arra and the economic crisis

8/14/2019 ARRA and the Economic Crisis

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Photo Credits:Miami Workers Center

Flickr; users South Carolina State Library,

readerwalker, Steve Rhodes

Contributors

Dennis Parker,ACLU

Dominique Apollon,Applied Research Center

Jacob Faber, Center for Social Inclusion

Anita Sinha,Advancement Project

Juhu Thukral, The Opportunity Agenda

Philip Tegeler, Poverty & Race Research Action Council

Deidre Swesnik, National Fair Housing Alliance

Amy Hanauer, Policy Matters Ohio

Gihan Perera, Miami Workers Center

Laura Barret, Transportation Equity Network

Sondra Youdelman, Community Voices Heard


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ARRA&theEconomicCrisisOneYearLater:HasStimulusHelpedCommunitiesinCrisis?

JasonReece,MattMartin,ChristyRogers&StephenMenendian

February2010

ExecutiveSummary

Facinganescalatingeconomiccrisis,newly inauguratedPresidentObamasignedthehistoricAmerican

RecoveryandReinvestmentAct(commonlyreferredtoasthestimulus)onFebruary17th2009.1 The

$787 billion stimulus bill was designed to create and preservejobs, spur economic growth, and be

administeredwithaparticularfocusontransparencyandaccountability.Thestimulusbillmadeexplicit

referenceto

assist

those

most

impacted

by

the

recession.

Has

ARRA

provided

relief

to

our

hardest

hit

communities?HasARRAworkedtopromotegreaterracialandsocioeconomicequityinournation?One

yearintotheimplementationofARRAwefindmixedresults,andoffercriticallessonslearnedfromthe

ARRA experience. In addition, we provide specific recommendations for achieving the goals of the

RecoveryAct,generatingjobsandbroadeningprosperity,andreducingourracialandeconomicdivide.

AnUnevenEconomicCrisis

The brunt of unemployment, layoffs, social service and education budget cuts, foreclosures, and

bankruptcieshasbeenbornebygroupsalreadymarginalizedbythemainstreameconomy.Inparticular,

theracialimpactsoftherecessionandhousingcrisishavebeenextreme.Oneinfivechildrenwereliving

inpovertyin2008,andpovertyratesforchildrenofcolorareclimbingabove40%insomestates.2While

onein

ten

workers

are

unemployed

nationally,

one

in

six

Black

workers

and

one

in

eight

Latino

workers

are unemployed.3 Nearly half of all subprime loans went to African American and Latino borrowers,

eventhoughmanyqualifiedforprimeloans.AfricanAmericanandLatinohomeownersareexpectedto

lose$164$213billioninassetsduetothehousingcrisis.4Whilemuchofouranalysisfocusesonrace,it

is importanttonotethatotherfactors,suchasgeographyandgender, impactedtheway inwhichthe

recession burdened already vulnerable communities. The impact of the recession on children has

alreadybeensevereandwillpotentiallybelonglasting.Thepercentageofchildreninpovertyislikelyto

peak at 21% in 2010. Neighborhoods and communities are also being reshaped by the detrimental

impactsofthehousingcrisisandrecession.

ARRAOneYearLater:ProtectingVulnerablePopulationsfromDevastatingStateBudgetCuts

AsignificantportionofARRAwasdedicatedtooffsettingstatebudgetshortfalls,manyofwhichcould

have

resulted

in

drastic

cuts

to

critical

services

for

marginalized

populations.

In

this

regard,

ARRA

prevented massive budget cuts to critical services that would have further harmed vulnerable

populations.AnalysisoftheimpactofARRAsuggeststhatseveralARRAprogramswillhelpalleviatethe

growingpovertyacrossthenationbyexpandingexistingtaxcreditsandfinancialassistanceprograms.

However,more fiscalperilandpotentialbudgetcutscouldbeonthehorizon.WhiletheRecoveryAct

will provide more than $100 billion to offset state budget deficits in 2010 and 2011, even with this

fundingStatesareexpectinganother$267billioninadditionalbudgetdeficitsfor2010and2011.5Asa

result,thedraconianbudgetcutspredictedfor2009mayloomagainin2010.


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ARRAOneYearLater:FailingtoAddressJoblessnessforMarginalizedRacialPopulations

JobproductionwasaprimarygoalofARRA,andtheabilityofARRAtooffsetrisingunemploymentisa

critical measuring stick to assess ARRAs impact. Despitejob production claims and growth in the US

domestic product, national unemployment has increased during 2009. Between February 2009 and

December 2009, the national unemployment rate increased from 8.2% to 10% and the number of

unemployedincreased

from

12.7

million

to

15.2

million

people.

As

recently

reported

by

the

Associated

Press,therewere6.1unemployedworkersforeveryavailablejobinDecemberof2009,afigurewhichis

nearlydoubletherateof3.1unemployedworkersforeveryavailablejobopeningattheendof2008.6

Workers of all races experienced increasing unemployment during 2009, with the number of

unemployedBlackandLatinoworkers increasingbynearly1.5million.Latinosexperiencedthefastest

rateofunemploymentgrowthduring2009,withunemployedLatinoworkersincreasingby38%.7

RecentlyreleasedJanuary2010unemploymentfiguresindicatesomechangingtrends,withadeclinein

nationalunemployment figures,butcontinuinggrowth inunemployment forsomepopulations.While

the national unemployment rate declined from 10% to 9.7% (indicating a decrease of 430,000

unemployed workers), unemployment increased for some racial groups.8 White unemployment has

started to decrease (from a peak of 9.4% in October 2009 to 8.7% in January 2010), while Black

unemployment

rates

continues

to

rise

(from

15.5%

to

16.5%

during

the

same

time

period).9

Latino

unemployment rates have also decreased slightly but remain very high, decreasing from 13.1% in

October 2009 to 12.6% in January 2010.10 The new divergence in unemployment rates is particularly

troublesome, suggesting our economys modest economic gains from late 2009 are not reaching our

most economically vulnerable populations. While overall unemployment has started to decline (and

declineforWhiteworkers),Blackworkersmaysoonreachthe2010unemploymentratewhichwasonce

projected to occur if a stimulus or recovery bill was not enacted. This suggests that many of the

employmentgainsfromARRAarenotreachingworkersofcolor.

ARRAOneYearLater:UnderperforminginProducingMinorityProcurement&Contracting

Contracting and procurement are the primary ways ARRA can directly benefit private businesses and

employers. Minority and disadvantaged business contracting is a critical source ofjob and wealth

creationformarginalizedgroupsandcommunities.Manyconcernshavebeenraisedabouttheabilityof

minority firms to successfully compete for contracts.11 Although consistent state level data on ARRA

contractingtominorityfirmsisnotwidelyavailable,figuresfromfederalprocurementindicatetroubling

and disparate contracting patterns. While Black, Latino, and Women owned businesses represent

5.2%,6.8%,and28.2%ofallbusinesses respectively,12asofFebruary1,2010,theyhadonlyreceived

1.1%, 1.6%, and 2.4% of all federally contracted ARRA funds.13 Of the $45 billion in direct federal

contractsallocatedbyFebruary1st2010,lessthan$2.4billion(5%ofthetotal)wereallocatedtoBlack,

Latino,andWomenownedbusinesses.

TheHousingCrisisOneYearLater:InadequateFederalResponse

Thesubprimelendingandforeclosurefiasco,akeydriverofthecurrenteconomicrecession,continues

todestabilize

families

and

neighborhoods

across

the

country.

The

Neighborhood

Stabilization

Program

(NSP),whichallocatesfundstocommunitiestobuyandrehabilitatevacanthomes,hasbeencriticizedas

toolittle,toolate.Inmanycommunities,thenumberofvacanthomesisseveralthousandtimesthatof

thenumberofhomespotentiallysalvagedbyNSP.Second,becausetheprogramdirectsthefundstobe

usedinhardesthitneighborhoods(aprinciplethatseemssoundonitsface),itmaybeputtingitsdrops

in the wrong bucket: rather than trying to salvage a few homes in an overwhelmed neighborhood, it

maybebettertomoveforeclosedfamiliesintorehabilitatedhomesinmorestableneighborhoods.


