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Audit Finds Reporting Inaccuracies Regarding Stimulus Awards Given by Fed Agency

Dec. 19, 2012 6:01am

When the Obama administration pushed for its multibillion dollar stimulus plan back in 2009, it promised it would create jobs.

Lots of them.

But it appears now that the requirements put in place by the feds to help certain agencies gauge whether stimulus dollars have been successful in creating jobs are inaccurate, or so says a recent review by the Inspector General of the U.S. Department of Agriculture.

“The IG released a report this week documenting widespread inaccuracies in USDA agencies’ reporting jobs ‘saved or created’ by more than $28 billion in stimulus expenditures,” notes the Heritage Foundation’s Lachlan Markay. “One third of the awards examined in the report inaccurately reported that data.”

As part of the process of being awarded stimulus cash, recipients are required to file a quarterly report explaining how they spent their stimulus dollars and the number of jobs created or “retained.”

“[R]ecipients did not always report correct information and USDA agencies did not adequately analyze the number of jobs that award recipients were reporting,” the IG reports.

Despite the fact that agencies are supposed to closely monitor and “develop procedures” to help ensure reported numbers are accurate, as the IG notes, USDA agencies settled for the minimum requirements set by the White House Office of Management and Budget and USDA’s chief financial officer.

But as the IG now admits, those guidelines aren’t doing a very good job of ensuring that the data is correct.

“Though we did find that they met the minimum requirements,” reads the report, “those requirements were not adequate to identify the errors found in the number of jobs reported.”

After reviewing 4,690 awards, whose recipients had reported about 10,600 jobs “created or retained,” the IG found these errors [via Markay]:

  • We manually compared the project description and project status to the number of jobs reported. This resulted in 324 questioned awards.
  • We reviewed contracts and grants that have expended at least $500,000 but have reported zero jobs. This resulted in 473 questioned awards.
  • We reviewed awards that would be paying less than minimum wage per each job retained or created, to determine whether recipients are over-reporting the number of jobs retained or created. This resulted in 1,773 questioned awards.
  • We reviewed the previous two quarters and compared them with reports from the first quarter of 2011 to identify cumulative reporting, which is not allowed by OMB. This resulted in 258 questioned awards.
  • We compared data from the third quarter of 2009—the quarter when cumulative reporting was used—to the first quarter of 2011 to identify job numbers that may have had a slight increase of five or fewer jobs retained or created. This resulted in seven questioned awards.
  • We reviewed projects that received multiple awards—most often one loan and one grant—to determine if they reported the number of jobs retained or created twice rather than once. This resulted in 123 questioned awards.

Needless to say, USDA officials promise that from now on they will do a better job of scrutinizing jobs data.

“But the report also raises concerns about the accuracy of stimulus jobs data reported to date,” Markay notes. “The inability to properly assess the measure’s chief objective – increasing employment – could undermine observers’ ability to gauge its effectiveness.”

USDA IG report on stimulus jobs reporting

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(H/T: The Foundry). Featured image courtesy Getty Images.

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