Diaz-Balart Statement from Hearing on EDA & Lessons from the Recovery Act

Washington, DC– The following is the statement of U.S. Rep. Mario Diaz-Balart (R-FL), Economic Development, Public Buildings and Emergency Management Subcommittee Ranking Member, from today’s hearing on the Economic Development Administration (EDA) and lessons learned from the Recovery Act:

“EDA was created to help spur job growth in economically distressed areas of the country, and given a number of studies over the years, EDA has a good track record. Studies reveal that EDA programs create jobs at an average cost of $4,000 per job, and every $1 million of EDA funding attracts $11 million of private and other public funding.

“EDA grants have assisted communities devastated by natural disasters, including Homestead in South Florida, which I have the privilege of representing. Those grants facilitated private-sector investment and helped create numerous jobs.

“What is critical to point out here is that EDA funds are not intended to be the sole source of funding for job creation or economic growth. Rather, EDA’s investments are put to work with private sector and local funding to ensure that when federal dollars are gone, the jobs don’t go with them. This ensures there is a real return on investment to the taxpayer.

“EDA received $150 million under the Recovery Act and, as of September of last year, 100% of its funds were obligated for 68 projects. EDA did not conduct business as usual when identifying projects under the Recovery Act. EDA obligated its funds a full year ahead of schedule and modified its process to ensure the most recent data on unemployment and poverty rates were used. While there may be areas that need improvement, I believe that the EDA model should have been one that other agencies followed when allocating their Recovery Act funds.”

Mr. Chris Masingill, from the Office of the Governor of Arkansas and testifying on behalf of the Delta Regional Authority (DRA) – another federal economic development agency – noted that the DRA model for investing federal economic development funds typically includes an agreement that require the grantee to meet stated outcomes. If grantees do not meet these outcomes, they must repay a portion of the funding. Diaz-Balart noted that this could serve as a model for other agencies.