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Stimulus Watch: More Stimulus Funds Mismanaged, Wasted

- March 8, 2011

WASHINGTON, D.C. OFFICIALS CANNOT ACCOUNT FOR JOB CREATION FROM STIMULUS FUNDS

Washington, D.C., “Spent Hundreds Of Millions Of [Stimulus] Dollars Without Being Able To Demonstrate Any Significant Improvement In The City’s Jobs Outlook.” “Despite receiving more than $885 million in federal economic stimulus funds since 2009, the D.C. government — whose residents face one of the highest unemployment rates in the nation — cannot say how many jobs it actually created for those who live in the District. Most of the money has been spent, and data suggest that overall regional job growth did occur as a result of the massive infusion of capital. But a review by The Washington Times of figures provided by D.C. officials shows that the city spent hundreds of millions of dollars without being able to demonstrate any significant improvement in the city’s jobs outlook.” (Jeffrey Anderson, “D.C. Has No Count Of Jobs From Stimulus,” The Washington Times, 3/7/12)

“Officials Concede That The Figure Is Derived From A Formula Based On Expenditures And Does Not Represent Actual Full-Time Employees Who Are D.C. Residents.” “The city administrator’s office said the District reported to the federal government that it created 12,709 jobs as of the end of the most recent reporting period, but officials concede that the figure is derived from a formula based on expenditures and does not represent actual full-time employees who are D.C. residents.” (Jeffrey Anderson, “D.C. Has No Count Of Jobs From Stimulus,” The Washington Times, 3/7/12)

IN DETROIT, STIMULUS FUNDS FAIL TO HELP JOB SEEKERS

In Detroit, Stimulus Funds Meant To Provide Clothing For 400 Only Helped Two. “Part of an $11 million grant intended to provide business attire to 400 low-income job-seekers instead helped only two people, an audit of the city's Department of Human Services has found. The audit, conducted by the city's auditor general for the period from July 2009 to September 2011, found the department failed to control the operations and finances of a boutique that was to provide the clothes. The department did not safeguard grant funds or create an inventory for the clothing, the audit found.” (Darren A. Nichols, “Audit: Part of $11M grant for Detroit job seekers only aided 2,” The Detroit News, 3/7/12)

Just The Latest In A Long Line Of “Chronic Mismanagement Of Federal Funds.” “The audit is the latest finding against the city's Department of Human Services, which has been under scrutiny for chronic mismanagement of federal funds. Many of the department's leaders have departed since an internal investigation was launched last year, including an inquiry into the purchase of $182,000 worth of high-end furniture for a department office. In 2009, the department received more than $11 million in stimulus funding and created a service center.” (Darren A. Nichols, “Audit: Part of $11M grant for Detroit job seekers only aided 2,” The Detroit News, 3/7/12)

IN OREGON, “LOOPHOLE” CREATES JOBS … FOR FOREIGN WORKERS

$7 Million In Federal Stimulus Funds Spent On Central Oregon Forest Clean-Up That Led To The Hiring Of 254 Foreign Workers And No American Workers. “At least $7 million in federal stimulus money intended to provide jobs to unemployed Oregonians instead paid wages to 254 foreign workers, federal investigators have concluded. The money was for forest clean-up jobs in central Oregon where thousands of experienced workers were idle. … ‘Employers were not required to recruit U.S. workers in Oregon, and we were provided no evidence that they did,’ federal investigators said. ‘Workers in Oregon were likely unaware that these job opportunities were available.’ In fact, although 146 U.S. workers were contacted for possible employment, investigators found that none was hired.” (Charles Pope, “Federal Stimulus Money For Oregon Jobs Hired Foreign Workers,” The Oregonian, 10/20/11)

Local TV Coverage Shows Even Democrats Are Criticizing The Stimulus

Anchor: “A loophole that allowed foreign workers to take Oregon logging jobs may soon close. Last year more than 250 foreign workers were hired using federal stimulus money even though thousands of Oregon loggers didn't have jobs. Forest companies exploited a loophole in a foreign worker visa program. But Representative Peter Defazio and Senator Jeff Merkley introduced a bill today to stop what they consider ‘abuse of the system.”

Sen. Jeff Merkley: “And all of this was about creating jobs for Americans and as it turned out this money was spent in Oregon and not a single Oregonian was hired.” (KVAL-CBS, 3/7/12)

IN GEORGIA, $7.7 MILLION SPENT ON UNNECESSARY SEVERANCE PAY WITH “NO DIRECT BENEFIT”

At The Savannah River Site In Georgia, A Contractor Paid $7.7 Million In Unnecessary Severance Pay To Stimulus-Funded Workers. “Savannah River Nuclear Solutions paid out $7.7 million in unnecessary separation payments to stimulus-funded workers at Savannah River Site, according to a new audit report by the U.S. Energy Department’s Inspector General.” (Rob Pavey, “Audit Finds $7.7 Million Overpaid To 526 SRS Workers,” The Augusta Chronicle, 2/27/12)

“No Direct Benefit” From $7.7 Million Payout. “Rather than provide workers with a required 60-day notice of separation – as contactors at Hanford properly did – SRNS opted instead to pay 526 workers an additional 60 days pay above and beyond the usual severance compensation the report said. ‘This decision resulted in payments for which the Department received no direct benefit.’ The sum computes to a per-employee average of $14,638.” (Rob Pavey, “Audit Finds $7.7 Million Overpaid To 526 SRS Workers,” The Augusta Chronicle, 2/27/12)

DOE Approved The Payments – And Will Not Demand Repayment. “Jim Giusti, an Energy Department spokesman at SRS, said Savannah River Nuclear Solutions will not be asked to repay the funds. ‘DOE headquarters approved the plan, so they basically did what we told them to do,’ he said. ‘The Inspector General has come back and said there is a better way of doing this.’” (Rob Pavey, “Audit Finds $7.7 Million Overpaid To 526 SRS Workers,” The Augusta Chronicle, 2/27/12)


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