Recovery and Reinvestment Act: Is it stimulating Tennessee? - Memphis Business Journal:

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“We’re not sure that we can measure the effects yet in employmengt or in any otherdirect effects,” says John former Tennessee comptroller and now deputy to Gov. Phil Bredesem and the ARRA point man for the But Morgan quickly points tothe state’w education system as a prime stimulusa target, where yet untold numbers of teachinh positions are expected to be saved through ARRA funds. He also pointse to businesses like that brought backseverall laid-off workers when the company won ARRA-supported bridgwe construction contracts. Morgan callsx education system funding an exampleof “Tennessee dollars.
” Those are more flexible ARRA dollaras given directly to the state to fund federak programs at a higher level. These funds free up statd budget dollars to save or enhancde programs at risk of heavy cuts from reduced tax revenues and the budger shortfallsthey create. TennCare is another example. The federal government used topay 63% of every dollaer spent on the Medicaid program in the Now, with ARRA funds, it pays 74% of each Over two years, this increase will free up $1.1 billiobn in state funds to spend elsewhere. Every “Tennessee from the ARRA this year has been proposedin Bredesen’s which can be fully reviewed at and is now in the hands of the .
When the budgey is approved next week, thosd ARRA dollars will be dispersed to different agenciezand municipalities. There is no timetable on when all of the ARRA fundws willbe received. Morgan calls the other ARRA fundse “Congressional dollars.” These fundsw come with mandated spending parameters straight from Much of this money goes straight to municipalitiezs to help pay for infrastructure projects and community For example, Shelby County cities will collectivelu get $6.1 million for public safety.
Thos e “Congressional funds” will funnel through the existing federal Edwardf Byrne Justice Assistance Grant Progra to keep cops on the payroll and keep the crimina l justice systemmoving along. This is basicallyg a job retainer, not necessariluy a creator, but one that will “simultaneouslyt help jump-start the American economy and protectour citizens,” President Baracok Obama said when the fundx were released in March. Ford Constructiobn officials pointed to workers they rehirecd earlier this year when the business won ARRAbridge contracts, Morganj says.
Congress outlined which projects would get ARRA fundx and companies that won bids have been able to show stimulusd fundsworking directly. An obvious strategy for any businesse looking to get is to get close to ARRAgovernment projects, whichh can all be found at recovery.gov or A business can either apply for a projec t directly or work with a company with a winning bid. Other areas targeted by the stimuluxs plan are receiving mixed reviews on thestimulation , agent Melissa Hayes says the stimulus packaged has “definitely” stimulated the Memphiss residential real estate market.
Signs for on-the-market homes she is sellingv now contain an extrza message that toutsthe $8,00 0 tax credit first-time home buyers can get thanks to the ARRA. “Everythingh in the $150,000 price range has been selling the best right Hayes says, noting she garneredf four contracts in the last weekend. “I thinok there is still apprehension in the People having stability issues with their jobs is themain thing.” Betweenh a slight interest rate uptick last week and the tax “people are really jumpinh on it,” she says. Kevin Yoon tells a differentr story. When asked if the ARRA is stimulatingg the homebuilding market, the LLC manager says flatl y “no.
” His company has sold 26 homesa so far this year, all in the $180,000-$600,000 priced range. While “one or two” of those were purchaser with taxcredit help, Serenity’s homex aren’t necessarily in the price range of first-time “We’ve been blessed this year and have triedd several things (to increase sales),” Yoon says. “Nott one of them is the single answer inthis economy, but not one of them is a governmentf program.
” Whether or not ARRA funding is stimulatinf the Memphis economy remainss a question yet to be But one part of the economicf stimulus plan is certain: Like the residentiapl tax credit, ARRA funds are for a limited time When the dust settles in December nearly $5 billion in stimulus funds will have been pumped into Tennessee. That makes state Rep. Curry R-Collierville, fearful about the state’s fiscal 2011 “What are we going to do aftert the stimulus money is gone and a new governor is saddled with hugebudget deficits?
” Todd “So far, we haven’t seen the monied kick in yet and I don’r know when they will; no one can predict I think it will help, but we’re not very optimisticc on what’s going to happen next year.” Morganj is a bit more “What we hope happens when the money runs out is the economgy is in a strong recovery positiom and we don’t miss a he says. “If that doesn’t happen, then we won’tr be able to do some of the thingss we’re able to do now going forward.
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