Iowa – September 23, 2009
Use of Funds
Our work in Iowa examined the state’s actions to stabilize its budget, to report on Recovery Act results to the federal Office of Management and Budget (OMB), and to monitor controls over Recovery Act funds. We updated funding information on Recovery Act education programs. In addition, for three programs—higher education, highway infrastructure, and weatherization—we reviewed the use of Recovery Act funds; the implementation of safeguards over these funds, including those related to the procurement of goods and services; and efforts to assess results from the use of these funds. We selected these three programs because they are among the programs receiving the greatest amount of Recovery Act funds in Iowa and have recently begun to disburse or are already using significant amounts of Recovery Act funds. Specifically, Iowa institutions of higher education have received their first disbursements of Recovery Act funds, providing the opportunity to examine the use of Recovery Act funds by nonstate entities. Iowa has obligated funds for several highway infrastructure projects, providing an opportunity to review contract administration for four selected projects—two state-administered and two locally administered—located in different highway districts and counties. Finally, Iowa’s Weatherization Assistance Program has received 50 percent of its total Department of Energy (DOE) allocation, providing the opportunity to examine the use of some of these funds and review Iowa’s program to weatherize more than 7,000 homes of low-income residents.
Consistent with the purposes of the Recovery Act, funds from the programs we reviewed are being directed to help Iowa and its local governments stabilize their budgets and promote economic recovery—thereby providing needed services and potentially creating and saving jobs. In addition, the use of Recovery Act funds must comply with specific program requirements but also, in some cases, enables states to free up state funds to address their projected budget shortfall. The following provides highlights of our review:
Education Programs Funded under the Recovery Act
- As of August 31, 2009, the U.S. Department of Education (Education) has made available about $439.1 million of the total $566.6 million in Recovery Act funds Iowa expects to use for education.
- As of August 31, 2009, Education had made available to Iowa about $51.5 million in Recovery Act funds under Title I, Part A, of the Elementary and Secondary Education Act (ESEA) of 1965. The Iowa Department of Education had disbursed about $16.2 million to school districts. These funds are to be used to help educate disadvantaged youth.
- As of August 31, 2009, Education had also made available to Iowa about $126.2 million in Recovery Act funds under the Individuals with Disabilities Education Act (IDEA), Part B. The Iowa Department of Education had disbursed about $25.2 million to school districts and area education agencies. These funds support special education and related services for children and youth with disabilities.
- As of August 31, 2009, Education had made available to Iowa about $261.4 million of the $388.9 million in State Fiscal Stabilization Fund (SFSF) funds for education stabilization and government services funds that Iowa plans to use for education. Iowa had disbursed about $40 million to school districts, $13.2 million to public universities, and $4.3 million to community colleges. Iowa plans to use these funds to restore state aid to school districts and community colleges and to restore state appropriations to public universities. Iowa plans to use an additional $83.5 million in SFSF government services funds for other programs, including public assistance and Medicaid.
Institutions of Higher Education
- Of the $388.9 million in SFSF funds Iowa plans to use for education, it is using approximately $105 million to support institutions of higher education—about $79.4 million for public universities, and about $25.6 million for community colleges. As of August 31, 2009, public universities had received about $13.2 million, and community colleges had received about $4.3 million in SFSF funds. The two institutions of higher education that we visited are using Recovery Act funds to stabilize their budgets, mitigate tuition increases, and save jobs.
Highway Infrastructure Investment Program
- The U.S. Department of Transportation’s Federal Highway Administration (FHWA) apportioned $358 million in Recovery Act funds to Iowa. As of September 1, 2009, the federal government had obligated $320 million for Iowa projects, and Iowa had been reimbursed $91 million for work submitted for payment by highway contractors.
- According to state transportation officials, citing Iowa’s most recent report to the U.S. House Committee on Transportation and Infrastructure, the Recovery Act funded 2,724 highway contractor employees in July 2009. Officials said that, cumulatively, Iowa’s Department of Transportation has reported to the committee that the Recovery Act has funded more than 363,000 hours of work.
- Iowa transportation officials estimated that for projects completed as of August 17, 2009, Recovery Act funding has contributed to the repair of more than 110 miles of state, county, and city roads.
Weatherization Assistance Program
- The U.S. Department of Energy (DOE) allocated $80 million in Recovery Act funds to Iowa for the Weatherization Assistance Program. Iowa plans to use these funds to help more than 7,000 low-income families reduce their utility bills by making long-term energy-efficient improvements to their homes.
- As of August 31, 2009, Iowa had received about $40.4 million, or 50 percent of its total DOE allocation, but had spent only about 5 percent of the funding received. No homes had been weatherized using Recovery Act funds, but Iowa has used funds to provide training and technical assistance and purchase vehicles and equipment—“ramp up” activities—that will be used when the Recovery Act Weatherization Program is fully implemented in the state.
- Home weatherization activities were on hold in Iowa until August 19 when the Department of Labor (Labor) established a prevailing wage rate for weatherization work in the state. On August 20, state officials received notification that prevailing wages had been determined and notified local agencies that they could accept bids and issue contracts for weatherization
Full September ReportBack to top
- Recovery Act: Funds Continue to Provide Fiscal Relief to States and Localities, While Accountability and Reporting Challenges Need to Be Fully Addressed
- Summary (HTML) Highlights Page (PDF) Full Report (PDF, 163 pages) Accessible Text
- Recovery Act: Funds Continue to Provide Fiscal Relief to States and Localities, While Accountability and Reporting Challenges Need to Be Fully Addressed (Appendixes)
- Summary (HTML) Full Report (PDF, 671 pages) Accessible Text
-  Pub. L. No. 111-5, 123 Stat. 115 (Feb. 17, 2009).
- This does not include obligations associated with $0.6 million of apportioned funds that were transferred from FHWA to the Federal Transit Administration (FTA) for transit projects. Generally, FHWA has authority pursuant to 23 U.S.C. § 104(k) (1) to transfer funds made available for transit projects to FTA.
-  States request reimbursement from FHWA as they make payments to contractors working on approved projects.