Tuesday, August 01, 2006

Empowerment Zone Data - A report from the City Manager

This is a report from David E Rager, the City Manager. The second page has a section that details the expenditures of the Cincinnati Empowerment Corporation.

“During the report period, the City disbursed a total of $2,944,801.00 of Empowerment Zone grant funds to the CEC for the following programs, services and projects that are directly administered by the CEC:

CEC Administrative Costs: $1,728,032
Loans to homeowners and businesses: $69,891;
Job training, job placement, and apprenticeship programs; $802,058
Business technical assistance in financial management, marketing, administration, and e-commerce: $39,245
Down payment assistance: $16,509
Youth recreation and internship programs: $253,286
Leadership skills of Empowerment Zone organizations and residents: $35,780

That is the way the City described it. I will try a few of my own:

CEC Administrative Costs: $1,728,032
All CEC programs combined: $1,216,769
Total Spending $2,944,801

59% of the money given to the Empowerment Zone doesn’t even make it out of the office. They spent 59% of the federal funds on administration, and 41% on the actual programs.

Put another way, it cost us $1,728,032.00 just to have them give away the other $1,216,769.00. Can anyone say “Time to shut it down.” This is outrageous.

What about development and job creation? Let’s take another look at the numbers:

CEC Administrative Costs: 59% of budget
Loans to Homeowners and Businesses 2% of budget
For every $1 they spent towards developmental loans, they spent $25 on Administrative Costs.

The CEC has a paid staff consisting of six people.
CEC Administrative Costs: $1,728,032
CEC Costs divided by number of staff: $288,005
Total Loans to homeowners and businesses: $69,891;

The administrative cost per staff member is over four times the amount of the total developmental loans given to businesses and homeowners.

The Empowerment Zone program came to be during the Clinton administration. A major push of the zone was attracting jobs to depressed areas to stimulate economic development. An overriding concern was how urban areas were being left behind. The goal was to attract more businesses and jobs into the urban core.

Looking at these numbers is sad. The Empowerment Zone in Cincinnati only seems to empower the current administration that gets to divvy up that fat budget.

Let's look at the numbers again.

Good non profits generally spend around 20% of the budget in administrative expenses. If you are a non profit and you go to the United Way for instance, they demand a written explanation if these expenses exceed 25%.

An important note is that most non-profits spend a good chunk of their administrative expenses on fundraising. They have to get the word out on who they are and what they do, and they have to solicit people to give them money so that they can continue to carry out their mission. But the CEC doesn’t even have fundraising expenses, because they are fully funded by the Federal Government and your tax dollars. Even with this obvious advantage they are still spending three out of every five dollars disbursed on administrative expenses.

It is disgusting. You don’t need to find fraud or embezzlement to shut this baby down. The fraud is on the taxpayer and the EZ residents, and it is hiding in plain sight.

Soft Programs

Of the money that did make it out of the office ($1,216,769), 90% (or $1,091,124) of that went to “soft programs”.

Job training, job placement, and apprenticeship programs; $802,058
Youth recreation and internship programs: $253,286
Leadership skills of Empowerment Zone organizations and residents: $35,780
Total Soft Spending: $1,091,124

This is a good example of mission creep. An agency that was founded for urban economic redevelopment is spending three and a half times more on youth recreation than it spends on economic development loans. Is youth recreation a good thing? Yes. Is that the mission of an organization committed to economic redevelopment? No.

The biggest line item in their budget (outside the 59% for administrative expenses) is for job training and placement. I would bet they find that Markus “fat-mouth” Jenkins gets a piece of that action. That would be the same Markus Jenkins who apparently lives in one of Dale Mallory’s abandoned buildings.

One of the advantages (to the CEC) of funding “soft” programs is that it is difficult to tell if these programs succeed in doing anything. What are the defined benefits vs. the opportunity costs? It is almost impossible to judge, and if you can’t judge success you can’t judge failure.

Another disturbing facet of these soft programs is that they are plagued with yet another layer of “Administrative Costs”. That means that the $1,728,032 that was previously pegged as the total administrative costs is actually substantially understated.

I will put it another way. The CEC spent $35,780 on enhancing Leadership Skills of EZ residents. That probably entailed paying one of their friends $35 grand to go round and talk to people. How do you judge the success of that? Were leadership skills of EZ residents improved? You can’t objectively measure that fact one way or the other.

