WASHINGTON — The Government Accountability Office expects to publicly release analysis on Build America Bonds issuance in February as part of a report on American Recovery and Reinvestment Act funding for state and local governments.
The report will review the extent to which BABs have been used by municipal bond issuers and how they factor into issuers’ overall financial portfolios, as well as how they decide to use them, Sandra Beattie, senior analyst in charge for the GAO, said during a conference here presented by The Bond Buyer and Bank of New York Mellon.
The GAO expects to issue a separate set of comments next month on stimulus reporting from states and localities.
The agency has scattered a staff of 150 across the country, tasking them with “field work” that includes audits of the 16 largest states and the District of Columbia, Beattie said. The GAO has visited individual housing authorities, school districts, transit authorities, and state transportation departments to review their use of stimulus funds.
So far, the agency has found that about 63% of federal stimulus funds have gone toward Medicaid programs, and about 6% of the funds have gone toward highway infrastructure, Beattie said. The federal government is actually the “single largest source of revenue” for states and local governments, she added.
The GAO issued a report last month saying that as of Sept. 11, the the Treasury Department had disbursed about $48 billion of the $49 billion of stimulus funds projected for use in fiscal 2009, which ended yesterday.
The recovery act and the Obama administration has asked states and localities to perform an unprecedented degree of reporting and transparency work as part of the “strings attached” to federal stimulus funds, according to speakers at the conference.
The stimulus act also has required uncommonly frequent analysis from GAO. The agency has been issuing stimulus-related reports every two months, as opposed to the usual schedule of every 12 to 18 months, Beattie said.
But expectations are not especially high for governments to meet the reporting deadlines, said Guy Cavallo, senior government strategist for Microsoft, which has been working with states and about 100 cities and counties on stimulus reporting submissions. “This is incredibly hard on state and local customers,” he said. “It’s been very painful.”
From the beginning, the reporting requirements and guidelines have been fuzzy, Cavallo said. Between February and September, the federal government has issued several different versions of the guidance, with varying levels of detail, he said.
“I think a lot of people are going to miss this first deadline,” Cavallo said during the conference. “We expect a lot of the [reporting] forms to be rejected.”
Some recipients of ARRA funds, including Florida and California, are planning to manually file their reports to the federal government due to worries about technical hazards of electronic filing, he said.
