Missing green

Federal eco-friendly stimulus dollars go unspent

California is sitting on piles of unused stimulus funds that should have helped reduce energy costs for low-income residents.

California is sitting on piles of unused stimulus funds that should have helped reduce energy costs for low-income residents.


While the federal government plans more funding cuts following its debt-ceiling deal, California continues to sit on a pile of unused government cash intended to help low-income families and communities. The cash is from the American Recovery and Reinvestment Act—a program that uses federal funds to help boost local economies, particularly when other sources of investment are absent.

Since 2009, two California agencies, the California Energy Commission and the Department of Community Services and Development, have received Recovery Act funds to help with environmentally friendly programs.

But two July audits by California’s Bureau of State Audits found that the CEC had yet to spend 31 percent of the $226 million awarded, and the CSD has spent only $105.9 million of its $185 million stimulus grant. Both agencies face spring 2012 deadlines to use the remainder of their funds.

“We have spent everything we have been allocated, but there are more [projects] in the pipeline we could use money for,” said Joan Graham, deputy director of one of the local beneficiaries of the CSD funds, the Community Resource Project.

Other states are encountering similar problems. According to the group Federal Funds Information for States, many states have spent only minimal amounts of their weatherization allocation, and millions have gone untapped nationally.

In California, both the CEC and CSD attribute the problems to holdups created by the government.

“The goal is to increase the quality of life for low-income families and reduce their energy burdens,” Rachel Arrezola, a CSD spokeswoman, told SN&R. “But there has been a federal delay that has impacted us [because of] some strings attached.”

The CEC, which received money for green building retrofits and jobs training, referred SN&R to an August 1 letter written by Robert Oglesby, the CEC’s executive director. In it he responds to the state audit and blames delays on red tape, particularly invoice and status report requirements.

Arrezola goes further, and points to unusually burdensome federal requirements that have slowed things down after the CSD met benchmarks last year and received its initial funds.

“The funding included a prevailing wage clause, but it was unclear what that wage might be,” she explained of a section on what to pay workers. The worker pay also, unusually, required employees to be paid weekly. “The feds made these requirements, and many states didn’t have the infrastructure for weekly pay, and the Department of Energy didn’t issue guidelines about [implementing] wages rates for more than a year.”

Other hurdles have included a requirement for energy audits of buildings and for a “whole building weatherization,” rather than simply caulking, window proofing and insulating smaller parts of a house.

In a July letter to the U.S. Department of Energy requesting a deadline extension, John Wagner, CSD’s interim director, wrote, “California providers simply lacked the necessary experience to tackle large projects. … California had little prior experience with the energy audit because annual funding levels were so low there was little justification for using it.”

In the meantime, the Sacramento organization handling the weatherization project—one of CSD’s 39 such partners statewide—is making do.

“All of the money is spent and we will be looking for more grant funding,” Graham said of the looming March deadline.

So far, the Community Resource Project has received $5 million to help families reduce monthly utility bills by weatherproofing their homes.

“The program also creates jobs and has allowed us to increase our workforce,” Graham added. The organization has concentrated particularly in a south Sacramento neighbor known as The Avenues and completed work on 1,290 homes. It also has another $3 million lined up for work on another 1,490 homes. After those projects are complete, the future remains in limbo.

In the meantime, Arrezola stressed her agency is pursuing all options and hoping the spring deadline can be extended.