Recovery Act Reporting System Begins to Take Shape

The wide range of state and local groups mobilizing to make sure the Recovery Act addresses vital social needs all have one thing in common: they can't organize effectively without detailed online information on how the money is being spent. Thus a lot is riding on President Obama's pledge to make the recovery program fully transparent and accountable.

The U.S. Office of Management and Budget (OMB) is moving in that direction by creating a reporting system for contractors and other organizational recipients of Recovery Act funds. In a memorandum for federal agencies issued on April 3, OMB Director Peter Orszag lays out his agency's latest thinking on how to collect the information.

On the positive side, OMB envisions the use of one central collection system for all Recovery Act data-which will promote consistency and comparability for information from many different sources. Orszag also confirms that the launch of the system will follow the timetable stated in the Recovery Act, meaning the first batch of data will arrive in October 2009 covering activity through the quarter ending September 30. OMB will attempt to make some information available sooner on the quarter ending June 30.

There are, however, some problems with the OMB memo. First, it is not clear that the reporting requirements apply to contractors working for with state (as opposed to federal) agencies, even though a large portion of Recovery Act contracting funds will pass through the states. If state contractors don't have to report to the federal government, will state agencies collect that information-and can we assume they will they do so in a consistent manner? The memo suggests that state contractor reporting will come later but does not offer a timetable.

For contractors dealing directly with the federal government, the OMB memo says that general contract reporting requirements apply only to prime contractors and first-tier subcontractors. Unless the prime contractors are required to collect extensive data from all subs, a great deal of data could remain unreported.

It is also not clear from the OMB memo whether full employer-specific data for any contractors will be made immediately available to the public. The absence of such information would greatly reduce transparency and accountability.

As for specific reporting on job creation, it is also very encouraging that OMB is requesting data based on actual payrolls rather than simply making broad estimates (though such estimates will be used separately by the Council of Economic Advisers in producing macro-employment reports).

The required information will consist of the number of jobs created or retained on the project (calculated in terms of full-time equivalents) as well as some indication of the types of jobs involved. Unfortunately, the memo does not require the collection of data on job quality, i.e. wage levels and availability of benefits such as health coverage. Without this additional information, it will be difficult to monitor whether Recovery Act projects are resulting in the creation of substandard jobs.

The Coalition for an Accountable Recovery, the federal-level counterpart of STAR, will be submitting comments on the new OMB reporting guidance.