By DAVID LIGHTMAN and WILLIAM DOUGLAS
McClatchy Newspapers

WASHINGTON — Energy programs could see money flowing in two to three months. Some highway projects could get funding right away, and some could wait until next year. And key tax breaks will start showing up this summer.

However, there’s no easy way to pinpoint when people will see pieces of the $787 billion economic stimulus plan start to show up in their communities.

The plan, signed into law by President Barack Obama on Tuesday, "lit a fire under the federal agencies," said Robert Reischauer, president of the Urban Institute and a former director of the Congressional Budget Office. But at the same time, state and local governments ultimately spend much of the money, and they need time to figure out who gets what.

In addition, governments at every level need safeguards to make sure that the funds are not wasted or abused. The biggest potential delay is that spenders need time to understand the rules governing the dollars.

The federal Transportation Department, for instance, has already met with state and local officials, and Washington is familiar with key local projects.

"DOT has a team of people who have been primed for this stimulus," said Leslie Wollack, principal legislative counsel for the National League of Cities.

She said, however, that everyone is still studying the legislation. "Some of the language is complicated, and subject to different interpretations," Wollack said.

The fastest payouts are likely to come as tax breaks. Treasury officials hope the "Making Work Pay" credit will reduce wage withholding for most workers by about $13 a week by mid-June. And the extra 20 to 33 weeks of jobless benefits in high-unemployment states should be added quickly.

Spending on contracts takes longer, however. The Congressional Budget Office estimates that about 23 percent of the stimulus will be spent before Sept. 30 and that 74 percent of the total $787 billion will be out a year later.

Officials said several steps are needed before much of the money can spent, including:

Federal scrutiny. Harold Simon, executive director of the National Housing Institute, said the government process could cause $2 billion slated for the Neighborhood Stabilization Program to take up to nine months to reach its targets. The program gives state and local governments funds to buy and redevelop foreclosed properties to stem neighborhood abandonment and blight.

The Energy Department, which has about $39 billion in tax breaks, grants and other programs, is "really looking at months," Energy Secretary Steven Chu said.

Most of the healthcare funding — notably $87 billion to help states pay bills for Medicaid, which provides care to the poor and people with disabilities — is also seen as being spent before that date, according to an analysis by the Committee for a Responsible Federal Budget, a Washington research group.

Local scrutiny. State and municipal officials say it’s important that the money not be spent too rapidly. They want to avoid waste and abuse, and continue to study which projects most need help.

"We have to do a lot of programming work, and whittle [the requests] down a little bit," Pennsylvania Transportation Secretary Allen Biehler said.

Looking ahead. The stimulus is often not a long-term solution to long-festering problems.

"We have to remember this is a sprint, not a marathon," said Beverly Scott, the chairwoman of the American Public Transportation Association. "There have been a lot of years where there wasn’t enough investment in public transit, and we still haven’t caught up" even with the stimulus law’s money.

Adjusting the system. Companies need time to adjust millions of paychecks and tax forms to reflect tax breaks. That’s why the government figures it probably will be June before payroll tax withholding rates are adjusted so people can get the "Making Work Pay" tax credit. The credit reduces most taxpayers’ liability by $400 this year and next.

"There’s a huge sense of urgency; we want to move quickly," Education Secretary Arne Duncan said, "but we also want to move very smartly.

McClatchy Newspapers’ Halimah Abdullah contributed to this report.

Copyright © 2008The McClatchy Company