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Infact,thefederalgovernmenthasaddressedtheforeclosurecrisisprimarilyoutsideofthestimulusbill,

throughtheDepartmentofTreasuryprograms.Byallaccounts,evenTreasurystheprogramshavenot

performedwellenough. Withmillionsoffamiliesfacing foreclosure,comparativelyfewhavereceived

permanent loan modifications under Making Home Affordable, which includes both HARP and

HAMP. HARP was designed forborrowerswho are underwater,or owemore than their home is

worth. Unfortunately,manyhomeownersareso farunderwatertheycannotqualify forarefinance;

nordotheyhavetheabilitytopayclosingcosts,giventhattheyhaveexhaustedthemselvesfinanciallytrying to keep current on the mortgage. As of October 2009, about 130,000 of the five million

potentiallyeligibleloansweremodifiedunderHARP.14WithregardstoHAMP,outofthethreetofour

millionhouseholdstargetedbytheprogram,110,000havebeenapprovedforpermanentmodifications

asof lateDecember,withagreatmanymore intemporarymodifications(theAdministrationreported

in January that a total of 850,000 homeowners have received temporary or permanent HAMP

modifications15). Two macroscale forces are weakening the programs, including continually falling

home prices and increasingjoblessness. The voluntary nature of the programs, and the fact that

mortgagecompaniescancollect lucrative fees from longterm delinquency,16has slowedservicerand

lenderaction.

Inshort,thescaleandscopeofthecrisishasoverwhelmedthe federalresponse. TheAdministration

should now consider more significant actions, such as requiring equity writedowns and giving

bankruptcyjudgestherighttoamendmortgages. Inbroaderterms,thesubprimecrisisandresultant

economic tsunami requires nothing short of a systemic reconfiguration of federal priorities, including

effectivebankregulationandconsumerprotections.

MovingForward:RespondingtoChallenges&PromotingOpportunitiesforEquity

DespiteARRAsinabilitytofullycountertheeconomiccrisisfacingmarginalizedcommunities,theneed

for continued federal action, investment and leadership is critical. As documented in this report,

indicatorsforsocioeconomichealthinmanycommunitiesareindicatingwidespreadhardshipformany

marginalizedcommunities,especiallycommunitiesofcolor.Atthestate level,ARRA funds (andfuture

policy efforts to reverse the economic crisis facing marginalized communities) must be refocused in

severalways.

ImproveTrackingofARRAResourcesandOutcomes.Ratherthanscalingbackjobtrackingefforts,thereshouldbeadditionalmeasureswhichconsiderthequalityanddurationof

employment,aswellastherace,gender,andzipcodeofjobrecipients.

IncreaseSmallandMinorityBusinessParticipation.Unbundlelargecontractsforsmallbusinesses.Breakinguplargeprojectswillallowformoresmallbusinessparticipationinthe

recovery.Setandmandatespecific,MBEandDBEGoalsforeverydepartment.

EnsureThatHardHitCommunitiesExperienceJobImpact.Usetargetedreinvestmentinhardhitareas,firstsourcehiring,apprenticeshipandjobtraining.Increaseemployment

opportunitiesforexoffenders.

Inaddition,federalreformsareneededtoassurethatfederalagencyplansareconsistentwithallofthe

goalsofARRA, including itsemphasisonthosemost impactedbytheeconomiccrisis.Areviewofthe

AgencyPlansraises twobroad,systemicconcernsthatrequire immediateattention. First, itappears

thatAgencyprograms fundedbyARRAmay insufficientlyreflectARRAspriorities. There isagreater

needtomorecarefullyalignAgencyprogrammaticactivitieswithARRAsgoals,particularlyitsemphasis

onjobcreationandassistancetothosemostaffectedbythecrisis. Secondly,themandatetoexpend

ARRA funds as quickly as possible, with special priority given to shovelready projects and projects


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receiving private investment, may be giving shortshrift to civil rights compliance, particularly Title VI

andTitleVIIIoftheCivilRightsActof1964.

Finally, an equitable jobs bill is still required to stem the economic crisis facing marginalized

communities.A futurejobsbillwould ideallysupportcommunitydevelopment inurbanandminority

majority areas, which have been damaged most severely by the recession and credit crises. The bill

shouldexplicitly

protect

and

provide

for

those

who

are

especially

vulnerable

to

joblessness

and

lack

of

accesstojobmarkets. Anynewfederaljobcreationstrategythatinvestsinournationsinfrastructure

should invest inothercriticalcommunity infrastructure (outsideof road investments)aswell,suchas

transit, schools and parks. It should develop new recruitment and training standards that help new

workersget intojobs,andhelpminorityandwomenownedbusinessesgeta fairopportunity towin

contracts.Finally,measuresmustbetakentoensure thatmarginalizedcommunitiesarebrought fully

intothegreeneconomy,asgreenjobinitiativesbegintotakeshapeinbothfederalandstatepolicy.


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ARRA&theEconomicCrisisOneYearLater:HasStimulusHelpedCommunitiesinCrisis?

JasonReece,MattMartin,ChristyRogers&StephenMenendian

February2010

TheKirwanInstitutefortheStudyofRace&Ethnicity1www.fairrecovery.organdwww.kirwaninstitute.org

TableofContents:

Page

1. Introduction

6

2. TheUnevenEconomicCrisis 7

3. HasARRAHelpedCommunitiesinGreatestNeed 10

4. ReflectionsfromtheField:ARRAOneYearLater 19

a. NationalReflections:Social,RacialEquity&ARRA DominiqueApollon,AppliedResearchCenter

LauraBarret,TransportationEquityNetwork

JacobFaber,CenterforSocialInclusion

Dennis

Parker,

ACLU

AnitaSinha,AdvancementProject

JuhuThukral,TheOpportunityAgenda

PhilipTegeler,Poverty&RaceResearchActionCouncil

DeidreSwesnik,NationalFairHousingAlliance

20

b. ReportsfromtheStates:Organizing,Advocacy,Equity&ARRA AmyHanauer,PolicyMattersOhio

GihanPerera,MiamiWorkersCenter

SondraYoudelman,CommunityVoicesHeard

28

5. MovingForward:RespondingtoChallenges&PromotingOpportunitiesforEquity

32

1TheKirwanInstitutewouldliketothankallguestcontributorsfeaturedinourreflectionsfromthefieldforsharingtheir

valuableexpertiseandexperiencesforthisreport.ForbiographicalinformationonKirwanstaffwhoauthoredthisreport,

pleasevisit:http://www.kirwaninstitute.org/aboutus/leadershipstaff/


8/44

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recession

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economic

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communi

year

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crisis, sp

communi

social jus

equitable

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crisis in t

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2. TheUnevenEconomicCrisis

WhenHurricaneKatrinadevastatedNewOrleansnearlyfiveyearsago,itquicklybecameclearthatthe

stormhadanundeniablysignificant impactonmarginalizedcommunities. WolfBlitzersSeptember1,

2005quoteintheCNNSituationRoomhassincebecomefamous:Yousimplygetchillseverytimeyou

seethese

poor

individuals.

Almost

all

of

them

that

we

see

are

so

poor,

and

they

are

so

black.

This

is

going to raise lots of questions for people who are watching the story unfold.18 Now, in 2010, a

tremendous economic downturn has impacted all Americans. However, like Katrina, the most

vulnerable populations and communities tended to be the ones hardest hit by the financial disaster.

This is not a coincidence. The reality is that all members of our society do not have equal access to

socialandphysicalinfrastructuresthathelppeopleweatherthestorm.

a. Unevenimpacts

The brunt of unemployment, layoffs, social service and education budget cuts, foreclosures, and

bankruptcies has been borne by groups already marginalized or undervalued by the mainstream

economy.

In

short,

the

economic

recession

has

had

an

uneven

impact

across

various

layers

of

marginalization.Inparticular,theracialimpactsoftherecessionandhousingcrisishavebeenextreme.

