Big bucks, but not many jobs from stimulus

By J. PATRICK PEPPER
Times-Herald Newspapers

With an unemployment rate of nearly 15 percent, the metropolitan Detroit area could stand to gain a few jobs.

And with American Recovery and Reinvestment Act money – money created exactly for that purpose – flowing to businesses and governmental units, there has been a reprieve for at least some unemployed lucky enough to find a job working at stimulus-funded projects.

But a recent Times-Herald analysis of federal stimulus spending in local communities reveals that the price for those jobs comes at a steep cost.

Job data was one of the key pillars of the ARRA when the $862 billion legislation was signed into law in February 2009. Recipients are required to report the information and could face future withholding of federal funds if reports are repeatedly not filed or misrepresented. But pinning down those numbers has proved an elusive, if not confounding, task for recipients.

Initial reporting guidelines left stimulus recipients largely on their own to make quarterly estimates on how many jobs were “created or saved” as a result of stimulus money. But after a series of miniscandals and instances of outrageously high job reports, the methodology’s veracity was called into question, and in the fourth quarter 2009 was changed to reflect the number of work hours paid for per quarter by stimulus funds.

According to recovery.gov, the federal government’s stimulus-tracker Web site, $119.54 million has been awarded for 56 projects in Dearborn and Dearborn Heights.

Only two of these projects were reported complete as of the fourth quarter with six jobs coming as a result. The Web site does not contain data from reporting periods prior to the fourth quarter, but the 78.33 total jobs listed on the site for projects that are under way or not yet started equates to a cost of $1.52 million per job.

Although the figure is subject to change with future data adjustments – a frequent occurrence so far – it illustrates a problem that has plagued federal officials as they try to maintain accountability while administering the largest one-time disbursal of funds in the county’s history. Even President Barack Obama has poked fun at the problems with job data, saying that he “created or saved” at least one turkey at the annual Thanksgiving turkey pardon.

Ford Motor Co. is the largest stimulus recipient in the Dearborn area at about $76 million. The money has been used for a number of projects, from thousands of new vehicles for the federal fleet to electric drive train development. But the automaker has listed only 19 positions created or saved.

The return on investment appears to be even less at area schools. Dearborn Public Schools, Westwood Community Schools, Crestwood Schools and Dearborn Heights School District 7 were awarded roughly $22 million combined, yet have reported zero jobs funded.

DPS spokesman David Mustonen said the district hasn’t reported any job data, because it was too difficult to figure out how many jobs are being saved while the district itself was waiting to determine how many positions it would have to eliminate.

“We didn’t really know how to report the numbers because the guidelines weren’t very clear initially,” he said.

The city of Dearborn also has or will receive grants totaling approximately $40 million, but has reported only 2.73 jobs created. Mayor John O’Reilly Jr. said that number is artificially low, however, because much of the money has been distributed to subcontractors, who are not required to make jobs reports.

“It’s not so much that we are hiring new city employees,” O’Reilly said. “It’s that we’re expecting to hire a lot more employment through contracting out projects.”