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Oregon stimulus waste, fraud and abuse

April 12, 2010

Several reports show continual problems with Oregon and Federal stimulus spending
By Oregon Tax News,

Oregon State officials boast more that the 2009 Legislature’s trumpeted economic stimulus package created or retained 7,500, a feat just shy of the 8,000-plus jobs reported for Oregon under the far bigger federal stimulus program. Yet, Oregon reports spending about $93 million so far compared with $1.3 billion. However, looks can be deceiving. Harry Esteve, of The Oregonian, reported that the average Oregon jobs created by the state stimulus lasted about two weeks and did little or nothing to dent the state’s bleak employment outlook. Unemployment was at 11.9 percent when the stimulus money started flowing in and still remains stuck at 11.5 percent. In addition, the state counted anyone working on a stimulus-related project as a job, regardless of whether the worker was already employed and in no danger of being laid off.

Federal stimulus spending requires more rigorous reporting of job numbers. Regardless of how many people are hired for a particular project, only the hours worked are counted, then translated into yearlong, full-time jobs. Hundreds of workers may have gotten a paycheck from a federal stimulus contract, but they’re not each counted as a separate job.

If that formula were applied to the state stimulus, the number of created and retained jobs would be about 600 — fewer than one-thirteenth of the 7,577 claimed in the most recent Go Oregon progress report, released by the Department of Administrative Services. Of those, 1,862 were new hires, and about a quarter of them weren’t from Oregon because some contractors hired out-of-state crews.

An analysis by The Oregonian shows that a disproportionately high amount of the state stimulus money was spent in Marion and Polk counties. These are two areas of the state favored by Senate President Peter Courtney, D-Salem, who championed the measure. Polk has gotten $3.6 million to date, which translates to about $54 per capita. That compares with $25 per capita spending statewide. Marion got $14.8 million, or about $47 per capita.

The plan was to borrow $172 million, then spend the money on hundreds of long-neglected maintenance projects, from mossy roofs to peeling paint. However, contractors say the program, which will cost Oregon’s general fund more than $300 million over 20 years because of interest rates, has done little to cushion their industry’s free fall.

“It’s been a huge disappointment,” said John Killin, president of Associated Builders and Contractors, whose members are scraping for every bit of work they can find. Since 2007, the number of construction workers in Oregon has fallen from a peak of 114,000 to fewer than 68,000, he said.

Although university and community college campuses got the bulk of the money from the state stimulus, the federal government stepped in with $17 million in specially-designated stimulus money for OSU. Kevin Hampton, of the Democrat-Herald, reported that an unnamed source sent an email Oregon State University Athletic Director Bob De Carolis was considering firing their basketball coach, Craig Robinson, Michelle Obama’s brother. According to the source, when word of this reached Washington, Undersecretary of Education Martha Kanter was dispatched to Corvallis with $17 million in stimulus money for the university. The source now says that Craig Robinson’s job is safe for this year.

Todd Simmons, OSU’s director of news and communications, said the e-mail rumor no doubt took root because Robinson is Barack Obama’s brother-in-law and OSU, like many other universities, did receive federal stimulus money.

Federal

Oregon has saved or created more than 9,600 jobs with money from the federal stimulus, but three out of four are government positions.

Oregon’s House Minority Leader, Bruce Hanna says the stimulus has been a failure. The unemployment rate — which was at 11.9 percent when the stimulus money started flowing in — is now at a stubbornly high 11.5 percent. And most of the decrease can be attributed to fewer Oregonians looking for work.

The work is part of a $135 million remodeling, with most of the money from federal stimulus funds. It is the largest single stimulus project announced so far in Oregon. The U.S. General Services Administration says its goal is to create a “landmark high-performance building architects and federal officials plan one of the world’s most extensive vertical gardens in downtown Portland — what amounts to a series of 250-foot-tall trellises designed to shade the west side of an 18-story office building

House Speaker Dave Hunt, D-Gladstone remains a strong supporter of Go Oregon. The program is meant as a rapidly built “bridge” toward more long-term jobs, such as big transportation projects that take longer to get under way, Hunt said.

  
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