PORTLAND — State officials boast more than 7,500 jobs have been "created or retained" by the 2009 Legislature's trumpeted economic stimulus package, 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 — yes, with a "b" — in federal stimulus spending in the state.
The state makes an eye-opening claim, and raises an obvious question: How did the "Go Oregon" package, as it is called, outperform the federal program by such a huge margin?
The short answer: It didn't.
An analysis by The Oregonian shows that, on average, Go Oregon jobs lasted about two weeks and did little or nothing to dent the state's bleak employment outlook. It also shows 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.
Furthermore, one in four workers employed in Go Oregon jobs was not a resident of the state. The analysis also shows a disproportionately high amount of the stimulus money was spent in Marion and Polk counties — two areas of the state favored by Senate President Peter Courtney, D-Salem, who championed the measure.
Courtney and other Democratic leaders pushed for the spending as a desperately needed jobs bill, saying it would put thousands to work quickly at a time when Oregon's unemployment rate was among the highest in the nation. The plan was to borrow $172 million, then spend the money on hundreds of long-neglected maintenance projects, from mossy roofs to peeling paint.
Senate Bill 338 was put on a fast track and zipped through both legislative chambers. Gov. Ted Kulongoski signed the bill just hours after it emerged from the House, saying it would "help families and get our economy moving."
But 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.
"The construction industry was looking for a glimmer of hope" and backed the stimulus proposal when it was first proposed, Killin said. But it soon became clear that the promised jobs "were not full time and were certainly not sustainable."
The inflated nature of the state's job claims is especially apparent when judged against the far bigger federal stimulus program.
Under the Go Oregon stimulus rules, any new hire is a job "created," whether for two days or two months. If the worker was already on staff, that's a "retained" job.
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.
"I never thought these jobs would last forever because they're in construction," Courtney said in a spirited defense of the spending. The jobs have come at a time when any work, no matter how long it lasts, is appreciated, he said.
"We've restored some things. We've rebuilt some things. People have had a chance to buy some things and survive. That's all I can say."
Courtney represents Marion County in the Legislature and works at Western Oregon University, which is in Polk County. Both counties have received a bigger-than-average share of the state stimulus spending.
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.
Courtney said he had nothing to do with which projects were picked. "I said this has to go into every nook and cranny or I'm not interested."
But two counties with the state's highest unemployment rates, Deschutes and Crook, received even less per capita than the state average.
The Go Oregon job numbers stand out against a backdrop of increasing cynicism toward government and public skepticism about stimulus spending of any sort. Adding to that skepticism have been government claims of creating thousands of jobs but almost no change in the unemployment rate.
At a time when many families are postponing their own improvement projects because of tight budgets, they may look askance at the state spending heavily to repair public structures.
Here are two representative examples of state stimulus projects, taken from the progress report:
- Workers upgraded the heating and air conditioning system at a state Fish and Wildlife building in Douglas County. Nine people, who already had jobs, worked on the project for an average of 10 hours apiece. Total cost: $18,624.
- Of the workers who renovated a Clackamas Community College building, 12 were already employed and 21 were new hires. Only 13 of the 33 workers were Oregon residents. On average, each worker spent about a week on the job, which cost $294,808.
University and community college campuses got the lion's share of the money, much to their delight. At Oregon State University, $500,000 in state stimulus money paid part of a $3.7 million renovation of Gill Coliseum, where the Beavers play basketball.
"The stimulus funding was really helpful," said Todd Simmons, an OSU spokesman. The coliseum "was very dated, very down at heel." Now it's an attractive, light-filled arena, Simmons said.
A leading state economist, however, said such jobs do little to stimulate Oregon's economy or to add the long-term jobs necessary for recovery.
"Really what we're doing is just moving forward future projects into the current time zone," said Tim Duy, economics professor at the University of Oregon and director of the Oregon Economic Forum. "This is not what I would define as a stimulus package."
There's nothing inherently wrong with the state borrowing money to move up its deferred maintenance schedule, he said. But the state is simply taking money that would have been spent on other programs — and paychecks — "and moving the pieces around."
At some point, he said, "You're just going to have a hangover on the other side."
Some of the financial headache already is being felt. Paying off money borrowed for the stimulus took $30.7 million out of the current general fund budget. An additional $32.8 million will come out of the 2011-13 budget — already projected to be $2.5 billion out of balance.
Despite the criticism, House Speaker Dave Hunt, D-Gladstone, remains a staunch Go Oregon cheerleader. 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.
"Are they going to put contracts in the pockets of Oregon businesses and paychecks in the pockets of Oregon workers?" he said. "There's no question this has met every criteria."