L.A. Stimulus: Helpful or Wasteful?


A new report from L.A. City Controller Wendy Gruel makes federal stimulus spending look like it's doing less for L.A. employment than you might have hoped.

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Details from the L.A. Times:

Federal stimulus funds yet have created only 55 jobs so far, according to a pair of reports issued Thursday by City Controller Wendy Greuel.

The reports conclude that the agencies, Public Works and Transportation, moved too slowly in spending the federal money, in part because of the time it takes to secure approval of government contracts. The two agencies plan to create or retain a combined 264 jobs once all the money is spent, according to the reports....<.p>

The controller's audits found that as of March 31, the city had secured $594 million from the American Recovery and Reinvestment Act, which was created to invigorate the economy by spending money on infrastructure projects.

Of that total, nearly $71 million went to the city's Department of Public Works, which plans to create or retain 238 jobs by resurfacing streets and bridges, rebuilding sidewalks and storm drains, and adding bicycle safety grates to catch basins.

So far, the public works agency has shielded 37 public employee jobs from elimination as a result of the city's ongoing budget crisis and created eight public or private jobs, the report said....

Greuel's report mostly blames delays in bidding processes and city council approval for the slow rollout of efficacy with all these federal bucks. Greuel will be issuing further reports on how different city agencies have used stimulus money in weeks to come.

Journalist (unemployed, as she notes) Chelsea Cody at Ron Kaye's site sums up some of the jumble of numbers floating around regarding L.A. jobs and stimulus money:

Controller Greuel focuses solely on the Department of Public Works and the Department of Transportation. In just these two city departments a mere 55 jobs were created with $111 million in federal stimulus money....

The City of Los Angeles has reportedly received a total of close to $600 million in American Recovery and Reinvestment Act funds...Back in February, City Administrative Officer Miguel Santana issued a memo in response to requests from the Ad Hoc Committee on Economic Recovery and Reinvestment in which he made clear that the city had created or retained only 347 full-time jobs, 860 temporary summer jobs, and 67 jobs in the private sector using ARRA Funds.

Contrast these numbers to those spit out by the city's LA Recovery website, which is supposed to monitor and provide records of how the city is utilizing ARRA money, that says the city's ARRA funding program was originally expected to create or retain 8,118 jobs with $55 million of the amount received.

In March, those job numbers were called into question and the city reduced this estimate down to 4,763. The Mayor's Office (tellingly) stated that further reductions might be necessary. This was then followed up by the CAO's Office reporting that the funds would create or save 2,822 jobs.

Leftist media watchdog group Media Matters is peeved at the way coverage of the Greuel stimulus study story implies stimulus money isn't working as efficiently as it should, saying most reports ignore possible jobs in contracted-out projects and future or "indirect" positive economic effects of stimulus spending.

A fresh $200 million in federal stimulus is on its way to California colleges and universities. Check out Greuel's stimulus audits for yourself.

Image taken by Flickr user Kansas Sebastian. Used under user Creative Commons license.

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