As of May 22, $36.7 billion of American Recovery and Reinvestment Act funds had been paid out. The federal government's target is to have 70% of the $787-billion Act invested by the end of 2010, which is why successful applicants focus on projects that can start now and deliver results quickly.
Depending on the federal agency, funds are being distributed in two primary ways. About two-thirds is being distributed in stages to the states, with amounts determined on a formula basis and subsequently disbursed from states to local agencies. Another 18% will be distributed through the competitive grant programs of 26 federal agencies that will cascade into local offices and agencies that will act as the grant provider. The rest - 16% - will be distributed as discretionary funding to projects, loan guarantees, and other not-yet-defined mechanisms.
No matter how and when the funds are received, the Obama administration has made it abundantly clear that accountability and transparency are the responsibility of recipients. The unprecedented reporting requirements established by the Office of Management and Budget are among the Act's greatest challenges because the reporting process and required tools are still undefined.
This we do know: Beginning July 10, recipients must share the following information with granting agencies on a quarterly basis:
- Amount received
- A list of projects that includes status towards completion
- Estimated number of jobs created
- Any information on sub-grants or subcontracts created from the funds.
These reports will be rolled up into the official federal Web site that tracks the progress of the Act.
There's no separate funding to cover associated administrative costs, but recipients of funds disbursed through the state can use up to 0.5% to enhance administrative capabilities. Where funds are slated to be reimbursed upon project completion, the money - which can be used for data collection; auditing; contract and grant planning and management; and investigating waste, fraud, and abuse - will be made available up front so public works operations can set up the proper management processes.
The requirements impact compliance, risk management, contract management systems, procurement, and control processes. Early analysis suggests the tools and applications that infrastructure operations currently use will be challenged. So this is a chance to institute robust project and program management systems. Here are three ways to stay ahead of the curve:
Prioritize against organizational goals. By leveraging existing planning processes and examining programs or projects on the horizon, you can begin to synchronize existing goals and initiatives with Act funding and pursue competitive grants that are most applicable to your operation's priorities. What projects are far enough along in the planning stages to get started expeditiously? What were you already planning to do that you've been waiting on funding for?
Setting sound priorities is important at the start of any project, and those created from objective criteria such as costs, benefits, and viability are the most effective. Understand the motives, history, and aspirations of grant programs to identify appropriate funding opportunities according to organizational priorities and allow for the possibility of accelerated project plans.
While many application deadlines have passed, the opportunity for funding is far from over. As of June 1, www.Grants.gov lists those available through the remainder of the year, with some deadlines extending into 2010. Additional opportunities are also likely to become available.
Create or use simple, centralized tools. They should allow you to identify target projects as well as decision support frameworks to help define priorities. Both off-the-shelf and proprietary tools are available.
For example, mPlanner, a tool developed by MWH, helped Chicago develop a Climate Action Plan that aligns stakeholder input with program goals. The tool was used to prioritize, in a consistent and transparent manner, 29 actions that officials and residents can take to mitigate greenhouse gas emissions.
Florida's Miami Dade County used the tool to prioritize renewal and replacement decisions as part of a comprehensive asset management program. Fund allocation priorities were set based on factors including risk and various business drivers to provide better service by lowering the possibility of system failures.
Establish measurable and mutual goals to track project status. As projects move toward goal achievement, performance tracking tools and processes will help you make necessary adjustments and deliver the expected return on investment.
The Five Star Institute, for example, offers a performance management tool that Northglenn, Colo., implemented. The program helps the city improve accountability and transparency in project execution by tracking team goals, individual actions, and timeframes and success measures while breaking down organizational silos and encouraging cross-functional cooperation. Clear goals and concise tactics lead to successful project completion while aligning with the Act's quarterly accountability and transparency reports.
How to synchronize opportunities with resources
But how do you manage stimulus-related projects and funds in the midst of a challenging economy? Resources were scarce before the legislation was signed.
Consider establishing a Project Management Office (PMO) to organize key people, tools, and resources.
For post-Hurricane Katrina redevelopment projects, for example, New Orleans and MWH established a program office with a blended team of approximately 40 employees, including team members from MWH, who represented various departments including law, purchasing, finance, real estate, property management, the Mayor's Office of Communications, capital projects administration and the department of public works. This collaboration was established to ensure that 600 projects were delivered on time and on budget and met Federal Emergency Management Agency auditing requirements. By having a centralized team, processes and reporting were standardized and adapted quickly to meet ever-evolving challenges. While not all operations can afford to adopt this model, adding stimulus projects to the workload of an already strained team can create a high-risk environment. Prioritizing projects that can meet tangible goals will help you to best allocate existing resources without significantly straining employees. Even if you're working with a smaller team, now's the time to challenge them to meet or exceed service levels.
By seizing this opportunity to improve processes, performance and efficiencies, you can use the project and performance management requirements of the stimulus funding long after the final dollar is spent. The systems your operation puts into place now will enhance goal-setting, project identification and prioritization, performance tracking, and communication of accomplishments - all of which will improve your organization's effectiveness and image.
Gallagher is director of program management and DeGeorge is a business consultant for the Business Solutions Group of MWH [www.mwhglobal.com], a provider of environmental engineering, construction and strategic consulting services.