One infivechildrenwere living inpoverty in2008,andpovertyratesforchildrenofcolorareclimbing

above40%insomestates.19WhiletheU.S.hasbeeninarecessionformorethantwoyears,peopleof

colorhavebeen inarecession fornearlysixyears,andhaveenteredadepressionduring thecurrent

economiccrisis.20 Whileone in tenworkersseekingemployment isunemployednationally,one insix

BlackworkersandoneineightLatinoworkersareunemployed.21Nearlyhalfofallsubprimeloanswent

to African American and Latino borrowers, even though many qualified for prime loans. African

AmericanandLatinohomeownersareexpectedtolose$164$213billioninassetsduetothehousing

crisis.22Whilemuchoftheanalysisabovefocusesonrace,itisimportanttonotethatotherfactors,such

asgeographyandgender,alsohaveshownunevenimpactsduringtherecession. Forexample,arapid

loss of manufacturing jobs has created devastating economic impacts in traditional rust belt

communitiesintheMidwest(SeeFigures2and3).

b. Longtermconsequences

Theeconomiccrisisisexacerbatinglongstandingchallengesfacingmanymarginalizedcommunities.As

one pediatrician has warned, We are seeing the emergence of what amounts to a recession

generation. Increases in child poverty, homelessness, and temporary relief indicate that children

acrosstheU.S.areexperiencingaquietdisaster.23 Between2007and2008,744,000morechildren

becamepoor,andthenumbersareexpectedtoriseastheimpactsoftherecessioncontinue.24AsNew

YorkTimescolumnistBobHerbertrecentlystated:

there is little doubt thatpoverty andfamily homelessness are rising, that the quality ofpublic

education in many communities is deteriorating and that legions of children are losing access to

healthcareastheirparentsjointhevastlyexpandingranksoftheunemployed.Thisisatoxicmixfor

children,ademoralizingconvergenceoffactorsthathavelongbeenknowntoimpedetheabilityof

youngpeopletoflourish.25


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Theimpactoftherecessiononchildrenhasalreadybeensevereandwillpotentiallybelonglasting.The

percentageofchildreninpovertyislikelytopeakat21%in2010.Twentysevenpercentofchildren8

million will likelyhaveat leastoneparentnotworkingfulltimeyearround in2010. Median family

income is expected to drop for all families, but especially for single femaleheaded households.

Childhoodobesitymayrisefromparents'relianceoncheapmeals,behavioralproblemscouldincreaseif

adolescents

who

are

not

in

school

cannot

findjobs,

and

state

and

local

budget

cuts

could

limit

the

availabilityofprekindergartenprograms.

Neighborhoods and communities are also being reshaped by the detrimental impacts of the housing

crisisandrecession.Thisimpactismagnifiedinmanycommunitiesofcolorwhichhavebeendevastated

by the foreclosure crisis. Communities which had faced a number of challenges already,such as high

poverty,disinvestmentorvacantpropertiespriortotheforeclosureepidemic,arenowfacingextreme

conditions.Theforeclosurecrisisisproducingwidespreadvacantproperties,whichactlikeatoxininthe

urbanenvironment,poisoningthehealthoftheentirecommunity.26Thegrowthinvacantpropertiesis

further dragging down property values, creating extensive blight and safety risks and in some cases

spiraling

stable

neighborhoods

into

a

permanent

state

of

distress,

as

well

as

undermining

entire

cities.

27

For people of color and others isolated in these neighborhoods, the crisis is creating widespread

burdens,ensnaringallresidents,eventhosewhoarenotfacingforeclosure.

Figure2:TheUnevenGeographicFootprintoftheRecession:UnemploymentRatebyCountyDecember09


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Figure3:TheUnevenGeographicFootprintoftheRecession:ChangeinUnemploymentDecember08toDecember09


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Page|10

3. HasARRAHelpedCommunitiesinGreatestNeed?

ToreviewtheimpactofARRAonhardhitandmarginalizedpopulations,weassessafewkeyareas:state

budgetimpacts,jobsproduction(alsoaccountability&transparency),procurementandtheresponseto

the housing crisis. Our evaluation finds mixed results, with ARRA contributing significantly to

communities

in

great

need

in

some

areas

(stabilizing

state

budgets

and

programs

for

those

in

need)

while coming up short in other domains (job production, procurement and housing). Meanwhile,

accountability challenges in data collection make it impossible tojudge thejob benefits produced by

ARRAforhardhitcommunities.

a. AvoidingDisastrousStateBudgetShortfalls

AsignificantportionofARRAwasdedicatedtooffsettingstatebudgetshortfalls,manyofwhichcould

haveresulted indrasticcutstocriticalservices formarginalizedpopulations. Inthisregard,ARRAwas

crucialtoavoidingmassivebudgetcutstocriticalservicesthatwouldhave further isolatedvulnerable

populations. In themonthsprecedingARRAspassage,statebudgetsacross thenationweresuffering

unprecedentedrevenue

shortfalls.

Besieged

by

both

the

housing

crisis

and

the

recession,

nearly

half

of

allstatesfacedbudgetdeficitsattheendof2008.28Inresponse,muchofthereliefprovidedinthefirst

year of ARRA was directed to state budget relief, most notably in supporting health and education

programs.TheGAOreportsthat85%of the$69billion in federaloutlays toStatesbetweenFebruary

andNovemberof2009weredirected tohealth,educationandtraining.29This reliefhasproventobe

criticaltoprotectingstateservices,asnotedbytherecentstatefinancialreportreleasedbytheNational

GovernorsAssociation.

Byprovidingnearly$135billioninflexibleemergencyfundingthroughtheAmericanRecovery

and Reinvestment Act of 2009 (ARRA), the federal government has helped states avoid

draconiancuts

to

state

services.

30

Analysis of the impact of ARRA suggests that several ARRA programs will help soften the growing

povertyacrossthenationbyexpandingexistingtaxcreditsandfinancialassistanceprograms.According

to research produced by the Center for Budget & Policy Priorities, several components of ARRA

(emergencyunemploymentprovision,earned incometaxcredit,makingworkpay taxcredit,childtax

credit,foodstampsanddisabilityassistance)willstemthegrowthofpovertyoverthenextfiveyears.

TheCBPPreportestimatestheseprovisionshelped6.2millionfamiliesavoid fallingbelowthepoverty

linein2009,ofwhichtheyestimatemorethan50%ofthoseassistedwereBlackorLatino(3.3million).31

While these reports show positive results for ARRAs impact on vulnerable populations, concerns are

risinginregardstocontinuallyincreasingpovertyandimpendingstatebudgetdeficits.TheU.S.poverty

rate of 13.2% in 2008 (the most recent national poverty figure), was the highest rate recorded in 11

years.32ThenumberofAmericansinpovertyincreasedby2.5millionbetween2007and2008,ofwhich

more than 60% of new people in poverty were nonWhite or Latino.33 While the recent CBPP report

estimatesARRAwillstemthegrowthofpovertyin2009,without2009povertydata,thisestimateisnot

provable at this time. In contrast, some hard hit states show continued growth in economic distress,

despitethe implementationofARRA.Forexample,Ohiohasnoupdatedpovertyfigures for2009,but


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between theendofDecember2008and December 2009, foodstampparticipation grew by14% and

unemployment increased by 46%, while the number of children on free and reduced lunch grew by

morethan100,000between2007and2009.34

Lookingpast thereliefprovided in2009 forstatebudgets,more fiscalperilandpotentialbudgetcuts

could

be

on

the

horizon.

While

the

recovery

act

will

provide

more

than

$100

billion

to

offset

state

budget deficits in 2010and 2011, even with this funding States are expecting another$267 billion in

additionalbudgetdeficitsfor2010and2011.35Asaresult,thedraconianbudgetcutspredictedfor2009

may be impending without additional federal assistance. The Center for Budget and Policy Priorities

estimates that in response, 43 states have enacted budget cuts which harm our most vulnerable

residents,andifcontinued,suchcutscouldeliminateanother900,000jobs.36

b. Jobs,Accountability&Transparency

JobproductionwasaprimarygoalofARRAandtheabilityofARRAtooffsetrisingunemployment isa

criticalmeasuringsticktoassessARRAsimpact.Themostrecentreportedfiguresforjobsproducedor

supportedby

ARRA

claim

599,108

jobs

supported

or

created

with

ARRA

funds

between

October

1st

and

December 31st 2009.37 Despite the job production claims, national unemployment has continued

unabatedduring2009.BetweenFebruary2009andDecember2009,thenationalunemploymentrate

increased from 8.2% to 10%; the number of unemployed increased from 12.7 million to 15.2 million

during this time frame (See Figures 4 to 8). Despite growth in US gross domestic product (which

increasedby5.7% inthe furtherquarterof2009),joblessnesscontinued togrow in2009.As recently

reported by the Associated Press, there were 6.1 unemployed workers for every available job in

December of 2009, a figure which is nearly double the rate of 3.1 unemployed workers for every

availablejob opening, recorded at the end of 2008.38 Workers of all races experienced increasing

unemployment during 2009, with the number of unemployed Black and Latino workers increasing by

nearly

1.5

million.

