WASHINGTON — There's never been a better time to take $3,500 or $4,500 from the government for trading in your gas-guzzler. But come Monday, time's up.

That's when the Obama administration ends the Cash for Clunkers program, to prevent car dealers and shoppers from claiming more than the $3 billion Congress approved.

Transportation Secretary Ray LaHood said the program has been "a lifeline to the automobile industry, jump-starting a major sector of the economy and putting people back to work." He said the department is "working toward an orderly wind-down of this very popular program."

The decision announced yesterday means that the program, which had been expected to generate 250,000 vehicle sales over three months, will have triggered more than 700,000 in about a month. While meeting its goals of destroying gas guzzlers and spurring auto production, the plan's larger effects on the economy and environment will be long debated.

The program has also drawn many complaints from dealers who say the government has been slow to reimburse them for the clunker trade-ins they took from customers. Federal officials claim dealer mistakes are often to blame for the delays. So far, 8 percent of the $1.9 billion in deals submitted have been paid for.

Dealers can appeal those calls after Monday's deadline, but it could take weeks for the backlog to clear. President Obama said dealers "will get their money, but we've got to process it properly."

Some auto dealers in Hawai'i have already begun putting the brakes on the program to ensure they don't enter into deals for which they will not be reimbursed by the government if funding runs out, Dave Rolf, executive director of the Hawaii Automobile Dealers Association, said yesterday.

Local dealers were concerned about a projection report, commissioned by dealers in Washington state, that the program's funds would be exhausted by yesterday or today, he said.

At a HADA board meeting yesterday, the 11 dealers in attendance (mostly the larger operators among Hawai'i's 30) reported a total of 1,100 sales under the clunker program, Rolf said. He added that he won't have a complete number for Hawai'i dealers until the National Highway Transportation Agency issues its final report.

"I don't think anyone expected this success," he said. "The program was fraught with a host of difficulties, which is understandable in doing something this complex in such a short timeframe. But as one Mainland dealer said, there may have been a lot of problems but when someone throws you a life preserver you don't complain about the color."

Reimbursements from the government have been slow in coming, but some Hawai'i dealers report that the first payments are starting to trickle in, Rolf added.

Only about one in five of the Cash for Clunker deals reviewed by federal officials has won approval so far, raising questions about whether dealers have been too lax in enforcing rules or federal officials too strict.

John McEleney, chairman of the National Automobile Dealers Association, said he remained concerned that so few dealers had been reimbursed for clunker deals.

But he said the Monday deadline should give dealers time to get their paperwork in order.

"I think if we can get a clean cutoff Monday and get everything processed by then, it will have been a pretty darned successful program," he said.

PAPERWORK MUDDLE

Monday's 2 p.m. (Hawai'i time) deadline applies only to new deals as the program winds down; the government will continue processing deals already turned in, and dealers will have chances to correct any transaction kicked back by the government. In recent days, the government boosted the number of people processing clunker deals to 1,200.

The Obama administration has struggled to keep the clunker plan under control, pushing a $2 billion extension through Congress this month when the plan burned through its original $1 billion in about a week. Plan backers have said they will not seek any money beyond that, and the White House reiterated that stance yesterday.

"We're confident that with this window, we'll be bringing the program in within the range allocated to it," an official said.

The Department of Transportation said $1.9 billion has been claimed through 457,476 transactions, but estimated that dealers are likely sitting on an additional $400 million in deals yet to be submitted. With the costs of overseeing the program probably close to $100 million, that would leave about $600 million available.

But a White House official said that only $145 million, 8 percent of the $1.9 billion claimed by dealers under the program, has been paid out by the government.

Of the 457,476 deals submitted, the administration said, about 170,000 had been reviewed, with a "large number" rejected for incomplete or inaccurate paperwork. To be reimbursed, dealers have to submit proof that the customer met several requirements, such as having the clunker registered and insured continuously for the past year.


The Detroit Free Press and Associated Press contributed to this report.