 U.S.C. apply
  • At least 50% of the funds must be obligated within 120 days of the award
    
• Aviation Security
  • $500 million of the House plan is allocated under the Department of Homeland Security for airport safety
  • This money will be used to install Aviation Explosive Detection Systems and to advanced checkpoint screening technologies at the nation's airports
  • Funds are competitively awarded based on security risks at airports
  • As part of the $500 million investment, TSA will be able to accelerate the procurement of next generation passenger screening technologies

Specific Road Transportation Proposals:

• Under the House bill, over $43 billion is allocated for transportation infrastructure investment, with almost $30 billion of that slated specifically for highways and bridges.
• This investment will create approximately 835,000 jobs across all sectors of the economy
  • Overall $30 million will be apportioned to the states under the same percentages as the distribution formula obligation limitation for states in fiscal year 2008. Priority will be given to projects that can award contracts in 120 days, to projects on the STIP or MTIP, and where appropriate, to projects that can be completed in three years, and those in economically distressed areas.
  • The state apportionments are divided into two pots:
    • 55% of the money ($16 billion) goes directly to state DOTs for discretionary spending.
    • The remaining 45% ($13 billion) essentially follows the Surface Transportation Program:
      • where 10% ($1.3 billion) goes to a transportation set-aside for enhancements
      • and where, for the remaining 90% ($11.8 billion)
        • 62.5% ($7.4 billion) goes to metropolitan planning organizations, half of which must be obligated in 90 days, with the rest to be obligated by July 1, 2010
        • 37.5% ($4.4 billion) remains at the state DOT discretion, with half to be obligated in 120 days, and the other by August 1, 2010
  • Ohio, for example, is slated for the following funds:
    • $1.036 billion total
    • $570 million for ODOT discretion (the 55% pot)
    • $466 million allocated like the Surface Transportation Program (the 45% pot)
      • $46.6 million under transportation enhancements
  • $207.5 million for mpo's> 200K
  • $37 million for population areas 5K-199K
  • $17 million for population areas <5K
  • $157 million left to state discretion
  • Within 10 days of receipt of allocations, each State submits to DOT its "90-Day Program of Projects" demonstrating how it intends to meet the requirement that 50% of funds be obligated within 90 days of the date of allocation
  • Certification
    • Together with the 90-Day Program of Projects, each State submits a one-time certification, signed by the Governor, that the State will maintain its level of funding for the types of infrastructure projects that received funding in the stimulus bill
  • Each State submits an additional certification, signed by the Governor, that the 90-Day Program of Projects represents an equitable distribution of funds within the State
  • These certifications are to be made public
  • Within 30 days of the bill's enactment, the first of several DOT periodic reports is due to Congress, with several periodic reports to follow during the next three years. The reports will track the following:
    • the amount of funds apportioned, allocated, obligated, and outlayed;
• the number of projects that have been put out to bid and the amount of funds associated with such projects;
• the number of projects for which contracts have been awarded and the amount of funds associated with such projects;
• the number of projects on which work has begun under such contracts;
• the number of such contracts that have been completed;
• the number of jobs created or sustained by the Federal funds provided, including information on job sector and pay levels; and
• maintenance of effort, as measured by comparing planned State spending levels as of the date of enactment of economic recovery act to actual State spending levels that have occurred since enactment.
• Any funds in the 90-Day Programs of Projects not obligated (based on awarded contracts) within 90 days of receipt of allocation will be redistributed by DOT to other States, meaning a state must use it or lose it
• Within 180 days of receipt of allocations, each State submits to DOT a Program of Projects demonstrating how they intend to meet the requirement that the remaining 50 percent of funds be obligated within one year of the date of enactment