State May Be Forced To Return Millions In Unspent Energy Funds To Feds
LOS ANGELES (CBS) — In a report released Monday, the California State Auditor said the Energy Commission has spent only around half of the $226 million in federal Recovery Act funds given to the state in April 2009.
Monday's report was a follow up to an earlier audit that found the Commission had used only 19 percent of the funds by June of last year, more than two years after the money was granted.
As part of the American Recovery and Reinvestment Act of 2009, the U.S. Department of Energy awarded the $226 million to the California Department of Energy Resources Conservation and Development Commission.
The purpose of the Act was to preserve and create jobs, promote economic recovery, and invest in environmental protection, among other things. The funds awarded to California's Energy Commission were meant for the State Energy Program to fund contracts, grants, and loans related to energy conservation, efficiency and renewal projects.
After its July report, State Auditor Elaine Howle says the Commission rapidly accelerated spending, unloading another 33 percent of the funds – nearly $75 million – in six months' time. By Dec. 20, the total spent was up to $117.5 million.
According to Howle's report, if the Commission does not spend the remaining $108.6 million by April 30, the unspent funds must be returned to the federal government.
The Commission tells Howle its contract managers are working closely with subrecipients to ensure their programs' funds are allocated to projects that will be able to use them in full by the federal spending deadline.
The Commission's deputy division chief told Howle the reality is more funds have been spent than what is reflected in the Commission's records. He says many subrecipients have chosen to wait until projects are complete before submitting final invoices.
The Commission was required in 2009 to transfer $25 million into an Energy Efficient State Property Revolving Loan program, administered by the state's Department of General Services. Howle found that while only $9 million of those funds had been loaned out by April 19 of last year, the full $25 million is considered spent dollars as far as the Department of Energy is concerned, since General Services is considered a third party.
An additional $50 million was authorized for transfer into the loan funding pool in October of last year.
The Commission's deputy division chief says there is still an option to transfer up to $50 million more into this fund to save those dollars from reverting back to the feds.
A subsequent report by Howle Thursday indicated an extension may be granted to the state's Community Services, which received $185.8 million from the Recovery Act to fund grants for its Weatherization Assistance for Low Income Persons program, which it was to have spent by June 30 of this year.
Howle says Los Angeles – through Community Services' contract with the LADWP – has made significant strides toward weatherizing the required number of homes. Oakland and San Francisco, however, "had weatherized few to no homes" by the close of 2011.
