Government investigators are auditing some of President Barack Obama’s more than $7 billion in renewable energy grants to determine whether the money was awarded properly and the recipients were eligible.
The grants were authorized in the American Recovery and Reinvestment Act of 2009, which directed the Treasury to provide funding to qualified projects. There is no cap on the amount that can be awarded. Obama signed the measure into law on February 17, 2009.
Six months after Obama signed the stimulus measure, the inspector general said managers at the Treasury Department had failed to explain what staffing would be needed to evaluate “the potentially thousands of applications of varying complexity for awards under this program,” according to an Aug. 5, 2009, report.
The Treasury Department responded that “the current team of four is adequate,” according to the inspector general’s report.
The incentives began under President George W. Bush as a tax credit companies could use to offset profit by investing in renewable energy projects.
Concerned that the 2008 financial crisis “dried up” company profits and opportunities to use the tax credit, the Obama administration engineered its transition into a grant, said Paul Dickerson, head of Haynes & Boone LLP’s clean- technology group in Houston and former chief operating officer of the Energy Department’s office of energy efficiency and renewable energy.
The grant program is worth continuing even if some developers try to cheat, Dickerson said. Grant applicants for projects of more than $1 million must submit an independent accountant’s certification of costs, he said.
“It’s like people who cheat on their taxes,” Dickerson said in an interview. “If someone is inflating their projects’ costs or somehow getting an independent accountant to falsely attest to the accuracy of those costs, well then we just get to send them to prison.”