The American Recovery and Reinvestment Act (ARRA) allocated approximately $63 billion towards energy-related provisions, with $45 billion going to the Department of Energy (DOE) for projects focused on renewables, energy efficiency, and smart grid development. New York received $6.3 billion in state energy grants from ARRA, with the New York State Energy Research and Development Authority (NYSERDA) administering the funds and approving projects focused on energy efficiency and conservation. Recipients of ARRA funds must meet new reporting requirements to ensure transparency and accountability in the use of public funds.

1. Opportunities and Compliance
Obligations under the Federal
Stimulus Package
Andrew Ratzkin
General Counsel, Burns and Roe Group
The Business of Being Green
City Bar Center for CLE
September 29, 2009

2. Overview of Energy-Related Provisions of
Stimulus Package
• American Recovery and Reinvestment Act of 2009
(ARRA) signed into law February 17, 2009.
• Significant but not “DREAM in 3” by itself.
• Relation to:
• Budget priorities
• Energy bills (Waxman-Markey, ACELA) (renewables (inc. RPS),
energy efficiency, transmission/smart grid, CCS)
• Climate/GHGs (Cap & Trade) (Waxman-Markey)
• Energy provisions of ARRA focus primarily on
renewables, efficiency and transmission and
distribution.
• Fossil spending ($3.4B) focused on decarbonization
(CCS, EOR, etc.).
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3. Overview of Energy-Related Provisions of
Stimulus Package
• One of the largest spending bills ever: $787B (est.) in
spending and tax cuts.
• Approx. $63B relating to energy ($43B spending, $20B
tax cuts).
• Approx. $45B to DOE including loan guars and
borrowing auth., $6.3B of which flows down to States
as grants.
• Most of ARRA funds allocated to DOE relate to
renewables, energy efficiency, “smart grid” and electric
transmission.
• Approx. $10B relating to energy efficiency and climate
change administered by other federal agencies,
primarily DOD and GSA (>$4B each).
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4. Overview of Major Energy-Related Spending
Provisions of Stimulus Package
• “Smart Grid” – $4.5B
• Electric Transmission – $3.25B each to WAPA and BPA (borrowing authority—
avail. until 9/30/12)
• Renewable Energy and Transmission Loan Guars – $6B* to underwrite $60B
in loans under the Innovative Technologies Loan Guarantee Program (inc.
biomass, hydrogen, wind, solar, hydro, advanced coal, CCS, pollution control)
• State Energy Grants – $6.3B (energy efficiency and conservation (formula)
block grants, State energy programs)
• Energy Efficiency Improvements in Federal Buildings – $4.5B (GSA)
• Qualified School Construction Bonds – $22B (DoEd) (not energy specific)
• Low-Income Weatherization – $5B
• DOD Energy Efficiency Projects – $>4B (SecDef expenditure plan reported to
Cong. 3/19). See www.defenselink.mil/recovery/.
• Public Transit Energy Efficiency – $100M
• Transportation Electrification - $400M DOE grants
• R&D Relating to Energy Efficiency, Renewables and Climate Change - $3.4B to
DOE Fossil Energy R&D Program; $2.5B for DOE energy efficiency and
renewable research, development, demo and deployment activities (inc.
$800M for biomass and $400M for geothermal); $1.6B for DOE Office of
Science.
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5. Overview of Energy-Related Provisions of
Stimulus Package—DOE Funds from ARRA
Energy Efficiency & Renewable Energy $16.8B
Weatherization - $5.0B
State Energy Program - $3.1B
Advanced Batteries Mfg - $2.0B
Energy Efficiency & Renewable Energy - $6.7B
Environmental Management (EM) $6.0B
Smart Grid & related programs $4.5B
Fossil Energy R&D $3.4B
Science $1.6B
ARPA-E $0.4B
____________________________________________________________
DOE Total (excluding loan programs) $32.7B
Innovative/Comm’ly Avail. Technology Loan Guars $6.0B*
DOE Power Admin Borrowing Authority $6.5B
(WAPA & BPA: $3.25B each)
*$6B was originally appropriated to underwrite up to $60B in loans for Renewable
Energy and T&D projects (inc. biomass, hydrogen, wind, solar, hydro, advanced
coal, CCS, pollution control). Subsequently, $2B was re-appropriated to support
cash-for-clunkers; the original amount may be restored.
