Business & Economy
Governor Quinn Announces Efforts to Boost Development of South Suburban Cook County PDF Print E-mail
News Releases - Business & Economy
Written by Laurel White   
Tuesday, 12 July 2011 11:55

Announces $6.6 Million “IKE” Funding to Revitalize Communities Throughout South Cook; Signs Laws to Support Economy

TINLEY PARK – July 11, 2011. Governor Pat Quinn today announced $6.6 million in federal funding to increase affordable housing, stabilize communities and make infrastructure improvements in six south suburban Cook County communities. Awarded through the “IKE” Disaster Recovery Program, the funding will be used to purchase and rehab or demolish vacant or abandoned homes and to upgrade water-sewer lines and roads in the vicinity of the targeted housing projects. 

“This funding will help revitalize the economy with much needed improvements for several suburban cook county communities,” said Governor Quinn. “With this assistance, we’re helping to ensure the expansion of affordable housing and improvement of the infrastructure needed to prevent future damage.”

The recovery program is named for Hurricane Ike, the 2008 disaster that was one of the costliest hurricanes ever to make landfall in the United States. Illinois received a total of $169 million in federal disaster funds under the IKE to assist communities within 41 Illinois counties recover from devastating floods and storms in 2008 and minimize the impact of future disasters.

Last month, Governor Quinn announced $48 million in public infrastructure investments that were awarded in 85 Illinois communities, including six awards in south suburban Chicago totaling nearly $3.7 million. The awards will support long term recovery by upgrading core public infrastructure severely damaged by the 2008 storms and subsequent flooding throughout the Midwest. Projects range from levee improvements and culvert restoration to upgrades to water and sewer systems, pump stations and replacement of emergency power generators.

Governor Quinn announced the housing and public infrastructure grant awards on behalf of communities in south suburban Chicago during the July meeting of the Southland Chamber of Commerce. A complete list of projects is attached.

During the meeting, Governor Quinn also signed legislation that will help support economic growth in south suburban Chicago. House Bill 1730 sponsored by Rep. Al Riley (D-Hazel Crest) and Sen. Toi Hutchinson (D-Chicago Heights) helps municipalities appropriate funding dedicated to economic development. The Governor also signed House Bill 1215 sponsored by Rep. Riley and Sen. Maggie Crotty (D-Oak Forest) extends the deadline for the city of Markham to complete a redevelopment project in that TIF district.

For additional information on the IKE Disaster Recovery Program, visit www.ildceo.net/disasterrecovery.

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Weekly Video Address: Exports Help Generate Jobs PDF Print E-mail
News Releases - Business & Economy
Written by Grassley Press   
Monday, 11 July 2011 13:31

Advisory for Iowa Reporters and Editors

Friday, July 8, 2011

During his weekly video address, Senator Chuck Grassley discusses three international trade agreements that can help generate jobs for workers in the United States.

Click here for audio.

The text of the address is available below.  

   

Grassley Weekly Video Address:

Exports Help Generate Jobs

This week the Senate Finance Committee turned to three international trade agreements that have been ready for action by Congress for four years.  It was a big mistake to let these agreements get sidelined.  Jobs supported by exports pay 15 percent more than the national average.  Manufacturers, farmers, and the service sector need new markets for their products.  So, it’s a matter of retaining and creating jobs.  And final approval of these agreements needs to be part of America’s economic recovery effort.

Getting to a congressional vote has been a frustrating process.  A year and a-half ago, President Obama said he wanted to double exports within the next five years.  Still, he let the three trade agreements languish.  This spring, the United States Trade Representative said the trade agreements were ready, but then the administration changed the terms and is insisting that the Trade Adjustment Assistance program be passed with the trade agreements.

The Trade Adjustment Assistance program should be voted on separately, rather than used to bog down job-generating trade agreements.  The focus needs to stay on helping to spur manufacturing, services and agriculture-related jobs in the United States.  The opportunities are significant.  Today, U.S.-Colombia trade is a one-way street.  None of our ag products have duty-free access to the Colombian market, but more than 99 percent of Colombian ag exports enter the U.S. market duty-free.  With a trade agreement, Korea is expected to absorb five percent of total U.S. pork production.  The insurance and financial services industry in the United States, including Iowa, says Korea represents the largest insurance market yet in a free-trade agreement and presents enormous opportunities for domestic job growth.  Panama has tariffs on U.S. beef and corn that would go to zero under a trade agreement.