Latinos

experienced

the

fastest

rate

of

unemployment

growth

during

2009,

with

unemployedLatinoworkersincreasingby38%duringthistime(SeeFigure4to8).39

AGrowingRacialDivideinUnemployment

RecentlyreleasedJanuary2010unemploymentfiguresindicatesomechangingtrends,withadeclinein

national unemployment figures, but continuing growth in unemployment for some populations (See

Figure9).Whilethenationalunemploymentratedeclinedfrom10%to9.7%(indicatingadecreaseof

430,000unemployedworkers)unemploymentincreasedforsomeracialgroups.40Whiteunemployment

has started to decrease (from a peak of 9.4% in October 2009 to 8.7% in January 2010), while Black

unemployment

rates

continues

to

rise

unabated

(from

15.5%

to

16.5%

during

the

same

time

period).

41

Latinounemploymentrateshavealsodecreasedslightlybutremainveryhigh,decreasingfrom13.1%in

October2009to12.6% inJanuary2010.42 Meanwhilestarkunemploymentdisparitiescontinuewithin

variousdemographiccategoriesintherecentJanuaryunemploymentfigures.Blackmenoverage20are

now experiencing unemployment rates of 17.6% (compared to White male unemployment of 9.1%).

Blackfemaleunemployment isat13.3%,nearlydoubletheWhitefemaleunemploymentrateof6.8%.

Employment for Black youth (ages 16 to 19) is now at 43.8%, nearly twice the rate found for White


14/44

Page|12

youth, whose unemployment rates were 23.5%.43 The new divergence in unemployment growth for

Blackworkers isparticularlytroublesome,suggestingoureconomysmodesteconomicgainsfrom late

2009arenotreachingourmosteconomicallyvulnerablepopulationsandresulting inextremeratesof

unemploymentforsomepopulations.AsrecentlystatedbyDeWayneWickhaminaneditorialcolumnin

USAToday:

Evenmoreworrisome,thejoblessrateforblackmen20andolderroseafullpercentagepoint

to17.6%.ThatrateisclosertothelevelofAmericanswhowereunemployedattheheightofthe

GreatDepression(24.9%),thantothepercentageofwhitemen(9.1%)outofworkinJanuary.44

HasARRAproducedthejobbenefitsexpectedpriorto itspassage?Areviewofunemploymentfigures

andprojectedunemployment(projectedtooccurwithoutarecoverypackage)suggeststhat ithasnot

achievedthejobproductiongainsexpectedofarecoverybill.TheIssueBriefWithoutAdequatePublic

Spending, A Catastrophic Recession for Some prepared by Lawrence Mishel and Heidi Shierholz and

published by the Economic Policy Institute, projected 2010 unemployment rates without a economic

recovery package to addressjoblessness. 45 Their predictions for unemployment in 2010, without an

adequate recovery package are strikingly close to recorded unemployment rates for January 2010,

especiallyforworkersofcolor(SeeFigure10).MishelandShierholzpredictedBlackunemploymentto

reach 18.2% by 2010 without a recovery package, current unemployment figures for Black workers

standat16.5%inJanuary2010andaresteadilyincreasing.Whileoverallunemploymenthasstartedto

decline(anddeclineforWhiteworkers),Blackworkersmaysoonreachthe2010unemploymentrates

expected to occur, if a stimulus or recovery bill was not enacted, suggesting that many of the

employmentgainsfromARRAarenotreachingworkersofcolor.

WhyhaventtheemploymentgainsfromARRAinvestmentsreversedunemploymentgrowth?Although

ARRAhascertainlyproducedsomenewemploymentopportunities,areviewofjobfiguressuggeststhat

more

of

the

employment

opportunities

produced

by

ARRA

were

job

retention

and

not

new

employment.Morethantwothirdsofthejobsreportedduringthelastquarterof2009werereported

by the Federal Department of Education, while 40% of jobs reported were produced by state

stabilization grants going to State Departments of Education.46 Its likely that these state grants

primarilysupportedexistingjobsandpersonnelinpublicsectoragenciesandarenotrepresentingnew

job growth. Analysis by the Associated Press indicates that ARRA investments made little impact in

reversing local level unemployment trends.47 With public support and confidence in ARRA on the

decline,ARRAs inabilitytostemthegrowingunemploymentwithnewjobproductionmaybepartially

responsibleforincreasingpublicdoubtconcerningARRAsimpact.48


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Figure4:

Monthly

Unemployment

Rats

by

Race;

Source:

Bureau

of

Labor

Statistics

Figure5:UnemploymentbyRace(January2009andJanuary2010);Source:BureauofLaborStatistics

6.0

8.0

10.0

12.014.0

16.0

18.0

Monthly National Unemployment Rate by Race(January 09 to Janurary 2010)

White Black Latino Total

7.0

12.8

9.9

7.7

8.7

16.5

12.6

9.7

6.0

8.0

10.0

12.0

14.0

16.0

18.0


Unemployment Rate by Race(January 09 to January 10)

Jan-09 Jan-10


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Page|14

Figure6:

Percent

Change

in

Unemployment

by

Race

2009;

Source:

Bureau

of

Labor

Statistics

Figure7:MonthlyUnemploymentCountsbyRace;Source:BureauofLaborStatistics

Figure8:MonthlyUnemploymentRatesbyRace;Source:BureauofLaborStatistics

22.3%

32.2%

38.4%

33.9%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%


Percent Change in Unemployment, by Race:(January 2009 to January 2010)

Count Dec08 Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oct09 Nov09 Dec09 Jan10

White 8,458 8, 815 9,408 9,996 10,213 10, 874 10, 986 10,927 11, 254 11, 366 11, 813 11,589 11,266 10,782

Black 2,150 2,278 2,396 2,367 2,676 2,650 2,617 2,600 2,682 2,701 2,754 2,757 2,843 2,929

Latino 2,089 2,186 2,433 2,571 2,548 2,860 2,739 2,792 2,908 2,849 2,939 2,872 2,891 2,848

Total 11,400 11, 919 12,714 13,310 13,816 14, 518 14,721 14, 534 14, 993 15,159 15, 612 15,340 15,267 14,837

Source:ftp://ftp.bls.gov/pub/suppl/empsit.cpseea3.txt, http://www.bls.gov/news.release/empsit.nr0.htm

Rate Dec08 Jan09 Feb09 Mar09 Apr09 May09 Jun09 Jul09 Aug09 Sep09 Oct09 Nov09 Dec09 Jan10

White 6.7 7.0 7.5 8.0 8.1 8.6 8.7 8.7 8.9 9.1 9.4 9.3 9.0 8.7

Black 12.1 12.8 13.5 13.5 15.0 15.0 14.8 14.7 15.2 15.5 15.7 15.6 16.2 16.5Latino 9.4 9.9 11.0 11.6 11.4 12.7 12.3 12.4 13.0 12.7 13.1 12.7 12.9 12.6

Total 7.4 7.7 8.2 8.6 8.9 9.4 9.5 9.4 9.7 9.8 10.1 10 10 9.7

Source:ftp://ftp.bls.gov/pub/suppl/empsit.cpseea4.txt, http://www.bls.gov/news.release/empsit.nr0.htm


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Figure9:Recenttrendsinunemploymentbyrace;Source:BureauofLaborStatistics

Figure10:ActualJanuary2010unemploymentratescomparedtoprojected2010unemploymentrates(projectedtooccurin

2010 without a recovery bill). Actual January 2010 unemployment figures from the Bureau of Labor Statistics, projected

figuresbasedonanalysisinthereportWithoutAdequatePublicSpending,ACatastrophicRecessionforSomepreparedby

Lawrence Mishel and Heidi Shierholz and published by the Economic Policy Institute (January 2009).49

Note: Latino teen

January2010figureisnotseasonallyadjusted,noseasonallyadjustedfiguresavailableforLatinoteensinJanuary2010.