Which leads to a political aspect of soft programs; Who can be against job training, youth recreation, or enhancing leadership skills? They sound great and that makes them politically viable. And since the success is never measured they can’t possibly fail.

On the other hand, “hard” programs have defined benefits for Empowerment Zone residents. If a loan or a grant is made for development, you can come along later and measure the progress in jobs created, increased tax base, as well as the physical bricks and mortar and other physical improvements to the infrastructure in the zone. This is what local activists mean when they say they want “Jobs, not job training”.

CityLink was going to provide job training, but such training isn’t effective if there aren’t any jobs. One of the pressing demographic problems in the urban core is the migration of jobs and people moving outside of our cities. The EZ program was initially designed to bring back companies and jobs. Grants and loans made in that respect provide actual and measurable economic development, bringing it back into the EZ communities.

The Sad Tale of the Tax Payer

Let’s say you send Uncle Sam a dollar in taxes. He won’t send you a thank you letter.

The Federal government is a big bureaucratic behemoth. Let’s say your dollar gets slated for the Department of Housing and Urban Development, which itself is a massive government bureaucracy. Then HUD decides to send your dollar to the Cincinnati Empowerment Corporation for economic development.

The first obvious thing is, your dollar won’t be a dollar anymore. Once you send it to Washington, the Feds and HUD have to take their cut. They have administrative expenses of their own. So let's say 85 cents of your original tax dollar makes it out of HUD and on its way to the CEC.

While at the CEC, they take 59% of your remaining 85 cents and spend it on administrative expenses. That money never makes it out of Harold Cleveland’s office. This further whittles your original dollar down to 35 cents.

As for the money that actually makes it out the CEC door, 90% of that goes to soft programs with no measurable economic impact. That takes your George Washington down to less than 4 cents of the dollar.

So you just sent a tax dollar to Washington and they earmarked it for economic development in the urban core. Expect less than a nickel to actually go to that intended purpose.

If you would have kept that dollar and either saved it, invested it or spent it, the economic impact would have been far greater that having it gutted and sliced up by Harold Cleveland and crew.

“Stop the Madness!” This program needs to be stopped cold in its tracks.


Anonymous Anonymous said...

Saw Harold Cleveland on CityCable at 4pm Tuesday. Steph Smith was blowing in his ear, it was a tag team match. These 2 said "all is well". Crowley asked a Dale Mallory question. They replied "only 3 or 4% of Dale's time had to do with CityLink, it's too small to worry about".
I've seen the invoices......it's more like 30-35%. But these guys just say "it's in the past, let's look forward".
Remember Eddy Haskell from the show "Leave it to Beaver"??? Cleveland is the EZ Eddy Haskell. He's up to no good, but he is all about bullshit charm and dodging hard questions. I wanted to puke. Smith makes you puke too. She is lying whenever her lips are moving.

3:28 AM  
Anonymous Wolverine JR said...

Didn't Smith resign? Or was that another 5/3rder? Whazzup with that?

The accounting time for D4S is right at the 30-35% marker, in his own words. But wait til some of the people who he said he 'met with', 'spoke with', see their names in print and realize he lied to place their names in play and get his 'work done'. One person has already had a flip-shit over the'Dale fudge factor'.

That's right, no longer the 3M DLC, DNC, ODP now it's big brother Dale and Joe-Joe's made up meetings as the DFF.

8:38 AM  
Anonymous watchdog. said...

I think there are more than 6 employees at the CEC. Not sure, but I thought the 6 were just the named administrators.

9:53 AM  
Blogger Male Dallory said...

You could be right on that, and I will check into that Watchdog. That obviously wouldn't change any of the other ratios, just the admin cost/per employee number.

Talk about a fleecing of the taxpayer. We have a member of the crew that comments under the moniker of TaxPayer, I am surprised he hasn't chimed in yet.

10:12 AM  
Anonymous Anonymous said...

It's interesting to see the numbers broken down like that.

EZ staff: There are 5 CEC employees and 2 temporary employees.

10:34 AM  
Anonymous Anonymous said...


The title is:

"Multiple Employment Training Programs, Most Federal Agencies Do Not Know If They Are Working Effectively"

The term "soft program" is right on. Job training is a cash cow that you can milk every morning. I would rather have on the job training.

10:57 AM  
Anonymous Anonymous said...

