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SD County Lost Jobs Opportunity

SD County Lost Jobs Opportunity
We'll explore why San Diego County didn't apply for millions of dollars in federal stimulus money that would have put low-income people back to work.

GLORIA PENNER (Host): The job market remains stagnant in San Diego with 1 out of 10 people unemployed. That number hasn’t changed much in the last year. One bright light for some California counties is federal stimulus money, money that San Diego County apparently refused to apply for. So before we get into the turndown, Scott, what do we know about what the money can be used for?

SCOTT LEWIS (CEO, Well, you know, there’s money the federal government distributes for welfare, what you might call welfare, Welfare to Work, and then there was a stimulus package that the Emergency Contingency Fund that was passed into stimulus that was supposed to sort of buttress this around the counties and – or, in the states. And, you know, CalWORKS is the California version of welfare and this was, you know, this was presented as an opportunity for counties, most of the counties are using it – money to sort of subsidize employment. So, say you’re McDonald’s and you need an extra employee but you only have room to maybe pay that person $2.00 a hour and, obviously, that’s illegal. So what this does is help you sort of cover that gap until – with the thought being that as things recover that you’ll be willing to hire that person for the long term. LA County, for instance, got more than $60 million for this, and was able to put 8,000 people to work. Other counties got, you know, much less or different amounts. Orange County, for instance, only got $500,000. And the worry in the – And I’ve got to hand it to our investigative reporter, Kelly Bennett, when she discovered that the county was one of very few who decided that they didn’t want to – the County of San Diego didn’t want to participate in this program, and I think there are a few issues that emerged. Sure, they had their reasons but as County Supervisor Ron Roberts, who’s running on a platform that leads with creating jobs for people, he said that, you know, he was disappointed that they didn’t even have a chance to discuss whether to take it. And then the big – I think the real hammer on this story is Laura Chick. She’s the former, you know, rambunctious and fiery accountant – or I don’t remember what her title was at…

PENNER: Inspector General now.


LEWIS: Right, at LA, though, she was – she was like the…

BARBARA BRY (Co-Publisher/Opinion Editor, She was the Controller.

LEWIS: She was the Controller of the purse strings. She was always, you know, causing a flurry with her audits and such of how the City of LA was spending its money. Well, she looked at what the County of San Diego had done in denying these funds and said it was outrageous, that she had – she could not believe that they would turn down so much money. Now the County says that they – that they had, you know, dozens of conference calls about it, they tried to figure out how to make it work. They decided it wouldn’t, and that it would potentially be too risky. But the point was they never even brought it up to the board of supervisors to discuss and now the board of supervisors are, I think, paying the political price for that.

PENNER: Wow, you’ve really laid it out. And so I guess the main question now is who made the decision not to apply? How is that decision made? I mean, okay, they had e-mails and phone calls and they chit-chatted back and forth but where did the buck stop?

LEWIS: Well, I guess the buck would stop at the Health and Human Services and basically the County staff, which is led by Walt Eckard, the County Administration Officer. I don’t – I’m not sure exactly what happened that the decision to not go further with this was made or that it was not taken to the board of supervisors but this is sort of a radioactive issue. When the County’s job is dictated by funds from the state and the federal government and when it – when, you know, its prime responsibility, according to its supervisors, is to create jobs here, it just – it passed on an opportunity and that’s fine but it needs to explain why very clearly and some of these explanations aren’t necessarily doing the trick.


PENNER: JW, have you sort of been aware of what the members of the board of supervisors are saying in reaction to this? Scott did mention that it must’ve been rather embarrassing for Supervisor Ron Roberts, who’s running for office and running on this platform of job creation. What about the others?

JW AUGUST (Managing Editor, KGTV 10News): I called but I didn’t get a response. I’m not going to say who but to two supervisors. You know what the issue is, the County has got this culture they’ve had for some time that social welfare program’s at the bottom of the list of their concerns. And I think this had something to do with how the County handled this, how HHS, when it came in, how they looked at it. As you were asking, somebody in the chain made the decision. I’m sure they’ve been called – they have probably been called on the carpet but we may never know who did that. Maybe a FOIA would do it, and find out. But it just goes back to how the County has been for a number of years. I think the boys did a series of reports last year about how – what a poor job they do with food stamps as compared to other areas of – other counties in California.

PENNER: Yeah, and KPBS was also involved in an analysis of the board of supervisors. That was JW August, he’s managing editor of KGTV 10 News. And we’re here also with Barbara Bry from and Scott Lewis, and what we’re talking about is that the county board of supervisors – I’m sorry, the County—county board of supervisors didn’t know anything about it—did not apply for federal funds that would have employed those who are unemployed and who are basically on welfare. I’d like to know what you think about it. Apparently the media’s been jumping on this. It started with Voice of San Diego but now we’re hearing stories from other media outlets as well. So for the media, it’s a pretty hot topic. What about you as a private citizen? How do you feel about what the County has done? Our number is 1-888-895-5727, 895-KPBS. Barbara, would you say that this is a sign of an overburdened department? Or poorly managed system? Or a lazy or poorly motivated department? You’ve been in the business world in the past and you are now, as a matter of fact.

