Va. awash in stimulus money to weatherize homes

Ready or not, states are getting a huge boost in federal money to weatherize drafty homes, an increase so huge it has raised fears of waste and fraud and set off a scramble to find workers and houses for them to repair.

Virginia's cut is going up 23½ times, from $4 million annually to $94.1 million.

"I was stunned," said Shea Hollifield, Virginia's deputy director of housing. "Spending that much money will be a challenge."

An obscure program that installs insulation in homes and makes them more energy-efficient is distributing $4.7 billion in stimulus funds -- dwarfing the $447 million originally planned by Congress this year and the $227 million spent in 2008.

That is enough to weatherize 1 million homes, instead of the 140,000 normally done each year.

President Barack Obama said pouring money into the program would lower utility bills for cash-strapped families, provide jobs for construction workers idled by the housing slump, and make the nation more energy-efficient.

"You're getting a three-fer," Obama said. "That's exactly the kind of program we should be funding."

The Virginia Department of Housing and Community Development is allocating its weatherization funding regionally to 22 nonprofit organizations across the state, which have until March 2012 to spend the money.

On July 29, Gov. Timothy M. Kaine and members of his Cabinet are planning to pitch in on a home weatherization project in King George County in coordination with the Rappahannock Area Agency on Aging. The event is meant to highlight the increased funding for the state's Weatherization Assistance program.

Kaine will work alongside a crew from Community Housing Partners, a contractor that has doubled its staff and projects over the past eight months to meet increased demand sparked by the newly available funding, according to the governor's office.

But some worry states won't be able to keep track of the money.

Leslie Paige, spokeswoman for the Council for Citizens Against Government Waste, said the program is open to fraud because of the way oversight is divided. The federal government passes the money to states, then states pass it to community action agencies, and the agencies pass it to contractors who work with customers.

"It's such a Rube Goldberg operation it should be setting off alarm bells," she said.

Energy Department spokeswoman Christina Kielich defended the program, saying the federal government monitors state operations and does a thorough review at least every two years of the local organizations. In addition, states are getting their money in increments and must demonstrate quality control to get more.

The program helps low-income families take steps to reduce their home energy expenses, from caulking leaky windows to replacing heating and cooling systems. The Energy Department says 6.2 million households have benefited since it began in 1976, saving the average household about $350 a year on energy bills.

In addition to receiving an infusion of stimulus money, the program was expanded to cover families making up to twice the federal poverty level, or $44,100 for a family of four. Also, the average amount that can be spent per house was more than doubled to $6,500.

The funding for New York is going up from $20.1 million last year to $395 million. California's share is soaring from $6.3 million to $185.8 million. In Texas, the state's share is increasing nearly 60 times, from $5.6 million to $327 million. To spend the money efficiently and on time, state officials decided to go beyond the community organizations that normally distribute it and route $100 million to large cities.

"They have experience in administering large, complicated programs," said Gordon Anderson, spokesman for the Texas Department of Housing and Community Affairs.

Staff writer Olympia Meola contributed to this report.