CLIENT ALERT: Contracting Provisions of the House American Recovery and Reinvestment Act

    16 January 2009

    The House released its version of the American Recovery and Reinvestment Act on January 15, 2009. The House Bill proposes $275 billion in tax cuts and $550 billion in “priority” investments.
    The Bill calls for fast action—monies appropriated for discretionary grants must be allocated within 90 days of the final legislation’s enactment, and grantees are required to use 50 percent of the funds within one year and 100 percent within two years. 

    In a further effort to expedite the programs and projects outlined in the proposed legislation, the House Bill permits the use of existing government contracts to perform the work.  To the extent new contracts are awarded, agencies must utilize, “to the maximum extent possible,” fixed-price, competitively awarded contracts.  Any sole source awards cannot exceed one year.

    The programs funded by the proposed House Bill are varied and the dollar amounts are massive.  For example:

    • The Department of Defense is slated to receive $4.5 billion for facility sustainment, renovation, and modernization, including items tied to energy efficiency, medical treatment facilities, barracks renovation, and facilities sustainment.
    • The Army Corps of Engineers will receive $4.5 billion to accelerate the completion of ongoing capital improvement projects (such as flood control or navigation infrastructure) or initiate new elements of existing projects that can be completed within one year.
    • The Department of Energy will receive $2 billion for the research, development, demonstration, and deployment of renewable energy and energy efficiency.
    • One billion dollars are provided for grants to fund facilities for advanced battery manufacturing.
    • $7.7 billion is allocated for the construction, repair, and operation of existing Federal buildings, with the majority of the funding aimed at energy efficiency and conservation.
    • Six billion dollars will go the Clean Water State Revolving Fund (which provides grants to fund publicly-owned wastewater treatment plants), $2 billion is provided for the Drinking Water State Revolving Fund, and $100 million is provided for Brownfields competitive grants.
    • $14 billion is to go to the states for school modernization, renovation, and repair.

    This list provides but a few examples of the new opportunities envisioned by the legislation and the scale of the funds being provided for projects such as construction, research, and environmental protection.

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