Books Closed on FY17; $248 Million in ARRA High Speed Rail Funding Vanishes Unspent
December 1, 2017
The Treasury Department closed the books on fiscal year 2017 this week by releasing the account-level spending data to the public in the Combined Statement of Receipts, Outlays and Balances. For each account in the federal budget, the Combined Statement shows how much money was in the account at the start of the year, how much more was provided by Congress during the year, and how much was spent (outlaid) during the year.
The Combined Statement also shows how much money in each account lapsed in FY 2017 through disuse. Federal law (31 U.S.C. 1552) provides that all appropriations are repealed five years after the deadline for obligating the money. And since FY 2017 was the fifth year after the FY 2012 obligation deadline for the last of the appropriations for transportation made by the 2009 ARRA stimulus law, it allows a re-assessment of how much of the stimulus money was wasted through disuse.
The Combined Statement shows that $247.6 million of the $8 billion in high-speed rail funding provided by the ARRA stimulus law vanished, unspent, at midnight on September 30. This was 3.1 percent of the total appropriation. Other ARRA accounts at USDOT had earlier obligation deadlines, so by going through prior-year Combined Statements were were able to put together a complete picture of how much of the stimulus was never used.
|ARRA Stimulus Accounts at the U.S. Department of Transportation|
|(Millions of dollars.)|
|FAA||Facilities & Equipment||$200.0||$3.6||1.8%|
|FTA||Fixed Guideway Mod.||$750.0||$2.5||0.3%|
|MARAD||Aid to Shipyards||$100.0||$0.0||0.0%|
|Total, ARRA Accounts at USDOT||$48,100.0||$721.3||1.5%|
On a percentage basis, the amount of high-speed rail funding that was not used was by far the highest of any USDOT account (though the lapse of $369 million in highway funding was a higher dollar amount, that was only 1.3 percent of the highway total).
The use of off-budget emergency spending for the $787 billion ARRA stimulus legislation was justified by the urgent need for counter-cyclical economic stimulus – the need to get money moving in the economy as quickly as possible to alleviate the ongoing recession. So the “spendout rate” of the stimulus money is relevant. Over half of the $8 billion in ARRA high speed rail money was not outlaid until FY 2016 or 2017, by which point the recession was long since over.
The $8 billion in ARRA money was followed up by a $2.5 billion appropriation a few months later in the FY 2010 appropriations act (reduced to $2.1 billion a few months later when the Republicans took back control of Congress). Unlike the ARRA money, the FY 2010 money does not have any obligation deadline – it is “no year” money which remains available forever. So its spendout rate will likely be even slower than that of the ARRA money and will depend on how quickly the Central Valley portion of the California high-speed rail project is completed.
|How Quickly Were High-Speed Rail Appropriations Spent?|
|FY 2009 ARRA||FY 2010 Regular|
|(Lapsed 9/30/2017)||“(“No Year “)|
|(The original enacted FY 2010 appropriation was $2.500 billion but Congress rescinded $400 million of that before any of the money could be spent.)|
(Ed. Note: It’s at this point that we must, once again, share one of ETW’s all-time favorite anecdotes, as revealed in Michael Grunwald’s 2012 history of ARRA, The New New Deal. The $8 billion for high speed rail was put into the bill because White House chief of staff Rahm Emanuel thought the money “would persuade moderate House Republicans to support the stimulus.” Grunwald quotes Emanuel as saying, of those House Republicans, “They’re horny for high-speed rail!”)