On February 13th, Congress passed the final American Recovery and Reinvestment Act, H.R. 1, to save and create jobs, get our economy moving again, and transform it for long-term growth and stability.  On February 17th, during the first month of his term, President Obama signed the bill into law. This legislation will jumpstart our economy, create and save 3.5 million jobs, give 98% of American working families and individuals a tax cut, and begin to rebuild America’s road, rail, and water infrastructure, with unprecedented accountability measures -- no earmarks, new state whistleblower protections, and an historic degree of transparency at www.recovery.gov.

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The American Recovery and Reinvestment Act will:

• Create and save 3.5 million jobs, rebuilding America, making us more globally competitive and energy independent, and transforming our economy.
• Give 95 percent of American workers an immediate tax cut.
• Invest in roads, bridges, mass transit, energy efficient buildings, flood control, clean water projects, and other infrastructure projects.
• Restore science and innovation as the keys to new American-made technology, preventing and treating disease, and tackling urgent national challenges like climate change and dependence on foreign oil.
• Invest quickly into the economy.
  

• Clean, Efficient, American Energy
• Transforming our Economy with Science and Technology
• Lowering Health Care Costs and Ensuring Broader Coverage
• Investing in Education for the 21st Century
• Modernizing Roads, Bridges, Transit and Waterways
• Tax Cuts for Middle-Class Families and American Businesses
• Helping Workers Hurt by the Recession
• Spurring Job Creation by American Businesses Large and Small
• Creating Jobs & Improving Quality of Life for Our Troops and Veterans
• Strengthening Rural America
• Providing Strong Accountability Measures
  
  

Following are highlights of some key provisions in each of these areas.

Clean, Efficient, American Energy

To put people back to work today and reduce our dependence on foreign oil tomorrow, we are seeking to double our renewable energy production and renovate public buildings to make them more energy efficient.   The energy provisions of the American Recovery and Reinvestment Act, signed into law by President Obama on February 17, will create more than 500,000 jobs, and accelerate deployment of smart grid technology, provide energy efficiency funds for the nation’s schools, offer support for the nation’s governors and mayors to tackle their energy challenges, and establish a new loan guarantee program to keep our transition to renewable energy on track during the economic crisis.  

"… this approach is a win-win for a strong economy and a healthier environment. With green investments of close to $100 Billion, this bill will create good jobs for people here in America and reduce our dependence on dirtier energy sources. The Sierra Club praises Congress for promoting the shift to wind and solar power, high energy performance low carbon cars and buildings, mass transit, and a modernized water and transportation infrastructure." [Sierra Club, 2/11/09]

“..this economic recovery package …will deliver jobs and green infrastructure to America. The bill makes smart investments that will jumpstart the economy, help sustain future growth, and meet the challenges of the 21st century… The recovery package includes bold investments for renewable energy and efficiency… Renewable energy grants will help struggling businesses cope with the economic climate and advance technology that harnesses the power of the wind and sun…The economic recovery package reflects the commitment by Congress to fulfill President Obama’s vision for a clean energy future.”[Natural Resources Defense Council, 2/13/09] 

Smart Grid /Advanced Battery Technology/Energy Efficiency ($34 billion)

• Smart Grid:  Transforms the nation’s electricity systems through the Smart Grid Investment Program to modernize the electricity grid to make it more efficient and reliable.  This will jumpstart smart grid demonstration projects in geographically diverse areas, increase federal matching grants for smart grid technology (20% to 50%) including “Smart Meters” that give consumer more choice in their energy consumption at home, and spur research and development.  Build new power lines that can transmit clean, renewable energy from sources throughout the nation.  ($11 billion)
• Renewable Energy Power:  Guarantees up to $60 billion in loans for renewable energy power generation and electric transmission projects that begin in the next two years.  These guaranteed loans would help ease credit constraints for renewable energy investors and spur new private sector investment over the next three years. ($6 billion)
• Advance Battery Technology:  Supports U.S. development of advanced vehicle batteries and battery systems through loans and grants so that America can lead the world in transforming the way automobiles are powered.  Also includes other initiatives to promote the use of alternative fuel vehicles by the federal government. ($2.3 billion)
• State and Local Energy Programs:  Helps state and local governments make investments for innovative best practices to achieve greater energy efficiency and reduce energy usage, including building and home energy conservation programs, energy audits, fuel conservation programs, building retrofits,  and "Smart Growth" planning and zoning. Also encourages states to align their utility regulation with energy efficiency goals and to adopt updated energy-efficient building codes. ($6.3 billion)
• Energy Efficient Appliance Rebates:  Provides consumer rebates to buy energy efficient appliances to replace old ones to lower energy bills. ($300 million)
• Energy Research:  Spurs energy efficiency and renewable energy research, development, demonstration, and deployment activities at universities, companies, and national laboratories to foster energy independence, reduce carbon emissions, and cut utility bills. ($2.5 billion)
• ARPA-E:  Invests in the Advanced Research Project Agency-Energy (ARPA-E) to support high-risk, high-payoff research into energy sources and energy efficiency in collaboration with private industry and universities. ($400 million)
• Carbon Capture & Sequestration:  Makes key investments in carbon capture and sequestration technology demonstration projects to work toward making coal part of the solution and reducing the amount of carbon dioxide emitted from industrial facilities and fossil fuel power plants. ($3.4 billion)
• Training for Green Collar Jobs: Invests in training of workers for green-collar jobs. ($500 million)
• Other Energy Efficiency Investments:  Invests in other energy efficiency programs, including alternative fuel trucks and buses, transportation charging infrastructure, and diesel emissions reduction. ($1 billion)

Landmark Energy Savings at Home ($5 billion)

• Weatherization:  Improves the energy efficiency for up to 1 million modest-income homes through weatherization, expanding the number of families (from 150% to 200% of the federal poverty income levels) and the aid level (from $2,500 to 6,500 per household) to maintain the current per-household efficiency investment in the face of diminished state and other aid;
• Energy Savings:  This will save modest-income families on average $350 per year on heating and air conditioning bills, while creating up to 90,000 jobs.

Tax Incentives to Spur Energy Savings and Green Jobs ($20 billion over 10 years)

• Tax Credit for Renewable Energy:  Extends for three years the production tax credit (PTC) for electricity derived from wind (through 2012) and for electricity derived from biomass, geothermal, hydropower, landfill gas, and waste-to-energy facilities (through 2013). 
• Easing Credit Crunch for Renewable Energy:  Provides grants of up to 30 percent of the cost of building a new renewable energy facility in 2009 and 2010 or permits that business to claim a 30 percent investment credit instead of a production tax credit.
• Energy Efficient Home Tax Credits:  Promotes energy efficient investments in homes by extending and expanding tax credits through 2010 for investments such as new furnaces, energy-efficient windows and doors, or insulation.  Increases the credit from 10 percent to 30 percent of the cost of the investment and raises the credit cap from $500 to $1,500, saving American families money on their energy bills.
• Plug-in Hybrid Tax Credit:  Spurs the next generation of cars by providing a tax credit for families that purchase plug-in hybrid and all-electric vehicles of up to $7,500.
• Renewable Energy Bonds: Provides clean renewable energy bonds for state and local governments, electric cooperatives and public power companies to finance renewable energy facilities to generate electricity.
• Investment in Advance Energy Manufacturing:  Establishes a new manufacturing investment tax credit for advanced energy facilities, such as facilities that manufacture components for the production of renewable energy, advanced battery technology, and other innovative next-generation green technologies. 
• Alternative Fuel Pumps: Increases incentives to install pumps that dispense alternative fuels including E85, biodiesel, hydrogen, and natural gas. More of these fuel pumps are needed for consumers with flex-fuel and alternative fuel vehicles.

Modernizing Federal Infrastructure & Housing to Lower Energy Costs ($10 billion)

• Energy Efficient Federal Buildings:  Makes an historic investment in upgrading federal buildings and making them energy efficient – working to save taxpayers over one billion dollars by slashing energy costs in our federal buildings by 25 percent.
  • The federal government is the world’s largest consumer of energy.
  • This will help create good-paying jobs in the green building industry.
• GSA Federal Buildings: Invests in renovations and repairs to federal buildings, focused on increasing energy efficiency and conservation.  ($4.5 billion)
• DOD Facilities:  Invests in energy efficiency projects at the Defense Department and repairing and modernizing their facilities, including military medical facilities and Army barracks. ($4.2 billion)
• Public Housing:  Invests in energy efficiency upgrades in public housing, including new windows, furnaces, and insulation to improve living conditions and lower energy costs of operating these facilities. ($1 billion)
• Low Income Housing: Upgrades HUD sponsored low-income housing (elderly, disabled and Section 8) to increase energy efficiency, with new insulation, windows, and furnaces.  ($250 million)

Transforming Our Economy with Science, Technology & Innovation

The American Recovery and Reinvestment Act, signed into law by President Obama on February 17,  invests in science and technology – both creating jobs in the short-term and building a foundation for strong economic growth in the long-term.  The recovery package includes a $17 billion investment in scientific research, including investments at the National Institutes of Health and the National Science Foundation, among others.  Regarding new technologies, the package also includes nearly $40 billion in investments in America’s IT network infrastructure (including broadband, health IT, and a smarter energy grid).  More than 100 high-tech CEOs and business leaders have endorsed these IT investments and stated that this $40 billion investment alone will create more than 949,000 U.S. jobs, more than half of which will be in small businesses.  

