Federal gov’t. to help states cover up-front costs of tracking stimulus spending

Feds to cover up-front costs of tracking stimulus

WASHINGTON — Cash-strapped states are getting help from Washington to keep track of how they spend the $787 billion in federal stimulus money aimed at boosting jobs and the economy.

States will now be able to get federal funds to hire auditors and accountants and pay other administrative costs associated with the stimulus money, said a memo released Wednesday by the White House.

Facing serious budget shortfalls, a number of states had complained they didn’t have the staff or resources to comply with the accounting requirements in the stimulus law, which calls for stringent reporting on how money is spent.

According to the memo from Office of Management and Budget Director Peter Orszag, federal money for estimated administrative costs will be provided up front instead of being reimbursed toward the end of the stimulus program.

States welcomed the news.

“We are glad that the federal government has responded to our concerns and clarified a way to plan and budget for our costs to appropriately track the Recovery Act funds,” said Myung Oak Kim, communications manager for Colorado Gov. Bill Ritter’s economic recovery team.

Colorado expects to get about $7 billion in stimulus money and would use some of that to hire additional staff to track and audit the federal dollars.

New York stands to receive more than $24 billion in stimulus funds.

A spokesman for New York comptroller Thomas DiNapoli says the office is preparing for a rush of stimulus projects.

The fast-tracked administrative funding “will allow New York to speed up the process to make sure the money goes out the door fast without skipping any steps and we’ll also be able to do more in-depth post-auditing,” said spokesman Dennis Tompkins.

In South Carolina, the state comptroller general applauded the quickened process for oversight costs, but he stressed that the state is hoping to spend more money on much-needed stimulus programs and less on overhead.

“We’re the state that’s trying to do this on the cheap,” said Richard Eckstrom. “We continue to work night and weekends to oversee and administer the spending of these funds.”

South Carolina is pulling lawyers, accountants and auditors from existing resources before outside hiring for the $2.8 billion allocated for the state, said Eckstrom.