BRY: Umm-hmm.

PENNER: How do you analyze this?

BRY: Well, I think, you know, leadership always starts at the top and JW talked about the Voice of San Diego reports, which, you know, I guess KPBS also did, about what a low priority it seems our – the county puts on, you know, making sure that people who are eligible get food stamps and other social services compared with other parts of California. So – And we know that, you know, there have been government – You know, everybody’s stretched to the limits. You know, the County has less money to spend. So I think it’s a combination of issues. But, you know, leadership starts at the top and if it was clear to the workers at HHS that it was important to apply for these kinds of federal programs, I think it would’ve happened.

PENNER: Well, how actively, let’s say, has the County of San Diego been in applying for these kinds of grants? I’m taking a look right now at an article again in Voice of San Diego that came out this morning in which the head of HHS, Mr. Macchione, outlined that $55 million for the County’s Social Services programs come from stimulus money, that another $5.4 million is being used to help the unemployed. I mean, he lists a couple of things here, and he’s really defending his department.

BRY: Yeah, well, I guess, you know, maybe Scott and JW know more but I don’t know how well San Diego has done in terms of – the County has done in terms of getting stimulus money compared with other counties. According to the Center on Policy Initiatives, the County could’ve gotten somewhere between $11 to $18 million from this pool of this money that they didn’t apply for.

PENNER: Scott, the – this article also notes that Mr. Macchione said that other counties may have taken the risk to pursue the funds without the necessary clarity from the state. So he’s kind of laying it on the state now, saying, you know, maybe if the state had given us really clear guidelines, we might’ve gone for it.

LEWIS: Right, but then you look at Laura Chick, who’s in charge of these funds statewide and she says, well, why didn’t they bring these concerns to me? Why couldn’t we – You know, they say that the language was uncertain for them, that they’re not sure what kind of risk they were taking. So, for instance, if they take this money but they don’t account for it properly, according to these vague terms that the state puts out, does that mean that county funds would have to be used to backfill it. And they said that that was the risk that they were taking and that that was too much. These are all potentially legitimate risks. The point is, and I think that the concern is, and Kelly Bennett, our writer, highlighted this, was that the political leaders who are supposed to make these decisions about taking risks, the people who are supposed to make decisions about priorities, weren’t offered the opportunity to, or at least that’s what they say. If they, you know, implemented a culture that wouldn’t have made that possible or something, that’s something they need to answer for but that’s the issue. And so, you know, we have to be able to prioritize this in the publicly and open way.

PENNER: Well, our listeners are really very engaged in this. We have lots of people calling in so let’s take some of these calls and find out what people who live in San Diego feel about this and say about it. We’ll start with Tom in Escondido. Tom, let’s see, Escondido, that’s Pam Slater’s area, isn’t it?

TOM (Caller, Escondido): Yes, it is.

PENNER: Okay, go ahead, Tom.

TOM: Hello. Good morning. I have an experience with the County that is sort of an overview pertaining to the building department but the County as the operator, their thrust, their force, their – just the way they do things. Had a loss in the fires and tried to get permits for building and it’s such a mess, it’s so disorganized, and the left hand has no idea what the right hand’s doing and I’m just – When I go down there, what passes for doing your job? These people just have their little nut and their little cubicle and they don’t have anything, awareness or consciousness, of the larger picture which would’ve been someone saying, look, there’s all this money, we need money, let’s do our job and go, you know, go do the things that are – we’re being paid to do.

PENNER: Okay, thank you, Tom. Barbara, is that the sign of an over-bureaucratized organization?

BRY: Well, I mean, the caller, you know, has his own anecdotal experience and it’s always dangerous to generalize from individual experiences but, in general, you know, as we – you know, you asked me the leadership question before. Leadership starts at the top and, you know, in a well-run organization, you know, the priorities filter down to the bottom.

PENNER: That’s true. However, Barbara, this is a system that’s the target of complaints from the public and the media and criticism from the state Department of Social and Health Services. When you have all this criticism, how can this allow – be allowed to proceed unchanged?

BRY: Well, I think it has to start now with the board of supervisors standing up and, hopefully, you know, in uni – all five of them saying, it’s important for us to apply for, you know, every viable pot of federal stimulus money that is available and that we care about all the citizens of San Diego…

PENNER: Well, we…

BRY: …of every economic level.

