Less than one week into the new Obama Administration, the proposed economic stimulus bill, the “American Recovery and Reinvestment Act of 2009” (ARRA), has gained political momentum. This morning, the House approved, by a 240 - 174 vote (with all but 5 Democrats voting in favor), H. Res. 92 , a structured rule adopted by the House Rules Committee for floor consideration of H.R. 1 and various amendments to be considered. The House is expected to begin debate on H.R. 1 later today. The process in the Senate is ongoing, and it is expected that the Senate version of the bill will include key differences that will, if approved by the Senate, require resolution in conference.

Yesterday, the Senate Appropriations Committee approved its portion of the ARRA by a 21-9 vote. Committee Chairman Daniel K. Inouye (D-Hawaii) urged for bipartisanship in solving the economic crisis. He stated that “[t]he guiding principle behind this legislation is to use the resources of the Federal government as one of the means to reinvigorate the economic engine that is the United States economy.” Some highlights of the proposed legislation include the allocation of resources in the following areas:

  • $142 billion invested in infrastructure (including improvements related to mass transit, aviation, railroads), public housing, environmental clean-up and science;
  • $125 billion invested in education which includes a commitment to providing various incentive grants to states that meet “key education performance measures”;
  • $49 billion invested in “the development of clean, efficient, American energy, including modernizing energy transmission, research and development of renewable energy technologies, and modernizing and upgrading government buildings and vehicles”;
  • $25 billion invested in providing immediate and critical social services;
  • $16 billion dedicated to “provid[ing] investments in areas critical to immediate and long-term healthcare for millions of Americans” as related to research, treatment and prevention; and
  • $110 million earmarked for GAO and Agency Inspectors General “in order to provide appropriate oversight of spending contained” within the bill, additional allocations of $730 million to stimulate liquidity in small businesses, and $3.95 billion to support law enforcements.”

The Senate Finance Committee also met yesterday during an open executive session to consider its version of ARRA. Ranking Member Chuck Grassley (R-Iowa) in his opening statement questioned whether some of the provisions included in the proposed bill would effectively stimulate the economy or add to the present deficit. Chairman Max Baucus (D-Mont.) in his remarks stated that the adoption of the economic recovery bill was essential to America’s recovery and noted that several key provisions in the bill “represent the best ways to address spending slowdowns and rising unemployment.”

Among the many key differences that exist between the two congressional bills as proposed, one notable difference relates to the treatment of renewable energy tax cuts. While both bills include provisions to use renewal energy tax measures to stimulate the economy and commit federal resources to improving energy related infrastructure, the bills differ significantly with “regard to the refundability of tax credits that incentivize the development of wind, solar, biomass and other renewable energy power plants within the United States.”