Investments in Scientific Research ($17 Billion)

National Science Foundation

• Provides $3 billion overall for the National Science Foundation (NSF), putting the NSF budget on track to double over the next seven years, as called for under the America COMPETES Act (PL 110-69).
• Includes $2.5 billion for NSF research and research-related activities.  Sustained, targeted investment by NSF in basic research in fundamental science and engineering advances discovery and spurs innovation. 
  • The $2.5 billion includes $300 million for major research equipment shared by institutions of higher education and other scientists.
  • The $2.5 billion also includes $200 million to repair and modernize science and engineering research facilities at the nation’s institutions of higher education.
• Includes $400 million to build major research facilities that perform cutting-edge science.
• Includes $100 million for improving K-12 instruction in science, technology, engineering, and mathematics (STEM).

 
Department of Energy’s Office of Science

• Provides $1.6 billion for DOE’s Office of Science, putting the office’s budget also on track to double over the next seven years, as called for under the America COMPETES Act (PL 110-69).
• The DOE Office of Science is the single largest supporter of basic research in the physical sciences in the United States, providing more than 40 percent of total funding for this vital area of national importance.  It oversees the nation’s research programs in climate science, advanced computing, biofuels, high-energy physics, nuclear physics, and fusion energy sciences – areas crucial to our energy future.

ARPA-E

• Provides $400 million for the Advanced Research Project Agency-Energy (ARPA-E) to support high-risk, high-payoff research into energy sources and energy efficiency in collaboration with private industry and universities.

National Institutes of Health

• Provides $8.7 billion overall for NIH research and research-related activities, including $500 million for renovation of NIH research facilities.  The $8.7 billion will fund a significant expansion in cutting-edge research to study diseases such as Alzheimer’s, Parkinson’s, cancer, and heart disease. 
• According to Research America, this investment could create 70,000 jobs and stimulate the economy in numerous states because 90 percent of NIH research funding is distributed to colleges, universities and research institutions across the country.
• Also provides $1.3 billion for NIH to renovate and equip university research facilities and help them compete for biomedical research grants.

National Institute of Standards and Technology

• Provides $580 million overall for the Commerce Department’s National Institute of Standards and Technology (NIST).
• Includes $360 million for construction at NIST labs and competitive construction grants for research science buildings at colleges, universities, and other research organizations.
• Includes $220 million for additional research, equipment, and competitive grants.

Certain Other Key Investments in Scientific Research

• $1 billion for NASA, including $400 million to put more scientists to work doing climate change and o ther research, $400 million to further exploration activities, $150 million for aeronautics activities to improve aviation security and Next Generation air traffic control (NextGen), and $50 million to repair NASA centers damaged by hurricanes and floods last year.
• Provides $830 million for the National Oceanic and Atmospheric Administration (NOAA), including $600 million for construction and repair of facilities, ships, and equipment, improving weather forecasting, supporting satellite development, and addressing critical gaps in climate modeling; and $230 million to address a backlog of ready-to-go research, restoration, navigation, and conservation activities.

Investments in IT Network Infrastructure ($37 Billion)

More than 100 high-tech CEOs and business leaders have endorsed the bill’s nearly $40 billion in investments in IT network infrastructure, including broadband, health IT, and a smarter energy grid and estimate these investments will create more than 949,000 U.S. jobs, more than half of which will be in small businesses. They stated, “The investments in a smarter energy grid, health care IT…., and accelerating broadband deployment … will not only stimulate the economy, but will also accelerate long-term growth.”

Broadband and Wireless Services

• Provides $7.2 billion for extending broadband and wireless services to underserved communities across the country, so that rural and inner-city businesses can compete with any company in the world.
• For every dollar invested in broadband, the economy sees a ten-fold return on that investment.
• The stimulative impact of this investment would be:  1) jobs to procure, produce, deliver, install, and maintain new infrastructure; and 2) jobs in sectors of the economy that rely on e-commerce, including the retail, high-tech, education, health care, and real estate sectors.

Smarter Energy Grid

• Provides $11 billion for improving the grid, including transforming the nation’s electricity systems through the Smart Grid Investment Program to modernize the grid to make it more efficient and reliable.  This will jumpstart smart grid demonstration projects in geographically diverse areas; increase federal matching grants for smart grid technology (to 50% from the current 20%) including “Smart Meters” that give consumers more choice in their energy consumption at home; and spur research and development.  The funding will also facilitate the building of new power lines that can transmit clean, renewable energy from sources throughout the nation.

Health Information Technology

• Provides $19 billion to accelerate adoption of Health Information Technology (HIT) systems by doctors and hospitals, in order to modernize the health care system, save billions of dollars, reduce medical errors, and improve quality – including significant financial incentives through the Medicare and Medicaid programs to encourage doctors and hospitals to adopt and use HIT.

Lowering Health Care Costs and Securing Health Coverage

Affordable and quality health care is key to strong American economic growth.  The American Recovery and Reinvestment Act, signed into law by President Obama on February 17, invests in bringing our health care system into the 21st century with information technology – that is proven to reduce costs, increase quality, and save lives.  The package also protects health coverage for millions of Americans who have lost their jobs in this recession by providing up to 9 months of subsidized COBRA health insurance continuation coverage.  Modernizing our health care system will create hundreds of thousands of jobs.  Economist Mark Zandi estimates that, overall, this recovery package will save or create more than 250,000 jobs in the health care and education sectors.

Modernizing Health Care System to Lower Costs and Save Lives

• Provides $19 billion to accelerate adoption of Health Information Technology (HIT) systems by doctors and hospitals, in order to modernize the health care system, save billions of dollars, reduce medical errors and improve quality.
• Includes significant financial incentives through the Medicare and Medicaid programs to encourage doctors and hospitals to adopt and use electronic health records that will streamline medical care.
• Directs the federal government take a leadership role in developing HIT standards by 2010 – those standards will allow for the nationwide electronic exchange and use of health information in order to improve the quality and coordination of patients’ care, within a framework of enhanced security and privacy.
• Strengthens federal privacy and security law to protect personally identifiable health information from misuse and abuse as the health care sector increases the use of HIT.
• Creates hundreds of thousands of jobs – many in high-tech sectors – by promoting the adoption of HIT.
• Facilitates broad adoption of electronic health records.  The nonpartisan Congressional Budget Office (CBO) estimates that, as a result of this legislation, approximately 90 percent of doctors and 70 percent of hospitals will be using electronic health records within the next 10 years.
• Controls health care costs.  CBO estimates that this proposal will reduce the health care costs of the federal government by over $12 billion over 10 years and it will generate additional savings throughout the health sector through improvements in quality of care, care coordination, and reductions in medical errors and duplicative care.  

Protecting Health Care Coverage for Millions Through Medicaid

• Throughout the country, the health care coverage of millions of Americans on Medicaid is being threatened by the unprecedented, massive fiscal crisis facing the states – as a result of this recession.  Total state budget gaps for FY 2009 (generally running from 7/1/08 through 6/30/09) are about $99 billion – $48 billion in gaps before state budgets were adopted last summer, which were closed by cutting services or raising revenues; and $51 billion in gaps which have opened up since then. 
• Budget deficits are also already projected for 43 states for the upcoming FY 2010.  Initial estimates of these shortfalls total almost $94 billion.  As the full extent of FY 2010 deficits become known, state shortfalls are likely to equal $145 billion.
• In response to these shortfalls, at least 28 states have already proposed or implemented cuts that will affect  eligibility for Medicaid or reduce services covered.  For example, South Carolina is limiting coverage for many Medicaid services, such as psychological counseling, physician visits, and routine physicals; and California and Utah are reducing services covered by their Medicaid programs. 
• To help states avoid these types of cuts in Medicaid enrollment and coverage, provides states an estimated $87 billion in additional federal matching funds for Medicaid over a two-year period.  Under the bill, every state gets an across-the-board increase in matching funds of 6.2% and then there is a schedule of additional bonus payments based on the increase in the state’s unemployment rate.
• In addition to shoring up existing Medicaid enrollment and coverage, this $87 billion in increased federal assistance for Medicaid is an excellent economic stimulus.  According to economist Mark Zandi, every dollar of federal Medicaid aid results in $1.38 in increased economic activity.
• Also provides an 18-month extension of transitional medical assistance (TMA), which is a bridge that protects health coverage for families transitioning from welfare to work.