PENNER: Well, we haven’t seen that. Yes, the reaction from, example, Supervisors Jacobs and Cox is that the staff has done a great job on getting grants. Let’s hear from another listener and this is from Victor in Valley Center. Hi, Victor. You’re on with the editors.

VICTOR (Caller, Valley Center): Good morning. I just want to post a comment in the opposite direction. I disagree with any efforts of the County to go after more federal money and more handouts and I think it’s great that they’re last priority is more welfare. I think more people just need to get to work, not necessarily because there’s money there from the federal government but because there’s work to be done.

PENNER: Okay. Thanks, Victor. Scott.

LEWIS: Well, that’s interesting. The County already, let’s be clear, allocates tons of resources and money to welfare. So if you don’t want them to do that then there’s a broader discussion to be had. I think the issue is, is that this was money that could’ve been used to take people on welfare currently, just getting handouts, and put them to work. And that was the whole goal of it. The County’s actually relaxed its requirements for its outsourced services who go out and put, you know, manage people on welfare. It’s relaxed their requirements to get people to work because of how bad things are. You know, these entities are supposed to go out, find people on welfare and then work with them but then also get them to work. And the County’s said, you know, things are so hard right now, we understand you probably can’t do that. Here was an opportunity to literally get people to work right away. As I said, LA got 8,000 people to work and there are – there’s evidence across the state that people are staying in those jobs even when these funds run out. If you’re going to have a stimulus, if you have it out there and you’re already doing welfare, this is a chance to achieve some of your goals and if they don’t want to do it, they need to explain a little better.

PENNER: Okay. Thank you, Scott. And thank you, Victor. And we’re going to return to this subject in just a minute. We’re going to take a short break now. When we return, we’ll continue taking your calls. This is the Editors Roundtable. I’m Gloria Penner.

PENNER: This is the Editors Roundtable. I’m Gloria Penner. And we’re discussing a situation whereby the County of San Diego did not go for millions of dollars in federal grants in order to hire the unemployed in San Diego, people who are on welfare and can use the jobs and, sure enough, we would rather that they worked than that they collect welfare. But in this case, the County did not apply for that money and we’re checking into it with our editors and trying to figure out why, and what’s going to happen in the future. With me today at the roundtable we have JW August. JW is the general – I’m sorry, the…

AUGUST: Yeah, yeah, general manager.

PENNER: …general manager, oh, God no. Managing editor of 10News. And Scott Lewis is with us and Scott is the CEO of, and from we have Barbara Bry, who’s co-publisher and opinion editor. We have lots of calls but I do want to say there was a call that came in and, unfortunately, the caller didn’t stay with us but I liked his question so I’m going to ask it. He wanted to know, Scott, whether perhaps the federal money comes with too many strings attached?

LEWIS: I don’t – I don’t think the County is even saying that it came with too many strings. I’m saying that I think they looked at it and they said they didn’t know if it came with too many strings and so they decided that rather than take that risk, they decided to stay back from it. And I think that that – When you make a decision like that then that shows an element of almost political or policy decisions that, you know, we actually are supposedly supposed to elect people to make. If we want an appointed board of supervisors, perhaps we should talk about that. I don’t necessarily think that’s a bad idea. The point is, is that we do have people who are supposed to make calculations about risks and such and that’s what, you know, Ron Roberts, in particular, and Pam Slater-Price were upset about. The other three supervisors were more of we just trust our staff. So it’s actually a very interesting discussion about the management of the County happening right now. And you were asking, you know, what’s happening to fix it. I think that’s what we’re watching right now, is what is, you know, what is the fallout from this? Is everything okay? And this is – and we should just move on? Or it really feels like this story has legs and it’s having an impact.

PENNER: Do you think that everything’s okay now, JW? Or do you think that we’re going to have to see some reaction? Do you think that the public is interested and riled up enough so that the…

AUGUST: Well, I think…

PENNER: …supervisors have to respond?

AUGUST: Well, I – And I agree with Scott that this is a problem but I think it also speaks, and as you said, to a larger problem of management in the County system. There are basically two silos over there, the political side of it and the administrative side. Eckard is on the administrative side and the political side. I deal with him a lot. I talk to a lot of people there in the County. There’s a lot of bright, intelligent, well-meaning people and there’s a lot of Dilberts running around the place who don’t want to rock the boat, they don’t want to tick off Eckard and his office, they don’t want to tick off the supervisors. They’re walking around eggshells. It’s not the best environment. There’s – Every time I call over there, there’s some kind of tension going on between the two sides of the government, two elements of the county government. And I think this walking on eggshells and nobody want to talk to you because they’re afraid the bosses’ll get mad, that sort of thing reminds me of like, you know, of like you’re in East Germany or sometime – It’s incredible sometimes, trying to get through the wall to talk to people there because they’re so frightened they’re going to tick somebody off. Nobody – Everybody’s afraid. Many of them are afraid to stand up and speak for themselves.