9.4 9.39.0

8.7

15.7 15.616.2

16.5

13.112.7 12.9 12.6

10.1 10 109.7

8.0

9.0

10.0

11.0

12.0

13.0

14.0

15.0

16.0

17.0

Oct09 Nov09 Dec09 Jan10

RecentUnemploymentTrends(Rate)byRace

10/2009to1/2010


9.7 8.7

16.512.6

23.5

43.8

37.2

10.2 8.9

18.2

13.1

30.1

55.7

35.7

0

10

20

30

40

50

60

Total White Black Latino WhiteTeens BlackTeens LatinoTeens*

ActualJanuary2010unemploymentvs.unemploymentprojectedto

occurin2010withoutarecoveryact

ActualJan2010UnemploymentRates 2010RatesProjected(WithoutaRecoveryBill)


18/44

Page|16

Additionally,thetracking,reportingandaccountabilitymethodsforARRAhavecontinuedtoundermine

theabilitytogaugethetrueemployment impactofARRA investmentsandgrants.AlthoughARRAhas

many requirements for tracking, accountability and transparency, one of the most significant

shortcomings of the tracking efforts thus far is the failure to record data pertaining to the impact of

investmentsandjobcreationformarginalizedgroupsandcommunities.Manyofthetrackingmeasures

failto

consider

some

basic

indicators

related

to

community

need

and

distress,

such

as

geography,

race,

andgender.Themainchallengetotrackingtheimpactofrecoveryexpendituresisthelackofraceand

genderdataat theemployee level. According tothe July22,2009OMBGuidancememo,ARRA fund

recipientsarenotrequiredtotrackandreportdataoneithercategory.Althoughgeographicaldataare

trackedbyrecipient,recipientsarenotrequiredtotrackemployeeleveldata.Failingtotrackemployee

leveldatabyrace,gender,andgeographywillmake itverydifficulttodeterminewhetherARRAfunds

are reaching marginalized communities and, more broadly, whether the economic recovery is truly a

recoveryforallAmericans.

The challenges associated with tracking resources and determining their impact upon marginalized

communitieshave

been

compounded

by

recent

changes.

.Following

increasing

sentiment

that

ARRA

has

had no real impact upon local unemployment,50 the White House recently made changes to the

methodology for howjob impact will be reported. While the original methodology was intended to

count the number of newjobs, or the number ofjobs that would have otherwise been lost without

ARRA intervention, beginning with 2010, the tracking measures will only be counting the work hours

thathavebeenpaidforwithARRAresources,fundamentallydismantlinganyabilitytodeterminewhere

jobshavegenuinelybeencreatedorsaved.51

c. Procurement&Contracting

ContractingandprocurementaretheprimarywaysARRAcanbenefitprivatebusinessesandemployers.

Minority

business

(and

disadvantaged

business)

contracting

is

a

critical

source

ofjob

and

wealth

creationformarginalizedgroupsandcommunities.Greatconcernshavebeenraisedabouttheabilityof

minorityfirmstosuccessfullycompeteforcontracts.52Whilesomestates(suchasMaryland&Colorado)

havemadeeffortstoopenaccesstostimulusresources,manyminorityandsmallfirmsareexperiencing

challenges accessing stimulus contracts, due to poor outreach by states, labor contracts which favor

largerWhiteunionfirms,and limitedbusinesscapacity. Inresponse,someminoritybusinessnetworks

areattemptingtocollaboratetogainaccesstostimuluscontracts,butprogresshasbeenlimited.53

Although consistent state level data on ARRA contracting to minority firms is not widely available,

figures from federal procurement indicate very troubling and disparate contracting patterns when

reviewingdata

on

procurement

to

minority

and

women

owned

businesses.

While

Black,

Latino,

and

Womenownedbusinessesrepresent5.2%,6.8%,and28.2%respectively,54asofFebruary1,2010,they

hadonlyreceived1.1%,1.6%,and2.4%ofallfederallycontractedARRAfunds(SeeFigure11).55Ofthe

$45 billion in direct federal contracts allocated by February 1st2010, less than $2.4 billion (5% of the

total)wereallocatedtoBlack,LatinoandWomenownedbusinesses(SeeFigures11and12).


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Figure11:FederalARRAContractProcurementbyBusinessType(AsofFebruary1st2010)

Business Type Contracts Amount % of Contracts % of Amount

Small Business 11,933 $7,498,160,470 36.2% 16.5%

Total for All Non White Owned 4,721 $3,409,766,348 14.3% 7.5%

Women Owned 2,655 $1,100,301,476 8.1% 2.4%

Hispanic Owned 1,232 $725,105,107 3.7% 1.6%

Black Owned 864 $496,588,134 2.6% 1.1%

Total for All Contracts 32,946 $45,505,971,648

Source: Federal Procurement Data System (www.fpds.gov), Recovery Report; 2/1/2010Figure12:FederalARRAContractProcurement(Volumeof$'s)byBusinessType

HistoricalchallengesinminoritycontractingatthestatelevelandrecentreportsfromtheStatessuggest

similartrendsmaybehappeningwithStatelevelARRAcontracts.In2008,theCaliforniaDepartmentof

Transportation only procured $3.1 million out of $2.3 billion in state transportation contracts.56

Research recently conducted by the Kirwan Institute on Florida Department of Transportation

contracting to minority businesses, found few ARRA contracts allocated to minority firms, despite

attemptsbytheStatetosupportminorityprocurement.57

d. RelieffromtheHousingCrisis?

Thesubprimelendingandforeclosurefiasco,akeydriverofthecurrenteconomicrecession,continues

todestabilize

families

and

neighborhoods

across

the

country.

The

Neighborhood

Stabilization

Program

(NSP),whichallocatesfundstocommunitiestobuyandrehabilitatevacanthomes,hasbeencriticizedas

toolittle,toolate.Inmanycommunities,thenumberofvacanthomesisseveralthousandtimesthatof

thenumberofhomespotentiallysalvagedbyNSP. Forexample,anestimated31to39propertiescan

be remediated in Oakland,CA (depending on the sale price of the property). Data from the Oakland

CommunityLandTrustindicatesthat10,249propertieswereindefaultintheCityasofDecember2009,

with936newdefaults in2009alone. Second,becausetheprogramdirectsthefundstobeusedto in

hardesthitneighborhoods(aprinciplethatseemssoundonitsface), itmaybeputtingitsdrops inthe

36.2%

14.3%

8.1%

3.7%2.6%

16.5%

7.5%

2.4% 1.6% 1.1%0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

SmallBusiness TotalforAllNon

WhiteOwned

WomenOwned HispanicOwned BlackOwned

FederalARRAContractProcurementbyBusinessType

%of

Contracts %

of

Amount


20/44

Page|18

wrongbucket:ratherthantryingtosalvageafewhomes inanoverwhelmedneighborhood, itmaybe

bettertomoveforeclosedfamiliesintorehabilitatedhomesinmorestableneighborhoods.

Infact,thefederalgovernmenthasaddressedtheforeclosurecrisisprimarilyoutsideofthestimulusbill,

through the Department of Treasury programs. By all accounts, even Treasurys programs have not

performedwellenough. Withmillionsoffamiliesfacing foreclosure,comparativelyfewhavereceived

permanent

loan

modifications

under

Making

Home

Affordable,

which

includes

both

HARP

and

HAMP. HARP was designed forborrowerswho are underwater,or owemore than their home is

worth. Unfortunately,manyhomeownersareso farunderwatertheycannotqualify forarefinance;

nordotheyhavetheabilitytopayclosingcosts,giventhattheyhaveexhaustedthemselvesfinancially

trying to keep current on the mortgage. As of October 2009, about 130,000 of the five million

potentiallyeligibleloansweremodifiedunderHARP.58WithregardstoHAMP,outofthethreetofour

millionhouseholdstargetedbytheprogram,110,000havebeenapprovedforpermanentmodifications

asof lateDecember,withagreatmanymore intemporarymodifications(theAdministrationreported

in January that a total of 850,000 homeowners have received temporary or permanent HAMP

modifications59). Two macroscale forces are weakening the programs, including continually falling

home prices and increasingjoblessness. The voluntary nature of the programs, and the fact that

mortgagecompaniescancollect lucrative fees from longterm delinquency,60has slowedservicerand

lenderaction.

