Federal Stimulus Funds Mount in Knoxville

By far the biggest chunk of the Recovery Act money that's coming our way is earmarked for education.

Federal stimulus funds on their way to Knoxville already exceed the city of Knoxville's entire $165 million operating budget, and could go higher.

Since only about $10 million of the stimulus money will go directly to the city, comparing it to the city budget is somewhat of a stretch—all the more so since most of the federal outlays will be spread over two years or more. Still, it's wondrous to behold just how much the big-time spenders in Washington are doing for us and how many different ways they are doing it.

By far the biggest chunk of the money that's coming our way is earmarked for education. UT-Knoxville is due to receive, through the state, about $86 million over two years under a federal mandate to maintain outlays for higher education at their pre-recession 2008 level. Then there's the $31 million that Gov. Phil Bredesen has dedicated to the creation and sustenance of a Tennessee Solar Institute that will be a joint UT/ORNL research enterprise. Knox County Schools are in line to receive $26 million over two years that doesn't even show up in the school system's budget for enhanced special-education programs and extra support for at-risk students.

The rest of the money, under what's known as the American Recovery and Reinvestment Act (ARRA), is spread among a diverse array of programs mostly administered by the city, Knox County, or their joint Community Action Committee (CAC). In many cases, the ARRA funding supplements pre-existing programs, but in some cases on a scale that will be challenging to implement in the time frames that are required. Consider:


Among its many services to the needy, CAC weatherizes houses whose dwellers have incomes of less than 125 percent of the federal poverty line, mainly to cut their utility bills. The process starts with an energy audit that identifies insulation needs, and the work is then performed by a single contractor who has a handful of employees.

Presently 80-100 dwellings are covered in a year, but with a $5 million ARRA grant coming, CAC's Executive Director Barbara Kelly reckons that number could increase tenfold over the 18 months in which the funds must be committed. That begets a need for an augmented audit staff, multiple contracts, and perhaps 100-150 workers. While CAC reports getting a lot of calls from prospective contractors, and there are lots of underemployed construction workers, considerable training is also required. Fortunately, CAC is also getting a $2.5 million Workforce Connections grant that will cover training in collaboration with Pellissippi State as well as some 500 summer jobs for youths.

"It's like putting together the pieces of a jigsaw puzzle in a way that meets funder requirements and the needs of clients," Kelly says.

Neighborhood Stabilization Program

Another $2 billion pot of ARRA money is available nationally to enable cities that have been hard hit by foreclosures to acquire and renovate abandoned or blighted houses for resale or rental. But these NSP grants will be awarded competitively, and applications must be for a minimum of $5 million and cover at least 100 houses. Knoxville may be at a big disadvantage to the hardest-hit states of Arizona, California, Florida, and Nevada in competing for those grants, but the city's undaunted director of community development, Madeline Rogero, is determined to try for one.

Rogero is meeting with a dozen not-for-profit organizations with whom the city has worked in the past on affordable housing development under ongoing programs funded by the federal Department of Housing and Urban Development. But the scale of the NSP plan that must be submitted by a July application deadline transcends any that have gone before. "The challenge is that the regulations and the deadlines are so tight," Rogero says. "Where we normally have a six-month planning process [in applying for HUD grants], we've got to come up with a plan that combines the capacity of all these organizations around the table in about four weeks."

Energy Efficiency and Conservation

The city and Knox County each have a $2 million allocation of ARRA funds for initiatives that would reduce their energy use and cost, and each has just completed an energy efficiency audit that provides a blueprint for doing so. In the city's case, a goal is to cut its $8 million annual utility and fuel costs by 15 to 25 percent. "Low hanging fruit" for doing so include converting traffic signals and some street lights from incandescent bulbs to LEDs that use 90 percent less energy, and both the city and the county are already underway in doing so. Installing more efficient water heaters in public buildings represents another, among many, sources of savings. So do electric vehicles. The city, in partnership with ORNL, is exploring the feasibility of a battery station (potentially solar powered) on the Market Square Garage to charge them.

Other ARRA funding includes: (1) $6.7 million for several road projects; (2) $5.8 million to Knoxville Area Transit for infrastructure at its new downtown transit center, and an upgrade of its Magnolia Avenue facility; (3) $1.6 million in supplemented community block grants for a variety of uses; and (4) $800,000 toward the city's plan for eliminating homelessness. In addition to these fixed amounts, CAC is seeking a $1.2 million competitive grant for quadrupling the enrollment (to 128) of the Early Head Start program it administers for disadvantaged children under the age of 3.

One can debate the efficacy of the $787 billion ARRA program in achieving its stated purpose of economic stimulus. But taking its existence as a given, Knoxville has done a commendable job of pursuing opportunities for worthy initiatives.