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Bureaucratic interpretation blocks Angelou funding
By Dan McCue
Staff Writer
The tri-county region’s hopes of receiving close to $6 million to implement the recommendations of the AngelouEconomics report and other jobs-related initiatives has been thwarted, at least for the time being, because the S.C. Department of Commerce was slow in spending federal funds intended to benefit dislocated workers.
Economic developers in the region are still reeling from a communication from the U.S. Labor Department two months ago that revealed the region, which was negatively affected by the Base Realignment and Closure Act of 2005, was ineligible to apply for implementation funding despite having already received a $250,000 planning grant.
According to Paul L. Connerty, executive director of the Trident Workforce Investment Board, the policy decision was based solely on the state having not yet spent 80% of the dislocated workers funding it has been allocated by the Labor Department.
“That decision took us completely by surprise, both because of informal assurances we’d received and also because the situation it describes is true not only of South Carolina, but also of 38 other states,” Connerty said. “That would appear to foreclose many, many communities who have been impacted by a BRAC from applying for critical funding.”
The region’s Congressional delegation has written to Labor Secretary Elaine Chao asking the agency to reconsider its decision and at least allow the local groups, who’ve banded together to seek the funding, to apply.
In the meantime, each of those individual groups, which include the Charleston Regional Development Alliance, the Lowcountry Council of Governments and the area’s chambers of commerce, among others, is seeking grant money from other sources.
BRAC hits accountants, engineers
The Base Realignment and Closure Act of 2005 mandated the demise of the Defense Finance and Accounting Service and Naval Facilities Engineering offices in North Charleston and the realignment of the Naval Weapons Station there, eliminating approximately 1,000 jobs.
In its wake, the region received a $250,000 planning grant. Based on the region’s experience after the 1995 base closure, however, Connerty and others were expecting far more federal support in the form of additional grants to help implement a wide range of strategies, including those suggested in a report by Austin, Texas-based AngelouEconomics. That report outlined an economic development plan to provide jobs for workers in the region who were displaced as a result of the latest base closures.
Eleven years ago, when the Charleston Naval Base was closed, a revenue stream opened that amounted to $36.4 million over the next three years, according to data from the federal General Accounting Office.
The large investment was understandable. After all, more than 6,200 civilian jobs were lost on the base alone, and estimates by local economic developers suggest actual job losses in the region stemming from the base closure may have been as high as 22,000.
Last time around, the closure was perhaps the greatest economic catastrophe to befall the region in more than 100 years. The U.S. Department of Defense itself seemed to acknowledge as much in an April 1998 report on the BRAC when it concluded that the number of DOD-related job losses, as a percentage of the region’s work force, “was greater than at any other BRAC location.”
David Ginn, president of the Charleston Regional Development Alliance, said given the size of the population of workers affected this time, the request for funding was proportionately smaller, but the process of applying for and using funds seemed to be the same.
Immediately after the BRAC announcement, a coalition of stakeholders came together as a local BRAC planning committee, received money in September 2005 to plan a comprehensive community response and came up with a broad range of initiatives to meet both the more immediate and the longer range needs of the impacted workers.
“That’s why the decision by the Labor Department seemed to come out of left field,” Ginn said. “Everything proceeded just as I understood it had a decade ago.
“Our whole goal as a community has been working toward implementation of the targets established with the AngelouEconomics report, and I think that was clear from the number and variety of stakeholders who came together to secure the planning grant. It seems strange to me that an agency would encourage so broad an effort and then at the end of the day not follow through with some kind of support.”
The plan was intended to provide career assistance to displaced workers while implementing the AngelouEconomics report’s strategy for creating a future local economy based on five key business sectors.
Rules adjusted in mid-process
Dislocated workers funding from the federal government reaches local communities through the S.C. Department of Commerce Office of Workforce Development. The state allocates funds to local programs, such as the One-Stop Career Centers located in Berkeley, Charleston and Dorchester counties, through a formula based on six factors, including insured unemployment data, unemployment concentrations and plant closing and mass layoff data.
Representatives from the state Department of Commerce were unavailable for comment by press time. However, the department’s Web site shows that last year it spent about $9.2 million of the $13.9 million, or about 69%, of the dislocated workers funding it received.
Regardless of the percentage, however, Ginn said to the best of his knowledge, the spending of that pool of federal money never played a part in determining whether a community was eligible for BRAC-related funding.
“Basically I think some of the rules were adjusted in mid-process,” he said.
He surmised that it is in part due to the heavy financial strain of the Iraq and Afghanistan wars, as well as the recovery from Hurricane Katrina.
“Lots of federal resources are allocated elsewhere, we understand that, but at least let us apply,” he said.
Far-reaching implications
The situation poses a dilemma for the Trident Workforce Investment Board, Connerty said, because the lack of funding and the present uncertainty over what other funding stream might come through is limiting its response to the pending job loses.
“We’re losing a valuable asset in the community and find ourselves not being able to fund the research necessary to understand what skill gaps might exist among these workers and other issues like that,” he said. “We’re using some of the planning grant money for preliminary research and job fairs and the like, but there isn’t a whole lot of that money left. This decision by the Labor Department has far-reaching implications.”
Among them is the potentially diminished ability of the AngelouEconomics report’s stakeholders to marshal the efforts needed to see the business clusters come to fruition.
“You have to have some level of staff resources and research money to initiate each of these five clusters. Each of them drives a different set of needs, and you need the ability to assess each in terms of work force issues, education issues, and to establish groups to serve as sustainable resources in these areas,” Ginn said.
“Of course, the money we were expecting to receive to implement all this isn’t the only money out there, but time is of the essence. What we’ve learned through a lot of research is that you need to have this sustainable system in place as early as possible, because if you don’t, these things tend to begin to lose steam rather quickly.”
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