Jesse Kelly, the Republican candidate running to replace Gabrielle Giffords in Congress, argues that President Barack Obama's economic-stimulus program failed to boost the economy through infrastructure projects and that government spending is driving the country to bankruptcy.

But the family construction company where Kelly has worked for about eight years, Don Kelly Construction Inc., has benefited from at least three contracts financed by millions in stimulus dollars and has relied almost exclusively on government-funded pipeline projects for its business.

Kelly is running against Democrat Ron Barber in the Congressional District 8 special election on June 12 to fill Giffords' seat until January. Giffords stepped down in January to recover from wounds suffered in a shooting last year at a Tucson-area constituent event.

Barber worked as her district director and was wounded in the same shooting. Green Party candidate Charlie Manolakis is also in the southern Arizona race.

In 2010, Kelly narrowly lost to Giffords. Attacking Obama's $787 billion American Recovery and Reinvestment Act was a key part of his platform, which, like many "tea party" candidates, focused heavily on reining in government spending and reducing federal bureaucracy.

Kelly deflected criticism during that race when it was reported that Don Kelly Construction worked on several stimulus and government-funded projects.

The Arizona Republic has found that since 2010, additional stimulus and government-funded projects, totaling at least $60.8 million, have gone to the company.

"When Kelly talks about cutting (government) spending, but his own family's company is profiting from that very spending, you have to scratch your head and wonder whether he really believes what he says," said Rodd McLeod, a spokesman for Barber. "If he's really against it, why is he in that business?"

Some voters may be bothered by the issue, said longtime Tucson pollster Margaret Kenski, owner of Arizona Opinion, but others may see it as "just politics."

"I think that (Kelly) could make a defense and say, 'The money was offered. We provide good services. We do the projects right.' ... You wouldn't hold it against him if he was building schools," Kenski said. "(But) it sounds self-serving to me a little bit. ... As far as the stimulus, I think that would put him in a reasonable position to be attacked."

Campaign spokesman John Ellinwood said Kelly has not requested that his father refrain from bidding on any stimulus or government-sponsored projects.

"That would have been completely and totally absurd because it had no effect on whether the project would go forward or not," Ellinwood said. "These projects were going to be done. Someone was going to get (the contract). ... Somebody will be getting paid."

Ellinwood said Don Kelly Construction may have saved the government money because competition can drive down project bids.

"It may have cost the government more money if there were fewer people bidding," Ellinwood said. "The family's business is actually saving the taxpayers money by bidding."

Working his way up

Kelly, 30, joined his father's business, which installs sewer pipelines and does flood-control work across the country, in 2004 after finishing a four-year enlistment in the Marine Corps, in which he led a squad in combat in Iraq.

Kelly started at Don Kelly Construction "with his shovel in his hand" and worked his way up to project manager, Ellinwood said. "You start with the basics in the Kelly family."

As project manager, Kelly oversees projects from bidding through the completion of construction, ensuring they stay on budget and on schedule, according to Ellinwood. He does not choose which projects the company pursues, although Kelly has estimated that 90 percent of the company's business comes from publicly funded projects.

Kelly's business experience is a fixture of his stump speeches on the campaign trail. He promises to fix the economy by getting government out of the way of business and cutting government spending.

Kelly told voters during his first campaign that his inspiration to run came out of opposition to the 2009 American Recovery and Reinvestment Act.

"I decided to run right after President Obama signed the stimulus that would indebt my 20-month-old son for the rest of his life," Kelly told the conservative magazine National Review in 2010. He said the stimulus and federal earmarks were "bribery with taxpayer money."

Kelly's comments drew criticism at the time.

A Republican opponent in 2010 called Kelly's employment at a company benefiting from the federal program "blatant hypocrisy." A former Tucson tea-party leader and a conservative political-action group circulated material questioning him over the family company's work.

Kelly's campaign then called the efforts "desperate." One stimulus project under question, an $11 million contract to install sewer pipelines in Pima County, was funded with $2 million from the federal government only after the project began and without any input from the company, Kelly said in 2010.

The company doesn't control who pays for projects, Ellinwood argued. The company often does subcontract work.

Projects and proposals

Though it is unclear which projects Kelly has overseen directly, the additional stimulus and government-funded projects that Don Kelly Construction has landed since 2010 include:

An $8.5 million contract in January 2010 from Oxnard, Calif., to install water and sewer lines.

Two stimulus-funded subcontracts, of $18.5 million and $5.4 million, in February 2010 for earthmoving on a project to repair and raise levees along the Rio Grande in far western Texas.

A $6.7 million contract in June 2010 from McAllen, Texas, to relocate a reservoir near the local airport.

A $4.6 million contract in November 2010 from Muskogee, Okla., for a sewer-line replacement.

Two wastewater contracts, of $3.9 million and $10 million, in 2010 and 2011 in Pima County. The work was scheduled to be completed this month.

A $2.5 million water-project contract in April 2011 from San Diego.

A $67,000 contract in March from the San Antonio Water System Board for a sewer line.

Ellinwood said Kelly doesn't oppose government spending on infrastructure projects, whether local or federal, "if it's constitutionally authorized."

Asked what that means, Ellinwood did not give examples but said the project must directly relate to the "proper role of the federal government."

Ellinwood said Kelly opposed the stimulus "because it used money that we didn't have" and didn't help the economy.

"The people on these make-work projects have a job, and they spend that money, but (other) people save money because they are worried about the extra debt taken on by the federal government," Ellinwood said. "It's just not the right way to grow an economy."

Instead, Kelly advocates for lower taxes, fewer regulations and increased domestic energy production to grow jobs. He argues that the country has "an unlimited supply of wealth" that would solve the economic downturn as well as take care of the nation's debt if the government would allow deposits of oil, natural gas, coal and uranium to be tapped.

Though estimates vary, the Congressional Budget Office said that the stimulus program at its 2010 peak saved or created 900,000 to 4.7 million jobs, largely by funding infrastructure projects.

Ellinwood said he did not know if it was helpful to Don Kelly Construction to receive work paid for by the stimulus during the tough recession. But he said the stimulus overall has not been good. "The thing about debt is it needs to be paid or you need to go through bankruptcy. Neither one of those are good."