OMB Moves to Fix ARRA Snafus

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Responding to criticisms such as those issued by the Coalition for an Accountable Recovery (CAR) and States for a Transparent and Accountable Recovery (STAR), the Office of Management and Budget (OMB) has revised its guidance that governs how Recovery Act grant and contract recipients report on jobs.

The revisions, consistent with recommendations from CAR and STAR as well as the Government Accountability Office (GAO), are intended to make job-counting less subjective and therefore less prone to errors. In the new guidance, OMB also signals that recipients that continually fail to report will be subject to penalties.

Because many recipients failed to accurately account for created or retained jobs in their October reports, OMB simplified its instructions. The new guidance says: count all work hours funded by Recovery Act dollars, divide those hours by a full-time work schedule for the quarter, and report that number. And don’t try to figure out cumulative jobs.

Although the guidance is likely to correct the most egregious reporting problems on the number of Recovery Act jobs, it fails to address CAR and STAR concerns about job quality and equity issues. Specifically, the coalitions remain on record seeking revisions in the guidance to include:

  • The wages of the jobs and whether they include access to benefits like healthcare.
  • The race, gender and nine-digit residential ZIP code of all workers performing those hours of Recovery Act-funded jobs. This will help determine if those most in need of economic stimulus are receiving their fair share.

The revised guidance also states that Federal agencies can terminate awards and/or revoke a recipient’s ability to receive future funds if a recipient or sub-recipient:

The guidance also warns that failing to submit a report or persistently filing late or negligently shall be treated as a non-compliant recipient subject to Federal action. There were more than 4,000 such cases in the first round alone. Moreover, it states, if a recipient or sub-recipient intentionally reports false information, Federal prosecutors may bring civil and/or criminal proceedings as enabled by ARRA or existing Federal procurement rules.

With clarified reporting rules, the blame for any new egregious errors will clearly rest with recipients, including state governments, not the feds. Effective February 2, corrections can be made continuously, not quarterly, at FederalReporting.gov.

While OMB should be congratulated for clarifying job reporting guidelines, the failure to include metrics on job quality and equity issues remains troubling.

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