Inspector General: Energy Dept. Stimulus Spending Was Like 'Putting A Lawn Hose on a Fire Hydrant'

November 2, 2011 - 4:12 PM
Gregory Friedman

Gregory Friedman, inspector general of the Department of Energy, testified at a House hearing on Nov. 2, 2011 about the obstacles that kept stimulus funds from creating green jobs. (CNSNews.com/Penny Starr)

(CNSNews.com) – Inspector Generals with the Departments of Energy and Labor told a House panel on Wednesday that reports compiled at Congress’ request show that billions of dollars in stimulus funding given to the agencies to create green jobs have failed to achieve that goal.

DOE Inspector General Gregory Friedman told the House Subcommittee on Regulatory Affairs, Stimulus Oversight and Government Spending that his agency received $35.2 billion from the American Recovery and Reinvestment Act, signed into law by President Barack Obama in 2009.

Friedman’s office found that as of Oct. 22, 2011 about 45 percent of the agency’s stimulus funds had not been spent – mostly by state and local recipients of stimulus funds.

The reasons, Friedman said, are that few “shovel ready” jobs actually existed and that the infrastructure and personnel were not in place at the state and local level to put funding and programs in place.

He compared it to “putting a lawn hose on a fire hydrant.”

The majority of grants and loan guarantees were given to “green” technology programs or research, including those that focused on “energy efficiency and renewable energy” and “environmental management,” which Friedman described as “high-risk areas.”

Moreover, Friedman said that the end of stimulus funding would lead to “significant downsizing of the contractor workforce.”

Friedman said, “The department estimates that with the end of Recovery Act funding, over 4,000 workers at Environmental Management sites … will be displaced by the end of 2011.”

Friedman also testified that $5 billion of the stimulus funds his agency received were for weatherization programs that did not always succeed.

“Weatherization work was often of poor quality,” Friedman said in his prepared opening remarks. “In a recent audit performed at the state level, 9 of 17 weatherized homes we visited failed inspections because of substandard workmanship.”

Elliot Lewis

Elliot Lewis, assistant inspector general for the audit office of the Department of Labor's inspector general's office, testified at a House hearing on Nov. 2, 2011, that the stimulus funds given to the agency's job training program fell short of creating the number of projected jobs. (CNSNews.com/Penny Starr)

Elliott Lewis, assistant inspector general for the audit office of the Department of Labor, said the agency received $500 million in stimulus funds for its Employment and Training Administration (ETA) for “competitive grants for research, labor exchange and job training projects to prepare workers for careers in the energy efficiency and renewable energy industries – the department’s Green Jobs program.”

Among the findings Lewis shared at the hearing:

- Grantees have reported serving an overall 52,762 individuals (42 percent of the targeted 124,893).

- Grantees also reported that 46,627 participants had enrolled in training, assessment, case management, or job placement assistance (about 40 percent of the targeted 115,395.

Jim Jordan

Rep. Jim Jordan (R-Ohio) said that the testimony of the Energy and Labor inspectors proved the stimulus funding was 'a complete failure.' (CNSNews.com/Penny Starr)

- Grantees reported the 8,035 participants had entered employment as of June 30, 2011 – 10 percent of the program’s goal of 79,854 placements.

- Of those placed, only 1,336 participants had retained employment for more than 6 months – or about two percent of the planned 69,717.

Rep. Jim Jordan (R-Ohio), chairman of the subcommittee, summed up the men’s testimony.

“Mr. Friedman and Mr. Lewis, based on your testimony, it looks like both the weatherization program and the green jobs training program are, I guess, by anyone’s conclusion, just a complete failure,” Jordan said.