Building Trades News

All through 2009, stimulus funding has been promised as the necessary “kick start” for the economy, and it still can be. However we haven’t yet seen the boost in infrastructure development that was expected.

Although Congress approved stimulus funding in February of 2009, the manner in which the money has been distributed has held up many projects – even those that were rushed through the permitting process.

The problem has been that the administration has distributed the stimulus dollars by putting the states – and their governors – in charge of its spending. This has created major political problems, particularly in cash-strapped states like California. Not surprisingly, governors have been spending a large part of the stimulus funds to balance their states’ budgets instead of creating jobs.

In California, Gov. Schwarzenegger’s administrators have received over $18.5 billion in total funding, with $8.5 billion of that earmarked for infrastructure dollars, and yet they have utilized only $34 million on actual projects. (See state recovery website) This is happening when California has 2.5 million people out of work – a more than 12 percent unemployment rate.

President Obama is on the right track with the stimulus package as a way to help the economy. However, we are concerned that having it overseen by each state governor is a mistake and will create roadblocks to having the stimulus work efficiently and effectively. In California, Schwarzenegger has already shown that he will use the money for other than infrastructure programs.

History has shown us what stimulus dollars can do to boost the economy. Just look at what President Roosevelt’s “Works Progress Administration” was able to accomplish in the midst of the Great Depression. With over 20 percent unemployment in 1935, or 9.2 million people, and with the economy continuing to freefall, the government was able to put millions to work. Some 3.3 million people were working on WPA projects by November of 1938, which also created profits for retail and commercial businesses and opportunities for new business to grow.

Economic growth began almost immediately when the WPA was enacted in 1935, with unemployment dropping to 14.3 percent by 1937. This was done in spite of continued opposition from so-called conservatives in Congress, business groups and even some southern Democrats. But with Roosevelt’s resolve, unemployment continued to fall and the country’s gross national product continued to recover.

Many Congressmen and state representatives in Sacramento have been vigilant in monitoring the stimulus funding and have worked directly with the craft unions on giving us information on construction dollars as they are issued. Still, their best efforts haven’t produced much employment.

Both craftsmen and women and the skilled and experienced contractors we work with everyday, are vitally interested in converting stimulus dollars to actual jobs. We need all of our elected representatives to take a strong role in moving the President to demand that the stimulus funding be rushed to project construction. There are over $6 billion in “shovel ready” projects that have been identified in Los Angeles and Orange Counties alone. These are projects that could put 24,000 craftsmen and women to work immediately - along with thousands of contracting management and professionals as well.

The state can do its part by speeding up any permitting or environmental review on these projects. I’m not talking about short-cutting these important processes. We don’t have to. Instead, I’m referring to elected officials making sure the state’s processes are streamlined and there are sufficient administrators to deliver the projects that are under the state’s control.

A good example of a state legislator who gets it, is State Senator Rod Wright, who just last year shepherded a bill through the legislature to overturn a State superior court judge’s blocking of the Air Quality Management District Air Quality Credits Permit Program. The program allowed air quality credits that were banked with the AQMD by companies installing major pollution reduction equipment to be sold to other project owners who could not afford new equipment or where technology wasn’t available to modify their installations.

The overall effect was that air pollution was reduced. But that was not good enough for a major environmental group. They filed a lawsuit that was responsible for stopping over 1,500 needed projects that would have provided over 10,000 construction jobs. Senator Wright’s bill, SB 827, modified the environmental process rules to allow the projects to be permitted. Over 1,000 projects have now received approval. This is an example of how our elected representatives can make sure that the state is ready to streamline its rules. They can work towards this end now, before all the stimulus is awarded and faces a log jam if the state isn’t prepared.

We can all push to get the stimulus funds we need to put Californian’s craftsmen and women back to work. Please call or email your state legislators, Congress members, the Governor and President Obama demanding that they speed up the distribution of stimulus funding. Your contact can be especially effective if you’re in the construction industry and your job depends on the stimulus getting out fast. Let your elected officials know what you need and they will respond.
This can be the “year of the job” if we work together.