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Summary

On September 4, 2013, we issued a report on the Federal Highway Administration’s (FHWA) monitoring of unexpended American Recovery and Reinvestment Act of 2009 (ARRA) funds. Our report examined the status of unexpended ARRA highway project funds and States’ ability to use them to the fullest extent before the spending period expires. We conducted the review as part of our ARRA oversight work. We found that FHWA has taken adequate actions to monitor remaining obligated unexpended ARRA funds.  We also estimated that $356 million in ARRA funds could remain unused when ARRA concludes after September 30, 2015. Factors outside of FHWA’s control, such as Federal restrictions on the use of funds, impact the amount of funds that may remain unused. Another contributing factor is FHWA’s nationwide $25 million fiscal year limitation on obligating recovered funds, which prevents States from using their funds when qualified cost increases exceed this limitation. We made two recommendations advising that (1) FHWA revise its policy regarding the treatment of recovered ARRA funds and (2) implement a process to obtain more complete data and more accurately determine how much recovered funding States need in excess of the authority provided to obligate them. FHWA partially concurred with one recommendation and proposed  an alternative action to explore the implications of providing upward adjustments in excess of $25 million per fiscal year. We are requesting  additional information to fully assess FHWA’s proposed action. FHWA concurred with our other recommendation, and we will close it when the planned actions are complete.