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Audit of Federal Stimulus Funds in Los Angeles Shows $111 Million in ARRA Grants Has Only Created 55 Jobs

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I released two very disappointing audits today of how the City of Los Angeles has used American Recovery and Reinvestment Act (ARRA) funds. The audits looked at the how the two departments that have received the largest amount of ARRA funding so far - the Department of Transportation (LADOT) and the Department of Public Works (DPW) - have used those funds and how many jobs were created. Los Angeles has become the largest City in America to conduct an audit of how ARRA funds have been expended.

DPW has received $70.65 million and created or retained 45.46 jobs, though they are expected to create 238 jobs overall (the fraction of a job created or retained correlates to the number of actual hours works). LADOT has been awarded $40.8 million and created or retained 9 jobs, though they are expected to create 26 jobs overall. Overall, the Departments have received $111 million in federal stimulus funds out of the $594 million the City has been awarded so far and created or retained 54.46 jobs.

I'm disappointed that we've only created or retained 55 jobs after receiving $111 million in ARRA funds. With our local unemployment rate over 12% we need to do a better job cutting the red tape and putting Angelenos back to work.

While it doesn't appear that any of the ARRA funds were misspent, the City needs to do a better job expediting the process and creating jobs. We're going to continue to audit how these funds are spent, to ensure that they are expended quickly and correctly. I'm pleased that since our auditors completed their field work, the Departments have begun to implement the changes we identified to help get this money out the door faster.

I know that some people might try to use this as an opportunity to criticize the President and the effectiveness of the stimulus package. I think that would be a big mistake. There have been 3.3 million jobs nationwide that have been saved or created because of ARRA. The stimulus was critical to keep the American economy afloat. The message we're sending is that the City needs to do a better job taking these funds and getting them out the door quicker and getting Angelenos back to work.