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Federal Eye: GAO: States Struggling With Stimulus Funding

Most state governments have barely touched their federal economic stimulus money and some state officials have expressed concern that they may not be able to manage the extra money and oversight, according to a report issued today by the Government Accountability Office.

GAO Acting Comptroller General Gene L. Dodaro, who appeared today along with federal, state and local officials at a Senate Homeland Security and Governmental Affairs Committee hearing on the tracking of stimulus money, told senators that the distribution of funds has been held up because most states have yet to reach agreement with the Department of Transportation on specific infrastructure projects. The watchdog agency is tracking progress in the District of Columbia and the 16 states that are set to receive more than two-thirds of economic stimulus funding.

“As of April 16, two of the 16 states had agreements covering more than 50 percent of their states’ apportioned funds, and three states did not have agreement on any projects,” according to the GAO report. “While a few, including Mississippi and Iowa had already executed contracts, most of the 16 states were planning to solicit bids in April or May. Thus, states generally had not yet expended significant amounts of Recovery Act funds.”

The White House and other observers have warned that states and cities would not begin to reap potential benefits of the American Recovery and Reinvestment Act for many months. In a letter delivered today to the Senate panel, Vice President Biden painted a rosier picture, noting that more than 2,400 transportation projects have been funded in all 50 states and that more than $75 billion in stimulus funding has already been made available for various projects.

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