RALEIGH — A massive influx of federal funds to make low-income households more energy efficient has state officials scrambling to make sure the money is spent properly.

During the next three years, $132 million will flow into the state to provide free insulation, sealing, and in some cases new central heating and cooling systems, for about 25,000 homes.

The 30 social-service agencies throughout the state that already handle such work for low-income households are hiring and training extra staff to handle the influx of applications, verify personal income claims and schedule work orders. Companies eager for work are already lining up for employee training required to win contracts. And the state offices responsible for minding the money are adding more inspectors and considering other oversight.

Critics warn that the prospect of distributing that kind of money could result in a major fiasco if monitoring is not stepped up. They point to past abuses of federal aid, welfare, bailouts and other well-intentioned programs with weak oversight.

"Any time you open up a spigot of money like this, the word spreads quickly and you get everyone coming out of the woodwork," said Joseph Coletti, a fiscal policy analyst for the John Locke Foundation in Raleigh. "You have a lot of avenues for people to be wasteful and disappear."

The weatherization work is expected to begin in August, leaving North Carolina officials with just months to prepare. On Thursday, the U.S. Department of Energy awarded $52.8million, nearly half North Carolina's weatherization money in the stimulus package, for state officials to begin using for the program.

In all, $5 billion is designated for weatherization nationwide under the American Recovery and Reinvestment Act, which is expected to triple the number of homes fixed up each year in this state under the program that has been in place three decades.

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