Providing Health Insurance for Unemployed Workers

• As millions of people are losing their jobs in this recession, they are also losing their health insurance.  This bill has a key provision to strengthen COBRA to help maintain health coverage during this downturn.
• COBRA currently provides temporary coverage for workers between jobs, but it is expensive.  A typical family premium on COBRA is over $1,000 a month.  To help people maintain their health coverage, the bill provides a 65% subsidy for COBRA premiums for up to 9 months for people who were involuntarily separated from their jobs between 9/1/08 and 12/31/09.  The assistance is limited to individuals with  incomes up to $125,000 and families with incomes up to $250,000.
• This provision is estimated by the Joint Committee on Taxation and CBO as assisting 7 million people with the cost of their health insurance coverage.  

Investing in Prevention and Wellness

• Provides $1 billion for a new Prevention and Wellness Fund.
• Includes funding for immunization programs; because 156 million Americans go without the flu vaccine every year, the bill makes a significant investment in immunizations to remove the cost barrier.    
• Funds healthcare-associated infection prevention programs to reduce the incidence of infection.
• Also assures funding for evidence-based clinical and community-based prevention strategies.  Over 75 percent of total health care dollars are spent on patients with one or more chronic conditions, including diabetes, heart disease, and high blood pressure.  Investing in preventing these chronic conditions is one of the most effective ways to reduce health care spending, saving billions of dollars a year.

Other Key Health Care Investments & Other Provisions

• Invests $10 billion for NIH, including for expanding good jobs in biomedical research to study diseases such as Alzheimer’s, Parkinson’s, cancer, and heart disease, and for improving NIH facilities.
• Invests $2 billion in community health centers (CHCs), to increase the number of uninsured Americans who receive quality health care and to renovate clinics and make health information technology improvements.  More than 400 applications for new or expanded CHC sites currently remain unfunded.
• Invests $1.1 billion in comparative effectiveness research, to evaluate the relative effectiveness of different health care services and treatment options.  This research will improve the quality of care.
• Invests $500 million for the training of doctors, dentists, and nurses, in order to address the shortage of primary care providers; also funds helping pay medical school expenses for students who agree to practice in underserved communities.
• Extends the moratorium on damaging Medicaid regulations for targeted case management, provider taxes, and school-based administration and transportation services through June 30, 2009 and adds moratoriums on the Medicaid regulation for hospital outpatient services and on Medicare regulations cutting payments for teaching hospitals and hospice providers.

Investing in Education for the 21st Century

Economists tell us that strategic investments in education are one of the best ways to help America become stronger, and more productive and competitive.  The American Recovery and Reinvestment Act, signed into law by President Obama on February 17, makes investments to modernize our schools, help the states avoid teacher layoffs and other education cutbacks, and make college more affordable.  Economist Zandi estimates that, overall, this recovery package will save or create more than 250,000 jobs in the education and health care sectors.

Preventing Teacher Layoffs and Education Cuts/Modernizing Schools

• Establishes a $53.6 billion State Fiscal Stabilization Fund, which has three components:
  • $39.5 billion that goes to local school districts using existing funding formulas, which can be used to restore state education cuts; prevent teacher layoffs; prevent other education cutbacks; modernize, renovate, and repair public schools; and for other purposes;
  • $5 billion in incentive and innovation grants to be distributed by the Secretary of Education on a competitive basis to states and local school districts for progress achieved on key education reform and student achievement objectives; and
  • $8.8 billion to states for high-priority needs such as public safety and other critical services, which may include education, including modernization, renovation and repair of public school and higher education facilities.
• The State Fiscal Stabilization Fund is vitally needed because states are facing an unprecedented, massive fiscal crisis.  Budget shortfalls are already projected for 43 states for the upcoming FY 2010.  Initial estimates of these shortfalls total almost $94 billion.  As the full extent of FY 2010 deficits become known, state shortfalls are likely to equal $145 billion.
• In recent months, 28 states have implemented cuts in education due to budget shortfalls – for example, Georgia has cut aid to school districts by $95 per pupil; the University of Florida has eliminated 430 faculty and staff positions; and the University of Kentucky is raising its tuition 9 percent.
• Without the recovery package, school districts across the country would have to enact further cuts.  Newspaper stories from across the country show the following:  “As many as 2,300 teachers could face midyear layoffs because of the state budget crisis, Los Angeles Unified School District officials said.”  (Los Angeles Times, 1/7/09)  “Local school officials are preparing for drastic budget cuts…Most Marion and Polk County school districts are considering shortening the school year, asking staff to take salary cuts, or eliminating programs.”  (Statesman Journal – Oregon, 1/21/09)
• Projects to modernize public school and higher education facilities – which are permitted under the State Fiscal Stabilization Fund – will create new construction jobs while ensuring that students can learn and teachers can teach in safe, healthy, technologically up-to-date, energy-efficient learning environments.

Additional School Modernization Funding

• Also includes school modernization bond provisions.   These provisions create a new category of tax credit bonds for the construction, rehabilitation, or repair of public school facilities or for the acquisition of land on which a public school facility will be constructed.  There is a limitation on the amount of qualified school modernization bonds that may be issued of $25 billion.

Making College More Affordable as Working Families Are Struggling

• In this recession, tens of millions of students are losing the opportunity to go to college, with their families struggling – and this package includes key steps to keep the doors of college open to these students.
• Improves current higher education tax credits, by creating a new “American Opportunity” tax credit with a maximum of $2,500 rather than the current maximum of $1,800 -- thereby making college more affordable for millions of low- and moderate-income students.
• Also provides this new “American Opportunity” tax credit to more than 4 million low-income students who had not had any access to higher education tax credits in the past – by making it partially refundable.  As a result, the nearly one-fifth of high school seniors who receive no tax credit under the current system will receive a tax cut to make college affordable for the first time.
• Makes college more affordable for approximately 7 million students by increasing the maximum Pell Grant by $500, for a maximum of $5,350 in 2009 and $5,550 in 2010, and also backfilling the program’s funding shortfall.
• Adds $200 million to the vital Work-Study program that supports undergraduate and graduate students who work while attending college.  The increased funding will allow an additional 133,000 students to participate.
• As the National Association of Independent Colleges and Universities has stated, “Together these proposals mean that low-income students and families on the brink of stopping or dropping out of their higher education plans can stay in, and that unemployed workers can choose retraining for a new job.”

Investing in Early Childhood Development

• Provides $2.1 billion for Head Start, which provides comprehensive development services to low-income preschool children – thereby providing services for 110,000 additional children.  The $2.1 billion in additional funds includes $1.1 billion for the vital Early Head Start infant and toddler program.  These investments will create 50,000 new jobs, increasing the demand for early educators, transportation providers, nutrition providers, etc.
• Research has shown that Head Start works and is a good investment for taxpayers – saving society money in the long-term.  Studies have shown that Head Start is one of the best ways to improve child well-being, increase the educational achievement and future productivity of children, and reduce crime.
• Provides $2 billion for the Child Care and Development Block Grant to provide child care services to an additional 300,000 children in low-income families while their parents go to work.  Today, only one out of every seven children eligible for federal child care assistance receives it.

Providing Other Key Education Investments

• Provides $13 billion for Title I grants to help disadvantaged kids reach high academic standards – ensuring that in this period of tight state and local budgets these vital services are maintained.
• Provides $12.2 billion for grants for IDEA (Special Education) to increase the federal share of these costs, and ensure adequate resources for these mandatory services.
• Provides $650 million for Education Technology, in order to invest in 21st century classrooms, including funding computer labs and training teachers to use technology.
• Provides $300 million for improving teacher quality, including $200 million for competitive grants to school districts and states to provide performance pay for teachers and principals who raise student achievement and close the achievement gaps in high-need schools and $100 million for competitive grants to states to address teacher shortages and modernize the teaching workforce.
• Provides $250 million for statewide data systems, providing competitive grants to states to design and develop data systems that analyze individual student data to help teachers and administrators improve student achievement.

