STIMULUS WATCH: $5 billion stimulus weatherizing program led to fewer jobs than expected

By Garance Burke, AP
Saturday, March 27, 2010

STIMULUS WATCH: Weatherizing program slow to start

FRESNO, Calif. — After a year of crippling delays, President Barack Obama’s $5 billion program to install weather-tight windows and doors has retrofitted a fraction of homes and created far fewer construction jobs than expected.

In Indiana, state-trained workers flubbed insulation jobs. In Alaska, Wyoming and the District of Columbia, the program has yet to produce a single job or retrofit one home. And in California, a state with nearly 37 million residents, the program at last count had created 84 jobs.

The program was a hallmark of the American Recovery and Reinvestment Act, a way to shore up the economy while encouraging people to conserve energy at home. But government rules about how to run what was deemed to be a “shovel-ready” project, including how much to pay contractors and how to protect historic homes during renovations, have thwarted chances at early success, according to an Associated Press review of the program.

“It seems like every day there is a new wrench in the works that keeps us from moving ahead,” said program manager Joanne Chappell-Theunissen. She has spent the past several months mailing in photographs of old houses in rural Michigan to meet federal historic preservation rules. “We keep playing catch-up.”

The stimulus package gave a jolt to the decades-old federal Weatherization Assistance Program. Weatherization money flows from Washington to the states, where it is passed to local nonprofits that hire contractors to spread insulation and install efficient heaters in people’s homes.

Energy officials said the stimulus infusion is on track to create thousands of career-pathway jobs and support an industry that lowers carbon emissions while saving consumers money.

“This is the beginning of the next industrial revolution with the explosion of clean energy investments,” said assistant U.S. Energy Secretary Cathy Zoi. “These are good jobs that are here to stay.”

But after a year, the stimulus program has retrofitted 30,250 homes — about 5 percent of the overall goal — and fallen well short of the 87,000 jobs that the department planned, according to the latest available figures.

As the Obama administration promotes a second home energy-savings program — a $6 billion rebate plan — some experts are asking whether that will pay off for homeowners or for the planet.

“A very rosy picture was painted that energy efficiency would be a great way to create jobs and save money,” said Michael Shellenberger, an energy expert who heads the Breakthrough Institute, an Oakland-based think tank that is financed by nonpartisan foundations and works on energy, climate change and health care issues. “The Obama administration risks overpromising again.”

Many states held off on weatherizing under the stimulus over concerns about a Depression-era law that requires contractors to pay workers wages equal to those paid for local public works projects. The U.S. Labor Department issued wage rules for every county in the country in September but after receiving about 100 complaints, changed the wage rates again a few months later.

Bureaucratic delays kept officials in Austin, Texas, from weatherizing anything while they waited to hire furnace technicians under a $7.4 million federal grant, of which they received the first installment this month.

The recession itself has compounded the problems, since hiring freezes in some states meant there weren’t enough public employees to administer the program.

In California, where Gov. Arnold Schwarzenegger ordered many state workers to take “Furlough Fridays,” the program had created 84 jobs and weatherized 849 homes at last count, in December. Officials estimate several hundred jobs have been created since then.

Energy Department spokeswoman Jen Stutsman said the program produced 8,500 jobs nationwide from October to December 2009, but said she could not provide job creation figures for the last full year since federal guidelines for measuring the program’s impact changed in the fall.

Zoi said the number of jobs created and homes completed would rise quickly as the program emerged from its startup phase, and that it was on target to meet overall goals. Now that the money is trickling down more quickly, auditors are fretting over how to make sure it doesn’t fall into the wrong hands.

The Energy Department plans to hire one program officer for each state to watch for waste, fraud and mismanagement.

That also will help to ensure crews’ performance is up to snuff.

In Illinois, the staff of the department’s inspector general, Gregory Friedman, discovered that one agency weatherization inspector missed a dangerous gas leak on a newly installed furnace. State and local officials told auditors they would make sure the leak was fixed and retool statewide training materials.

In Indiana, where workers were required to go through a state weatherization training program, local managers say they have spent hours teaching new recruits to do their jobs properly.

“We keep getting inundated with all kinds of people who want a paycheck, but just aren’t qualified to do this kind of work,” said Bertha Proctor, who heads a nonprofit contracting agency in Vincennes, Ind.

Still, some of the stimulus program’s flexible standards have allowed for innovation.

In Portland, Ore., local officials are reporting an energy-saving boon that has helped minority-owned businesses in the job-starved construction industry. Ohio, which had a strong weatherization program in place at the outset, had completed 6,814 homes by the end of last year, more than a fifth of the total nationwide.

Legislation authorizing a second energy savings program is moving slowly through Congress. Many details of the plan, including how long it will run and its total cost, still need to be worked out. The Obama administration said the “HomeStar” program would reward homeowners who buy energy-saving equipment with an on-the-spot rebate of $1,000 or more, and hope it could become as popular as last year’s Cash for Clunkers money-back program for cars and trucks.

Micheline Guilbeault, 65, of Lawton, Okla., whose home was weatherized through the stimulus package, said she thought the new proposal would encourage more homeowners to go green.

“My house doesn’t shudder anymore when the wind blows,” Guilbeault said. “With the door that they just put in, I’m sure that the bill will go down because myself, I can feel the difference.”

Still, some government watchdog groups said taxpayers shouldn’t be on the hook paying for home improvements if the government has yet to release figures showing how much weatherizing saves.

“The government should have stayed out of the weatherizing business in the first place,” said Leslie Paige of Washington-based Citizens Against Government Waste. “This is a way to rapidly expand and entrench an existing program without ever going back and looking at the rationale or intent or effectiveness.”

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