ECONOMIC STIMULUS:

Cities rush to turn 'green' with $3.2 billion of federal green

Officials in hundreds of cities across the country are scrambling to find ways to spend billions of federal dollars that could make their carbon footprint smaller. Driven by tight deadlines, they need projects that create jobs, promote efficiency and fight global warming. In the process, they are learning that the impending cloudburst of federal cash can be both a "godsend" and a headache.

The looming release of $3.2 billion in new climate-related block grants stands to spark an energy-saving revolution in tiny towns like Wahpeton, N.D. And it promises to thrust emission-belching metropolises into a cleaner trajectory. But the sudden flow of federal funding is raising questions about whether many of these communities are really ready for it.

Some 1,000 cities and counties have direct access to the new entitlement account, the Energy Efficiency and Conservation Block Grant Program. They have until June 25 to submit plans, but that's a challenge, because most haven't received federal grants for energy projects before.

Many communities are having trouble retaining enough police officers, let alone hiring sustainability professionals who understand how to establish energy efficiency programs that will evolve into long-term savings in power and money, experts say.

"Some cities are ready for this, others aren't," said Mark Wolfe, executive director of the Energy Programs Consortium, which helps state energy programs establish efficiency policies.

Tiny towns urged to 'think big'

The program is poised to drop $2.74 billion on the 10 largest cities and counties in every state. Another $456 million will be awarded competitively. Many local officials, it appears, will be plunging into climate policy for the first time. The jolt is magnified by this deadline: The money must be reducing energy output within 18 months.

"Our concern is that there are very few cities in the country that are able to use this money in a rapid fashion. There's a lot of learning," said Mark Sinclair, vice president and chief operating officer of the Clean Energy Group.

Cities like San Francisco and New York can plug the money into existing efficiency programs. But others might struggle. The grants will go to places like Cody, Wyo., with a population of 8,835, and Wahpeton, N.D., population 8,585, which markets itself as "the most industrialized city in North Dakota." Scores of other small and medium-sized cities are automatically eligible for funding.

In Las Cruces, N.M., the city's grant writer, Auguie Henry, is drafting the greenhouse gas reduction strategy that will be submitted with the energy efficiency grant application. He knows about grants, but not so much about climate change. So he has turned to New Mexico State University for help.

Las Cruces expects to receive $888,000. Henry said it will help pay for a solar array and "all the green stuff" on an old adobe bank the city is converting into a natural history museum that will be certified under the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) guidelines. The project will cost about $6 million.

The city is trying to hire a sustainability manager, a move that could make Henry's job easier. "It's part of the city's long-term program to 'go green,' I guess, is the popular term to use," he said.

DOE tries to push grantees beyond more efficient light bulbs

The Department of Energy recently extended the deadline for cities to submit their grant applications. The process is arduous. And city officials attending a recent question-and-answer event with the DOE's point person clamored for technical answers about the federal paperwork. What constitutes a proper energy efficiency program? local officials asked over and over.

Saving energy with new light bulbs and insulation would be a "wasted" opportunity, answered Mark Bailey, DOE's local and state team leader.

"Think big. Think carbon trading markets. Think outside the box," he urged local officials.

That could mean using the federal money to attract private financing for larger projects. Bundling it into loans, for example, could earn revenue through interest. That could mean a program lasts longer and grows bigger.

"Don't use the entire amount of this money to set up a single capital fund that when that fund is done, your program is done," Bailey told local officials. "Because you will have potentially, I think, wasted an opportunity to set in motion a program that could last five, 10, 15, 20 years."

That is the challenge that scores of cities now face. Most don't have the manpower to establish rigorous processes for offering, approving and maintaining loan programs, experts say. Many cities are enacting layoffs amid the worst economic collapse in decades.

Awestruck by the gusher of cash

If municipal leaders believe their state governments can help, think again, said Sinclair of the Clean Energy Group. Many states have expert staffs, but they, too, are shrinking. And they're bustling to make use of other revenue streams pouring into state offices from the massive stimulus measure.

Sinclair and his group are urging DOE to deploy "SWAT teams," derived of energy experts from nonprofits and other groups, across the country to guide municipal leaders toward long-term programs that won't fizzle away federal money on things like efficient light bulbs.

"I think DOE needs to get a little smarter," Sinclair said.

Still, you won't find city officials complaining about extra cash, even if it comes with strings. One consultant working with several Southern California municipalities called the grants a "godsend."

"We've never seen anything like it," noted Andrew Spano, county executive for Westchester County in New York state, home of Playland Amusement Park.

"It's full of light bulbs," Spano said of the park. "One part of our strategy might be to really do all of those light bulbs" with more efficient light-emitting diodes.

One thing is clear: Cities that already have sustainability programs in place will be better positioned to reduce emissions over the long run by plugging in the federal funding.

Texas poker players keep cash for another round

Take El Paso, Texas. The sprawling city is due to receive $5.8 million in energy efficiency grants. It will use $3 million of that to help finance a $15 million "performance contract" program aimed at cutting energy use 30 percent in 52 public buildings.

That's a big chunk of the retrofit program, allowing the city to turn more quickly to its 121 remaining buildings.

El Paso will use the balance of the grant -- $2.8 million -- for a variety of other projects. One of them includes capturing methane -- a greenhouse gas whose contribution to global warming is more intense than that of carbon dioxide -- from a landfill and turning it into CO2.

"It's not the best," admits Marty Howell, the city's sustainability manager.

But that $1 million investment will make the landfill more attractive for a private developer to step in and finish the project, which includes using the carbon dioxide to spin a generator and produce electricity. That is DOE's recipe for success: using public money to attract private money.

Maybe, one day soon, Howell will be able to call Washington to brag about his success, using a cell phone that was charged by the sun. That's because the city also plans to install color-changing solar panels as part of an outside art gallery that both teaches the public about clean energy and powers phones.

Citizens will have access to lock boxes where they can leave their cell phones for a solar-powered charge of electricity. The sudden blast of federal cash, Howell said, "will allow us to do different projects we wouldn't have been able to do it before," he said.