Inshort,thescaleandscopeofthecrisishasoverwhelmedthe federalresponse. TheAdministration

should now consider more immediate significant actions, such as requiring equity writedowns and

givingbankruptcyjudges the right toamendmortgages. Inbroader terms, thesubprime lendingand

foreclosurecrisis requiresnothingshortofa largescale,systemic reconfigurationof federalpriorities,

includingeffectivebankregulationandconsumerprotection. Forexample,thenewmodelthatbanks

havedevelopedtoservelowerincomeandlowerwealthcustomersdependslargelyonfees.Mortgage

companies first shifted from interest to feebased income by originating loans to sell, not hold; then

banksfollowedsuitwithotherproducts. Whatssignificantaboutthisshiftonethat,unsurprisingly,

disproportionatelyburdenspeopleofcolor isthat itactuallyworsensthe financialoutlook formost

families.

From

subprime

mortgage

pre

payment

penalties,

to

credit

card

fees,

to

insufficient

funds

fees,

toremittancefees,feesdigpeopledeeperintodebt.Thefeestructureisinfactactivelyhamperingloan

modificationprograms;servicersprefertocontinuetocollectinvestorfeesratherthanmodifyloans.

***********************

Formoreinformationonthehousingandcreditchallengesfacingcommunitiesacrossthecountryinthe

wakeofthecrisis,pleaseseeourrecentlyreleasedreport,FairCreditandFairHousingintheWakeoftheSubprimeLendingandForeclosureCrisis:FindingsfromtheKirwanInstituteInitiativeavailableatwww.kirwaninstitute.org. The report reflects conversations with twentyfive diverse Advisory Board

Members,fourteen indepth commissioned works by leading academics andpractitioners, and an in

personlookatthefairhousingandfaircreditlandscapeindistinctlydifferentregionsacrossthecountry.***********************


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4. ReflectionsfromtheField

The following section of this report presents reflections by leading experts and advocates who have

worked to produce equitable recovery policy and outcomes for marginalized communities. The

reflectionsoftheseexperts in the field illustratesomeof thechallengesandopportunities, invarious

domains(education,

procurement,

housing),

and

at

both

the

national

and

state

level,

associated

with

ARRA in itsfirstyear.Inaddition,commentatorsreflectontheARRAsabilitytoaddressthe impactof

thehousingcrisisoncommunitiesofcolor,whileexploringtheroleofTARP inaddressingfairhousing

challenges.Inclosing,organizersandadvocatesfromOhio,Florida,MinnesotaandNewYorkreflecton

the impact of ARRA in producing economic relief and equity for marginalized communities. These

reflections explore impacts of the green economy of workers of color, contracting challenges and

opportunitieswithARRA,dataandtransparencyconcernsandareasofreformfordatacollection.These

collective reflections paint a compelling view of the critical lessons learned from ARRA, and present

insightfulcommentaryofwhatneedstohappentopromoteafairrecoveryforall.

a. NationalReflections:Social,RacialEquity&ARRA DominiqueApollon,AppliedResearchCenter

LauraBarret,TransportationEquityNetwork


DennisParker,ACLU

AnitaSinha,AdvancementProject

JuhuThukral,TheOpportunityAgenda



b. ReportsfromtheStates:Organizing,Advocacy,Equity&ARRA AmyHanauer,PolicyMattersOhio


SondraYoudelman,CommunityVoicesHeard


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NATIONALREFLECTIONS:SOCIAL,RACIALEQUITY&ARRAONEYEARLATER

ARRA1YearLater:Recovery,GreenJobsandCommunitiesofColor

DominiqueApollon,AppliedResearchCenter

At theAppliedResearchCenter (ARC), we believe thatARRAmustnot succumb to the myth that the

principalreason

women

and

people

of

color

are

woefully

underrepresented

in

green

jobs

is

their

lack

of

skills,preparation,and/ordesire.Whatourcommunitiesneedisjobcreation,notjustjobtraining.And

even where jobs are created, we must remove structural barriers and discrimination that limit

communitiesofcolorandwomensaccesstogoodqualityjobs.

ARRAwillnot liveuptoPresidentObamaspromiseof"helpingthosehardesthitbytherecession," in

largepartbecausetherearenoracialandgenderequitystandardsinplace.TheRecoveryActisunlikely

to alter the status quo of white men dominating greenjobs and green entrepreneurship if the focus

remainssolelyorevenprimarilyonjobtraining(accordingtotheWomenofColorPolicyNetwork,less

than30% of greenjobs areheld byPOC,andgenderdisparitiesare evenmore stark.ARCanalysisof

Equal Employment Opportunity Commission data found that less than 9% of energy sector firms are

owned/managedbyPOC).AreviewofmanyARRAgrantsinthegreensector,includingPathwaysOutof

Poverty,Energy

Training

Partnership,

and

State

Energy

Sector

Partnership

and

Training

grants,

reveal

thatonthecriticalmatterofjobplacement,littletonoaccountabilityisrequiredofARRArecipients.

Insteadofjobtrainingalone,recoverydollarsmustconcentrateonthetargetedcreationofjobs inthe

communities that suffer most from unemployment and barriers to employment. More thanjust the

trainingprogramsofPathwaysOutofPoverty,weneedguaranteedGreenCareerLaddersthatscreenin

POC/women into familysustaining, green careers. A true recovery will do more than simply train

womenandpeopleofcolorforjobsthatdonotyetand indeedmayneverexist intheircommunities,

anditwillensurethemaccesswhenandwherejobsarecreated.

As part of our Green Equity Toolkit for community organizations, interested in advocating for the

creation of goodquality greenjobs and for equitable outcomes, ARC highlights an example ofjob

creation inacasestudyongreenretrofitsofLosAngelescitybuildings.SCOPE,themainadvocatefor

the retrofit policy, also identified ways of reducing structural barriers to employment (for example,

providingchildcareforsinglemotherssotheycanparticipateinatrainingprogram).

ARRA isbutafirststeptoward liftingourcountryoutofthisrecession.Now,weneedto insertequity

standards inreportingrequirementswithaccountabilitymechanismstodemandthereturnof funds if

equity isnt practiced. Also known as the clawback, these mechanisms would be similar to those

announcedby theOMBonDecember18th to terminateawardsand/or revokea recipientsability to

receivefuturefundswhentheyfailtoupholddatareportingstandardsortocorrectreportingproblems.

Without collecting the data on who is receivingjobs that are actually created, ARRA funds forjob

trainingareunlikelytotrulyhelpthosewhohavebeenhardesthit. Again:jobcreation,notjustjob

training.

DominiqueApollon

is

Research

Director

at

the

Applied

Research

Center,

aracial

justice

think

tank

and

homeformediaandactivismwithofficesinOakland,CAandNewYorkCity.www.arc.org


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ARRAOneYearLater:Transportation,InvestmentandEquity

LauraBarrett,TransportationEquityNetwork(TEN)

Thestimulusbillwasan extraordinarychance to reverse thesystematicdenialofopportunity to low

incomepeopleandpeopleofcolor.Itssignificantinvestmentsintransportationinfrastructureprovided

awaytobegintoreshapeourmetropolitancenterstospureconomicgrowth,reverseongoingpatterns

ofde

facto

segregation,

and

promote

sustainable

development.

Intherushtogetthefundsoutthedoor,manyofthoseopportunitieswerelost.TheU.S.Department

ofTransportationhasdisclosedthatofthe$48billioninfederalstimulusfundscommittedforhighway

constructionviastatesasoftheendof2009,only$986million(2%)werecommittedtodisadvantaged

andminoritycontractorsinspiteofamandatoryminimumof10%.TEN itselfdiscoveredthatofthe

$163.8million incontracts theUSDOTawardeddirectly (notviastates),$9.7millionwent towomen

ownedbusinesses,$4.7milliontoHispanicownedbusinesses,and$0toBlackownedbusinesses.

We have heard from minority contractors and TEN members that minority firms need technical

assistance,bondingcapacity,andgreateraccesstoinsuranceinordertoleveltheplayingfieldforthese

contracts.ThoughTransportationSecretaryRayLaHoodhastakenstepstoexpandbondingassistance,

statesand

localities

have

clearly

paid

too

little

attention

to

these

issues.

And

in

spite

of

the

competitive

biddingsystem,minoritycontractorsarestrugglingwithanoldboysnetworkthathas leftthemout in

thecoldforyears,andleftstatesfallingfarshortoftheirdisadvantagedbusinessparticipationgoalslong

beforetherecession.

TheObamaadministrationneedstoensure,whetherbyexecutiveorderortakingtheleadinCongress,

that detailed demographic information is recorded and publicized on exactly who is winning these

contractsandwhoisactuallyperformingthework.

