OMB Releases New Last-Minute Recovery Act Jobs Guidance

[1]While most of the nation's attention seems to have been focused on health care and budget issues as of late, the Office of Management and Budget has been hard at work on the Recovery Act recently. With the start of the second recipient reporting cycle rapidly approaching, on Friday OMB put out a new Recovery Act guidance [2], this one specifically addressing job creation estimates and data quality issues. These two areas have been huge problems for OMB and the Recovery Act in general, with many of the story lines from the last cycle focusing on terrible data quality [3] and suspect job creation estimates [4]. With the new guidance, OMB is hoping to head off some of these stories for the coming reporting cycle.

Overall, the guidance is very helpful. First, it lays out ways in which agencies can help recipients report better data. Agencies now are supposed to highlight for recipients data elements that have been shown to have significant errors, such as recipient name, award amount, and job creation estimates, with the hope that recipients will pay more attention to these sections when entering their data. The agencies also are instructed to have recipients examine their reports for logical inconsistencies, such as if a recipient reports having created a large number of jobs despite not yet starting a project.

Most of the document though, fourteen pages of the twenty-four page document, are dedicated to guidance on job creation estimates (so called "full time equivalents," or FTEs). The new guidance is surprisingly in-depth, providing multiple examples covering a range of possible scenarios. It even includes a worksheet at the end giving step-by-step instructions for how recipients should go about calculating FTEs.

Perhaps the most significant change in the new guidance is in this FTE section. In the previous reporting cycle, many recipients were confused about the distinction the OMB made between jobs created and jobs retained. Earlier guidance was not very clear about when a job should be counted as created or saved. Under the new guidance, however, this distinction is largely eliminated. Recipients now simply report FTEs based on the hours worked on Recovery Act funded projects, regardless of whether those hours were worked by a new or retained employee.

That said, the new guidance isn't perfect. Among other problems, the guidance is very, very late. OMB released it on the night of December 18, a Friday night a week before Christmas, meaning that agencies have less than a week to act on the new guidelines before the second reporting cycle beings on January 1. Because of this short turnaround time, it doesn't seem likely that much of this clarifying guidance will make it down to the recipients in time for the upcoming cycle.

At the same time, the guidance also includes several December 22 deadlines, which is today, the Tuesday after the Friday OMB published it. I imagine many agencies will not meet these deadlines, since, thanks to the epic Snowpocalypse of 2009 [5], the federal government was not open on Monday, and is still not operating at full strength.

Finally, and perhaps most disappointingly, the guidance still does not provide for a standardized FTE. OMB still leaves it up to the recipient to decide how many hours constitute a "full time" job (although the new guidance changes the period of time an FTE should be measured by to a quarter, down from the life of a project). So despite all of the changes and positive clarifications delivered through the guidance, it will still be impossible [6] to compare FTEs between recipients.