MISSION ACCOMPLISHED: Energy Department showed that only 9,100 homes were weatherized out of 593,000 planned.

HERE IS WHAT OBAMA PROMISED IN FEBRUARY 2009





HERE IS WHAT OBAMA DELIVERD BY FEBRUARY 2010

FEBRUARY 19, 2010
Red Tape Delayed Stimulus Projects


By LOUISE RADNOFSKY And MELANIE TROTTMAN WSJ

Red tape delayed a variety of federal stimulus projects including transportation-security upgrades, home weatherization and housing-project surveillance cameras, according to a government report.

Agencies responsible for administering stimulus dollars told the Government Accountability Office that complying with aspects regulating the use of the funds—such as requiring contractors to pay local prevailing wages, strict "Buy American" rules for materials, and a mandate that federal agencies must consider a project's effect on any historic site—were preventing them from moving more quickly to put stimulus money to work.

The report by the nonpartisan GAO was requested by Senate Minority Leader Mitch McConnell (R., Ky.) and could provide more ammunition for the partisan fight over the effectiveness of the stimulus stirred up by the program's one-year anniversary this week. Obama administration officials say the stimulus program has succeeded in averting a deeper recession. Republicans say the program has been ineffective, costly and slow.

A spokesman for the White House Office of Management and Budget said that when Congress assembled the stimulus package it "wanted to ensure that all possible Recovery Act opportunities are available for American workers and American companies."

The stimulus bill required for the first time that recipients of grants from the Energy Department's weatherization program comply with Davis-Bacon wage requirements, which are supported by unions.

In part because of delays in complying with wage and other requirements, the GAO said, the data available from the Energy Department showed that only 9,100 homes were weatherized out of 593,000 planned.

The DOE said the report cited out-of-date figures and that since the fall, it had resolved wage and preservation issues in all 50 states and weatherized about 124,000 homes by the end of the year.

The Labor Department finished determining the prevailing wages for weatherization workers in each county of the U.S. on Sept. 3, and some states said they had waited to start weatherizing homes until the Labor Department finished setting the wages for their state.

The Labor Department said it wasn't to blame for the delays, because the DOE decided it couldn't use existing rate data for the weatherization work. That forced the Labor Department to begin a one-month survey in July to determine new rates. The Labor Department added that it issued wage guidance for states to use in the meantime.

A DOE spokeswoman said the Labor Department's data were for residential construction workers and didn't accurately reflect wages for weatherization workers, and that it needed to have the right wages to make decisions about cost-effectiveness.

Separately, the stimulus bill required that projects to upgrade Amtrak rail stations, bridges and tunnels get clearance from state historic preservation agencies. The National Historic Preservation Act of 1966 applies to all federally funded projects, and the decades-old Davis-Bacon requirements affect contractors on most federally funded construction projects.

More delays arose at agencies that had to run competitions to administer grants and contracts or negotiate with contractors over the extra transparency requirements attached to the stimulus. And Buy American rules complicated efforts, for example, by the Chicago Housing Authority to buy new security cameras because the systems it wanted weren't made in the U.S.

About $19 billion of around $180 billion appropriated for infrastructure projects has been paid out, a Wall Street Journal analysis has found. Agencies have "obligated" an additional $84 billion, announcing who will get it and working with the recipients to draw up contracts and other agreements for its use. Some agencies have moved more slowly than others in handling their stimulus money, and the lag has contributed to a lack of public confidence in whether the plan is working.

Scott Paul, executive director of the Alliance for American Manufacturing, which supported the Buy American provisions of the stimulus, called the GAO's findings "incredibly anecdotal." "We've been able to find scores of success stories around the country," he said.

Chris Braddock, director of procurement policy at the U.S. Chamber of Commerce, said he wasn't surprised by the report and that he had found the process for getting waivers for the requirements to be "hit and miss." The chamber has also criticized the Buy American Act.

Write to Louise Radnofsky at louise.radnofsky@dowjones.com and Melanie Trottman at melanie.trottman@wsj.com