Guest blogger John Atcheson just retired from a long career in government service, most recently as a Senior Analyst working for the DOE on weatherization. His job consisted primarily of analyzing innovative policies to increase the effectiveness of the Weatherization and State Grant Programs.
Yesterday, the NY Times ran a story on a report by DOE’s Inspector General pointing to problems in the implementation of the scaled up the Weatherization Assistance Program under the American Recovery and Reinvestment Act. To be sure, the implementation has not been as fast as some expected. And as usual, “bureaucrats” received the brunt of the blame.
But the bottom line is that the program has moved with speed and is poised to move much faster from this point forward. Since it’s Winter Olympics time, let me offer an analogy: The NYT is reporting on the pace of ascending the mountain on the ski lift, while ignoring the pace at which the skiers will descend – and the benefits that will accrue.
Here are the facts.
When Congress passed the Recovery plan, they did two things.
First, they expanded the size of the Weatherization program dramatically. It had been funded at between $204 to $250 million for the previous 3 years to $5 billion in 2009, a more than 20 fold increase.
Second, they inserted provisions requiring certain wage standards – a provision built upon the Davis Bacon Act. This represented a fundamental change in the way labor costs had to be established and required a complex legal finding in each region.
The Office of Management and Budget also issued complex and thorough monitoring and reporting requirements to be sure the money was well spent.
All of these factors created challenges in implementing the program, but as outlined below, DOE’s Weatherization Program took decisive action and the nation is poised to reap the benefits. But you wouldn’t know that from reading the NYT.
DOE developed a strategy to weatherize as many as 1 million homes per year with the increased funding from the Recovery Act. In a little over 6 months, the Department issued necessary guidances and fiscal management guidelines (including the Davis-Bacon Act requirements), developed and expanded training programs for new staff, and issued 50% of all grant funds to every state to initiate activity.
We are now set to reap the benefits – it’s time for the downhill skiing portion of the program. Beyond creating some 133,000 new jobs , displacing more than 18 billion barrels of oil, the expanded program will garner some impressive benefits, including:
- Returning $2.73 for every $1 invested. These include $1.65 in energy-related benefits and $1.07 in other benefits such as reducing pollution, unemployment, and adverse health impacts.
- Saving approximately $350 per household annually on household energy bills. These homes avoid an estimated 1.79 tons of carbon dioxide emissions per home annually.
- Reducing average gas space heating use by 32% annually.
Pinpointing the Problem
The main challenge facing the Weatherization program right now is lack of state capacity to implement it. As the IG report noted, many states have hiring freezes and are unable to add the staff essential to ensure that the expanded program is well run. As Robert Reich and Paul Krugman have noted, this problem occurred with other ARRA programs, and it directly threatens the nation’s recovery.
The problem is not “bureaucrats.” The problem is that fiscal realities are causing states to contract across the board at a time when the public sector needs to expand.
The Weatherization program is a proven job creator – it was responsible for 21,000 new jobs in 2008. Let’s fix the real problem rather than take cheap shots at anonymous bureaucrats.