I talked with an Iowa cattleman who took a trip to Korea less than three weeks ago.  He had a tremendous trip promoting U.S. beef.  But one of his takeaways was that all of Asia is watching how the United States handles these trade deals.  And want to know if the United Sates wants to be in a leadership role for international trade.  They want to know if we are people of action, or just words.  They want to know if we will follow through with these agreements or will we let them languish even longer.  This cattleman came away with the message loud and clear.  Either we get this done, or our trading partners will be looking at other places for the trading terms that they desire.

For the sake of U.S. exports, these trade agreements need to be implemented without delay. 

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Commentary -- Washington's Wonderland PDF Print E-mail
News Releases - Business & Economy
Written by Grassley Press   
Monday, 11 July 2011 13:29

by U.S. Senator Chuck Grassley  

   

As Americans celebrated the 235th birthday of the United States with hometown fireworks and backyard barbeques, a divided government in Washington wrestled over taxes and spending needed to reach a long overdue budget agreement.  

   

It’s been 800 days since the Democratic majority in the U.S. Senate has passed a federal budget. Without an enforceable rudder to rein in spending, Washington has been sailing along the high seas of deficit-spending as far as the eye can see.  

   

The budget-free zone has resulted in a reckless spending pattern in Washington. Federal expenditures have accelerated to an unprecedented 25 percent of gross domestic product. The federal debt has soared above $14 trillion. The shovel-ready stimulus package was not as shovel-ready as the Obama administration advertised. Pumping tax dollars into the economy has not triggered job creation. Unemployment has been at 9 percent, or higher, for all but two months since early 2009.  Persistent joblessness sinks already wilted consumer confidence.  

   

And yet, lawmakers and the White House are having trouble seeing eye-to-eye on ways to trim the deficit and stop adding to the debt. If an Iowa household noticed its monthly bills were higher than its income month after month, the obvious solution would be to cut spending, not continue an unsustainable pattern of borrowing. But Washington chooses to jump down the rabbit hole time after time, continuing an unsustainable spending binge and deferring fiscal sanity for another day.  

   

Washington’s wonderland needs a reality check. Phantom budgets and pixie-dust economics aren’t working.  

   

During the last two years, spending by Washington has increased 22 percent, not even counting the stimulus program.  Sooner rather than later, the surge of retiring baby boomers will overwhelm the nation’s public entitlement programs, especially if reasonable reforms to save and strengthen the programs are ignored or killed by partisan demagoguery.  

   

It’s been said that this White House considers it a shame to waste a crisis. What’s shameful is the absence of leadership needed to secure economic growth and prosperity for generations to come. Instead of championing spending cuts and entitlement reform, the president has urged Congress to increase the debt limit by $2.4 trillion. It’s time to cancel Washington’s blank checks, not continue writing them.  

   

Instead of drawing lines in the sand and fanning the flames of class warfare, the big spenders need to accept that higher tax rates will not curb deficit spending. Since World War II, for every $1 raised in new taxes, Washington spends $1.17. Raising taxes has been a license for Washington to spend more and borrow more.  

   

What’s more, each dollar earmarked for the Federal Treasury shrinks the take-home pay for consumers. It limits their ability to save, spend and invest. Raising the tax burden on investors, innovators and entrepreneurs limits their potential to drive economic growth and create jobs on Main Street.  

   

It’s time for the big spenders to pluck their heads out of the sand and realize Washington cannot tax and spend our way to prosperity.  

   

Washington clearly needs help to curb its excessive appetite for spending. The federal government has run trillion dollar deficits for the last three years.  

   

How can Washington dig itself out of this rabbit hole and get American back on the right track?  