Creating Jobs by Modernizing Roads, Bridges, Transit and Waterways 

To build a 21st century economy, we must create jobs rebuilding our crumbling roads and bridges, modernizing public buildings, and putting people to work cleaning up our air, water and land. The American Recovery and Reinvestment Act, signed into law by President Obama on February 17, will make large investments to repair and modernize thousands of miles of roadways in the U.S. and to provide new mass transit options for millions of Americans.  These provisions in total would create or save about 1.8 million American jobs.  Unprecedented accountability and transparency measures are built into the legislation to ensure that tax dollars are spent wisely.
 
“Increasing infrastructure spending will also greatly boost the economy… Most of the infrastructure money will be spent on hiring workers and on materials and equipment produced domestically… The boost to GDP from every dollar spent on public infrastructure is large—an estimated $1.59—and there is little doubt that the nation has underinvested in infrastructure for some time, to the increasing detriment of the nation's long-term growth prospects.” (Chief Economist Mark Zandi of Moody’s Economy.com, 1/21/09)
 
“The economic recovery legislation signed by the President today will trigger an infusion of funds that will put this nation on the road to recovery. It will allow transportation departments across America to make smart investments in thousands of projects, creating hundreds of thousands of family-wage jobs in the struggling construction industry. At the same time, it will upgrade the highways, bridges, and transit and rail systems that America depends on.” [American Association of State Highway and Transportation Officials, 2/17/09]
 
Modernizing Roads and Bridges (Creates more than 750,000 jobs)

• Creates more than 750,000 jobs through investment in transportation, with $27.5 billion for highway construction.  These projects create jobs in the short term while saving commuters time and money in the long term.
• Includes $1.5 billion in discretionary grants for highways, bridges, mass transit, rail, and port infrastructure.
• States have over 5,100 projects totaling over $64 billion that could be under contract within 180 days. 
• In 2006, the Department of Transportation estimated an additional $8.5 billion per year was needed to maintain current systems and an additional $61.4 billion per year was needed to improve highways and bridges. 
• Includes strict accountability measures to ensure that highways and transit funds get out the door quickly to create jobs.  Requires 50 percent of the highway funding to be obligated within 120 days, and 50 percent of the transit formula funding to be obligated within 180 days, or the Transportation Department can reclaim some of the states’ highway/transit funding in the bill.

 
Improving Public Transit and Rail (Creates more than 200,000 Jobs)

• Creates more than 200,000 jobs by making investments in transit and rail to reduce traffic congestion and our dependence on foreign oil ($8.4 billion transit).  Provides funds for new construction of commuter and light rail, modernizing existing transit systems, and purchasing buses and equipment needed to increase public transportation and improve intermodal and transit facilities.
• Provides $1.5 billion in discretionary grants for highways, bridges, mass transit, rail, and port infrastructure.
• Makes landmark investments ($8 billion) in the development of high speed rail and to improve intercity passenger rail service in corridors across the nation from Ohio to California.  Also includes grants for Amtrak.  Connecting cities with faster rail service will relieve congestion, improve energy conservation, spur commerce between cities, create jobs, and revitalize local economies.
• Public transportation saves as much as 4.2 billion gallons of gasoline and reduces carbon emissions by 37 million metric tons each year. 
• There are 787 ready-to-go transit projects totaling $15.9 billion. [American Public Transit Association]

 
Modernizing Federal Infrastructure to Lower Energy Costs

• Makes an historic investment in upgrading federal buildings and making them energy efficient – working to save taxpayers over one billion dollars by slashing energy costs in our federal buildings by 25 percent.
• Provides $4.5 billion for renovations and repairs to federal buildings, focused on increasing energy efficiency and conservation.  
• Invests $4.2 billion in energy efficiency projects at the Defense Department and repairing and modernizing their facilities, including military medical facilities and Army barracks.
• The federal government is the world’s largest consumer of energy.
• This will help create good-paying jobs in the green building industry as well as save taxpayer money.

Prioritizing Clean Water/Flood Control/Environment Restoration (Creates approximately 300,000 Jobs)

• Creates approximately 300,000 jobs by modernizing our nation’s water systems to strengthen the safety and cleanliness of our water and to ensure that about 3 million rural households have new or improved service.
• Experts note that $16 billion in water projects could be quickly obligated.  [National Governors’ Association and the Association of State and Interstate Water Pollution Control Administrators] 
• Expands efforts at environmental restoration, flood protection, hydropower, and navigation infrastructure and providing clean, reliable drinking water to rural areas critical to the economy through the Army Corp of Engineers and the Bureau of Reclamation. 
• Strengthens environmental cleanup efforts for Superfund, cleanup of petroleum leaks from underground storage tanks, nuclear waste cleanup, and brownfields -- which has the added benefit of creating jobs.

Building Affordable Housing & Addressing the Housing Crisis ($10 billion)

• Repairs and modernizes public housing.  Every dollar of these public housing expenditures produces $2.12 in economic return. 
• Low-Income Housing tax credits to restart low-income housing construction stalled by the credit crunch.
• Provides for the purchase and rehabilitation of foreclosed, vacant properties by local communities in order to create more affordable housing and reduce neighborhood blight. 
• Supports $11 billion in direct loans and loan guarantees to help rural families and individuals buy homes during the credit crunch.
• Invests in emergency shelters to provide short-term rental assistance, housing relocation, and stabilization services for families during the economic crisis. 

 
Building 21st Century Schools

• Spurs new construction, rehabilitation, or repair of public school facilities with a new bond financing program for state and local governments.  This will create construction jobs and strengthen the education of our children.

Buy American

• Provides that all government projects funded by the recovery plan must use U.S. iron, steel and manufactured goods -- unless it violates obligations under World Trade Organization or U.S. free trade agreements or a federal agency head waives the requirement because of costs or non-availability.

Tax Cuts for Middle-class Families and American Businesses

The tax cuts in the American Recovery and Reinvestment Act, signed into law by President Obama on February 17, will jumpstart the economy by returning money to the hands of about 95% of American workers, and encouraging new job-creating investments by businesses large and small, that will transform our economy for years to come, such as in renewable energy and energy efficiency.  These tax cuts make up 36 percent of the package – the largest individual component of the plan.  As President Obama pointed out on February 21, “[B]y April 1st, a typical family will begin taking home at least $65 more every month. Never before in our history has a tax cut taken effect faster or gone to so many hardworking Americans.”

Tax Cuts for American Families ($232 billion over 10 years)

• Making Work Pay Tax Cut:  Provides immediate and sustained tax relief to about 95 percent of American workers and their families through the Making Work Pay tax credit, a refundable tax credit of up to $400 per worker ($800 per couple filing jointly), phasing out completely at $190,000 for couples filing jointly and $95,000 for single filers. 
  • These tax cuts will be distributed to 129 million families by reducing tax withholding from workers’ paychecks by April 1st.  These tax cuts are a downpayment on President Obama’s plan for permanent middle-class tax relief, but were scaled back to gain the support of the needed Senate Republicans.
• Child Tax Credit:  Cuts taxes for the families of more than 16 million children through an expansion of the child tax credit. This would provide a new tax cut for more than 6 million children, and increase the existing credit for more than 10 million children.
• Earned Income Tax Credit:  Expands the Earned Income Tax Credit by providing tax relief to families with three or more children and increasing marriage penalty relief.
• College Tax Credit:  Helps more than 4 million additional students attend college with a new, $2,500 tax credit for families, which is partially refundable.  As a result, the nearly one-fifth of high school seniors who currently receive no tax credit will receive a tax cut to make college affordable for the first time.  These tax credits phase out completely at $90,000 for individuals and $180,000 for couples filing jointly.
• Alternative Minimum Tax:  Protects 26 million middle-class families from being hit by the alternative minimum tax. 
• First-Time Homebuyers:  Strengthens the housing market by enhancing the current tax first-time homebuyer credit by increasing it to $8,000 (up from $7,500) and by removing the current repayment requirement.
• Incentives to Buy New Cars:  Provides a tax deduction for state and local sales taxes and excise taxes paid on the purchase of new cars, including light trucks and motor homes.
• Unemployment Benefits: Temporarily suspends federal taxes on the first $2,400 of unemployment benefits.