Let us not forget....48,000 of those administrative costs went to a certain board member's WIFE employed by the EZ.....the plot certainly does thicken.

Great work, once again Truth Squad. Keep banging at these crooked bastards.

11:09 AM  
Anonymous Anonymous said...

Let us not forget....48,000 of those administrative costs went to a certain board member's WIFE employed by the EZ.....the plot certainly does thicken.

Great work, once again Truth Squad. Keep banging at these crooked bastards.

11:10 AM  
Anonymous The Kaiser Soze said...

They probably spent more money on Dale Mallory and Kathleen Norris than they spent on redevelopment.

5:34 PM  
Anonymous Anonymous said...

The Enquirer ran a story in today's Local section about how a former investigator with OMI was harassed and demoted in 2000-2001 for speaking out against certain city officials link to the now-defunct Genesis Redevelopment Corp. And let us not forget....Beatty was at the center of THAT as well. Seems as though wherever there's public non-profit dollars, there he is (and his wife) fleecing the community along with all of the other poverty pimps...Mallory included.

7:30 PM  
Anonymous Carstairs said...

I saw the replay of the Neighborhoods Committee starring Harold Cleveland & Stephanie Smith this afternoon. Talk about people with forked tongues!

There were a couple of times Laketa Cole finally got some backbone & moxy & called Smitty out. Wasn't that dame just all puffed up & full of herself? Yeah, I thought she had stepped down, too. What Cleveland couldn't put into words, she did. After a while, she became his mouthpiece. I wanted to reach thru the TV screen & slut-slap the snot out of her (but then I would have been a racist).

Bottom line, those 2 clowns told one lie after another & I certainly don't think those council members in attendance bought their bag of baloney.

I certainly loved how those folks had put their applications in for money & never heard from anyone - the mature couple from the University-Corryville area & the lady who wanted to start a day care in Avondale.

I could relate to the lady from Avondale. Her words were almost verabatim with the jazz of calling over there to the EZ & asking when I could see their public records. That lady quoted almost everything word for word.

Soft Programs: that's a not-for-profit's absolute delight, the ambrosia as to why they are in business. And these not-for-profits in this city are completely clued into the fact that no one is going to hold them accountable for the success rates. No one in authority, including the City's Community Development Dept. has set any sort of concrete benchmarks to tie the dollars they get to the success percentages.

That's why every December you see City Hall Council Chambers packed to the rafters. All these freeloading not-for-profits are in there for plush payroll money. And that's basically what it is - they use the dollars they wring out of taxpayers to leverage grant money & other charitable giving. Not a one of those organizations have to meet any sort of benchmark criteria.

Ladies & gentlemen, I've been bitching & bellyaching to City Hall about this nonsense for years. Junk the joke social programs!

I agree that Harold Cleveland is like Eddie Haskell from Beaver. And Smitty reminds me of Alexis from the old Dynasty show. Bunch of schemers, skammers, connivers & crooks.

As to who's on the EZ staff, at one time, I called over there after hours & pressed the buttons to listen to the taped recording of all the plushbottoms who have a telephone extension. I put that out there on a previous post. And that's exactly what they are - a bunch of plushbottoms. Yeah, it makes me want to hurl, too.

Anon 12:10, honey, the banging was over early in the game. We're busy with the sledgehammers right now. Next is going to be the heavy artillery. Sometimes you have to drop the brick wall on thick people because they just aren't getting it.

Court House update: Howdy the Hitman will receive his verdict on 8/23 at 10:30AM. That's the latest news. I'll keep on this & provide any updates or changes. Seats are limited, so reserve yours ASAP.

9:03 PM  
Anonymous The Whiptacular said...

Everyday there is nothing in the Local section of the Enquirer proves the futility of this board. Y'all should not have chosen to live in an area where the caretakers have contempt for their own.

12:53 AM  
Anonymous Anonymous said...

Carstairs...I'll be there with bells on, trust...

As far as the Smith/Cleveland cat/dog show...my guess is that they're setting up the public front for when they roll on JB/Mallory/and the rest of their minions...you guys have to know that they all posess a cannibal trait...they'll eat their young. And Truth Squad, if you will dig even DEEPER, you'll find evidence of that. It's not that hard.

Also...don't focus that much on Howdy. In the grand scheme of things...he's just a stooge. FOR REAL...his brother on the other hand...welllllllll, that's another story.

2:32 AM  
Anonymous Anonymous said...

