Statement of The Honorable James L. Oberstar
October 27, 2009
The Committee on Transportation and Infrastructure has worked to ensure that infrastructure investment programs play a key role in our nation's economic recovery and lay out the case for maintaining public buildings playing an important role in creating and retaining jobs. Today's hearing is a step in that direction by identifying the role the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) has played in today’s economy by providing jobs and shoring up the nation’s infrastructure.
Of the $5.55 billion in Recovery Act funds provided to the General Services Administration, the agency has awarded contracts worth $1.4 billion for 288 projects, as of October 16, 2009. This amount represents 25 percent of GSA’s total apportionment. While this rate of obligation makes it likely that GSA will meet the requirement that it obligate not less than $5 billion of the funds by September 30, 2010, and the remainder not later than September 30, 2011, I would like to hear today about how GSA plans to increase its rate of obligation and beat these deadlines by months.
I am also pleased to report that the Economic Development Administration, over a month ago, reached a milestone by announcing its final Recovery Act project. In total, EDA announced 68 grants in 37 states totaling $147 million. EDA’s efforts deserve applause and send a clear message to other federal agencies implementing Recovery Act projects: you too can quickly deliver infrastructure projects, put shovels into the ground, and in doing so improve our nation’s infrastructure and lift our economy out of recession.
We will also hear today from the Smithsonian Institution. Of the $25 million provided, Smithsonian has signed contracts worth $22 million for 13 projects. This represents 87 percent of the Smithsonian’s total apportionment.
The Associated General Contractors of America has testified before this Committee that $1 billion in non-residential construction creates or sustains 28,500 jobs. Given that the Department of Labor indicated last month that the unemployment rate is 9.8 percent, the funds provided to GSA, EDA, and the Smithsonian are absolutely necessary to create jobs, maintain and grow this economy.
GSA projects carry the added bonus of being focused on energy efficiency and conservation, which provide utility cost savings over the long term. The federal government is the largest consumer of energy in the United States, so by making gederal buildings more energy efficient, jobs are created and the nation’s energy bill is reduced.
The Recovery Act also enables GSA to bolster its management of its capital asset portfolio. In previous hearings, I have expressed my concern with GSA leaving federal buildings for leased office space because of the deteriorating condition of some buildings. When the federal government leases space, it has the dual impact of greater long-term costs in housing federal agencies and reducing contributions to the Federal Building Fund, which is used to fund construction and repair and alteration projects within the GSA inventory.
I look forward to hearing the testimony of today's witnesses and ascertaining whether the construction funds have had the intended effect of creating good, family-wage jobs as quickly as possible, while also improving our deteriorating public buildings infrastructure and laying the foundation for our future economic growth.
Statement Of The Honorable Eleanor Holmes Norton
Subcommittee on Economic Development, Public Buildings, and Emergency Management
Hearing On “Tracking Hearing #3: Following the Dollars to the Jobs”
October 27, 2009
The American Recovery and Reinvestment Act of 2009 (P.L. 111-5), signed into law on February 17, 2009, provided $5.55 billion for the General Services Administration (GSA), $4.5 billion of which was to convert GSA buildings into high performance green buildings in all 50 states, the District of Columbia and the four territories. In addition, GSA received $300 million for border stations and land ports of entry, and an additional $750 million for the repair, alteration and construction of federal buildings and courthouses, $450 million of which was allocated to the new Department of Homeland Security (DHS) headquarters compound of buildings to be located on the St. Elizabeth’s campus in Ward 8 of the District of Columbia. The Smithsonian Institution received an appropriation of $25 million for "facilities capital," which was to be used for the repair and revitalization of its many deteriorating facilities. The Economic Development Administration (EDA) received $150 million, almost all of which was allocated for strategic grant investments in areas hard hit by the current recession.
The Recovery Act is premised on the direct spending that data from many decades has shown has the best record for simultaneously stimulating the economy, providing jobs, and meeting the ongoing and existing responsibilities of governments at every level for public infrastructure. The Recovery Act’s primary purpose is to stimulate economic recovery through investments that preserve and create jobs, spur technological advances to enhance energy conservation, and improve infrastructure to provide long-term economic benefits. Our goal, though, is to not only distribute the funds quickly and spark short-term job creation, but to ensure that these investments will lead to long term, higher skill and higher wage jobs.