Business Tax Incentives to Create Jobs and Spur Investment ($10 billion over 10 years)

• Bonus Depreciation:  Helps businesses quickly recover costs of new capital investments by extending the increased bonus depreciation for businesses making investments in new plants and equipment in 2009.
• Buying Back Debt: Provides assistance to companies looking to reduce their debt burdens by delaying the tax on businesses that have discharged indebtedness, which will help these companies strengthen their balance sheets and obtain resources to invest in job creation.
• Small Business Expensing:  Spurs small business investment by extending small business expensing, which doubles the amount small businesses can immediately write off their taxes for capital investments and purchases of new equipment made in 2009 from $125,000 to $250,000.  This write off phases out completely for investments over $800,000 (up from $500,000).
• Small Business Loss Carrybacks:  Increases cash flow for small businesses by providing a 5-year carryback of net operating losses (NOLs).  This would allow small businesses (with gross receipts of less than $15 million) to write off losses incurred in 2008 against taxes assessed over the previous five years (current law limits NOL carryback to the previous two years), thereby reducing their taxes this spring. 
• Small Business Investment:  Spurs investments in small businesses by cutting the capital gain tax on investors in small businesses who buy stock (in the next two years) and hold it for more than five years – increasing from 50 percent to 75 percent the capital gains that are excluded from tax. 
• 3% Government Withholding:  Delays the mandate that federal, state, local governments withhold 3 percent of payments to businesses for goods and services, which is supported by the National Small Business Association.
• Jobs for Unemployment Veterans or Youth:  Encourages new job creation with business tax credits for hiring recently discharged unemployed veterans and youth that have been out of work and out of school for the 6 months prior to hire.

Renewable Energy and Energy Efficiency Tax Incentives to Spur Energy Savings and Create Green Jobs ($20 billion over 10 years)

• Tax Credit for Renewable Energy:  Extends for three years the production tax credit (PTC) for electricity derived from wind (through 2012) and for electricity derived from biomass, geothermal, hydropower, landfill gas, and waste-to-energy facilities (through 2013). 
• Easing Credit Crunch for Renewable Energy:  Provides grants of up to 30 percent of the cost of building a new renewable energy facility in 2009 and 2010 or permits that business to claim a 30 percent investment credit instead of a production tax credit, to address current the credit crunch for investments in renewable energy.
• Energy Efficient Home Tax Credits:  Promotes energy efficient investments in homes by extending and expanding tax credits through 2010 for investments such as new furnaces, energy-efficient windows and doors, or insulation.  Increases the credit from 10 percent to 30 percent of the cost of the investment and raises the credit cap from $500 to $1,500, saving American families money on their energy bills.
• Plug-in Hybrid Tax Credit:  Spurs the next generation of cars by providing a tax credit for families that purchase plug-in hybrid and all-electric vehicles of up to $7,500.
• Renewable Energy Bonds:  Provides clean renewable energy bonds for State and local governments, electric cooperatives and public power companies to finance facilities that generate electricity from renewable resources.
• Energy Conservation Bonds:  Increases qualified energy conservation bonds for State and local governments to make a variety of energy conservation investments, such as investments in public infrastructure, loans and grants to retrofit homes, and funding for research to reduce greenhouse gas emissions.
• Investment in Advance Energy Manufacturing:  Establishes a new manufacturing investment tax credit for advanced energy facilities, such as facilities that manufacture components for the production of renewable energy, advanced battery technology, and other innovative next-generation green technologies. 
• Alternative Fuel Pumps: Increases incentives to install pumps that dispense alternative fuels including E85, biodiesel, hydrogen, and natural gas.  More of these fuel pumps are needed for consumers with flex-fuel and alternative fuel vehicles.

Tax Incentives for State and Local Economic Development ($26 billion over 10 years)

• School Construction:  Spurs new construction, rehabilitation, or repair of public school facilities with a new bond financing program for state and local governments with $22.4 billion in tax credit bonds over the next two years.  This will create construction jobs and strengthen the education of our children.
• Recovery Zone Bonds:  Provides relief for America’s hardest hit areas with tax credits and tax-exempt bonds for development in “Recovery Zones” (areas hit particularly hard by job loss, poverty, and home foreclosures). 
• Build America Bonds:  Establishes new Build America Bonds which are a better value for state and local governments to use to finance state and local infrastructure projects. 
• Low-Income Housing:  Provides temporary grants to states to support investment in low-income housing in lieu of tax credits.

Helping Workers Hurt by the Recession

In this economic crisis, high unemployment and rising costs have put a huge strain on many American families.  The American Recovery and Reinvestment Act, signed into law by President Obama on February 17, contains a series of provisions to help, including helping workers train and find jobs, extending unemployment benefits, and increasing food stamp benefits.  Not only will these steps provide relief to American families, they will help jumpstart our economy as these funds are spent quickly and have the most “bang for the buck” in creating jobs and spurring economic growth.

“Increased income support has been part of the federal response to most recessions, and for good reason.  It is the most efficient way to prime the economy’s pump.  … Every dollar spent on UI benefits generates an estimated $1.63 in near-term GDP.  Boosting food stamp payments by $1 increases GDP by $1.73.  People who receive these benefits are hard-pressed and will spend any financial aid they receive very quickly.”  (Chief Economist Mark Zandi of Moody’s Economy.com, 1/21/09)

Extending and Improving Unemployment Benefits

• Continues through December 2009 the extended unemployment benefits program (which provides up to 33 weeks of extended benefits), that is otherwise scheduled to begin to phase out at the end of March 2009 – thereby helping an additional 3.5 million jobless workers.
• Increases unemployment benefits for 20 million jobless workers by $25 per week.
• Temporarily suspends the taxation of some unemployment benefits.
• To encourage states to modernize their Unemployment Insurance (UI) systems to keep up with the changing workforce, provides a total of up to $7 billion for states implementing specific UI reforms to improve access for low-wage, part-time and other workers who are often now excluded from the program.
• Every dollar in unemployment benefits creates at least $1.63 in economic activity, according to chief economist Mark Zandi of Moody’s Economy.com.

Increasing Food Stamp Benefits

• Provides $19.9 billion to increase food stamp benefits by 13% to help offset rising food costs for more than 31 million Americans, half of whom are children. 
• Every dollar in food stamps creates at least $1.73 in economic activity, according to economist Mark Zandi of Moody’s Economy.com.

Increasing Other Food Assistance

• Provides $150 million for the Emergency Food Assistance Program to purchase commodities for food banks to refill emptying shelves.
• Provides $100 million for formula grants to states for elderly nutrition services including Meals on Wheels and Congregate Meals.
• Provides $100 million for the School Lunch Program in order to provide schools with assistance in purchasing equipment, with priority for low-income schools.

Providing Health Insurance for Unemployed Workers

• As millions of people are losing their jobs in this recession, they are also losing their health insurance.  This bill has a key provision to strengthen COBRA to help maintain health insurance coverage during this downturn.
• COBRA currently provides temporary coverage for workers between jobs, but it is expensive.  A typical family premium on COBRA is over $1,000 a month.  To help people maintain their health coverage, the bill provides a 65% subsidy for COBRA premiums for up to 9 months for people who were involuntarily separated from their jobs between 9/1/08 and 12/31/09.  The assistance is limited to individuals with incomes up to $125,000 and families with incomes up to $250,000.
• This provision is estimated by the Joint Committee on Taxation and CBO as assisting 7 million people with the cost of their health insurance coverage.

Helping Workers Find Jobs

• Training and Employment Services:  Provides $3.95 billion for job training including increased funding for formula grants for adult, dislocated worker, and youth job training ; increased funding for the YouthBuild program; and funding for competitive grants for training in health care and green jobs.
• Vocational Rehabilitation State Grants:  Provides $500 million for state formula grants to help persons with disabilities prepare for gainful employment. 
• Employment Services Grants:  Provides $400 million to match unemployed individuals to job openings through state employment service agencies and allow states to provide customized services.
• Community Service Employment for Older Americans:  Provides $120 million to provide subsidized community service jobs for low-income older Americans.

Providing Aid to Seniors, Disabled Veterans, and SSI Recipients

• Provides a payment of $250 to retirees, disabled individuals, and SSI recipients receiving benefits from the Social Security Administration, Railroad Retirement beneficiaries, and disabled veterans receiving benefits from the Department of Veterans Affairs.

Providing Other Key Investments

• Housing Assistance:  Increases support for several critical housing programs, including providing $2 billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties and $1.5 billion for the Emergency Shelter Grant program to provide short-term rental assistance and housing relocation and stabilization services for families during this economic crisis.
• Trade Adjustment Assistance:  Extends all Trade Adjustment Assistance (TAA) programs through December 31, 2010.  Also significantly expands TAA programs, including extending TAA to trade-affected service sector workers and to workers affected by the offshoring or outsourcing of jobs to other countries, such as China and India.
• TANF:  Provides $2.7 billion for temporary increased federal funding for the Temporary Assistance for Needy Families (TANF), including created a temporary TANF Emergency Contingency Fund to provide states with relief during this recession.
• Child Support Enforcement:  Suspends for FY 2009 and FY 2010 damaging cuts made in federal funding for child support enforcement by a GOP-controlled Congress in 2006.  
• Community Services Block Grant:  Provides $1 billion for grants to local communities to support employment, food, housing, and health care efforts serving those hardest hit by the recession.
• Community Development Block Grant:  Provides $1 billion for community and economic development projects including housing and services for those hit hard by tough economic times. 

