THE BLOG
07/11/2009 05:12 am ET | Updated May 25, 2011

Is Stimulus Spending Fast or Slow?

by Amanda Michel, ProPublica

Here at ProPublica,

To date, the department has obligated $15.7 billion, according to Transportation Secretary Ray LaHood's latest blog post last night. That is a third of the department's overall stimulus budget.

 

But “obligate” doesn’t mean the money has been spent, only that the department has approved the project and committed to funding it.
Just $151.76 million has been paid out to the states.

Compare the two numbers, and you'll see that just one percent of overall transportation funds has actually been spent.

In the same post, LaHood points out that the rate of federal spending shouldn't slow down states from hiring workers or starting projects:

Every time we make ARRA funds available to the states, we send an immediate signal for states to advertise contracts, and for contractors to begin hiring workers and ordering materials like steel and asphalt. And for workers to make purchases. And for steel and asphalt vendors to hire workers and make purchases. That is economic stimulus, and all of that activity occurs before states have been reimbursed by DOT. When the states come back to DOT for reimbursement, then and only then do the funds we've made available become outlays.

This is how the department traditionally works
-- contractors bid, and the state awards the contract; then contractors begin work and the states seek reimbursement from the federal government. So the federal government reimburses, rather than disburses. The money still gets into the economy; it's just not the federal government's money at first.

The rates at which the federal government approves projects and states award them to contractors, then, may be the better measuring sticks.

 

Based on the most recent weekly report,

Amanda Michel is editor of distributed reporting for ProPublica, America's largest investigative newsroom.