   

In the short-term, Washington needs to enact spending cuts and tax reforms that will help fuel economic growth. Voters hired lawmakers last November who campaigned for less federal spending, not more. For the long-term, let’s rally behind a balanced budget amendment to the U.S. Constitution. It would create a permanent, non-negotiable benchmark to enforce fiscal discipline.  

   

Let’s honor the vision of our nation’s Founders whose service and sacrifice more than two centuries ago helped secure freedom and independence for future generations of Americans. Today’s leaders in Washington can restore America’s promise of prosperity and opportunity. Let’s erase the legacy of debt and return to a legacy of hope. By living within our means, we can help our children and grandchildren achieve higher standards of living in the future.  

Friday, July 8, 2011

 
Trade agreements before the Finance Committee PDF Print E-mail
News Releases - Business & Economy
Written by Grassley Press   
Friday, 08 July 2011 12:04
Statement of U.S. Senator Chuck Grassley
Senate Committee on Finance
Executive Session to consider the U.S.-Korea Free Trade Agreement, the U.S.-Panama Trade Promotion Agreement, and the U.S.-Colombia Trade Promotion Agreement
Thursday, July 7, 2011

Let me start by saying I am glad we are here today trying to work out these trade deals.

We all know how important these agreements are.  We can all cite to statistics and data that tell us how much they mean to our economy.  I don’t need to recite numbers, because we already know them.  We have heard the same speeches on the benefits of these agreements for four years.  But these deals have been kicked around and delayed over partisan fights.  The American people simply can’t afford that anymore.

The Obama administration has finally gotten the message that increasing trade has to be a part of growing our economy.  That is why they are willing to move these deals forward.  But now, as we are on the brink of real action, President Obama has moved the goal-posts once again.  Not only are we told that these deals won’t be sent to Congress without a deal on Trade Adjustment Assistance, but we have the unprecedented move of putting TAA into an implementing bill.

There are parts of TAA that I support.  As Ranking Member of this committee, I helped draft some of the reforms Congress passed in 2009.  But the political gamesmanship with these deals by the administration has to stop.  TAA is a spending bill that should be debated and passed on its merits. 

It’s a violation of the process to put a program like this in an implementing bill.  But I know that the Chairman has spoken of some flexibility that might be in that, and I’ve told him that I’d like to help with that process of having a separate and open and fair debate.  I hope we can move forward with that flexibility.  In telling the Chairman that, I’d also like to urge the administration to reconsider its current approach.  Instead, we should come to terms on an agreement for sequencing four separate bills -  including the three separate implementing bills -  And a fourth bill that addresses TAA, trade promotion authority, and the generalized system of preferences.

I was just contacted by an Iowa cattleman who took a trip to Korea less than three weeks ago.  He had a tremendous trip promoting U.S. beef.  But one of his takeaways was that all of Asia is watching how the United States handles these trade deals.  And want to know if the United Sates wants to be in a leadership role for international trade.  They want to know if we are people of action, or just words.  They want to know if we will follow through with these agreements or will we let them languish even longer.  This cattleman came away with the message loud and clear.  Either we get this done, or our trading partners will be looking at other places for the trading terms that they desire.

We don’t want to let that happen.  American farmers, businesses, and workers need greater access to these markets.  They need these trade deals.  I appreciate the Chairman scheduling this session today, and scheduling it so we have an adequate amount of time to address these important issues and at a time when more members of the committee are able to be present.  Thank you, Mr. Chairman.

Statement of U.S. Senator Chuck Grassley

Wednesday, July 7, 2011

The June unemployment figure is expected on Friday, and this morning there’s a meeting of Finance Committee members about pending international trade agreements with Korea, Panama and Colombia.  Approval of those agreements needs to be part of the economic recovery effort.

These three agreements have been ready for congressional action for more than four years.  Demands made by congressional Democrats were accommodated to get the agreements ready back in 2007.  Even so, the Democratic leadership of Congress has refused to allow a vote.  Since President Obama took office, trade got sidelined even more.  That’s a mistake.  Jobs supported by exports pay 15 percent more than the national average.  Manufacturers, farmers, and the service sector need new markets for their products.  It’s a matter of retaining and creating jobs.