Spurring Job Creation by American Businesses Large and Small

American businesses, large and small, are the engine of the economy.  The American Recovery and Reinvestment Act, signed into law by President Obama on February 17, expands opportunities for small business, and contains incentives for businesses of all sizes to invest in new plants and equipment.  The measure will strengthen a broad range of industries, such as renewable energy, construction and manufacturing, and information technology, which are critical to creating jobs now, as well as transforming our economy for the 21st Century. 

“The National Association of Manufacturers … urges you to support the conference report on H.R. 1, the American Recovery and Reinvestment Act, because this legislation is essential to economic revitalization and the creation of jobs…. The overall plan balances tax cuts and investment and is designed to help working Americans and those who provide their jobs.”[National Association of Manufacturers, 2/13/09]

“Since the elections, we’ve vowed to work with the President to quickly develop and pass a stimulus bill that would apply a defibrillator to our economy and shock it back to life… We support the cancellation of indebtedness tax provisions that will encourage businesses to restructure and reduce debt, enabling them to preserve jobs, renew investment, and begin to grow once again. … By offering tax incentives to first-time homebuyers and new car purchasers, this bill could provide much needed liquidity to the market while jumpstarting critical industries.  We urge both chambers of Congress to swiftly pass the bill.”[Chamber of Commerce, 2/13/09]
 
The measure is supported by a broad range of business organizations, including the American Wind Energy Association, The Information Technology Industry Council (ITI), National Association of Realtors, Real Estate Roundtable, Solar Energy Industries Association, and Retail Industry Leaders Association.


Creating Small Business Opportunities (Invests over $1 billion to create an estimated 645,000 jobs)

• Spurs more than $21 billion in new investment in small business and small business loans, with guarantees needed to make loans more attractive to lenders and to free up capital for small businesses.  By making the Small Business Administration a more active partner and by unfreezing credit markets, this will give smaller firms access to the capital they need to stay afloat, create jobs and help drive an economic recovery.
  • Eliminates all fees on SBA-backed loans. 
  • Establishes a new program that will allow SBA to make no-interest loans to firms that are struggling to make payment on existing debts.
  • Raises from 85 to 90 percent the portion of a loan that the Small Business Administration will guarantee. 
  • Spurs investment in high-growth, small firms by streamlining the Small Business Investment Company (SBIC) program to allow them to invest more flexibly.
• Guarantees nearly $3 billion in loans for rural businesses at a time of unprecedented demand due to the credit crunch.  Private lenders are increasingly turning to this program to help businesses get access to capital. 
• Invests in Economic Development Assistance (EDA) to address long-term economic distress in urban industrial cores and rural areas, distributed based on need and ability to create jobs and attract private investment.  Every $1 in federal EDA funds leverages $10 in private investments.

Business Tax Incentives to Create Jobs and Spur Investment ($76 billion in 2 years; $10 billion over 10 years)

• Bonus Depreciation:  Helps businesses quickly recover costs of new capital investments by extending the increased bonus depreciation for businesses making investments in new plants and equipment in 2009.
• Buying Back Debt: Provides assistance to companies looking to reduce their debt burdens by delaying the tax on businesses that have discharged indebtedness, which will help these companies strengthen their balance sheets and obtain resources to invest in job creation.
• Small Business Expensing:  Spurs small business investment by extending increased small business expensing, which doubles the amount small businesses can immediately write off for capital investments and purchases of new equipment made in 2009 from $125,000 to $250,000.  This write off phases out completely for investments over $800,000 (up from $500,000).
• Small Business Loss Carrybacks:  Increases cash flow for small businesses by providing a 5-year carryback of net operating losses (NOLs).  This would allow small businesses (with gross receipts of less than $15 million) to write off losses incurred in 2008 against taxes assessed over the previous five years (current law limits NOL carryback to the previous two years).
• Small Business Investment:  Spurs investments in small businesses by cutting the capital gain tax (by increasing from 50 percent to 75 percent the capital gains that are excluded from tax) for investors in small businesses who buy stock (in the next two years) and hold it for more than five years. 
• 3% Government Withholding:  Delays the mandate that federal, state, and local governments withhold 3 percent of payments to businesses for goods and services, which is supported by the National Small Business Association.
• Jobs for Unemployment Veterans or Youth:  Encourages new job creation with business tax credits for hiring recently discharged unemployed veterans and youth that have been out of work and out of school for the 6 months prior to hire.

Growing Businesses under the Recovery Plan 

• Rebuilding America’s Highways, Bridges, and Other Infrastructure: Businesses in construction and manufacturing will get a boost from the large investments in infrastructure, including repairing and modernizing thousands of miles of roadways in the U.S., providing new mass transit options for millions of Americans and cleaning up our water.  These provisions in total would create 1.8 million American jobs. 
• Spurring Renewable Energy: For renewable energy firms, such as wind and solar, the bill includes critical provisions, such as those that:
  • Provide a three-year extension of the production tax credit (PTC) for electricity derived from wind (through 2012) and for electricity derived from biomass, geothermal, hydropower, landfill gas and waste-to-energy facilities (through 2013). 
  • Make grants for businesses that begin or complete construction of new renewable energy facilities in 2009 or 2010 for up to 30 percent of the cost of the investment in order to help speed up investment in new facilities and to address current renewable energy credit market concerns.
  • Guarantees up to $60 billion in loans for renewable energy power generation and electric transmission projects that begin in the next two years.  These guaranteed loans would help ease credit constraints for renewable energy investors and spur new private sector investment over the next three years.
  • The American Wind Energy Association:  “The renewable energy provisions in the final bill will stimulate economic and job growth in the wind industry.  More than that, this bill is a critical down payment on long-term policies needed to meet the President’s ambitious renewable energy goals, enhance America’s energy security, grow our economy and reduce global warming pollution.”  [2/12/09]
• Making Homes, Schools and Buildings More Energy Efficient:  For those who rebuild and renovate our homes and buildings for energy efficiency and savings, including many small businesses such as plumbers and electricians, the bill includes provisions to: 
  • Improve the energy efficiency for up to 1 million modest-income homes through weatherization;
  • Make key energy efficiency upgrades to public housing and HUD-assisted housing with new insulation, windows, and furnaces; and
  • Make an historic investment in upgrading federal buildings and making them energy efficient – working to save taxpayers over one billion dollars by slashing energy costs in our federal buildings by 25 percent.
• Innovation through Science & Technology:  The recovery package also includes nearly $40 billion in investments in America’s IT network infrastructure (including broadband, health IT, and a smarter energy grid).  More than 100 high-tech CEOs and business leaders have endorsed these IT investments and stated that this $40 billion investment alone will create more than 949,000 U.S. jobs, more than half of which will be in small businesses.  
  • Investing in extending broadband and wireless services to underserved communities across the country, thereby growing businesses that procure, produce, deliver, install, and maintain new infrastructure, as well as sectors of the economy that rely on e-commerce, including the retail, education, health care, and real estate industries.
  • Providing funding for the aggressive adoption of Health Information Technology systems will create hundreds of thousands of jobs – many of them in high-tech sectors, including computer hardware manufacturing and information technology services.

Creating Jobs & Improving Quality of Life for Our Troops and Veterans

As President Obama has often stated, one of the chief goals of the American Recovery and Reinvestment Act, signed by the President on February 17, is to create jobs by putting Americans to work doing the work that America needs done.  The long-neglected infrastructure needs of both our military and veterans’ facilities, as the Walter Reed scandal highlighted, require swift action.  That is why this legislation identifies and funds some of the most pressing infrastructure needs of the military and VA.  Funding these infrastructure projects will create tens of thousands of new jobs, along with taking another step in keeping our promises to our troops and veterans.  This legislation also includes other key provisions – including giving businesses tax credits for hiring unemployed veterans and providing disabled veterans a payment of $250.  In addition, it includes other provisions to improve the lives of our troops and veterans, such as funding additional child care centers and warrior transition centers for wounded warriors returning from combat.

