August 20, 2010 Volume 111 Number 16

Pelosi touts retrofit program as stimulus success

By Don McINTOSH, Associate Editor

These days, the most popular words in the Democratic Party political vocabulary are “green” and “jobs.” Aug. 15, U.S. House Speaker Nancy Pelosi (D-Calif.) was in Portland highlighting a program that combines the two.

Clean Energy Works Portland does “home energy retrofits”— insulation, high-efficiency furnaces and water heaters — using federal stimulus act dollars as seed money for a revolving loan fund. Homeowners repay the loans on their utility bills. Workers, including some union members, earn a living wage.

For a year, the program’s local boosters have been describing it as a national model. Now it’s official. “It really is a model for the country,” said Pelosi, who as speaker is third in line of succession to the U.S. president.

Pelosi was given a tour of a Northeast Portland home that was retrofitted by Neil Kelly Co. Neil Kelly is the only full-fledged union-signatory contractor that is participating in Clean Energy Works Portland thus far. The company employs members of Carpenters Local 247 to do basic weatherization.

Thanks to Clean Energy Works Portland, Pete and Heather Ficht, whose home was showcased for the press, got $28,000 worth of energy efficiency improvements for only $300 up front. The work included insulation, a high-efficiency furnace, and a tankless water heater. Rebates and tax credits lowered their cost, and the remainder they will repay with a $100-a-month charge on their natural gas bill over the next 20 years. Because they got more work done than most participants in the program, the loan payments are likely to be higher than what they’ll save in energy costs, but they also got big improvements in the comfort and usability of their home.

Pelosi was joined by Congressman Earl Blumenauer (D-Oregon), Portland Mayor Sam Adams and a gaggle of press to see 22-month-old Sabine Ficht’s new bedroom, an upstairs space that previously was too hot in the summer and too cold in the winter to be usable.

“Insulation is the least sexy thing we’ve had done, but it’s made the biggest difference,” said Heather Ficht, who works as a project manager at Worksystems, Inc.

The program’s “green” aspect is easy to see, but the “jobs” are harder to nail down.

Ana Gonzalez, hired by Neil Kelly in late-July, was front-and-center at the Pelosi press event as an example of someone who found work thanks to the program, which got a $1.1 million initial grant from stimulus funds. Gonzalez, 41, worked six years in quality assurance at Adidas, then got a job at a domestic violence non-profit. After referring women clients to Oregon Tradeswomen Inc., Gonzalez decided a job in the building trades would be a good career move for her too. She went through the group’s seven-week pre-apprenticeship program for women, and found work at Neil Kelly. Now she’s a member of Carpenters Local 247, earning $15.85 an hour in the union’s new weatherization technician classification. She will also have full-family health coverage once she logs 250 hours on the job, thanks to a $6.44-an-hour employer contribution to the union health and welfare trust.

Neil Kelly’s new Home Performance division has seven employees: three new hires including Gonzalez, and four who transferred from the company’s other divisions. That’s in a home remodeling company that shrunk from 165 to 130 in the recession. Neil Kelly’s home performance division works exclusively with Clean Energy Works, and is doing about 60 of the 500 homes in the program’s first stage. It’s the company’s only growth spot right now, company president Tom Kelly told Pelosi.

Program-wide, Clean Energy Works Portland reports just 16 new jobs created a year into the program — 11 in the private sector and five for the program itself.

Yet, Mayor Adams told Pelosi Clean Energy Works will be responsible for 1,300 jobs in the next three years as it rolls out statewide, thanks to a second stimulus grant of $20 million.

Clean Energy Works Portland director Andria Jacob explained the 1,300 jobs figure to the Labor Press. It uses a U.S. Department of Energy economic model which estimates a job is created for every $92,000 spent; and it assumes the program will meet a requirement that it find a five-to-one funding match for the stimulus funds.

Pelosi’s staff also wanted to make a point that the stimulus-funded project would employ not just the workers doing the retrofit, but the workers manufacturing the equipment and supplies they installed. But Clean Energy Works is too small to meet the threshold triggering the Recovery Act’s “Buy America” provision. Adams obliged, announcing an “emerging” supplier strategy that he said would make sure the program favors American-made goods.

Contractors taking part in Clean Energy Works Portland hadn’t heard anything from the City about a preference for U.S.-made supplies. At the Fichts’, the insulation and furnace were made in America, but the tankless water heater is Japanese.

Jacob, the program director, said Adams’ comment referred to a staff-person at Portland Development Commission who is developing a domestic and local content proposal.

While there was no national media at the Pelosi press event, it did get local coverage. In the Fichts’ living room, a freelance TV cameraman hit Pelosi with one of the three questions Fox News editors had given him to ask: “What do you say to critics who argue that this is just a payoff to the unions before the election?”

“How can people be opposed to this?” Pelosi replied. “It doesn’t make sense. They say it’s going to add to the deficit. Where were they during the Bush Administration when the biggest growth in debt was created?”

If local green job results appear modest, it’s worth noting that in a $3.5 trillion federal budget, the $1.1 million and $20 million grants to Clean Energy Works are pretty modest sums. And those are one-time stimulus act grants. Asked by the Labor Press about future federal funding for the program, Pelosi and Blumenauer said only that Congress is instead discussing home energy tax credits and rebates, the cost of which would be offset by ending some oil companies’ tax breaks.

“It’s not about government spending,” Pelosi said. “It’s about government investing to stimulate the private sector to take the lead.”

For Tom Kelly, seeing this work come and go with government policy would be an unfortunate bit of déja`vu.

“Back in the ’70s, in the Jimmy Carter era, our company had a division with 30 employees putting in insulation, putting in solar hot water heaters, doing storm windows in people’s houses,” Kelly told Pelosi. “In those days we called it weatherization. Now we use words like ‘energy retrofit.’ ” But the programs went away, Kelly said, and the industry dried up, when Ronald Reagan swept into the White House.

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