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The Voice of Business,
Industry & the Professions Since 1942
North Carolina's largest
business group proudly serves as the state chamber of commerce
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January 2005
State Government
Is Government Efficiency Passing the
Test?
By Steve Tuttle
Two
years after a landmark report exposed woeful inefficiencies in state
government operations, some significant progress has been made and there’s
an expectation that more will be accomplished in the year ahead.
The December 2002 report by the Commission to Promote Government
Efficiency and Savings on State Spending uncovered more than 80 examples
of archaic procedures, overlapping programs and serious deficiencies in
key operations.The commission was created by Gov. Easley at the urging of
NCCBI, and then-NCCBI Chair Jim Hyler was appointed to lead the effort.
Many of the recommendations required passage of new laws by the General
Assembly, and NCCBI pushed hard for those bills during last year’s session
of the General Assembly. In addition, at NCCBI’s request Gov. Mike Easley
appointed the Business Council on Fiscal Reform to press for
implementation of the Efficiency Commission recommendations. Several NCCBI
leaders were appointed to the Council.
NCCBI Chair Barry Eveland says he is encouraged at the progress achieved
to date, particularly passage of legislation overhauling the way state
government manages and buys computers and other IT equipment. He also
pointed to reforms that have greatly improved the ability of the state
Department of Revenue to collect delinquent taxes.
“Improving the way state government operates is a lot like turning around
an ocean liner. It’s just going to take time,” Eveland says. “I am
encouraged that the Efficiency Commission recommendations that have the
greatest potential for short-term savings of millions in tax dollars –
reforming the state’s information technology – now have a real chance of
being implemented.”
(See the State Government columns in the August and November issues for
stories on implementation of the new IT program.)
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Report Card: The Efficiency
Commission’s recommendations for improving state government operations can
be grouped into eight broad categories. The report card below indicates
the status of each one.
A — Improve information technology.
Passage of S. 991 and creation of new State Chief Information Officer sets
a positive direction, but results will be several years in coming. Real
clue will be how IT is treated in the upcoming budget.
A — Improve revenue collections.
Largely accomplished through measures allowing Revenue Department to
assess a 20 percent collection fee on delinquent taxpayers and
implementation of Project Compliance.
B — Improve capital management.
Largely accomplished with creation of Performance Contracting legislation,
Utility Savings Initiative and movement to sell surplus state properties.
D — Reform personnel policies. The
Legislative Studies Commission was directed to explore several of the
commission’s ideas and give a report to the 2005 General Assembly.
Governor Easley also has signaled his support for these reforms.
D — Privatize some state functions.
Some progress noted. Department of Administration has contracted with a
private company to a create system for determining surplus property.
Health and Human Services is studying ways to improve collection of child
support payments.
D — Improve efficiencies in government structure.
Some small but important progress noted, particularly efforts to
streamline and coordinate economic development programs.
Incomplete — Shift authority for provision of
some state services. Scant progress noted, in part due to
bureaucratic resistance. Much more work needed.
Incomplete — Explore systemic change in
government. Scant progress noted, in part due to bureaucratic
resistance. More work needed. |
NCCBI President Phil
Kirk says that in 2005 the association will be realistic in continuing to
press for implementation of the recommendations by the Efficiency
Commission. “Out stance is to try to identify those recommendations that
are ‘doable,’ meaning that, while there may be some resistance –
particularly at the agency level – we have a real chance of achieving them
if we have the support of the Governor’s Office and the legislative
leadership.”
Kirk said that probably would include efforts to reform state personnel
policies and procedures. “Like any business, payroll and employee benefits
are state government’s biggest expense. We believe there are several steps
the state could and should take in its personnel policies,” Kirk says.
For example, Kirk notes, the state isn’t able to afford large pay
increases for state employees partially because of spiraling increases in
the state employee health plan. “Most private employers have taken
reasonable steps to curtail increases in employee health and retirement
benefits. The state has done some of that, but must do more in this area.”
Kirk and Eveland recently met with Dan Gerlach, Gov. Easley’s chief budget
adviser, and received assurances that the governor remains committed to
implementing as many of the Efficiency Commission’s recommendations as
possible. Gerlach says he agrees with the NCCBI approach of focusing on
those remaining recommendations that have the best chance of being
implemented.
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