Improving the Quality of Life for Our Troops

• Renovating and Making More Energy-Efficient DOD Facilities:  Provides $4.2 billion to invest in energy efficient projects and to repair and modernize a variety of Department of Defense facilities. 
• Improving the Hospitals for Our Troops: Provides $1.3 billion for rebuild and renovate our aging military hospitals and ambulatory care centers.  Many of these facilities are 40 or even 50 years old, and are not suited to current medical standards and practices. 
• Providing Assistance to Military Homeowners: Provides $555 million for assistance to military homeowners, including wounded warriors and surviving spouses, who have been impacted by the housing crisis.
• Improving Troop and Family Housing:  Provides $335 million to build new barracks and dormitories for our soldiers, sailors, marines and airmen as well as to make further investments in quality family housing for military families. 
• Expanding Child Care for Military Families:  Provides $240 million for new child development centers on military bases across the country.  These facilities will help military spouses hold down jobs and will provide employment opportunities for caregivers.
• Establishing Warrior Transition Complexes: Provides $100 million for warrior transition complexes to provide services to wounded warriors returning from combat and their families.
• Constructing Needed Facilities for the National Guard: Provides $100 million for new construction of operations and training facilities to support National Guard units across the country.   

Improving the Quality of Life for Our Veterans

• Providing Businesses A Tax Credit for Hiring Unemployed Veterans: Provides a tax credit to businesses for hiring unemployed veterans.  Specifically, veterans would qualify if they were discharged or released from active duty from the Armed Forces during the previous five years and received unemployment benefits for more than 4 weeks before being hired.
• Providing Disabled Veterans A Payment of $250:  Provides a payment of $250 to all disabled veterans receiving benefits from the Department of Veterans Affairs.  (This $250 payment, which also goes to retirees, SSI beneficiaries and Railroad Retirement beneficiaries, is targeted to those who are likely not to benefit from the Making Work Pay tax credit.)
• Improving the Hospitals for Our Veterans:  Provides $1 billion for non-recurring maintenance, including energy efficiency projects, to address deficiencies and avoid serious maintenance problems at the 153 VA hospitals across the country.  
• Increasing the Number of VA Claims Processors:  Provides $150 million for an increase in VA claims processing staff, in order to address the large backlog in processing veterans’ claims.  This backlog has been a key complaint of veterans across the country.
• Improving Automation of VA Benefit Processing:  Provides $50 million to improve the automation of the processing of veterans’ benefits, to get benefits out sooner and more accurately.
• Constructing Extended Care Facilities for Veterans: Provides $150 million for state grants for the construction of additional extended care facilities for veterans. 

Strengthening Rural America

This deep recession has hit rural America hard. Declining commodity prices, high input costs, reduced demand, job layoffs and a looming credit crisis have left many in rural America struggling to make ends meet.  The American Recovery and Reinvestment Act makes key investments that will create jobs now, while investing in our long-term economy.  It will create or save 3.5 million American jobs, and cut taxes for 95 percent of working Americans.  It focuses on key priorities for rural America, deploying broadband to connect rural communities to more economic opportunities and better  health care and education, spurring the development of American renewable energy including biofuels and wind, strengthening small businesses, and rebuilding rural America’s highways, waterways, and housing.

“The American Farm Bureau Federation is pleased with the broadband, renewable energy and tax provisions contained in the stimulus package that was signed by President Barack Obama today. These provisions will help the agriculture industry and all Americans through the economic recovery period.”  2/17/09

Expanding Broadband and Wireless Services

• Provides $7.2 billion for extending broadband and wireless services to underserved communities across the country, so that rural and inner-city businesses can compete with any company in the world. 
• Allocates $2.5 billion of this total to the Rural Utilities Service, which could use it to benefit 7,185 rural communities, 3.4 million residents and businesses, and potentially create 113,000 new jobs.
• For every dollar invested in broadband, the economy sees a ten-fold return on that investment.
• Only 38% of those living in rural America now have broadband at home, compared with 55% of all adult Americans.  In rural communities, 24% of dial-up users said broadband wasn't available where they lived – more than seven times those in cities.  [Pew Center for the Internet]
• As the Farm Bureau noted:  “The $7.2 billion allocated for broadband will help rural communities participate in our recovering economy, while modernizing rural education and healthcare. It will create great economic opportunities for rural Americans and allow farmers and ranchers to take advantage of technology to help them remain profitable and competitive.”

Developing America’s Renewable Energy

• Smart Grid:  Transforms the nation’s electricity systems through the Smart Grid Investment Program to modernize the electricity grid to make it more efficient and reliable.  This will jumpstart smart grid demonstration projects in geographically diverse areas.  Installing a smart grid will help farms in the Midwest or the South produce electricity on their property through solar panels or wind turbines, which they will be able to sell back through the grid. 
• Renewable Energy Power:  Guarantees up to $60 billion in loans for renewable energy power generation and electric transmission projects that begin in the next two years.  These guaranteed loans would help ease credit constraints for investors in a range of renewable energy systems and projects such as wind or solar projects, electricity transmission projects and “leading edge biofuels projects.”
• Tax Credit for Renewable Energy:  Extends for three years the production tax credit (PTC) for electricity derived from wind (through 2012) and for electricity derived from biomass (through 2013).  Wind energy projects are already creating new jobs in rural communities in manufacturing, transportation, and project construction.  Another key to energy independence could come in the form of corncobs, cornstalks, switchgrass, agricultural waste and byproducts, and other types of biomass including woody biomass from forests, which are spread across America and can be converted into clean renewable energy sources.
• Easing Credit Crunch for Renewable Energy:  Provides grants of up to 30 percent of the cost of building a new renewable energy facility in 2009 and 2010 or permits that business to claim a 30 percent investment credit instead of a production tax credit.  This will be helpful for those seeking to build plants to process biofuels – a crucial element of our plan to end our dependence on foreign oil.
• Research:  Invests in energy efficiency and renewable energy research, development, demonstration and deployment (RDD&D), including $800 million for biomass. 
• Alternative Fuel Pumps: Increases tax incentives to install pumps that dispense alternative fuels including E85, biodiesel, hydrogen, and natural gas. More of these fuel pumps are needed to grow the market for biofuels, America’s homegrown energy source.
• Carbon Capture & Sequestration:  Makes key investments in carbon capture and sequestration technology demonstration projects to work toward making coal part of the solution and reducing the amount of carbon dioxide emitted from industrial facilities and fossil fuel power plants. ($3.4 billion)
• As the Farm Bureau noted:  “The tax incentives for renewable energy, particularly for new renewable fuels, will help build an industry that will provide farmers and ranchers with income and the rural economy with jobs, while contributing to a cleaner environment and reducing dependence on imported oil.”

Creating Small Business Opportunities

• Rural Business Loans:  Guarantees nearly $3 billion in loans for rural businesses at a time of unprecedented demand due to the credit crunch. 
• Small Business Loans:  Spurs more than $21 billion in new investment in small business and small business loans, with guarantees needed to make loans more attractive to lenders and to free up capital for small businesses.  This will give smaller firms access to the capital they need to stay afloat, create jobs and help drive an economic recovery.
  • Eliminates all fees on SBA-backed loans. 
  • Establishes a new program that will allow SBA to make no-interest loans to firms that are struggling to make payment on existing debts.
  • Raises from 85 to 90 percent the portion of a loan that the Small Business Administration will guarantee. 
• Bonus Depreciation:  Helps businesses quickly recover costs of new capital investments by extending the increased bonus depreciation for businesses making investments in new plants and equipment in 2009.
• Small Business Expensing:  Spurs small business investment by extending increased small business expensing, which doubles the amount small businesses can immediately write off for capital investments and purchases of new equipment made in 2009 from $125,000 to $250,000.  This write-off phases out completely for investments over $800,000 (up from $500,000).
• Economic Development:  Invests in Economic Development Administration (EDA) programs to address long-term economic distress in urban and rural areas, distributed based on need and ability to create jobs and attract private investment.  Every $1 in federal EDA funds leverages $10 in private investments.
• As the Farm Bureau noted:  “Farmers and ranchers will also greatly benefit from the extension of both the small business expensing levels and bonus depreciation tax, which will help them improve cash flow while aiding the economy by encouraging purchases of equipment.”