Getting to a congressional vote has been a frustrating process.  A year and a-half ago, President Obama said he wanted to double exports within the next five years.  Still, he let the three trade agreements languish.  This spring, the United States Trade Representative said the trade agreements were ready, but then the administration changed the terms and insisted that the Trade Adjustment Assistance program be passed with the trade agreements.

The Trade Adjustment Assistance program needs to be voted on separately, rather than used to bog down job-generating trade agreements.  The focus needs to stay on helping to spur manufacturing, services and agriculture-related jobs in the United States.  Today, U.S.-Colombia trade is a one-way street.  None of our ag products have duty-free access to the Colombian market, but more than 99 percent of Colombian ag exports enter the U.S. market duty-free.  With a trade agreement, Korea is expected to absorb five percent of total U.S. pork production.  The insurance and financial services industry in the United States, including Iowa, says Korea represents the largest insurance market yet in a free-trade agreement and presents enormous opportunities for domestic job growth.  Panama has tariffs on U.S. beef and corn that would go to zero under a trade agreement.  These trade agreements need to be implemented without delay.

 
Continued Review of Audits of the Defense Department Inspector General PDF Print E-mail
News Releases - Business & Economy
Written by Grassley Press   
Tuesday, 05 July 2011 22:47

Floor Statement of U.S. Senator Chuck Grassley

Tuesday, July 5, 2011

Continued Review of Audits of the Defense Department Inspector General

Click here for the video. Prepared remarks are below.

Mr. President, I come to the floor today to set the record straight on a report I issued on June 6th.

This report evaluated audits produced by the Department of Defense (DOD) Office of the Inspector General in fiscal year 2010.

I call it a Report Card because that is exactly what it is.

Each of the 113 unclassified reports published in fiscal year 2010 was reviewed, evaluated and graded in five categories. After each report was graded individually, all the scores for each report in each category were added up and averaged to create a composite score for all 113 reports.

Although 15 top quality audits were highlighted in the Report Card, the overall score awarded was a D minus. That’s low, I know. Maybe the score should be a little higher. I don’t know for sure.

Clearly, none reflected any of the reforms that Inspector General Heddell put in place in December 2010 – as all were published well in advance of that date.

My oversight staff read these reports as educated consumers. We expect these audits to provide leverage in the monumental day-to-day DOD oversight task. We want them to provide assurance that the Defense Department is spending the taxpayers’ money wisely.

Some did that but most did not.

This Senator from Iowa is sure of one thing: The audits, which are the subject of my Report Card, are not somehow exempt from oversight and public scrutiny. They, too, need to be put under the public microscope – especially when they cost almost a million dollars apiece to produce.

So that’s exactly what we did with the Report Card – put them in the public spotlight. And I will keep them there until I see sustained improvement.

As the report states and as I explained on in my speech on June 6th, this grading system was subjective and imperfect.  However, as subjective and inexact as it may be, I believe it provided a reasonable or rough measure of audit quality.

Following my speech, Defense Department Inspector General Heddell pounced on my report. He expressed strong opposition to the low score. He complained that it did not adequately reflect $4.2 billion in “achieved monetary benefits” identified in fiscal year 2010 audits.

To address IG Heddell’s concerns, my staff asked the Audit Office to prepare an information paper that links the $4.2 billion in savings to the audit where those savings were reported. That information was provided to me on June 20th. I call it a “cross-walk.” It takes me to the exact page in each report where the savings were discussed.

This document lists $4.4 billion in “identified potential monetary benefits” and “collections” of $4.2 billion.

After reviewing the “cross-walk,” I have concluded that IG Heddell had a legitimate gripe about the Report Card. He is right. It should have included a section that addressed potential savings. So I will address those issues now, focusing on four reports that contained almost all of the $4.2 billion in savings listed in the “collections” column.

In grading these reports, we did not give sufficient credit for potential savings and efficiencies. They were a casualty of the grading system – for one simple reason. If the exact dollar amounts of alleged fraud and waste were not verified using primary source accounting records, they did not pop up on my oversight radar screen.

