How does Cash for Caulkers work? How will the program be funded? How is this incentive money supposed to stimulate the economy?

Cash for Caulkers, officially titled Homestar, will be modeled after the Cash for Clunkers plan that paid vehicle owners to trade in low-mileage vehicles and buy more efficient vehicles. The plan's authors hope to jumpstart a badly hurting segment of the economy, construction and home improvement, while stimulating sales at home improvement stores. Here are the details that are being considered as part of the 2010 program:

How Much Will Homestar Cost?
The plan has a current budget of $23 billion, to be parceled out over a two-year period of time.

Where Will That Money Go?
Six billion dollars would be paid to people who completed at least two approved weatherization programs on their homes. Twelve billion dollars would be paid to people who completed home weatherization projects that qualified as major projects, meaning they reduced energy consumption by at least 20%. Two billion dollars would go to auditing of the projects funded. Three billion dollars would be paid to home improvement retailers to provide assistance to people who are trying to complete these projects.

Where Will the Funding Come From?
The funding for the Cash for Caulkers program will come from the unused portion of money granted through the stimulus package passed in 2009.

How Much Money Is Available Per Household?
The amount of money available for homeowners will depend on the costs of the projects undertaken. Homestar is planning on putting out a list of acceptable weatherization projects eligible for the incentive checks. As the proposal currently stands, any homeowner who completed two of the projects listed would be eligible for up to $2,000 in stimulus money, and any home owner who completed four of the listed projects would be eligible for up to $3,500. Any homeowner who undertook significant projects that reduced home energy consumption by at least 20% would be eligible for up to $4,000.

What Are the Limitations on Cash Incentives?
The projects undertaken would have to meet government requirements posted and have prove energy efficiency benefits. The government will not pay for more than 50% of the total cost of any given project, leaving at least half of the cost to be paid by the homeowner.

How Will These Incentives Stimulate the Economy?
Government officials hope the Cash for Caulkers program will create jobs, put money into homeowners' pockets, increase sales in retail stores and save homeowners money in energy costs. These energy savings should homeowners more money to spend on other things. All these factors combined should work to stimulate the economy.

How Can I Learn More About Cash for Caulkers?
You’ll have to keep your eye out for information about this program. Homestar is part of a jobs program for 2010 that is currently under consideration.