Stimulus funds may go to Oregon firm

Gov. Arnold Schwarzenegger has said federal stimulus money received by the state would be used to create jobs in California, so state Sen. Alex Padilla is asking why the administration is giving $18.8 million of the scarce funds to an Oregon group.

Padilla, (D-Pacoima), chairman of the Senate Energy Committee, has scheduled a hearing of the panel Tuesday to grill commission officials about why, when California’s unemployment rate is 12.5%, they propose sending funds to Oregon.

“To think that the California Energy Commission, for all its history of being on the cutting edge of policy, is giving huge sums to a firm outside the state I think is unconscionable,” Padilla said.

The energy commission’s five members were appointed by the governor.

Padilla is also asking whether the Oregon group had an inside track to get the grant, which was announced Feb. 11 by the commission staff and is expected to receive final approval from the panel next month. Padilla said some commission staff members belong to a professional group headed by the executive director of the Portland company, a nonprofit.

The commission held a competition to grant $29.6 million in federal stimulus funds to groups that would oversee energy-efficiency programs in government and commercial buildings. Seventy applications were filed, and the commission staff proposed that three firms receive grants, with 63% of the money going to Portland Energy Conservation Inc., based in Portland, Ore. The commission said most other applicants did not qualify.

Commission officials said most of the $18.8 million would go toward energy-efficiency work, such as audits of refrigeration units used by businesses, to be performed by young people from the California Conservation Corps.

The work could train corps members for careers “doing these kinds of audits in the private sector,” said Sandy Cooney, a spokesman for the state agency.

The Portland firm said in its application that the grant would create at least 117 jobs in California and “contribute to the retention of” more than 200 contractor and auditor positions.

Padilla noted that conservation corps workers are paid minimum wage, $8 an hour. At the same time, the company is proposing to bill the state up to $261 an hour for work by Oregon-based managers overseeing the project. The $261 rate is for Associate Director Allison Bially, who works in the Oregon office.

The state would pay the company up to $236 an hour for work by Senior Program Manager Emily Moore, with a cap of $614,000 during the three-year term of the contract, the grant applications say. For the efforts of Francisco Gadea, a program manager for the project, the Oregon group would receive up to $16,000 a month.

Cooney said the rates include administrative costs such as fringe benefits and overhead. Bially’s salary would be $107,000 a year, he said.

Reached in his office in Oregon, Gadea declined to comment on the work he will be doing but said the company has done work in California and a field office is being opened in San Francisco.

“Some of the personnel will stay here [in Oregon],” he said, “and some will go down there.”

In all, the firm proposed $991,824 for program management, $217,266 for program administration and $102,506 for travel, including $11,124 to fly Moore between Oregon and San Francisco.

“For an out-of-state firm to say they are going to create a couple hundred minimum- or near minimum-wage jobs while the executives are taking this grant to the bank, out of state, I think is completely contrary to the spirit and intent of the Recovery Act,” Padilla said. ". . . It would make a lot more sense to give the work to a California firm for people who live in California and don’t have to travel” and who pay taxes in California.

Bially declined to address the issue of pay. “Until we have a signed contract, we don’t want to comment on it,” she said when reached by phone.

The senator also raised questions about the relationship of California Energy Commission staffers with Phil Welker, the Portland firm’s executive director.

Welker’s website biography says he is also executive director of the California Commissioning Collaborative, a nonprofit “committed to improving the performance of buildings and their systems.” Two staffers for the California Energy Commission are listed on the collaborative’s website as members of its board of directors.

Cooney said those posts are not paid positions, and the staff’s involvement with the collaborative “has nothing to do with this grant.” Welker did not return calls seeking comment.

Schwarzenegger also has asked questions about the grant, according to spokesman Aaron McLear.

“The governor believes that every dollar coming into California should stay in California,” McLear said. “He has directed the head of his Recovery Task Force to immediately investigate this grant and take any possible action to keep this money in California.”