Billions of dollars in federal funds remain unused

Government waste isn't always about overspending. A new oversight report reveals that more than $70 billion in federal funds were left unspent years after being appropriated by Congress due to poorly drafted laws, bureaucracy and mismanagement.

Sen. Tom Coburn's (R-Okla.) newly released report “Money for Nothing” highlights how billions of dollars to fund high-priority programs, such as one aimed at helping victims of Hurricane Katrina, were left sitting in expired accounts and never used for their original purpose.

The report found that close to 1 in 3 highway dollars earmarked for highway projects since 1991 had not been spent as of 2011, accounting for about $13 billion. The Emergency Homeowners Loan Program also failed to pay out more than a half of its $1 billion budget -- even as thousands of those eligible for assistance were denied aid. Additionally, more than $100 million in federal aid was never spent in Detroit, Mich., to provide educational assistance to students in underperforming schools.

Nearly one-fourth of the $35 billion the Homeland Security Department awarded to state and local governments over the past nine years for disaster preparedness and recovery has also not been spent, the report stated.

“Much like a procrastinating college student, Congress waits until the last minute to do its work, like passing legislation to extend the authorization of important programs, or does not do its homework, including reading or reviewing bill text, before rushing through far reaching legislation,” Coburn writes in the report. "The result is often shoddy written laws that are difficult to interpret or carry out as intended, sometimes leaving millions or billions of dollars sitting unspent for decades.”

Unclear and narrow eligibility requirements not only resulted in billions of federal dollars being unspent but in some cases Congress extended authority to spend the money indefinitely. Another case showed that some projects received too much money, while others received funds to projects that were either canceled or abandoned.

These “legislative blunders,” Coburn said, had serious consequences, including funds being diverted from other priorities, increased spending and a dip in citizens’ trust in government.

About the Author

Camille Tuutti is a former FCW staff writer who covered federal oversight and the workforce.

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Reader comments

Mon, Jun 11, 2012 larry Virgina Beach

Deobligate would be the word, not Unobligate. In either case, as many readers have pointed out the funds may not have been appropriated in the first place so these may not be unspent dollars. I would rather see this than the waste that goes into spending money in the 4th quarter so the funds are not lost and the budget reduced next year mentality. More "real" dollars are wasted in the 4th quarter than anyone will ever know. As far as appointing another commitee to oversee... there are plenty of Agencies already being paid to do this. First and foremost is the GAO; none of them doing what the tax payers think they are doing. Too much inadequate oversight is why we have too big of a government now. Realign Aquistion, take project dollar out of the PM's hands and make him/her ask for and justify every penny they want to spend and you would have much greater efficiency and awareness.

Fri, Jun 8, 2012

I'm sure Government workers would be more able to spend money if Congress didn't dally as long as they do in approving a budget.

Fri, Jun 8, 2012 Wm

I'm a bit curious about how Mr. Sparkle knows that the funds were actually obligated? Being authorized to spend funds does not actually mean that there will be funds to spend. Only when Congress actually appropriates funds can an agency obligate the government to buy something. Bottom line, saying that something will be done and providing the money are worlds apart.

Fri, Jun 8, 2012 Mr. Sparkle DC

"Unused" funds aren't wasted, they were obligated (an accounting event), but just not spent. That means no disbursement from Treasury, no additional Treasury securities issued, and a slightly lower deficit. As other posters have stated, just de-obligate the funds to keep the books clean and move on.

Fri, Jun 8, 2012

I abhor new committees in government however in this instance it is readily apparent that a research and oversight committee needs to be created. The responsibility of this committee would be to catalog all the unfunded projects and the funds associated with those projects. Determine why the funds were not utilized for the designated purpose, close the project out or fund it. If the project is not to be funded reallocate the funds to other agencies for projects that are critical to national security, health or education.

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