To that end, we will be interested in how the apprenticeship training funds I got included in our package are being implemented. Today, nearly eight months after the passage of the Recovery Act, we want to know specifically about results – how many jobs have been created, how much has been obligated and spent, how much is left to be spent, when it will be spent, and whether it will be spent by the September 2010 deadline. If GSA knows that 38,000 jobs will be produced by the DHS headquarters construction over a period of several years, I am also interested in its calculation of the number of jobs to be created by the total $5.5 billion.
This subcommittee’s tracking hearings will continue throughout 2010, the duration of the stimulus funding, because of our unique responsibility among the various committees that are charged with oversight over stimulus funds. Unlike other funds in the Recovery Act the funds under our jurisdiction are not distributed to states. GSA, EDA, and the Smithsonian are not pass-throughs, but instead directly administer stimulus funds and contract for the work. This subcommittee, in turn, bears a similar direct responsibility for the stimulus funds under our jurisdiction and must continue to conduct especially vigorous oversight of these agencies. Americans can find the projects in their states and localities online, and we invite their comments and observations on job creation, efficiency and other aspects of the work.
The stimulus has given the GSA an unparalleled opportunity to build the biggest development in its 60-year history, the Department of Homeland Security headquarters compound of three new buildings and the reuse of 60 historic structures, may be the largest development project anywhere in the United States today. This work will occur over a period beyond the initial stimulus funding, over several more years. However, based on the difficulty I encountered in securing the first funding, I know that additional funding will depend on how well and how quickly the current work proceeds. So much is at stake that we will hold special hearings on this project alone.
Today, we want to understand what has begun, what has been accomplished, who and how many have been hired, and what the timeline is on the DHS headquarters, among other questions. I was able get the first sizeable funding for the DHS headquarters project only by arguing that the project would provide a clear, proven case for job creation for a vital federal agency. I will not be able to get the necessary additional funds, totaling more than $2 billion, for the DHS compound without a showing of significant progress, both in job creation and in efficiently getting the first building up while simultaneously beginning work on making the historic structures usable.
In addition, the GSA stimulus funding also bites into the GSA backlog of repair for its vast inventory. The subcommittee expects a quick start on much of this work, in particular. Many repair and rehabilitation projects do not require extensive design work and therefore can be implemented quickly to provide jobs of many kinds at a variety of skill levels while meeting the purpose of stimulating the economy. The repair and alteration of GSA’s existing federal buildings will also retain space in the federal inventory for occupancy by federal agencies, which helps prop up the declining Federal Building Fund that, in turn, returns rent payments to the federal government to fund repairs and rescue the GSA inventory from another cycle of decline.
The Smithsonian Institution likewise has a huge backlog of repairs for facilities. Although the Recovery Act funding for the Smithsonian is small relative to the need, these funds should permit a more systematic approach to shoring up its infrastructure while creating jobs.
For the record, I also want to comment today on highway stimulus spending by the District of Columbia. Though tracked through another subcommittee of this committee, the committee has also had oversight hearings on the Recovery Act spending by agencies under all of our subcommittees. At the last hearing, I was chagrined to see the District of Columbia listed next to last among the 50 states and the District of Columbia in highway stimulus fund spending. I want to report today, however, that 70 percent of the District’s highway stimulus funds have been awarded or spent. As the stimulus bill was being considered, I took pains to see that the District was treated as a state for funding. In reality, however, the District could not begin its work like states with large Departments of Transportation staffs on hand, but instead must rely mostly on contractors. Now that most of the work is in progress, it appears that the city is using the funds as Congress most desired, for energy conservation and sustainable projects that facilitate walking, cycling, and mass transit improvements and other projects that improve the local retail and commercial environment.
Just yesterday, Chairman Jim Oberstar and I went to Murch Elementary School, where the National Center for Safe Routes to School awarded Murch Elementary the James L. Oberstar Safe Routes to School Award for being the best in the country in encouraging walking and biking to school. Murch was able to win the award because the District added $4 million to its existing infrastructure funding for the Safe Routes to School program. Without objection, I am placing a letter from the Mayor of the District of Columbia detailing this program into the record.
We look forward to hearing from the GSA, the EDA and the Smithsonian Institution about what exactly has been accomplished. We are also pleased to welcome private contractors who have received Recovery Act funds.
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