What is the purpose of the American Recovery and Reinvestment Act?
The American Recovery and Reinvestment Act (ARRA) is intended to:
- Create and save jobs
- Jump-start the economy
- Promote economic recovery and growth
View the full text of the ARRA.
What may ARRA funds be used for?
ARRA funds may be used to:
- Modernize the state's infrastructure
- Enhance our energy independence
- Expand educational opportunities
- Increase access to health care
- Provide tax relief and protect those in greatest need
- Assist those most affected by the recession
How will the ARRA work?
Different agencies — such as the Departments of Education; Health and Human Services; and Energy — decide who will receive award grants and contracts. Sometimes the money goes to a state government; other times, the funds go directly to a school, hospital, contractor, or other organization. Agencies deliver that information to the Recovery.gov team. The information is available on Recovery.gov, and you can track where the money is going. You can search by state or even by Congressional district; you can look up names of Federal contractors or other recipients of Federal dollars.
Who will receive funding in Virginia?
Funds from the ARRA package come into Virginia through varying programs, with a wide range of different eligible recipients. Some funds are provided directly to the State and then awarded to public, private or non-profit entities to perform funded work. Other funds go directly to higher educational institutions, local governments, schools, and for profit and non-profit entities and private firms. Administration officials continue to analyze the federal bill to identify all funding opportunities.
Some funds have been allocated to Virginia via a federal formula and are being overseen and distributed by the state. Other formula funds have been allocated, for oversight and distribution, to cities, metropolitan planning organizations, community action agencies and other entities. Those localities and agencies then choose how to spend those monies in accordance with federal guidelines.
In addition, a range of Virginia entities have the opportunity to compete for other funds. More information is being provided about funds for which entities can compete as it becomes available.
There are funds the bill makes available to help individuals, like unemployment compensation funds or funds to support food assistance programs. These funds are being administered by state and local agencies.
How can I see how much recovery money is coming to my community?
As the funding is distributed by the federal government to states and local governments, and eventually to your community, quarterly recipient reports must submitted. This data is available on Recovery.gov or in the Where is Your Money Going? section of ARRA.Virginia.gov.
What are the timelines for funds to be spent in Virginia?
Timelines vary significantly depending upon the program. Congress intended the funds to be spent quickly to maximize their effect on the economy. The federal agencies administering the funds are establishing deadlines and clarifying program criteria.
What accountability and transparency steps are required by ARRA?
The Act includes extensive provisions to ensure that states spend funds in ways that are consistent with its purposes (see above). Requirements include:
- Certifications by governors or local officials that infrastructure expenditures have been fully reviewed and are an appropriate use of tax dollars.
- Public access to contract and grant information, including requests for proposals for competitive grant programs.
- Provisions for federal oversight, reviews and audits, coordinated by a Recovery Act Accountability and Transparency Board.
- Access by federal inspectors and the Recovery Act Accountability and Transparency Board to information needed to ensure accountability at the national level.
States receiving funds are required to report the following to the federal government:
- How funds are being used.
- Descriptions and status reports on ARRA-related projects.
- Estimates of jobs saved or created by ARRA activities.
- Estimates of tax increases averted because of ARRA funds.
The American Recovery and Reinvestment Act establishes an oversight board of inspectors general (the watchdogs of government) called the Recovery Accountability and Transparency Board, which is responsible for overseeing federal agencies to ensure that there is transparency and accountability for the expenditure of recovery funds. For the interim period until that board becomes operational, the President has coordinated a team from across federal agencies to track ARRA dollars and report findings on this website.
How will taxpayers ensure that funds are spent wisely and efficiently?
The American Recovery and Reinvestment Act includes unprecedented requirements for accountability and transparency. Taxpayers are able to track the funds both at a national and state level and are able to see to whom funds were awarded and the amount of the awards. In addition, both federal and state governments have significant monitoring, reporting, and risk management responsibilities to protect against fraud, mismanagement, and waste.
What types of programs will be funded?
Funding is provided for a range of federal programs. Funding increases or extends certain benefits payable under the Medicaid, unemployment compensation and nutrition assistance programs. Funding also reduces individual and corporate income tax collections and makes other changes to tax laws.
In sum, funding supports programs that:
- Create a framework for clean, efficient, American energy
- Transform our economy with science and technology
- Modernize roads, bridges, transit and waterways
- Overhaul education for the 21st century
- Dispense tax cuts to create jobs
- Expand access to health care and lower costs
- Provide assistance to workers hurt by the economy
- Save public sector jobs and protect vital services
Does the ARRA have requirements for infrastructure projects?
Yes. The ARRA requires that:
- Priority be given to projects where contracts can be awarded within 120 days of enactment of the plan;
- Can be completed in 3 years; and
- Are located in economically distressed areas.
In addition, the ARRA requires that funds given to a state or local government for infrastructure projects:
- Must be an appropriate use of taxpayer dollars;
- Can be started and finished quickly; and
- Can be used in a way that maximizes job creation and economic benefit.
Does the ARRA prohibit the use of funds for certain activities?
Yes. State, local and private entities cannot use ARRA funding for a casino or other gambling establishment, aquarium, zoo, golf course or swimming pool.
Local school districts and higher education institutions are prohibited from using funds for:
- Payment of maintenance costs;
- Stadiums or other facilities primarily used for athletic contests or exhibitions or other events charging admission;
- Purchase or upgrade of vehicles;
- Improvement of stand-alone facilities whose purpose is not the education of children;
- Maintenance of systems, equipment or facilities;
- Modernization, renovation or repair of stadiums or other facilities primarily used for athletic contests or exhibitions or other events for which admission is charged to the public; or
- Modernization, renovation or repair of facilities used for sectarian instruction or religious worship, or in which a substantial portion of the functions of the facilities are subsumed in a religious mission.
Colleges and universities are required to use funds for education and general expenditures in such a way as to mitigate the need to raise tuition for in-state students. Funds can also be used for modernization, renovation or repair of facilities that are primarily used for instruction, research or student housing. This includes modernization, renovation and for repairs that are consistent with a recognized green building rating system.
How will food assistance be affected?
If you receive supplemental nutritional assistance (formerly called food stamps), the ARRA bill provides a 13% increase in the monthly benefit. If you are currently enrolled in the program, you will automatically receive this increase. It will be added to your monthly benefit allowance beginning on April 1, 2009.
How will unemployment compensation benefits be affected?
You may be eligible for unemployment benefits. You should contact the Virginia Employment Commission for more information.