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6. Energy-Related Tax Provisions of Stimulus
Package: $20B (est.) over 10 yrs
• PTC and ITC: PTC in-service date extended for 3 yrs (2013; wind 2012)
for most renewables; marine, hydro 2 yrs. May elect ITC in lieu of PTC.
• Treas. Dept. Grant Program: In recognition of current earnings
environment, receipt of grants allowed in lieu of claiming PTC or ITC for
projects in service by or commenced in 2009 or 2010.
• Modification of Energy Tax Credits: Eliminates basis reduction for
purposes of computing energy credit under IRC § 48.
• Clean Renewable Energy Bonds: Addl $1.6B above current levels
authorized to finance renewables projects for govtl bodies, pub. power
providers, electric cooperatives.
• Qualified Energy Conservation Bonds: Addl $2.4 6B authorized.
• Advanced Energy ITC: New 30% ITC for facilities mfg advanced energy
property (renewables, energy storage, energy conservation, efficient
T&D, CCS, plug-in vehicles). Treas/DOE cert. required.
• Tax Credits for Nonbusiness Energy Property (inc. energy efficiency
improvements to existing homes). 30% credit through 2010.
• Tax Credits for Alternate Fuel Pumps.
• Tax Credits for Electric Vehicles.
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7. Spending to Date
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8. New York Stimulus Funding
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9. New York Stimulus Funding
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10. New York Stimulus Program
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11. New York Stimulus Program
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12. New York Stimulus Program
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13. Other States
• Funding decisions and processes vary by State.
• Common requirements established by federal
funding sources (such as enhanced project
information reporting).
• Common concerns about meeting deadlines
and spending fast enough: contract
management depth, developing RFPs, etc.
• (Even federal government concerns about own
staffing; plans to rehire contract officers out of
retirement.)
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14. Other States
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15. Common Denominators in Funding Categories
• Jobs and support of economic recovery
• Progress toward energy independence
• Progress toward decarbonization
• Note: Programs and guidelines in development
and policy goals are broad.
• A project potentially may have eligibility under
more than one program (program descriptions
frequently overlap): e.g., direct federal, State
block grants and SEP, tax incentives, financial
instruments (CREBs, loan guarantees, etc.).
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16. Funding Example: SEP Block Grants
The goals established for the State Energy
Program (SEP) ($3.1B) are:
1. Increase energy efficiency to reduce
energy costs and consumption for
consumers, businesses and government.
2. Reduce reliance on imported energy.
3. Improve the reliability of electricity and fuel
supply and the delivery of energy services.
4. Reduce the impacts of energy production
and use on the environment.
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17. Funding Example: SEP Block Grants
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18. SEP Block Grant Example: New York State
• Recovery and Reinvestment Cabinet established.
• http://recovery.ny.gov/
• States had until May 12 to apply for SEP grants.
• Each State’s ARRA funds administration differs
• SEP administration in NY delegated to NYSERDA
• http://www.nyserda.org/Economicrecovery/sep.asp
• Process:
• NYSERDA decision on application
• Governor, Mayor or other chief executive must certify review,
vetting and appropriate use of taxpayer funds. ARRA § 1511.
• Projects to be certified by Governor subject to review by
Recovery Cabinet
• Positioning and sponsors
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19. New York Stimulus Program
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20. New York Stimulus Program—NYSERDA
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21. New York Stimulus Program—NYSERDA
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22. New York Stimulus Program—NYSERDA
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23. New York Stimulus Program
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24. New York Stimulus Program
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25. The Stimulus Package and Energy Projects
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26. The Stimulus Package and Energy Projects
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27. The Stimulus Package and Energy Projects
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28. Oversight and Compliance
• Because of transparency goals, enhanced information and
requirements for all recipients (contracts, grants, cooperative
agreement, loan guarantees, tax incentives).
• DOE announcement of comprehensive reorganization of grant and
loan guarantee award process; at same time DOE has announced
enhanced oversight and reaffirmed due diligence measures on all
loan guarantee issuances.
• For contractors, FAR plus.
• Agencies required to publish contract pre-solicitation and award
notices beyond FAR Part 5 requirements. https://www.fbo.gov
• For contracting, fixed price preferred per FAR Part 16, though
OMB recognizes per FAR 9.103 that selection based solely on price
can produce a false economy.
• Reporting requirements have been developed as new standard
FAR clause (52.204-11) as per ARRA § 1512.
• Recipient information will be published on government websites.
