Friday, January 22, 2010

Coda and a Comment: A Stimulating Tale - Tithing to the State

Phil Scarrazzo, Accountability Officer for stimulus projects at the State Department of Transportation called this morning to correct some data in the first part of this series.  I had written that the state set aside 15% for continencies, and 10% for incidentals.  My error was not in the state's favor.  They actually set aside 25% for incidentals, and 10% for contingencies.

So, on a million dollar project, that's $250,000 for incidentals like processing applications, overtime, administrative work, audits, testing.

Just in regional projects, which are a fraction of the total projects the state is overseeing, if the formula holds true across the board, the DOT is distributing $90.6 million, which means that they are setting aside $22.5 million for "incidentals."

Wednesday I asked Scarrazzo what that "incidental" money went toward, and he provided me with the list I mentioned above (administration, application processing, overtime, auditing, testing, etc.).   Then I asked him how many people had to be hired to handle the influx of work.  He told me that there were no new hires at the DOT for the stimulus project, that people were transferred into a unit to handle the flood of work.  He also told me that the DOT had pledged not to ignore non-stimulus projects that were on the books.

So I asked him what all those DOT workers were doing before they were handling the stimulus projects.

He told me they were working on day-to-day DOT projects.

I asked him if those DOT employees had been in danger of layoffs if the stimulus money had not come through.

He told me they were not in jeopardy.

I suggested that perhaps these DOT employees had been previously underutilized since, as he had told me, the work in this area had increased at least five fold, and they were able to handle it all with some overtime.

He told me they had all been busy with their regular jobs.

I suggested that there was only so much air you could blow into a balloon before it burst, and the conversation got contentious.

Thursday, Scarrazzo told me that the March 1 deadline for applications meant that most employees at the DOT working on the stimulus program were working overtime, and that once construction season began in the Spring, contractors would be very busy.

All of which has lead me to some questions, and some conclusions, some of which are dismaying.

As I understand it, the goal of the ARRA (American Resource Recovery Act), or stimulus program, was to pump money into the economy and to create and/or preserve jobs.  And the goal was to do this quickly.

As I said in an earlier post, in the 06457 zip code, $16 million has been distributed.  Officially, so far, 6.07 jobs have been created a year after the program began.

I understand that many of these are major projects which take time to get on line, and that we can expect to see a flow of cash, and more jobs created in the Spring.

But I'm afraid I've come to the conclusion that with so much money being distributed so rapidly, that there's bound to be a significant portion which flows into areas where it was not intended, no matter how good the controls. (Some city hall cynics have told me that it's funny that I ever expected otherwise.)  I also feel that as bureaucracy is created to handle this flow of cash, some of the cash evaporates into that bureaucracy, and the process slows to a crawl by the weight of the mechanism through which it flows.

In the end, I believe good has come, and will come, from the stimulus program.  Still, I'm dismayed that so many of our dollars have disappeared into a vast, impenetrable bureaucratic monolith which seems to thrive, almost parasitically, on the lifeblood of the projects it funds.  And I'm aghast that so little has happened so far.

Here in Middletown, where we've played kind of a shell game with our stimulus dollars,  Technically the dollars will go to pay for the Industrial Park paving project.  Actually, those dollars replace bonded dollars which are now being proposed to pay for the Mellili Plaza parking project: a project which does not have unanimous support in the community.

4 comments:

Anonymous said...

Ed, the only thing the ststimulus money did was increase the work force in Washington. Its the same old story, the politicians get their slice of bread and the tax payers get the crumbs. No different than the $100 million in the Health Bill to the Jack Dempsey Hospital. How does that provide affordable health care to the American public.

Gramps

Anonymous said...

We should all thank Scot Brown. If wasn't for him the Dems were going to force that health care plan on us no matter how much we didn't want it. Oh, by the way lets move forward with the 500 billion dollar savings in medicare the President talked about. This is why we should all say thank you to the Mass voters.

Proud lefty said...

Who is this "we" you're talking about.

Most polls show that 60% of Americans want health care reform.

Many people who voted for Brown did so because the health care plan was not inclusive enough.

Our broken health care system has crippled economic development in the US for decades.

Do you really suppose people like the way insurance companies and pharmaceutical companies have been handling things?

It's the vested interests who have convinced most people that universal health care is wrong.

I thank Scott Brown for waking Dems up to the fact that they have not been aggressive enough in pursuing progressive solutions.

If elections needed a 60% majority like the Senate does, Brown would be in a runoff.

Let's fix the system so that the playing ground is equal.

NOBO said...

Dear Proud: You are correct- most Americans do want health care reform---they just don't want Obama's plan. 2,700 pages of pork and taxes.
I won't even comment on the "60%" majority theory you are proposing. Is that only to be used when the liberal..er, Progressive candidate is losing?
Perfectly ridiculous; perfectly Progressive.
P.S.- how many people come to the United States to take advantage of our "broken health care system?"