The Five Stimuluses…Stimuli?

So, the $787 billion American Recovery and Reinvestment Act is a big, confusing tome of federal funds. I’ve been joking with people that the most jobs created from this bill will be lawyers and consultants who will charge to help people understand how to get access to the money.

But, the downside of all of those opportunities is that people tend to not really understand how it all breaks down, and they assume that it is available to them to solve all of their problems. It’s actually a lot more restrictive and targeted than all that. I like to say that there are actually five stimulus sources:

  1. Tax breaks, like the middle class tax cut that’s reducing most of our payroll taxes
  2. Direct formula funds that go to state & local governments and organizations like school districts…mostly just to compensate for cuts that are being made due to falling sales and property tax revenues at the local level
  3. Competitive grants, available from most federal agencies and departments, with eligibility varying based on how the rules and regulations are set (many of them aren’t yet out)
  4. Competitive regrants, like money that goes to states for distribution to their local jurisdictions through whatever process and criteria the state sets (i.e. – the State Energy Program or potentially some of the broadband funds)
  5. Federal contracts: if you provide a good or service that the government needs to implement stimulus (i.e. – a road construction company or even contract management), you’re in good shape

As we build our regional economic recovery strategy, we need to make sure we’re leveraging all five sources of funds to be successful.


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