In legislation of unprecedented scope and significance, President Obama signed into law the American Recovery and Reinvestment Act (ARRA) of 2009, calling for nearly $787 billion in direct stimulus spending. In New York State alone, about $25 billion is expected to be allocated to fund projects that range from improvements to highways, bridges and tunnels, to investments in schools, health care, and renewable energy. The spending has already begun to flow into New York to fund “shovel-ready” projects designed to improve infrastructure and provide an economic catalyst.

Challenges Facing Stimulus Recipients in New York State

While not yet fully defined, the “strings” attached to the funding – in the form of project compliance and financial reporting – may impose an added burden on state and local governmental entities accepting the funds. The penalties for non-compliance could be severe, and may include forfeiture of future funds and even callback provisions with fines. All recipients of stimulus funding, including municipalities and regional authorities could be subject to these penalties. This will add another layer of complexity to an already challenging application and qualification process.

Assistance is Now Available

The firms of Whiteman Osterman & Hanna LLP, UHY LLP and Thacher Associates, LLC are working together to educate state agencies, public authorities and municipalities throughout New York State about funding-related compliance, including:

• Vendor compliance: Ensuring a competitive, transparent procurement process where the best qualified vendors are selected;
• Auditing and financial reporting: Meeting anticipated needs for quarterly reporting, periodic auditing and other assurance-related services;
• Independent monitoring: Providing third-party monitoring and certification of compliance to executives or oversight boards; and
• Inquiry response: Providing strategic advisory services to funding recipients who become subject to public inquiry or investigation, including, but not limited to, inspector general or attorney general investigations.

Keeping up with Stimulus-Related Developments

Here are some useful resources to keep up with the latest stimulus-related news:

• www.recovery.gov
• www.recovery.gov/?q=content/accountability-and-transparency
• http://www.treasury.gov/recovery/index.shtml
• http://www.economicrecovery.ny.gov/

Click for more information about ARRA.

If you have received, or expect to receive, stimulus or other sources of significant federal or state funding, and want to simplify your compliance obligations, contact us to schedule a free consultation:

• Whiteman Osterman & Hanna LLP: A 70+ attorney law firm based in Albany, New York, with extensive experience representing municipalities and government agencies in a wide variety of compliance-related matters. Contact: Scott Fein, Partner, at (518) 487-7729 or sfein@woh.com.
• UHY LLP: A national independent CPA firm with offices in Albany, New York City and Rye Brook, as well as throughout the country, providing a full suite of accounting services, including forensic accounting and auditing to state and local government. Contact: Dick Kotlow, Partner, at (518) 449-3166 or rkotlow@uhy-us.com or Michael Mahoney, Partner, at (212) 381-4700 or mmahoney@uhy-us.com.
• Thacher Associates, LLC: An integrity risk management company providing investigatory and compliance assurance services. Contact: Thomas "Toby" Thacher, President/CEO, at (212) 845-7525 toby@thacherassociates.com.