There’s plenty of work to do in California, and infrastructure bonds have been sold to cover it. But the money just sits there.
By George Skelton Capitol Journal
October 16, 2011, 9:37 p.m.
From Sacramento– Gov. Jerry Brown says President Obama should embark on an FDR-type public works program to stimulate the economy. Excellent idea. And Brown should follow his own advice in Sacramento.
The Brown administration is sitting on $9.1 billion in infrastructure bonds that have been sold and are costing the state a ton in debt payments. A rough estimate is $630 million a year.
But the borrowed money is stashed in various drawers throughout the bureaucracy instead of circulating around California creating jobs.
Why? No one I talked to seems to know. They’re trying to find out. Or they’re waiting for someone to tell them.
There’s a vague partial explanation about the state changing its system of disbursing bond money three years ago and not yet adjusting to it. Something like that.
Sounds a lot like bureaucratic inertia. The governor probably needs to kick some butt.
This came to mind last week when I read excerpts from an interview Brown gave KNX-AM (1070) in Los Angeles.
“We need a national investment to fix our sewers, our schools and roads … [as] Roosevelt did in the Depression,” the governor asserted.
“Unless the president and the Congress come together with a program like we had during the Great Depression, this [slump] is going to go on for another four, five years….
“We don’t have enough coming out of our national leadership.”
But we should have $9 billion-plus in public works money coming out of our state leaders in Sacramento.
Deputy Finance Director H.D. Palmer says the administration is working on it.
“We don’t want that money burning a hole in our pocket,” he says. “Particularly in this environment.”
Agency heads may have overestimated their immediate need for the construction funds, Palmer hypothesizes, and grabbed the money before their projects were ready.
“We thought it would go out faster,” he says. “We’ve been telling them they need to get this money out.”
The message is that if projects aren’t shovel-ready, shunt them aside. Find others that are and spend the money on them.
It’s estimated that every $1 billion spent on heavy construction, for example, creates about 13,000 jobs.
Nearly half the idle money — $4.2 billion — is resting in the Resources Agency, apparently for such projects as levee repair, waterworks, habitat improvement and other conservation.
Caltrans has parked $2 billion, presumably for highway projects. There’s also $1 billion waiting for housing development — and about $2 billion for such things as health facilities, stem cell research, the Air Resources Board, the University of California, community colleges and K-12 schools. It’s a long list.
Since 2009, the state has sold $30 billion in infrastructure bonds, disbursing $21 billion. None has been sold this year.
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