Strengthening Farmers, Housing and Rural Communities

• Agricultural Disasters:  Provides $752 million in relief money for farmers affected by the natural disasters of 2008, including those hard-hit by flooding and hurricanes in Louisiana, Texas, Oklahoma, Mississippi, Iowa, Illinois and Arkansas. 
• Farm Service Agency Payments: Provides $50 million for critical IT improvements to systems to process commodity and conservation payments as well as tracking payment and program eligibility, so that the country's 2 million farmers and ranchers can receive the payments they rely on in a timely way.
• Loans for Farmers and Ranchers:  Provides $173 million in direct loans to help farmers and ranchers facing dropping commodity prices and increased input costs.  These funds will help them to purchase seed to plant in the spring and buy feed for their livestock.
• Loans for Rural Housing:  Supports $11 billion in direct loans and loan guarantees to help rural families and individuals buy homes during the credit crunch.
• Rural Community Facilities:  Guarantees up to $1 billion in loans for rural facilities, including facilities for health care, education, fire and rescue, and day care, as well as community centers and libraries.
• State and Local Law Enforcement:  Includes $4 billion to support state and local law enforcement, including Byrne Justice Assistance formula grants to support local law enforcement efforts with equipment and operating costs, and the COPS hiring grant program.
• Public Safety and School Construction:  $8.8 billion to states for high-priority needs such as public safety and other critical services, which may include education, including modernization, renovation and repair of public school and higher education facilities.
• Focusing on High-Poverty Rural Areas:  Dedicates at least 10 percent of rural development funding to high-poverty counties for the Rural Housing Service, Rural Community Facilities Program Account, Rural Business-Cooperative Service, Rural Business Program Account, the Rural Utilities Service and the Rural Water and Waste Disposal Program Account.

Better Transportation, Waterways and Other Infrastructure

• Creates hundreds of thousands of jobs through investment in transportation, with $27.5 billion for highway construction.  Targets a portion of highway construction funds towards improving outdated and crumbling highways and bridges in small and rural communities. 
• Creates more than 200,000 jobs by modernizing our nation’s water systems to strengthen the safety and cleanliness of our water and to ensure that about 3.4 million rural households have new or improved service.  According to USDA, many rural communities still cannot afford to provide water to all residents and maintain sanitation systems - leaving thousands of families to haul water, rely on shallow wells, or use unsafe supplies.  And water bills upwards of $100 per month are not uncommon in rural areas.
  • Rural Water and Waste Disposal: Supports $3.8 billion in grants and loans to help communities fund drinking water and wastewater treatment systems.  This will bring investments to 94% of the public water supply systems in the nation, including rural water districts and municipal systems that serve less than 10,000 populations. [National Rural Water Association, 2/18/09]
  • Clean Water and Safe Drinking Water:  $6.4 billion for the Clean Water State Revolving Fund, the Drinking Water State Revolving Fund and other State and Tribal Assistance Grant programs, which provide assistance to local communities to construct and repair water and wastewater systems.
• Expands efforts at flood protection, navigation infrastructure, and providing clean, reliable drinking water to rural areas critical to the economy through the Army Corps of Engineers and the Bureau of Reclamation. 
• Corps of Engineers:  Invests $4.6 billion for environmental restoration, flood protection, hydropower, and navigation infrastructure critical to the economy. 
• Bureau of Reclamation: Includes $1 billion to provide clean, reliable drinking water to rural areas and to ensure adequate water supply to western localities impacted by drought. 
• Watershed Infrastructure: Provides $340 million for the Natural Resources Conservation Service watershed improvement programs to design and build flood protection and water quality projects, repair aging dams, and purchase and restore conservation easements in river flood zones.

Strengthening Rural Health Care

• Health Information Technology:  Makes an historic investment in rural America to accelerate adoption of Health Information Technology (HIT) systems by doctors and hospitals, in order to modernize the health care system, save billions of dollars, reduce medical errors and improve quality.  It provides $2 billion to the HHS Secretary to make sure that health care providers, especially in underserved communities, have money to invest and implement HIT in their facilities.  These funds can also be used for telemedicine that can reduce health disparities in rural areas.
• Staving off Cuts in Medicaid:  To help states avoid cuts in Medicaid enrollment and coverage, provides states an estimated $87 billion in additional federal matching funds for Medicaid over a two-year period.  Every state gets an across-the-board increase in matching funds of 6.2% and bonus payments based on the state’s unemployment rate.  More than one in four rural children rely on Medicaid for health care.
• Reducing Health Professions Workforce Shortages:  Invests $500 million for the training of doctors, dentists, mental health providers, specialized nurses, and additional public health workers to address the shortage of primary care providers; also helps pay medical school expenses for students who agree to practice in underserved communities.

Putting America’s Veterans First

• Rural America has made huge contributions to defending our country.  Army recruitment rates in rural counties across the United States are about 20 percent above the national average, and the casualty rate of those serving in Iraq and Afghanistan [among those of military age (18 to 59)] is fifty percent higher in rural America than in urban areas. [DailyYonder.com, 11/13/07, 3/2/09]
• Invests in rebuilding military and veterans’ facilities that were neglected for too long, as the Walter Reed scandal highlighted. 
  • Improving the Hospitals for Our Troops: Provides $1.3 billion for rebuild and renovate our aging military hospitals and ambulatory care centers.  Many of these facilities are 40 or even 50 years old, and are not suited to current medical standards and practices. 
  • Strengthening VA Hospitals:  Provides $1 billion for non-recurring maintenance to address deficiencies and avoid serious maintenance problems at the 153 VA hospitals across the country.  
  • Establishes Warrior Transition Complexes: Provides $100 million for warrior transition complexes to provide services to wounded warriors returning from combat and their families.
• Includes a range of other key provisions – including giving businesses tax credits for hiring unemployed veterans and providing disabled veterans a payment of $250. 
  • Assistance to Military Homeowners: Provides $555 million for assistance to military homeowners, including wounded warriors and surviving spouses, who have been impacted by the housing crisis.
  • Improving Troop and Family Housing & Expanding Child Care for Military Families:  Invests in building new barracks and dormitories for our service members and in new child development centers on military bases to help military spouses hold down jobs.
  • Increasing VA Claims Processors:  Provides $150 million for an increase in VA claims processing staff, in order to address the large backlog in processing veterans’ claims. 

Extending and Improving Unemployment Benefits

• The rural unemployment rate climbed to 7.6 percent in December – higher than the national average of 7.1 percent.  [Dailyyonder.com, 2/25/09]
• Continues through December 2009 the extended unemployment benefits program (which provides up to 33 weeks of extended benefits), that is otherwise scheduled to begin to phase out at the end of March 2009 – thereby helping an additional 3.5 million jobless workers.
• Increases unemployment benefits for 20 million jobless workers by $25 per week.
• Every dollar in unemployment benefits creates at least $1.63 in economic activity, according to chief economist Mark Zandi of Moody’s Economy.com.

Providing Aid to Seniors, Disabled Veterans, and SSI Recipients

• Payments for Seniors and Veterans:  Provides a one-time payment of $250 to retirees, disabled individuals, and SSI recipients receiving benefits from the Social Security Administration, Railroad Retirement beneficiaries, and disabled veterans receiving benefits from the Department of Veterans Affairs.   Rural communities have a disproportionate number of seniors. 
• Rural communities are significantly older than their urban counterparts.  Across America, 20 percent of rural Americans are older than 59 compared to 15 percent in cities.  More than 8 million rural Americans receive Social Security checks each month – including 5.5 million seniors.

Unprecedented Accountability

An historic level of transparency, oversight and accountability will help guarantee taxpayer dollars are spent wisely and ensure that Americans can see the results of their investment.

• By the Government
  • There are no earmarks or pet projects.
  • In many cases, funds are distributed to existing initiatives with proven track records and with tough accountability measures already in place.
  • How funds are spent, all announcements of contract and grant competitions and awards, and formula grant allocations must be posted on a special website created by the President.  It must also include the names of agency personnel to contact with concerns about infrastructure projects.
  • Public notice of funding must include a description of the investment funded, the purpose, the total cost, and why recovery dollars should be used.  Governors, mayors, or others making funding decisions must personally certify that the investment has been fully vetted and is an appropriate use of taxpayer dollars.  This information will also be placed on the internet.
  • The Council of Economic Advisors must report quarterly on the results for the American economy.
  • A Recovery Act Accountability and Transparency Board will be created to review management of recovery dollars and provide early warning of problems.  The board is made up largely of Inspectors General.
  • The Government Accountability Office and the Inspectors General are provided additional funding and access for special review of recovery funding.
  • State and local whistleblowers who report fraud and abuse are protected.
• Executive Compensation
  • Curbs multi-million dollar pay packages on Wall Street by imposing new limits on executive compensation at financial institutions and other corporations that have received or will receive funds through the Troubled Asset Relief Program (TARP).  
  • Limits bonuses for executives to one-third of their annual pay and prohibits cash bonuses (bonuses must be in the form of restricted stock that could not be cashed out until the TARP money was repaid), for example.  These restrictions will apply to the top 25 executives and highly paid employees at companies receiving more than $500 million from the TARP; the top 15 at companies receiving more than $250 million; and the top five at companies receiving more than $25 million.