My staff is attempting to work with the Audit Office to develop a mutually agreed upon set of standards for grading audits. The purpose of these discussions would be to create a grading process that would accurately capture the true quality of all reports, including policy reviews that uncover real savings and efficiencies.

From the beginning, I have been very critical of the Audit Office for producing far too many policy reviews and far too few hard-core contract and payment audits.

For the most part, the policy audits have no measurable monetary impact whatsoever. However, I have learned recently that at least a few are important for other reasons. I am told that some of these reports are of real value in the work of the Armed Services Committee.

Contract and payment audits are also very important. They go right to the heart of the IG’s core mission: To root out and deter fraud, waste and theft. If done right, they too can produce big pay offs. Those audits earned top scores in the Report Card.

Mr. President, I am not saying that the Audit Office should do nothing but contract and payment audits. What I am saying is this: The current mix of audits creates a huge imbalance in favor of policy reviews. A better balance needs to be established.

That said, Mr. President, I have an admission to make to my colleagues. I finally found a policy audit that I like.

This report is entitled Recapitalization and Acquisition of Light Tactical Wheeled Vehicles, number 2010-039, dated January 29, 2020. It identified potential savings of $3.84 billion. That’s 90% of the savings uncovered in FY 2010 audits.

Now, in my Report Card, I gave this audit a low grade. This audit failed to connect the dots on the money trail and verify dollar amounts using primary source contract and payment records. Plus it took 16 months to complete.  When you add the four to six months of planning that often precedes the audit start date, you are probably looking at two years to complete this audit. That’s far too long.

But this report had other important qualities that were overlooked. It uncovered gross violations of applicable procurement regulations, including use of a sole-source contracting arrangement. It also determined that the proposed vehicle might duplicate the capabilities of existing vehicles.

In the midst of this audit, for reasons that remain unclear, the project manager decided to stop the program “and put the $3.84 billion in funding to better use in FY 2010-2013.” This language suggests that all the money was reallocated within Army accounts for other purposes. Clearly, the audit may have helped to stop $3.84 billion in potential waste. That’s excellent, but this does not constitute savings in the classical sense -- as all the money was shifted to other Army projects. Waste could  happen there, too.

Using a modified grading system to reflect the good qualities of this audit, it would have earned a higher score were it not for an excessively long completion time. In this particular case, however, the impact of the audit was apparently felt while the audit was still in progress. So the timeliness rule may not apply here and probably should be set aside.

There are three other audits containing savings and efficiencies that I wish to discuss today.

The next one is entitled Implementation of the Predator/Sky Warrior Acquisition Decision Memorandum, number 2010-082, dated September 10, 2010.

The purpose of this audit was to determine whether the Air Force and the Army had complied with DOD directives and law to combine the Predator and Sky Warrior drone programs. The Defense Department estimated that $400 million could be saved by merging these two programs.

While the audit was in progress, DOD pulled the rug out from under the auditors. A new directive was issued, stating that the two programs did not have to be combined. To counter this move, the auditors recommended administrative action against those who failed to comply with the original directive. The DOD non-concurred and tossed the auditors a bone. DOD wiggled out of harm’s way by offering to do a meaningless “lessons learned” exercise.  In the end, the auditors caved in, agreeing that the DOD plan was “responsive” and backed off.

Despite what appears to be an unsuccessful outcome, the Office of the Inspector General still claims that this audit produced $60 million in savings.  The audit itself indicates that the $60 million was, in fact, “reprogrammed to meet higher priority operations.” That means it was reallocated to other DOD accounts – and not saved.

Since this audit was all about an opportunity to save $400 million – and DOD balked, maybe these so-called savings might be better characterized as lost savings.

In my Report Card, this audit earned low scores – mainly because it failed to verify actual costs of the two drone contracts, using primary source accounting records. And it failed to assess the validity of DOD’s estimated savings of $400 million.

I am not convinced this audit deserves a higher score – especially since it took 22.5 months to complete, and the recommendations – though initially tough -- were watered down at the end.

The next report claimed $242 million in potential savings.