If you can, Pull up and post info on JB, Dale4Jail and the Genesis Redevelopment Corporation....that will give a ton of info that relates to this current EZ issue. Everyone needs to get more history on how these crooked bastards have been doing the do.

2:40 AM  
Anonymous Anonymous said...

The 8/2/6 Enquirer story "Jury will hear lawsuit against city" is about a whistleblower that was punished for shining a light on Genesis corruption. Many of the corrupt players in that mismanaged $700,000 of Genesis money were then given $27,000,000 of Cincinnati Empowerment Corp.(CEC) money to mismanage. These newer scandals are now in HUD's and the FBI's hands. Our tax dollars are now being used to hire the very expensive Republican lawyer Bill Seitz to help his Democratic friends cover up this mess.
I empathize with Ms. Kimberly Gray. Once again, heavy handed bully tactics are being used to silence and punish our whistleblowers.

11:56 AM  
Anonymous Carstairs said...

Genesis Redevelopment - we've already dredged up some stuff & put it on previous blog threads. In addition, the City Community Development Dept. should have that business in their archives - all public record. But it would be a good idea to look at this for analysis purposes.

About Howdy - he's out of the picture, I agree. However, that'll be one less empty-headed enforcer in the Mallory Mafia infantry. The spotlight does need to swing on Georgie the Junebug. Seeing him in Court, there's something very sinister looking about this guy. I got the inkling he's done plenty & was never busted for the acts. And you'll never get me to believe that Howdy killed Kabaka because he couldn't handle the taunts & threats anymore. Oh no. Deep down, I firmly believe there's more to this than we will ever know. Kabaka took his story to the grave, the Beattys will never talk & Kenny avoided exposure by having a Bench Trial, all in an attempt to keep the secrets.

12:23 PM  
Anonymous Anonymous said...

JB is the one behind all of this, working in tandem with Mallory. And Carstairs, you're probably right about Howard's killing Kabaka is much deeper than the taunts and threats. One of the rumors on the streets was Kabaka was taking his complaints about JB's activities to the Hamilton County Commissioners and other public officials.

Keep digging in on JB...HE'S the source.

4:03 PM  
Anonymous Anonymous said...

Someone indicated in another thread that JB's wife is being charged with five counts of tax evasion. Is there anyway to find out just how much money she owes and for what?

4:06 PM  
Anonymous Anonymous said...

Some of the apprenticeship programs were for the purpose of having the EZ funds pay for people to work at EZ friendly companies. It was kickback city. Send in an EZ paid crew to work the job, it beats paying people yourself. Garrett knows plenty of people in the business.

8:08 PM  
Anonymous Anonymous said...

The Dean has a post about this thread:


2:00 PM  
Anonymous carstairs said...

Anon 5:06 PM, regarding your questions about Mrs. Junebug, Orlinda Jo Fenderson Beatty:

Case 06CRB437

She failed to file a return for 2003 & failed to pay/report withholding taxes. She also failed on both for 2004. To top it off, she failed to comply with an order to appear in person with her books & records, as ordered by the City Tax Commissioner.

I'm sure the City has rough numbers on how much she owes, but they won't have a sum total until they see 1040s, W2s & all that business.

This is all certainly believable, strange as it may seem, but those people firmly believe they are above the law & every order that they may receive from a higher authority. Knowing what we know about this Beatty woman, I was absolutely astonished to see her conduct & this fakey persona in Judge Nadel's Court Room. Why, you would have thought it was a Bar Mitzvah or a wedding, the way she was carrying on & her manner of less than conservative dress. You would have never guessed it was a murder trial & that her broad beam is on the hook for arrearages on city income tax. She's a modern-day example of "let them eat cake."

2:01 PM  
Anonymous Anonymous said...

Thanks, Carstairs. Not surprised at all by her behavior in and out of the courtroom. She's pretty gross from what I hear and have seen. I've never heard of the city going after back taxes, so I was curious about that. Given all that has been RIPPED OFF by her husband, whatever she owes is a drop in the bucket compared to their modern-day "Bonnie & Clyde" act. Next question...is this for the "business", i.e. JB's Chicken/Ribs joint or for the Parktown-Shoot-Em-Up-Cafe or both? On another note, I find it very interesting that this is all brought about in lieu of the EZ/Kabaka/Genesis-Resurface-case.

Gotta love KARMA, don't you?

2:41 AM  

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