PENNER: Well, and in this kind of job environment, people don’t want to lose their jobs.

AUGUST: Well, and I can understand that.

PENNER: They may be one of those people who is going to need the federal stimulus money. Let’s go to Frank now. Frank is in El Cajon and he’s been very patient. Hi, Frank, you’re on with the editors.

FRANK (Caller, El Cajon): …Gloria. It appears that the county – the San Diego County Board of Supervisors is marching to a political ideology that doesn’t believe the government should help the Joe Sixpacks of the world and then goes around administratively preventing the government from helping the Joe Sixpacks of the world. And this latest decision’s just another example.

PENNER: Thank you, Frank. I know – Scott wants to respond but let’s take one more call and then we’ll go around the table and see what the editors have to say about all of this. Margaret in University Heights. Margaret, you’re on with the editors.

MARGARET (Caller, University Heights): Hi.


MARGARET: I think it’s outrageous that the funds weren’t requested. If they didn’t know whether there were strings attached then apply for them; they can always say no. But to not take funding that can help the people that need the help the most, I don’t understand it and it sounds like there’s some sort of conflict that the people who were elected to be our representatives, the supervisors, never got a voice in this decision. It seems to me someone needs to be held accountable for not asking for the money, not when we are in such a poor economic situation. We need to help as many people as possible.

PENNER: Okay, thank you, Margaret. Barbara Bry, your last comment on it. You know, I’d sort of like to know when businesses are helped to pay employees’ salaries, and that’s what would’ve happened here.

BRY: Yes.

PENNER: Federal stimulus money would have gone to the businesses who hire these people to help pay for the salaries. What kind of effect does this have on the economy in general?

BRY: Well, it’s very good because these people are then, you know, earning more money than they were getting on welfare and they’re spending their money at the grocery store, at the department, you know, at Target, at Walmart, and, you know, it has a cyclical effect which is very good for the economy. It actually – What do they call it? The multiplier effect, so it actually, you know, has a very positive impact on the economy.

PENNER: Okay, and last comment on all of this, Scott. Do you expect that we are actually going to see changes or is this just going to float away the way many things do?

LEWIS: Oh, I doubt in the near future if you’ll see some sort of very clear example of where they’ve turned down money.

PENNER: But let me insert this. We do have two supervisors up for election…

LEWIS: Right.

PENNER: …this year. I mean, how will that impact their races for their election?

LEWIS: Well, again, Ron Roberts is – on his website, his top priority is to create jobs for people. I mean, this is a tough situation for him and which would explain why he’s been the most sort of quick to react to this. Look, the county supervisors are in a very interesting situation. On the one hand, their entire job, 80% of their job is dictated by the state and the country, by the federal government, and it’s largely about welfare, human services, public health, that sort of thing. And yet they’re very conservative in many ways and the county supervisors don’t believe that the government should solve problems like this. So they find themselves in this odd situation where they’re – The other day they put out a press release where they want to get rid of obesity. You know, here’s a group of people that don’t believe the government can solve all problems but it can make us thinner. And yet on the other hand, they’re stuck, you know, arguing for very, very conservative positions. And so they are always going to be in this situation of contradiction because their entire facility, the building that – the entity that they run, is about delivering these types of services and so it’s always going to be an awkward situation for them.

PENNER: And it’s interesting, JW, you get the final word on this. The North County Times reported in June that Health and Human Services has a $1.8 billion—billion dollar—budget. Is that more than the City of San Diego? I’m not sure. And…

LEWIS: The general fund, yeah.

PENNER: Yeah. And more than 5,000 workers. It’s slightly larger than it was last year. So we have a well-funded department, more workers…

AUGUST: In a growth industry, apparently.

PENNER: Yeah. And yet the Times also reported that the Family Resource Centers, that is sort of the front door for HHS, for Health and Human Services, seems overwhelmed.

AUGUST: Yeah, and part of the reason they said they didn’t apply for this is they were focusing on other projects, too. I recall that was part of the response from the department. Well, we have other stuff on the table so we really don’t have time to pass this on to the supervisors. There’s a disconnect there. That’s for sure.

PENNER: Barbara.

BRY: Gloria, I don’t want – I don’t think we should make it sound like the County is spending $1.8 billion on its own employees. Most of that money is pass-through money…


BRY: …that goes, you know, to pay for Health and Human Services things.

PENNER: Right, but…

BRY: It’s not like the county employees are earning the money.

PENNER: No, that’s their budget, though.

BRY: Yeah, yeah, exactly.

PENNER: Okay, let’s move on.