Skeptics that the stimulus package would provide a meaningful impact on the economy, or the recovery, are seeing their concerns validated. The Washington Post reports that as of now just $54 billion of the $787 billion has been obligated and $11.7 billion has been disbursed six weeks after the bill was signed.
Now, Administration officials say they hope to get 70 percent of the spending out the door by summer 2010, 18 months after the bill was signed. That leaves 30 percent after the summer of 2010. Let’s see, the economic forecasters are calling for the economy to be in recovery be the end of 2009. So, large chunks of the stimulus package will be hitting the economy during the upswing in the economy.
Why is taking so long? According to the Post article:
With more than 100 funding streams contained in the package, many officials find themselves having to file applications for several programs at a time, helping explain why much of the money is still months away from being spent.
Take, for instance, what Oregon’s Housing and Community Services Department needs to do to secure its $82 million. It has already applied for $38 million to weatherize low-income residents’ homes, and just received the first 10 percent of that, but still needs approval from the state legislature to spend it. It is awaiting guidelines for applying for $27 million in tax credits for affordable housing development. It just received the guidelines for applying for $8 million to help prevent homelessness, and expects that it will not spend that money before July.
And Oregon will not apply until July for “neighborhood stabilization” funding that will be
distributed on a competitive basis for states to renovate or demolish abandoned homes. In fact, it is still getting ready to spend $19.6 million that it received for a similar purpose from a housing recovery bill President George W. Bush signed in late July.
It is a lot of hoops to jump through, but officials say it is worth it. “This is a huge investment for us,” said Rick Crager, Oregon’s deputy housing director. The process “is not an issue for us. It’s important that we’re accountable.”
More of Reason Foundation’s coverage of the stimulus and financial bailout can be found here.