Wealsoneedtoguaranteethatfuturegrowthissustainablebotheconomicallyandecologically.TENs

GreenConstructionCareersmodel,whichwasincludedintheAmericanCleanEnergyandSecurityActof

2009(ACESA),wouldachievethisbybuildingmasstransitandbridgesandrepairingexistinghighways;

employingsignificantnumbersoflowincomepeople;andleadingtolongtermconstructioncareers.

Itsnottoolateforfederalactiontoseizetheopportunitiesmissedbythefirststimulus.Infact,weneed

itmorethanever.

LauraBarret is theExecutiveDirectorof theTransportationEquityNetwork (TEN).TheTransportation

EquityNetwork (TEN) isagrassrootsnetworkofmore than350communityorganizations in41states

workingtocreateanequitybasednationaltransportationsystem.TENseekstomeetthechallengesof

current crises in the economy, energy security, and climate change by building healthy, equitable

communitiesandprovidingequalpublictransportationaccesstoall.www.transportationequity.org


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ARRA1YearLater:Wheresthedata?Thepromiseoftransparencyhasyettobefulfilled


Americawillcomeoutofthisrecessionstrongerifallcommunitiesexperiencerecovery.Todothat,weneed

transparencytoknowifrecoverydollarsarereachingthehardesthitcommunities.Trackingthedollarsinthis

wayalsomakesvisiblewhengovernmentinvestmentimproveslivesandstrengthenscommunities,andwhen

it

doesnt.

We

cannot

do

this

without

the

right

data.

So

far,

the

promised

transparency

of

the

American

RecoveryandReinvestmentAct(orStimulus)hasfallenshort.

TheGreatRecessionishittingcommunitiesofcolorhardest.

Thesubprimelendingandforeclosurecrisistoredownourwholeeconomyandisaffectingeverycommunity.

A disproportionate number of these preyedupon borrowers were people of color. Black and Latino

borrowersearningover$350,000weremorelikelytoreceivesubprimeloansthanWhiteborrowersearning

under $50,000 a year in 2006.61

Homeownership rates among people of color fell twice as far (0.9%)

between2007and2008comparedtoWhites(0.4%)andthis isonlythefirsthalfoftherecession.62

Job

loss, while painful across the country, has also had its deepest impact in communities of color.

UnemploymentforBlacks(16.2%)andLatinos(12.9%)hasrisenhigherandfasterthanthenationalaverage

(10.0%) especially among youth.63

These disparities show us how much race still matters in shaping

opportunity.

Transparencyeffortsareagoodstart,buttheyhavealongwaytogo.

Recovery.gov isastep intherightdirection,butthesiteoffersnowaytomeasurehowequitablystimulus

dollarsarespent.Theresnoaccuratelocationlistedformanyinfrastructureimprovements.Forexample,the

HousingAuthorityofNewYorkCityisreceivingagrantfor$423,284,344. Itisunlikelythataffordablehousing

isbeingbuiltattheaddressprovidedbyRecovery.gov:NewYorkCityHall.Similarly,jobcreationestimates

areunreliableandtheydonttelluswhoisgettingjobs.Thesamegrantmentionedabovewillonlycreateor

save27.3jobsatthecostof$15,504,921perjob.Ifwedontknowwherethehousingisgoingup,orwhois

gettingthe27.3jobs,wedontknowwhetherStimulusisreachingthosewhoneed itmost,thehardesthit

communities.

Whatcan

be

done

to

improve

transparency?

TheOfficeofManagementandBudget (OMB)mustrequiretheprecise locations forallprojectsandthe

race/ethnicity,gender,andzipcodeofemployedindividuals.Asafirststep,thiscanbedonebyadjustingthe

RecipientReportingDataModel.

JacobFaberisaseniorresearcheratTheCenterforSocialInclusion.TheCenterforSocialInclusionworksto

transformstructuralbarrierstoopportunityforcommunitiesofcolor,andensurethatweallshareinthe

benefitsandburdensofpublicpolicy.www.centerforsocialinclusion.org

Figure13:SampleDataAvailablefromNewYorkStimulusTrackingWebSitewithcommentaryinsertedbyauthor.


25/44

Page|23

ARRA1YearLater:AssuringMinorityBusinessProcurementforARRAContracts

DennisParker,ACLU

From the very beginning of discussions about the American Recovery and Reinvestment Act of 2009

(ARRA), advocates recognized that any efforts to stimulate the economy would have to address the

plightofpeopleofcolorandwomenwhohadneverbeenfullparticipantsinthenationseconomyand

whohadonlybeenpushedfurthertotheperiphery inthecurrentdownturn.Atthesametime,ARRA

presented an unparalleled opportunity to counteract the effects of the downturn while promoting

inclusion in the national economy for the previouslyexcluded groups. It was equally clear that the

success of such an effort would depend on the efforts of government officials to include racial and

genderequalityconsiderationswhenshapingprogramssupportedbyARRAfunds.

Onebarriertotheproperconsiderationofrace,ethnicity,andgenderinshapinggovernmentpolicywas

themistakennotionthatthelawprohibitsgovernmentfromtakingraceandgenderintoconsideration.

The erroneousnotion was only reinforcedbymisreadingof the significance ofRicciv.DeStefano, the

United States Supreme Court June 2009 decision regarding the use of test scores to determine

promotionsofwhite,AfricanAmericanandHispanicfirefighters inNewHaven,Connecticut.Infact,as

described

in

documents

contained

in

the

FairRecovery.org

website,

state

and

local

governments

have

always been able to employ race and gendersensitive, or even, in some circumstances, race and

genderbased,approachestothedisbursementofARRAfunds.NothingintheRiccidecisionchangedthe

ability of governmental bodies to take these approaches. In factRicci interpreted Title VII of the Civil

RightsActof1964andnot theEqualProtectionClauseoftheFourteenthAmendmentwhichgoverns

theconsiderationofraceandgenderingovernmentaldecisionmaking.

Three documents on the www.FairRecovery.org website provide guidance for government officials

seekingtodesignprogramswhichwillbenefitthepeopleofcolorandwomenwhohavefelttheeffects

ofeconomicproblemsmostharshly.ExpandingEconomicOpportunityThroughtheAmericanRecovery

and Reinvestment Act of 2009 the Legal Landscape sets forth the general rules governing the

consideration of race and gender as interpreted by the United States Supreme Court. Promoting

Opportunity

and

Equality

in

America:

Part

II

provides

an

outline

of

the

development

of

the

applicable

lawineachofthefederalcircuitsinthenation.PromotingOpportunityandRacialEqualityinAmerica:A

Guide for Federal, State and Local Governments helps to provide a blueprint for designing programs

which further racial and gender equality in ways consistent with the Fourteenth Amendment. Using

these tools as a guide, government officials can begin to construct policies which consider racial

classifications or are, in some circumstances, explicitly raceconscious in order to assure equal

opportunityforparticipationinaneconomicrecoveryandinthenationseconomiclifeingeneral.

Thesematerialsdemonstratethatthelawisnotabarriertoeffectiveeffortstoreversepracticeswhich

haveexcludedpeopleofcolorandwomenfromfullparticipationinthenationseconomiclife.Without

a conscious effort to include principals of racial and gender fairness in the creation of programs

supported by ARRA funding, state and local governments would be squandering an unprecedented

opportunity

to

assure

fairness

while

contributing

to

the

economic

health

of

the

country

as

a

whole.

DennisParkeristheDirectoroftheACLUNationalOfficesRacialJusticeProgram(RJP).Concentratingon

issuesoftheschooltoprisonpipelinewhichfunnelschildrenofcolorfromtheeducationalsysteminto

thecriminaljusticesystem,racialprofiling,affirmativeaction,indigentrepresentationandfelon

enfranchisement,theRJPseekstoremovebarrierstoequalopportunityforcommunitiesofcolorthrough

litigation,publiceducation,communityorganizingandlegislation.www.aclu.org


26/44

ARRA1Y

AnitaSin

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27/44

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28/44

Page|26

ARRAandAccesstoOpportunityatHUDandtheU.S.DepartmentofEducation


TheAmericanRecoveryandReinvestmentAct isdesignedtostimulatetheeconomyandhelpfamilies

hardest hit by the recession, but it also represents a onceinalifetime opportunity to transform the

discriminatorystructures

that

have

perpetuated

inequality

and

helped

to

fuel

the

recession.

