New York – December 10, 2009

The content below was excerpted from the New York Appendix (PDF, 21 pages) of GAO's fourth bimonthly review of the Recovery Act.[1]


What We Did

We reviewed four specific programs funded by the Recovery Act—the Highway Infrastructure Investment Program, the Transit Capital Assistance and Fixed Guideway Infrastructure Investment programs, and the Weatherization Assistance Program.[2] These programs were selected primarily because they are receiving or expect to receive significant amounts of Recovery Act funds, recently began disbursing funds to states, or both. We also updated information on three Recovery Act education programs that will receive significant Recovery Act funds: (1) the U.S. Department of Education (Education) State Fiscal Stabilization Fund (SFSF); (2) Title I, Part A of the Elementary and Secondary Education Act of 1965 (ESEA), as amended; and (3) the Individuals with Disabilities Education Act (IDEA), as amended, Part B. We focused on how funds were being used, how safeguards were being implemented, and how results were being assessed.

Our work in New York also included understanding the state’s fiscal condition and visiting four localities to gain insight into their use of Recovery Act funds. We visited Buffalo and New York City because they are the two largest cities in the state and their unemployment rates are above the state’s rate.[3] We also selected Steuben County because it is a rural county with an unemployment rate above the state’s rate, and Westchester County because it is a suburban county with an unemployment rate below the state’s rate.

What We Found

Funds from the programs we reviewed are helping New York State and local governments stabilize their budgets, while also stimulating infrastructure development and expanding existing programs—thereby providing needed services and potential jobs. The following summarizes specific findings for the areas we examined.

Highway Infrastructure Investment Program

The U.S. Department of Transportation’s Federal Highway Administration (FHWA) apportioned $1.12 billion in Recovery Act funds to the New York State Department of Transportation (NYSDOT) in March 2009. As of October 31, 2009, about $833 million had been obligated and about $94 million had been reimbursed by FHWA. NYSDOT officials report that state Recovery Act contracts are receiving bids that average 15 percent lower than estimated costs. As a result, New York’s Governor recently announced that 34 new projects expected to cost about $70 million will be funded with these savings. The federal Web site reports the number of jobs created by project for the recipients we reviewed. The Recovery Act contractor representatives we spoke with emphasized that they reported hours paid for by Recovery Act dollars, which they explained, is required by their contracts. Consistent with Office of Management and Budget (OMB) guidance, they did not identify or distinguish between the number of new jobs created or retained by their Recovery Act projects.

Transit Capital Assistance and Fixed Guideway Infrastructure Investment Programs

The U.S. Department of Transportation’s Federal Transit Administration (FTA) apportioned over $1.3 billion of Recovery Act funds to the state of New York and urbanized areas located in the state.[4] As of November 5, 2009, FTA has obligated over $1.1 billion. For example, FTA awarded a $24.4 million Transit Capital Assistance grant to the Niagara Frontier Transportation Authority (NFTA) to replace 56 buses. FTA also apportioned over $254.8 million in Fixed Guideway Infrastructure Investment program funds under the Recovery Act to two cities in New York—New York and Buffalo. As of November 1, 2009, FTA has obligated 100 percent of these funds. The Metropolitan Transportation Authority (MTA) is using its $254.4 million grant for a variety of maintenance and safety improvement projects, while NFTA is using its $409,946 grant to purchase batteries, including backup batteries for its Metro Rail stations. In October, MTA and Greater Glens Falls Transit (GGFT) submitted their first Recovery Act quarterly reports to OMB, which included jobs data. Both agencies, consistent with OMB guidance, reported the total number of full-time equivalents (FTE) paid for with Recovery Act funds; ultimately, the information for these two agencies was reported on as “jobs created”.[5]


Many of the subgrantees implementing the Weatherization Assistance Program in New York delayed submitting their applications for Recovery Act funding to the New York State Division of Housing and Community Renewal (DHCR) until after the U.S. Department of Labor (Labor) established Davis-Bacon Act prevailing wage rates for weatherization workers on September 3, 2009. Because Recovery Act weatherization money has just begun to reach the subgrantees, DHCR has had little to report regarding the impact of the Recovery Act on its program.


Education awarded New York about $4.98 billion in SFSF; ESEA Title I, Part A; and IDEA, Part B Recovery Act funds. However, only about 3 percent of these funds had been disbursed, as of November 16, 2009. According to New York State Education Department (NYSED) officials, the time it takes the agency to develop and process the applications necessary to distribute funds to local education agencies (LEAs) contributed to the slow disbursement. The NYSED estimates that these funds, or the anticipated receipt of these funds, saved or created 28,000 education jobs. The localities we visited noted that a share of those jobs would be at risk once these funds are phased out.

New York’s Use of Recovery Act Funds

Because of continuing fiscal challenges, in October 2009, the Governor of New York proposed a Deficit Reduction Plan (DRP) to eliminate the state’s estimated $3.2 billion current-year budget gap. The DRP, which is being considered by the state legislature, would result in about $1.3 billion in across-the-board reductions in state aid to localities. The localities we visited plan to or are using Recovery Act funds for financing Medicaid, retaining teachers, upgrading infrastructure, and increasing housing services, among other things.

Full December ReportBack to top

Recovery Act: Status of States' and Localities' Use of Funds and Efforts to Ensure Accountability
Recovery Act: Status of States' and Localities' Use of Funds and Efforts to Ensure Accountability
  • [1] Pub. L. No. 111-5, 123 Stat. 115 (Feb. 17, 2009).
  • [2] For descriptions and requirements of the programs we covered, see app. XVIII of GAO-10-232SP.
  • [3]The New York State September 2009 unemployment rate was 8.8 percent, as provided by the U.S. Department of Labor.
  • [4]We followed up at the two New York transit agencies we reported on in September 2009—the Metropolitan Transportation Authority in New York City and Greater Glens Falls Transit in Glens Falls—and visited the Niagara Frontier Transportation Authority in Buffalo.
  • [5]In our November 2009 report, Recovery Act: Recipient Reported Jobs Data Provide Some Insight into Use of Recovery Act Funding, but Data Quality and Reporting Issues Need Attention (GAO-10-223), we made 2 recommendations to the Director of OMB. One of these recommendations was as follows: to improve the consistency of FTE data collected and reported, OMB should continue to work with federal agencies to increase recipient understanding of the reporting requirements and application of the guidance. As part of this recommendation, we recommended that OMB consider being more explicit that “jobs created or retained” are to be reported as hours worked and paid for with Recovery Act funds.

GAO Contact
portrait of of Susan A. Fleming

Susan A. Fleming

Director, Physical Infrastructure

(202) 512-4431

portrait of of David C. Maurer

David C. Maurer

Director, Homeland Security and Justice

(202) 512-9627