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29. Recipient Reporting Requirements
Per ARRA § 1512, each recipient required to report
information, including the following:
• Total amount of recovery funds received from
Agency.
• Amount of recovery funds obligated and expended.
• Detailed list of all projects or activities for which
recovery funds were obligated or expended,
including:
• Name of project/activity
• Description of project/activity
• Evaluation of completion status
• Estimate of number of jobs created and retained
• For State/local infrastructure investments, the purpose, total
cost and rationale for the funding, contact person for
concerns
• Detailed information on subcontracts/subgrants.
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30. Recipient Reporting Requirements
• In addition, all prime contractors and first-tier
subcontractors must report the name and total
compensation of each of its five most highly
compensated officers if, in the preceding fiscal year,
80% or more of its gross revenue had a federal
source (contracts, subcontracts, grants, subgrants,
cooperative agreements) and such federal-source
revenue exceeded $25,000,000. Interim FAR clause
52.204-11.
• See 74 Fed. Reg. 14639 (Mar. 31, 2009)
• Recovery Accountability and Transparency Board
oversight
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31. Recipient Reporting Requirements
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32. Whistleblower Protections
The McCaskill Amendment, ARRA § 1553, protects
disclosures:
• Made by employees of non-federal recipients of
“covered funds”
• That the employee reasonably believes is evidence of
• Gross mismanagement of a contract or grant relating to
covered funds;
• A gross waste of covered funds;
• A substantial and specific danger to public health or safety
related to the use of covered funds;
• An abuse of authority related to the use of covered funds; or
• A violation of law, rule or regulation related to an agency
contract or grant related to covered funds.
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33. Whistleblower Protections
Such a disclosure need not be formal, and is protected
if made, including during the “ordinary course of the
employee’s duties”, to:
• The Recovery Accountability and Transparency Board
• An Inspector General
• The Comptroller General
• A member of Congress
• A State or Federal regulatory or law enforcement agency
• A person with supervisory authority over the employee (or
such other person working for the employer who has
authority to investigated, discover or terminate
misconduct)
• A court or grand jury, or
• The head of a federal agency or their representatives
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34. Additional Resources
Overviews of ARRA
• American Recovery and Reinvestment Act of 2009, official text:
• http://frwebgate.access.gpo.gov/cgi-
bin/getdoc.cgi?dbname=111_cong_bills&docid=f:h1enr.pdf
• National Conference of State Legislatures’ summary:
• http://74.125.47.132/search?q=cache:x75TrJzEWXcJ:www.ncsl.org/statefed/2009econom
icstimulus.htm+stimulus+ARRA+summary&cd=7&hl=en&ct=clnk&gl=us
• Associated General Contractors’ summary:
• http://www.agc.org/cs/rebuild_americas_future
• Detailed OMB guidance:
• http://www.recovery.gov/?q=node/317
• Training materials:
• http://www.whitehouse.gov/recovery/WebinarTrainingMaterials/
• Recipient Reporting Information:
• http://www.recovery.gov/?q=content/recipient-reporting
• http://www.federalreporting.gov
• Tracking spending by state:
• http://www.recovery.com/Spending_by_State_Group_Seven.aspx#3
• DOE ARRA programs: http://www.energy.gov/recovery/
• DOD ARRA programs: http://www.defenselink.mil/recovery/
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35. Additional Resources
Application Process
• Registration and applications for ARRA funding programs:
http://www.grants.gov.
• Central Contractor Registration: http://www.ccr.gov.
• Loan guarantee program: www.lgprogram.energy.gov/apply.html;
opportunity and funding allocation notices published at:
GovLoans.gov.
• Link to State ARRA websites:
http://www.recovery.gov/?q=content/state-recovery-page
• State-by-State breakdown of DOE grant funding of state-level
energy programs and weatherization assistance.
http://www.energy.gov/recovery/documents/DOE_Formula_Block_Grant_
Allocation_03302009.xls
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36. The Stimulus Package and Energy Projects
About Burns and Roe
Burns and Roe is a comprehensive engineering,
procurement, construction, operations and maintenance
company providing services to private and governmental
clients worldwide, primarily in the power and energy
sectors. The firm's professional services extend from
project inception to operations and maintenance.
For more information, see www.roe.com.
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37. The Stimulus Package and Energy Projects
Contact:
Andrew Ratzkin
Burns and Roe Group, Inc.
201-265-2000
aratzkin@roe.com
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