In most areas of the federal budget, targeting specific geographic areas can be an effective way of

bringingjobs and other resources to disadvantaged families hit hardest by the recession. But when

assessingthedeploymentofhousingandschoolresources,wealsoneedtorecognizethatgovernment

policiesthatconcentratepoorpeopleofcolorinparticularneighborhoodsandschoolsarealsohelping

todriveinequalityandstructuraldisadvantage. Inhousingandeducation,poorfamiliesneedaccessto

highopportunityschoolsandcommunities,notmoresegregation. Newopportunitiesforpeople,not

places,needtobetheprimarytargetsofARRAinvestmentinhousingandeducation.

Forexample,atHUDandtheDepartmentofTreasury,programslikethePublicHousingCapitalFundare

supporting

muchneeded

improvements

in

the

public

housing

stock

without

giving

public

housing

residentsanynewchoicesaboutwheretolive. OtherARRAhousingprogramssharesimilarproblems:

the$2billionNeighborhoodStabilizationProgramneedstoberevisedtoopenuprentalopportunities

inhighopportunitycommunities;and the$2.25billion fundingprogram tostimulate theLow Income

HousingTaxCreditprogramshouldbecomeavehicle todrive longoverdue civil rights reforms in the

program,notsimplycontinuebusinessasusual.

Similarly,attheDepartmentofEducation,vastsumsofARRAfundingareflowingintoexistingstateand

localeducationstructuresthatinmoststatessupportseparateandunequalschoolsforpoorchildrenof

color. EventhetwocompetitiveARRAfundsthatsupporteducation innovationtheRacetotheTop

Fund ($4.35 billion) and the Investing in Innovation Fund ($650 million) include no incentives or

requirementsfor

applicants

to

reduce

racial

and

economic

concentration

in

K12

education.

By passing money through existing funding structures for housing and education, HUD and the

Department of Education risk reinforcing existing inequalities that are tied to place. These agencies

shouldreexaminetheirapproachinthesecondyearofARRA,toexpandopportunitiesforfamiliesmost

affectedbytherecession,ratherthanjustfundinghousingandschoolsindisadvantagedplaces.

PhilTegeleristheExecutiveDirectorofthePoverty&RaceResearchActionCouncil(PRRAC).PRRAC's

primarymissionistohelpconnectadvocateswithsocialscientistsworkingonraceandpovertyissues,

andtopromotearesearchbasedadvocacystrategyonstructuralinequalityissues.www.prrac.org


29/44

Page|27

FairHousingandtheRecovery:MovingPastARRATARP,FairHousingandtheHousingCrisis


The federal Fair Housing Act passed in 1968 has the dual mission to both eliminate housing

discrimination

and

promote

residential

integration.

In

order

to

promote

integration,

the

Fair

Housing

Actrequiresthatgovernmentagenciesspendfundsdedicatedtohousingandcommunitydevelopment

inamannerthataffirmativelyfurthersfairhousing.Thisobligation isnot limitedtotheDepartment

of Housing and Urban Development; rather it applies broadly and means that government agencies

spendinghousingandcommunitydevelopmentfundsandrecipientsofgovernmentgrantsmustuse

thosefundsinawaythathelpscreateintegrated,healthyneighborhoods.

AsAmericastruggles toemerge from itscurrenteconomicstruggles, the requirement toaffirmatively

further fair housing is as important as ever. Government efforts to jumpstart the economy have

involvedmassivespendingonhousingandcommunitydevelopment.Forexample,theTroubledAsset

Relief Program (TARP), the single largest program in place to address the economic crisis, has

recapitalized banks with the intention of restoring their ability to lend and has worked to provide

homeownerson

the

brink

of

foreclosure

with

opportunities

to

modify

their

loans

before

it

is

too

late.

Becausetherecessionhashitcommunitiesofcolorthehardest,andbecausetherecessionbeganinpart

becauseoffaileddiscriminatorymortgage loansmadeinthosecommunities,anyattemptstoeasethe

recession must involve explicit plans to increase residential and economic opportunities for the

residentsofthoseneighborhoods.

If TARP funds are to be administered in a way that affirmatively furthers fair housing, the federal

governmentmust: (1)analyze itsownprograms for raciallydisparate impactsandadjustprograms to

eliminatethoseimpacts;(2)identifywaysinwhichgranteesandrecipientsofitsfundscanaffirmatively

furtherfairhousingandevaluatetheirperformancebaseduponthiscriteria;and(3)allocate fundsto

communitygroupswithexperienceconnectingpeopletoeconomicandresidentialopportunities.The

financial services industry can also take specific steps to meet its fair housing obligations by offering

responsibleloans

that

enable

community

choice,

assuring

fair

marketing

of

properties,

sponsoring

non

discriminatoryforeclosurepreventionefforts,andfinancingfaireconomicdevelopmentopportunities.

Advocates play an important role in this equation: they must remind the federal government of the

importance of affirmatively furthering fair housing, use publicly available information to evaluate the

performanceofTARPrecipients,challengeTARPrecipientsthatareneglectingtheirresponsibilities,and

partnerwithwillingTARPrecipientstoprovidemeaningfulopportunitiesfortheAmericanpublic.

Deidre Swesnik is the Director of Public Policy and Communications at the National Fair Housing

Alliance.TheNationalFairHousingAllianceisthevoiceoffairhousing.NFHAworkstoeliminatehousing

discrimination and to ensure equal housing opportunityfor allpeople through leadership, education,

outreach,membershipservices,publicpolicyinitiatives,advocacyandenforcement.

www.nationalfairhousing.org


30/44

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31/44

Page|29

BeyondtheQuickFix:FightingforaFairRecoveryinFlorida


WhentheARRA,(i.e.stimulus)wasfirstannouncedweknewthattherewasthepossibilitythatitcould

right historic wrongs and create longneededopportunity through massive investment. However, we

alsohad

experience

that

the

funding

pipelines

went

directly

around

the

communities

in

most

need.

The

question for us: How do you take advantage of the historic opportunity of government investment

withoutourcommunitiesgettingleftoutofit?

Trackingthedata

Wedecided to track the stimulusmoneydown into the SunshineState.Ayear into it,wearent that

surprisedbytheresults,butweknowthat itsnotenoughtojustwhineabout it. WiththeTeaParty

generationcomplainingabouteverythinggovernmentdoes,wehavetobesmart.

Before we even started our research we knew the data was going to lead us to dead ends. Our

governmentdoesnothavethepropertrackingmechanisms inplacetoensuretrackingofgovernment

spendingandjobcreationfromthefederaldowntothelocallevel.Tobeginmakingarealargumentfor

targetedinvestment

in

our

communities

we

had

to

be

able

to

have

facts

that

everyone

could

agree

on.

Ourfirstdemand isforamuchdeeperanddetailedtrackingofthemoney. It isasimpleandessential

action,andtransparencywasabedrockoftheObamapresidentialcampaign.

ThePipelinesArentBroken

Simultaneously,weusedthedatawehaveandactualexamplestoseewhat'shappening.InFlorida,as

bigcontractscomedowntocountiesandmunicipalities,smallerminorityownedfirmscouldnotwin

bids on the work. They rarelyevenhaveaccess to the agenciesand processes forapplying. This is a

hugeproblembecauseminorityownedfirmsarefarmorelikelytoemployminoritiesandgenerallywill

uselinkageswithintheircommunities.However,thesebusinessescannotgetinthedoor.Thepipelines

forARRAmoneyarethesameonesthathaveledtotheunderdevelopmentofminorityownedfirms

andcommunities

in

the

first

place.

The

result

is

the

inequitable

distribution

of

opportunity

across

racial

communities.

Weneednewpipelines

Currently,there isauniversalistapproachtothedistributionofARRAfunds. Theunsaidphilosophy is

that money that gets injected 'blindly' into the economy will benefit everyone through a general

economicresurrection.Theproblemisthattheeconomyisnotuniversal;itisparticularlystructuredto

denyaccesstomarginalizedcommunities. It isonly ifnewpipelinesaredeliberatelydirectedtothose

communitiesthatwewillseeadifference. Itmustbedoneinamannerthatrecognizesandaddresses

theirparticularhistoryandstructuralneeds. This isnotonly importantforthesecommunities,butfor

allofus,becauseafterall,theeconomiccrisisimplodedexactlywherethegeneraleconomymetthese

marginalized communities. To restructure inequality

arra and the economic crisis

Documents