When Earmarks Actually Hurt Localities

If Congressional appropriations go unspent, they can be a double-whammy for states and cities.
by | January 6, 2011

State and local governments urging Congress to earmark money for transportation projects may want to think twice. Those earmarks could actually prove to be quite costly.

Nearly one third of highway dollars earmarked by Congress since 1991 remain unspent and mired by delays and red tape, according to an analysis published by USA TODAY.

That alone is bad news for local governments.

But the unspent money is actually a double-whammy, since the value of an earmark counts against a state's share of federal highway funds, even if it is unspent. In other words, a transportation earmark gone awry actually causes states to lose out on funding.

The earmarks can gain "orphan" status if they arrive too late or provide too little money, or if a project is cancelled or becomes stuck in red tape.

Since 1991, about $13 billion in earmarked highway dollars has gone unspent, according to USA TODAY, and those "orphan earmarks," as they are called, reduced the amount states could receive in federal highway funding by $7.5 billion.

USA TODAY pointed to a 2005 earmark by then-Sen. Barack Obama that allocated $1 million for a highway underpass in Illinois. But by then, the project had already begun, thanks to other funding sources, so the earmark legally couldn't be applied. As a result, that earmark instead wound up shrinking Illinois' share of federal highway funding by an equal amount.

USA TODAY'S report likely offers further ammunition to crusaders against earmarks, including members of the new House GOP leadership who have pledged to ban the practice.

Still, earmarking will likely continue -- at least in the Senate -- where even Republicans have said they don't support an outright ban, according to POLITICO: "While the House GOP leadership's steadfast opposition to earmarks ensures that spending bills won't emerge from the chamber with pet projects, how that issue will be resolved after Senate Democrats engage in the appropriations process remains an open question. (Senate Majority Leader Harry) Reid and other powerful Democrats have maintained that it's their constitutional right to set spending priorities -- and they have shown no willingness to bend to the GOP's demands."

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