This one is entitled “Deferred Maintenance and Carryover on the Army Abrams Tank,” number 2010-043, dated March 2, 2010.

This report concluded that contrary to Army claims, depot maintenance on M-1 tanks was not deferred in fiscal year 2008. All planned overhauls were, in fact, completed, but a large sum of money was left-over. The Army requested and received a formal, written waiver to “carryover” $346 million in un-needed and un-used fiscal year 2008 M-1 maintenance funds for use in 2009 and beyond. The reason given was inadequate capacity at the Lima, Ohio tank plant. Without the waiver, this money would have been cancelled and lost. The report concluded that Army documents contained “inaccurate and misleading” information and may have caused a violation of the Anti-Deficiency Act. It recommended that the waiver be recinded and $275 million in FY 2008 money be cancelled, reprogrammed or reduced.

The Army appeared to agree with the recommendation to disclose the $275 million carryover to Congress, but non-concurred with other recommendations.

This report does not point to any real savings.

This report probably deserves higher scores except for timeliness and strength of recommendations.

It was untimely, taking 22 months to complete.

In addition, there were unresolved issues about the waiver document. Did the official, who signed the waiver, know that document may have allegedly contained false and misleading information? Was he questioned about its truthfulness? If so, the report should have recommended that he be held accountable.

The last of four reports uncovered $2.2 million in purported savings, but this one appears to be  more about helping the Army spend – not save – money.

It is entitled “Controls Over Unliquidated Obligations for Department of the Army Contracts,” number 2010-073, dated July 19, 2010.

This report deserves high scores for hitting most of the dots on the money trail, including verification of exact dollar amounts using primary source accounting records. Such nitty gritty accounting work is highly commendable.

Unfortunately, the objective of this audit appears to be questionable. The report finds that sloppy Army accounting work “could increase the risk that funds are unavailable for other needs because funds available for de-obligation are not identified in a timely manner.” Now what does that really mean?

It means that the money in question is no longer needed and is at risk of being “lost” because it is about to expire.

Having un-needed money lying around in the Pentagon is almost always a recipe for more waste. In the Pentagon, there is no such thing as un-needed money. Every dollar has a mission.

This report is all about managing money to make sure that every cent is spent before it expires. Avoiding the loss of appropriations is the primary responsibility of the Army Comptroller or Chief Financial Officer – not the IG.

In this scenario, the IG’s primary focus should be to ensure that “lost” appropriations are not used illegally – or that un-needed monies are not wasted by being shifted to another questionable project.  Money that is not needed should be reported to Congress and returned to the Treasury.

Although this audit deserves high scores in several categories, its long completion time – 16 months – and questionable focus lowers its overall score.

To summarize, Mr. President, there are two main problems with these four reports on savings and collections: 1) None was timely; and 2) Reported savings are unverified and elusive.

First, these four reports took an average of 19 months to complete. Two took a total of 45 months or almost four years to finish. And that does not include the four to six months it takes – I am told -- to get each audit rolling. As I have said on other occasions, the power of top quality audit work is greatly weakened by stale information.

Second, these four audits supposedly produced $4.2 billion in collected savings. But all of that money appears to have been shifted to other DOD accounts and spent. To the best of my knowledge, not one cent was really saved or re-deposited in the taxpayer’s bank account.

Only in the government could you spend all the money and still claim savings.

What we are really talking about here are lost savings that grew out of waste that was thankfully discovered and avoided. And waste that is avoided surely has monetary benefits.

In closing Mr. President, I would like to share a simple observation with my colleagues.

For some reason, auditors in the Office of the Inspector General show a great reluctance to use the word waste in their reports. That word rarely – if ever – appears in their audits. At the same time, auditors seem overly eager to tout savings and efficiencies. Now, why would that be? Could it be that their superiors in the Pentagon take a dim view of the word waste?

Savings may be nothing more that the flip-side of waste. Auditors detect and verify potential waste and then convert it to potential savings by proposing remedies to eliminate the waste. Maybe the auditors need to start calling it what it is – call it waste, and then talk about savings.

I yield the floor.

 
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