Recovery Chairman Devaney Takes Aim at Urban Legends About Recovery Board

WASHINGTON, March 23 /PRNewswire-USNewswire/ -- Chairman Earl E. Devaney of the Recovery Accountability and Transparency Board, in his Chairman's Column posted on Recovery.gov today, fired away at several of the more prevalent urban legends that have been peddled over the past year "by some journalists and Internet grouches.''

"As the brickbats flew, we've listened patiently,'' Devaney went on. "Time now to bury the most publicized urban legends about the Board and the Recovery program."

Devaney described how some have accused the Recovery Board of wasting $18 million on Recovery.gov when, in reality, the Board has spent $6.8 million thus far on the website. He also detailed the distortions and misrepresentations on other Recovery issues, including claims that billions of dollars had disappeared into "phantom'' congressional districts.

The text of the Chairman's Corner follows:

Chairman's Corner, March 22, 2010

There's an old saying in journalism not always spoken in jest: don't let the facts get in the way of a good story.

Over the past year, the Recovery Board has received its share of gratuitous criticism from some journalists and Internet grouches. As the brickbats flew, we've listened patiently. Time now to bury the most publicized urban legends about the Board and the Recovery program:

• The Recovery Board wasted $18 million to redesign Recovery.gov.

Recovery.gov is not just a pretty face and not nearly that expensive. In July 2009, after careful vetting, the Recovery Board and the General Services Administration selected a Maryland company, Smartronix, Inc., to develop our state-of-the art website. The project included redesign and construction of the website; installation of hardware and software infrastructure; hosting and operation for the website; enhanced content management; and contract labor support. To date, we have paid Smartronix $6.8 million. If we exercise all options in the contract, the bill could total $18 million by January 2014.

• Billions of Recovery dollars disappeared into "phantom'' congressional districts.

Some bloggers and reporters breathlessly recounted how Recovery money had gone to phantom congressional districts. One blog headline: "$6.4 billion Stimulus Goes to Phantom Districts.'' But even a cursory review of the website would show that no money disappeared into a black hole. In reality, some recipients entered the wrong congressional district in spending data submitted to us and displayed on Recovery.gov. These were simple clerical errors, and we fixed the problem with edit checks preventing recipients from entering the wrong districts in future data reports. But to read some coverage, one might conclude that a scandal worthy of Sherlock Holmes had befallen the Recovery program. Not really—just critics hyperventilating.

• Why is the Recovery program spending $250,000 per job?

How about $150,000 per job? Or, let's say $500,000? Never mind that however you cut it, these cost estimates don't actually begin to tell the whole story. Essentially, critics are dividing the number of estimated jobs by the amount of money spent in a Recovery project. So, if a highway construction project cost $10 million and created 100 jobs, the cost per job must be $100,000, or so the critics say. In a struggling economy, this kind of analysis no doubt angers many Americans. But any second year economics major could tell you how absurd this analysis is. What about the benefits of that highway project to motorists? What about the indirect jobs, the subcontractors and the suppliers that benefit? Like most other things in life, simple analysis doesn't get the job done (no pun intended).

• The Recovery Board takes its orders from the Obama administration.

The Board is an independent entity consisting of myself and 12 independent Inspectors General from various federal agencies. The Board, it is true, works with the administration and I brief Vice President Biden and consult with him on issues relating to Recovery.gov. But I also meet with and brief key members of both parties in Congress. We listen and adjust our thinking, if necessary, but we do not take orders from either the administration or Congress. The Board must steer its own course. We are doing that.

• Why is the Recovery Board wasting so much money funding stupid projects?

This one pops up all the time. Many think the Board distributes Recovery funds and decides which projects to fund. The Board's role is carefully laid out in the American Recovery and Reinvestment Act of 2009, and we have nothing whatsoever to do with distributing funds or deciding what projects get funded. Our role is twofold: we manage Recovery.gov and a second website, FederalReporting.gov, which accepts recipient award reports, and we look for fraud, waste and abuse in the Recovery program. That's it. Federal agencies disburse Recovery funds.

What's important, considering the repeated distortions and misrepresentations, is not that the Recovery Board is being unfairly criticized. We can take the heat. The problem is that the public's confidence in the Board is undermined when such nonsense spreads like wildfire across the Internet. Citizens may not like what they see, but they have a right to see their government's actions clearly. Urban legends like those listed here serve only to obscure reality.

The Recovery Accountability and Transparency Board was created by the American Recovery and Reinvestment Act of 2009 to oversee the expenditure of Recovery funds and bring transparency and accountability to the process. The Board consists of a chairman, Earl E. Devaney, and 12 federal Inspectors General. The Board runs the Recovery.gov website that provides information on the Recovery initiatives and spearheads an accountability effort that involves both federal and state investigators and enforcement officials.

SOURCE Recovery Accountability and Transparency Board