2009 August

Main Street Journal: On the River: Show Me the Money: How the Federal stimulus will affect Shelby County

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The following article is taken from the September 2009 issue of the Main Street Journal. Click “Subscribe Online” above to start your subscription.

Show Me the Money: How the Federal stimulus will affect Shelby County
By: Lance Allen

Shelby County residents, probably like many throughout the Unites States, have been hearing about the American Recovery and Reinvestment Act of 2009 that was signed into law by President Barack Obama in February. Congress passed the bill, estimated to cost about $787 billion over the next several years, in an effort to bring the country out of the current economic recession.

Tennessee is expected to receive about $4.5 billion of that money, according to information from the state, covering a wide range of programs from drinking water to adoption assistance to education grants.

But hearing about a “stimulus” program and its mission and knowing exactly how it will be enacted are two separate things. How can one know where the act’s reach is being felt? There are many areas of everyday life being touched by ARRA, from newly paved roads to additional unemployment benefits to funding that keeps teachers in classrooms. Others make homes more energy efficient, saving on utility bills.

Some programs are meant to hit the limping economy at its foundation in an attempt to get it going again. The real estate market, a sector of the economy that has received much of the blame for the recession thanks in large part to the subprime mortgage debacle, could give a jumpstart to the recovery.

The First-Time Homebuyer Credit gives a 10 percent tax credit of the purchase price of a home – capped at $8,000 – to those people who are buying their first home. First-time homebuyers are defined as anyone who has not owned a principal residence for three years before buying a house. The actual credit comes as part of the year’s tax return. Area Realtors believe this is a good place to start an economic recovery.

“When first-time buyers purchase a home, rather than renting, this creates a ripple effect,” said Amy Chapman, broker and owner of Weichert, Realtors-Chapman & Associates. “This means the sellers of the home the first-time buyers purchased then have the opportunity to turn around and purchase another home, and so on. Buying, often, leads to more buying.”

That program is targeted at jumpstarting the economy by getting renters to invest money into homes.

There are the also some road projects deemed “shovel ready.” The projects range from basic road resurfacings to highway interchanges. The total ARRA funding for the Tennessee Department of Transportation is $572 million. Of that, $69.9 million is earmarked for the four major Metropolitan Planning Organizations – Memphis, Knoxville, Nashville and Chattanooga.

There are 11 Shelby County projects in TDOT’s three-year plan that is a part of the current Tennessee budget, but because they had to be ready for construction, only one is receiving ARRA funding. It’s a 2.7-mile resurfacing of U.S. Highway 64 from Isabelle Street to White Station Road. Fayette County also has one – the replacement of a bridge on Feathers Chapel Road over Treadville Creek. In Tipton County, however, there are six projects ready for work.

The other state road projects on the three-year plan include construction of a new interchange at Interstate 40 and Canada Road, the construction of eastbound I-40 lanes over Sam Cooper Boulevard and stage construction of Tennessee Highway 385.

In late March, the Memphis Metropolitan Planning Organization Transportation Policy Board approved project selections for federal economic stimulus funds. (For a full list of the projects, go to the Memphis-Shelby County Department of Regional Services Web site at www.dpdgov.com.)
There are other ARRA programs that, depending on the situation, will have an even bigger impact on some individuals and families, from increased unemployment benefits and COBRA insurance, to transit funding and education programs.

In mid-June, for example, the National Science Foundation awarded a $1.5 million Robert Noyce Teaching Fellowship grant to the University of Memphis to recruit, train and support secondary education math and science teachers at Memphis City Schools.

The program will recruit professionals with a bachelor’s degree in math or science. Twenty fellows will have their tuition paid to complete the 30-hour master of arts in teaching degree with licensure in secondary education. MCS will fund a part-time residency program to provide mentoring and classroom experience.

Fellows also will receive a salary supplement of $10,000 for each of the first four years of their full-time teaching assignment.

In April, it was announced that nearly $92 million in emergency education funding was released for MCS to help save jobs and maintain programs for low-income students and students with disabilities. U.S. Rep. Steve Cohen, D-Memphis, said MCS would receive $59.5 million in Title I funds and $32.3 million in funding for disabled students (IDEA).

In early June, the Federal Transit Administration awarded Memphis Area Transit Authority more than $17.7 million for the purchase of 35 state-of-the-art busses and technology to improve rider safety and the efficiency of the system. Those improvements include real-time electronic bus arrival time displays, automatic voice annunciation system for the announcement of stops and ticket vending machines for trolleys, among others.

In March, the U.S. Department of Energy made a $6.8 million grant to the city of Memphis and $421,800 to Shelby County to support energy audits and energy efficiency retrofits in residential and commercial buildings.

Also in March, Shelby County was the recipient of $6.1 million in funding allocated through the Edward Byrne Justice Assistance Grant Program. The city of Memphis received $5.7 million with Bartlett, Collierville, Germantown, Millington and Shelby County also receiving funds based on proportion to population and violent crime statistics.

The grants are earmarked for programs such as prevention and education; corrections and community corrections; drug treatment and enforcement; prosecution and court; and crime victim and witness programs.

The local impact won’t just be felt by those ARRA funds funneled through local and state government agencies. Individuals will be able to reap benefits through tax incentives, including:

*A money-back program for new vehicle purchases

*An increase in unemployment benefits

*A one-time payment of $250 to Social Security recipients

*An increase in the energy tax credit for homeowners who make energy efficient improvements to their existing homes.

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