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Wednesday, January 21, 2009
9:00 PM |
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House Appropriators Debate Economic Stimulus Package |
 The House Appropriations Committee today
debated an $825 billion
economic stimulus package, formally called the "American
Recovery and Reinvestment Act of 2009."
The bill
closely tracks
President Obama's proposals and represents his and congressional
Democrats' first legislative crack at creating or saving at least 3 million
jobs and jumpstarting the economy via $275 billion in tax breaks and
$550 billion in discretionary and entitlement spending. Appropriators
focused on roughly $358 billion in "emergency" discretionary spending.
Emergency dollars do not count against the current fiscal year's budget
caps or subject to
PAYGO offsets. "This package is no silver bullet," Appropriations Chairman David
Obey (D-WI) acknowledged. "By itself it cannot solve the problem. What
its aimed at is staving off the worst aspects of the recession and
minimizing the damage that it will cause."
Obey explained that approximately $150 billion will go to state
governments and $163 billion will be funneled to local governments
directly, based mostly on existing formulas such as special education
grants. Among the bill's
discretionary spending proposals are $30 billion for
highway/bridge construction projects and $20 billion for health
information technology initiatives. (The House Ways & Means and Senate
Finance Committees will review the
tax
portion of the stimulus package.)
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There was bipartisan agreement to get half of the transportation and housing construction funds
obligated within a year of the legislation's enactment and the full amount
obligated within two years of enactment. However, the Congressional Budget
Office estimates that
more than half of the $30 billion in infrastructure projects would not be spent until
after 2012, when most economists expect the recession to have ended. House
appropriators addressed this issue today, eventually adopting a modified
amendment offered by Transportation-HUD Appropriations Subcommittee Chairman John Olver
(D-MA) that establishes a goal of getting 50 percent of highway and transit
project funding under contract within 180 days of the bill's enactment. (The
Olver amendment as originally proposed would have provided states with a five
percent bonus if it reached the 180-day goal, and a five percent penalty if a
state had not obligated all of the money by 2011. This language was dropped
prior to final approval.) |
In light of the ban on earmarks, most of the contract and
grant dollars are required to be competitively bid, and lawmakers went as far as
clarifying that no stimulus money can be used for casinos or other gambling
establishments, aquariums, zoos, golf courses, or swimming pools.
On the transparency front, the bill requires federal,
state, and local agencies to notify the public -- via the website www.Recovery.gov
-- of infrastructure investments and contracts made. The stimulus package also
establishes a "Transparency Board" tasked with preventing waste, fraud, and
abuse.
Obey reiterated Democratic leaders' goal of sending the
final stimulus bill to President Obama by mid-February. However, there is talk
currently circulating around Capitol Hill that the Senate Finance
Committee could complicate -- and therefore stall -- negotiations on the
legislation by attaching a 12-month extension of an alternative minimum tax "patch."
The House Ways & Means Committee is scheduled to consider
the tax portion of the stimulus bill on Thursday morning.
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