Construction’s Windfall from the American Recovery and Reinvestment Act of 2009

The American Recovery and Reinvestment Act (ARRA) of 2009 has left a complicated wave of contention in its wake. For every source you find claiming the ARRA (stimulus) failed, you can find another concluding the opposite. The numbers and sources used in the back-and-forth argument simply get changed and adjusted to fit the outcome desired. But, what isn’t in contention is the fact that many businesses across the nation shared in a windfall of work––and construction was one of the biggest beneficiaries.

With the bulk of the ARRA funds now expended, there’s a record of companies and projects that received money from the stimulus. In particular, businesses in many sectors of construction benefited from the act. Take for example, construction companies that work on projects like those needed by the National Park Service.

National Park Bonanza

From the more than $35 million spent for the Crow Creek Tribal School in Stephan, South Dakota, to the $3.5 million stabilization of the historic Nuttall Mine Structures at the New River Gorge National River in West Virginia, the work for the National Park Service included nearly every kind of construction project. The Lincoln Memorial got a new reflecting pool, Ellis Island got its seawall stabilized, the Blue Ridge Pkwy. got its stone guard wall rebuilt, and the wastewater treatment facility was replaced at Denali National Park and Preserve.

More than $8 billion worth of public transportation projects updated and improved the nation’s ability to move a growing number of passengers.

All told, there were 89 projects with price tags exceeding $1 million. There were 186 projects costing between $100,000 and $1 million, 220 projects with budgets between $10,000 and $100,000, and more than 60 contracts for services that ranged from hundreds of dollars to $9,999. And, those are just the projects from 2009, the inaugural year of the stimulus. The number of projects at least doubled in 2010.

Money for People-Moving Projects

The transportation sector was another one where stimulus money created many projects. More than $8 billion worth of public transportation projects updated and improved the nation’s ability to move a growing number of passengers. From the $393 million dedicated to New York City rail projects, to the $26,000 passenger shelter project for passengers of the Northern Arizona Intergovernmental Public Transportation Authority, the projects included everything from routine maintenance to complete structures.

Of the more than 1,070 transportation contracts under the stimulus package, 34 exceeded $50 million, 128 had budgets between $10 million and $49 million, 570 were between $1 and $9 million, and there were 295 with contract amounts in the hundreds of thousands. 

All 50 states took some of the pie, with large states like California, New York, and Texas claiming the most in both volume and dollars. The stimulus in transportation extended to many industries, not just construction. From purchases of vehicles to facility security systems, a vast number of companies found something to contribute.

Powering the Grid

The nation’s power grid received $4.5 billion from the ARRA to stabilize and modernize electricity distribution across the country. Major efforts in modernizing the power grid include constructing Smart Grid Demonstration programs, all of which require some aspect of construction. 

The SGDPs “demonstrate how a suite of existing and emerging smart grid technologies can be innovatively applied and integrated to prove technical, operational, and business-model feasibility. The aim is to demonstrate new and more cost-effective smart grid technologies, tools, techniques, and system configurations that significantly improve upon those commonly used today.” The stimulus funded 32 SGDP projects at a cost of $1.6 billion.

Projects funded included the Beacon Power Project, a flywheel energy storage system made up of 200 flywheels that can “source or sink 20 MW for 15 minutes.”  The flywheels, each weighing a ton, are installed below grade, and spin at 16,000 RPM. In another example at Turlock, California, a company built a solar plant with a flow battery system to demonstrate “energy time shifting,” or storing energy during low price times and discharging it at high price times. 

The ARRA also stimulated many small homeowner energy projects. Those included energy upgrades to more than 800,000 homes, with another million homes getting weatherized between 2009 and 2012. That, along with $27 billion in clean energy generation and distribution investment, and funding for a 30 times increase in solar electricity generation, provided many more construction opportunities.

Improving Government Investments

Government buildings and infrastructure accounted for another major source of construction project work. 

• The Federal Center South, near Seattle, was modernized with sustainability features like 100% filtered outside air, rainwater for non-potable use, and 40% energy savings in the first year.

• The Denver Federal Center added photovoltaics to cut electricity costs by $700,000 per year.

• The Jackman Land Port of Entry in Maine added two wind turbines to supply half its energy requirements.

• The Federal Office Building at United Nations Plaza got a full renovation and modernization. Work included a seismic upgrade, more efficient systems, a roof garden, and improved office spaces.

The debate about whether the ARRA benefitted the nation will no doubt go on for many years, but according to the public record, there’s ample evidence it benefited the construction industry.