Massachusetts – April 23, 2009

Use of Funds

An estimated 90 percent of fiscal year 2009 Recovery Act funding provided to states and localities will be for health, transportation, and education programs. The three largest programs in these categories are the Medicaid Federal Medical Assistance Percentage (FMAP) awards, the State Fiscal Stabilization Fund, and highways.

Medicaid Federal Medical Assistance Percentage Funds

  • As of April 1, 2009, Centers for Medicare & Medicaid Services (CMS) had made about $1.2 billion in increased FMAP grant awards to Massachusetts.
  • As of April 1, 2009, the state had drawn down about $273 million, or 23 percent, of its initial increased FMAP grant awards.
  • Officials plan to use funds made available as a result of the increased FMAP to avoid additional cuts in health care and social service programs, restore certain provider rates, and provide caseload mitigation for Medicaid and Commonwealth Care (an expansion of its Medicaid program).

Transportation—Highway Infrastructure Investment

  • Massachusetts was apportioned about $425 million for highway infrastructure investment as of April 16, 2009, by the U.S. Department of Transportation.
  • As of April 16, 2009, the U.S. Department of Transportation had obligated about $63.9 million for 19 projects in Massachusetts.
  • As of April 4, 2009, the Massachusetts Executive Office of Transportation had advertised 19 projects for competitive bids totaling more than $62 million; the earliest announcements were scheduled to close on April 14, 2009, and work on the projects is expected to begin this spring.
  • These projects include activities such as road repaving and sign replacement.
  • Massachusetts will request reimbursement from the U.S. Department of Transportation as the state makes payments to contractors.

U.S. Department of Education State Fiscal Stabilization Fund (Initial Release)

  • Massachusetts was allocated about $666 million from the initial release of these funds on April 2, 2009, by the U.S. Department of Education.
  • Before receiving the funds, states are required to submit an application that provides several assurances to the Department of Education. These include assurances that they will meet maintenance of effort requirements (or that they will be able to comply with waiver provisions) and that they will implement strategies to meet certain educational requirements, including increasing teacher effectiveness, addressing inequities in the distribution of highly qualified teachers, and improving the quality of state academic standards and assessments. In early April 2009, state officials reported that the commonwealth will file its application for this money around April 15, 2009, when it would better understand the state fiscal year 2010 budget situation.
  • The Governor has announced that he intends to provide funds to 166 school districts to help them increase spending to prior levels and avoid program cuts and teacher layoffs in fiscal year 2010. He also intends to use some of these funds at public colleges and universities to reduce layoffs, program cuts, and student fee hikes.

The commonwealth of Massachusetts is also receiving additional Recovery Act funds under programs, such as Title I, Part A of the Elementary and Secondary Education Act of 1965 (ESEA, commonly known as No Child Left Behind); the Individuals with Disabilities Education Act, Part B (IDEA); and two programs of the U.S. Department of Agriculture—one for administration of the Temporary Food Assistance Program and one for competitive equipment grants targeted to low-income districts from the National School Lunch Program. The status of plans for using Recovery Act funds is discussed throughout this appendix.

Safeguarding & TransparencyBack to top

Task forces, established by the Governor, encouraged the state to adopt accountability and transparency measures. Further, Massachusetts is expanding its accounting system to track funds flowing through the state government. Although Massachusetts has plans to publicly report its Recovery Act spending, officials have said that the state may not be aware of all funds sent directly to other entities, such as municipalities and independent authorities. The commonwealth's oversight community has identified situations that raise concerns about the adequacy of safeguards, such as funding for larger projects and new programs, but is waiting for further information on what specific programs will receive funding before developing plans to address those concerns.

Assessing the Effects of SpendingBack to top

Massachusetts agencies are in the early stages of developing plans to assess the effects of Recovery Act spending. According to state officials, they are awaiting further guidance from the federal government, particularly related to measuring job creation.

For More InformationBack to top

The above excerpts are taken from GAO's April 23, 2009 Bimonthly Review of the Recovery Act:

Recovery Act: As Initial Implementation Unfolds in States and Localities, Continued Attention to Accountability Issues Is Essential
GAO-09-580, April 23, 2009
For more information on Massachusetts within the report, please see the following pages:
Appendix X: Massachusetts pages: 161 – 174
GAO Contact
portrait of of Stanley J. Czerwinski

Stanley J. Czerwinski

Director, Strategic Issues

czerwinskis@gao.gov

(202) 512-6520

portrait of of Laurie Ekstrand

Laurie Ekstrand

Massachusetts State Team

ekstrandl@gao.gov

(202) 512-6845