Massachusetts – July 8, 2009

The content below was excerpted from the Massachusetts Appendix (PDF, 49 pages) of GAO's second bimonthly review of the Recovery Act.[1]

Contents

Use of Funds

GAO’s work in Massachusetts focused on nine federal programs, selected primarily because they have begun disbursing funds to states, include new programs, or include existing programs receiving significant amounts of Recovery Act funds. Program funds are being directed to help Massachusetts stabilize its budget and support local governments, particularly school districts, and several are being used to expand existing programs. Funds from some of these programs are intended for disbursement through states or directly to localities. The funds include the following:

Funds Made Available as a Result of Increased Medicaid Federal Medical Assistance Percentage (FMAP)

As of June 29, 2009, Massachusetts had received over $1.2 billion in increased FMAP grant awards, of which it had drawn down over $833 million, or almost 68 percent. The commonwealth is using these funds to cover the state’s increased Medicaid caseload, maintain current populations and benefits, increase provider payment rates, and make additional state funds available to offset the state budget deficit.[2]

Highway Infrastructure Investment Funds

The U.S. Department of Transportation’s Federal Highway Administration (FHWA) apportioned $438 million in Recovery Act funds to Massachusetts, of which 30 percent was suballocated to metropolitan and other areas. As of June 25, 2009, the federal government’s obligation was $174 million, and Massachusetts had contracted for 20 projects and advertised for an additional 10 projects. All were quick-start projects largely involving road paving except for one complex project that includes construction of a new highway interchange. For example, one project in Adams entails 1.5 miles of road resurfacing and sidewalk reconstruction on Route 116. All paving except the topcoat is planned to be completed before winter. Another project in Swansea involves resurfacing Route 6 from the Somerset town line to the Rehoboth town line and that paving is expected to be completed before winter.

U.S. Department of Education State Fiscal Stabilization Fund (SFSF)

The U.S. Department of Education (Education) has awarded Massachusetts about $666 million, or about 67 percent of its total SFSF allocation of $994 million. The commonwealth has obligated $412 million as of June 26, 2009. Massachusetts is using these funds to restore state aid to school districts, helping to stabilize their budgets and, among other uses, retain staff. For example, a Lawrence Public Schools official said these funds would prevent the layoff of 123 staff members, including 90 teachers.

Title I, Part A, of the Elementary and Secondary Education Act (ESEA) of 1965

Education has awarded Massachusetts about $82 million in Recovery Act ESEA Title I, Part A, funds or 50 percent of its total allocation of $163 million. Of these funds, the commonwealth has allocated $78 million to local education agencies, based on information available as of June 30, 2009. These funds are to be used to help educate disadvantaged youth. For example, the Boston Public Schools plan to use these funds for benchmark assessments, a student information system, and targeted upgrades of computer facilities for teacher and student use.

Individuals with Disabilities Education Act (IDEA), Parts B and C

Education has awarded about $149 million in Recovery Act IDEA, Part B and C, funds, or 50 percent of its total allocation of $298 million. Massachusetts has allocated all of its available Part B funds to local education agencies, based on information available on June 30, 2009. These funds are planned to be used to support special education and related services for infants, toddlers, children, and youth with disabilities. For example, Boston Public Schools plan to use these funds to hire staff; invest in prereferral to special education intervention, autism-related technology, and training; and expand inclusion activities.

Weatherization Assistance Program

The U.S. Department of Energy (DOE) allocated about $122 million in Recovery Act weatherization funding to Massachusetts for a 3-year period. DOE has provided $12.2 million to the commonwealth, and Massachusetts has obligated none of these funds as of June 30, 2009, as it is awaiting approval of its state plan. In July 2009, Massachusetts plans to begin disbursing its funds for weatherizing low-income families’ homes and state and federal public housing, and for developing an energy-related training center.

Workforce Investment Act Youth Program

The U.S. Department of Labor allotted about $24.8 million to Massachusetts in Workforce Investment Act Youth Recovery Act funds. The commonwealth has allocated $21.1 million to local workforce boards, based on information available on June 30, 2009. Massachusetts plans to use 60 percent of Recovery Act funds under this program by September 30, 2009, to create about 6,500 summer jobs for youth.

Edward Byrne Memorial Justice Assistance Grants

The Department of Justice’s Bureau of Justice Assistance has awarded $25 million directly to Massachusetts in Recovery Act funding. Based on information available as of June 26, 2009, about $13 million (51 percent) of these funds have been obligated by the Executive Office of Public Safety and Security, which administers these grants for the commonwealth.[3]

Public Housing Capital Fund

The U.S. Department of Housing and Urban Development has allocated about $82 million in Recovery Act funding to 68 public housing agencies in Massachusetts. Based on information available as of June 20, 2009, about $3.1 million (4 percent) had been obligated by 20 of those agencies. At the two public housing agencies we visited (in Boston and Revere), this money, which flows directly to public housing agencies, is being used for various capital improvements, including modifying bathrooms, replacing roofs and windows, and adding security features.

Safeguarding & TransparencyBack to top

Massachusetts has begun planning its oversight efforts. Officials from the State Auditor’s Office have drafted an audit plan and are currently planning the risk assessments they will perform of programs receiving funding under the Recovery Act. The state Inspector General intends to focus on gaps in coverage. The oversight agencies have expressed concern regarding their 2010 budgets and potential staffing cuts due to the commonwealth’s fiscal situation. The extent of these cuts will not be known until the budget is passed for the fiscal year, which begins July 1, 2009. The commonwealth is in the process of putting into place a plan to obtain additional resources for these oversight agencies. Massachusetts has enhanced its accounting system to track Recovery Act funds that flow through the state accounting system. The Comptroller’s Office has included questions on compliance with Recovery Act provisions in its internal control questionnaire, and the Governor’s Office is continuing to assess whether agencies need new procedures for managing these funds.

Assessing the Effects of SpendingBack to top

Massachusetts agencies are beginning to develop strategies for collecting and reporting employment outcomes, focusing on incorporating federal guidance and adapting existing systems for collecting and reporting on jobs created and retained. State program officials report using a variety of methods to measure employment outcomes, which could lead to reporting inconsistencies. For example, highway construction projects are submitting monthly information on employees paid, while weatherization program officials have estimated the number of jobs that will be created using a model for the construction trades. Existing programs receiving Recovery Act funds are beginning to develop plans for measuring program performance.

Full July ReportBack to top

Recovery Act: States' and Localities' Current and Planned Uses of Funds While Facing Fiscal Stresses
GAO-09-829
Recovery Act: States' and Localities' Current and Planned Uses of Funds While Facing Fiscal Stresses (Appendixes)
GAO-09-830SP
  • [1] Pub. L. No. 111-5, 123 Stat. 115 (Feb. 17, 2009).
  • [2] The increased FMAP available under the Recovery Act is for state expenditures for Medicaid services. However, the receipt of this increased FMAP may reduce the funds that states would otherwise have to use for their Medicaid programs, and states have reported using these available funds for a variety of purposes.
  • [3] We did not review Edward Byrne Memorial Justice Assistance Grants awarded directly to local governments in this report because the Bureau of Justice Assistance’s solicitation for local governments closed on June 17.
GAO Contact
portrait of of Stanley J. Czerwinski

Stanley J. Czerwinski

Director, Strategic Issues

czerwinskis@gao.gov

(202) 512-6520

portrait of of Laurie Ekstrand

Laurie Ekstrand

Massachusetts State Team

ekstrandl@gao.gov

(202) 512-6845