Stimulus audit questions Calif. prison jobs saved

AP News
Posted: Nov 24, 2009 11:16 AM

State auditors said that California corrections officials overstated how many jobs they saved using more than $1 billion in federal stimulus money, listing thousands of jobs that were never in jeopardy.

In its report to the federal government last month, the Department of Corrections and Rehabilitation reported saving 18,229 correctional officer jobs since May by using the stimulus money to pay their salaries as the state struggled with a massive budget deficit.

State Auditor Elaine Howle questioned the total. The department is planning about 5,000 layoffs, less than a third of the jobs it claims to have saved.

The remaining 13,229 jobs appear never to have been in danger, Howle said Monday in a letter to Gov. Arnold Schwarzenegger and legislative leaders.

"It appears that Corrections simply reported how many correctional officers' salaries were paid with Recovery Act funding, regardless of whether these positions were truly at risk of being eliminated without federal funding," she wrote.

The state auditor's finding reflects broader concerns about how the federal government is tracking the $787 billion stimulus package and determining how many jobs across the country were saved or created. Corrections Undersecretary Mary Fernandez defended the department's calculations.

"We followed the federal formula," she said.

As for whether those jobs were ever in danger, Fernandez said, "It's kind of a Monday morning quarterback. Who knows what could have happened in May and June if we hadn't gotten the money?"

The state Department of Finance said in April it would use $727 million to replace an equal amount cut from the corrections department budget. The remaining $358 million was folded into department's budget for the current fiscal year, which began July 1.

The corrections department issued 3,655 layoff notices in May, a week before it received its first share of the federal money, although no employees have been laid off.

The department plans to eliminate about 1,500 jobs by Jan. 31. Because endangered employees can transfer to different jobs, fill vacancies or bump those with less seniority, only a few hundred people might actually be laid off, Fernandez said.

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The layoffs will begin despite the federal stimulus money received this year, she said.

Howle's office is auditing about $55 billion of the projected $85 billion being sent to California under the American Recovery and Reinvestment Act of 2009. The remaining $30 billion is tax relief.

Nationwide, the Obama administration has suggested the stimulus package would save or create 3.5 million jobs by the end of next year. The federal government claimed that as of last month, 640,000 jobs had been saved or created by the economic recovery plan.

But a number of problems have been found in the massive database of stimulus spending, including how states and other recipients are counting the jobs. Some reviews found that the figures were inflated by miscounts, such as claiming jobs for work not yet started and counting part-time jobs as full-time positions.


Associated Press Writer Judy Lin contributed to this report.