April 5, 2010

Key Details of Local Jobs for America Act (H.R. 4812)

• The U.S. Department of Labor would administer the program.

• The bill would provide $75 billion over two years ($37.5 billion in year one, and $37.5 billion in year two).

• The distribution mechanism is based on the Community Development Block Grant (CDBG) – with every city with a population of 50,000 or more receiving DIRECT FUNDING. Also like CDBG, cities below 50,000 would be eligible to receive funding, passed through the states.

• Like CDBG, 70 percent would be for direct entitlement cities and counties, and 30 percent would be for state pass-through.

• The formula is not the same as CDBG. This formula is based on the number of unemployed (50 percent), poverty (25 percent), and population (25 percent).

• Each city could use up to 50 percent to retain employees that might otherwise have to be let go because of budget shortfalls.

• Up to 25 percent can be given by a city to local community-based organizations to hire people that help provide needed services.

• Up to 25 percent can be for hiring new city employees, or rehiring those recently let go if desired by a city. However, there is no requirement that a city use this part of the program if it does not wish to hire or rehire employees.

• A city can use five percent of funding for administration of the program.

• This program has NO LOCAL MATCH requirement.

• There is no requirement to keep employees once the money ends. There would be two years of funding, and then it would be up to the city to either keep or not keep the new employees, based on need and local budgets.

• Employees would have to be hired full time with benefits, under existing contracts or agreements. The federal funding can be used to cover all costs, including salaries and benefits.

• There is no cap on per-employee costs; however, no more than 20 percent of the funds can be used for management employees.

• On top of the $75 billion for the jobs program, the bill also provides $23 billion to help states support an estimated 250,000 education jobs; provides $1.18 billion to put 5,500 law enforcement officers on the beat; and $500 million to hire and retain fire fighters.

• And, the bill provides $500 million for approximately 50,000 additional on-the-job training positions slots to help private business expand employment.