Weekly Wrap: Streamlining State Government

More and more state leaders from both political parties are talking about changing the face of state government as the recession severely limits the services states can offer.

“Indiana will have fewer dollars to work with in 2011 than we did in 2007,” Republican Gov. Mitch Daniels (R) recently told a gathering of state capitol reporters in Indianapolis, according to The Statesman-Journal of Salem, Ore. “That says you cannot have the same government you had, unless you plan to go broke.”

“Mitch Daniels is right,” Oregon’s Democratic governor, Ted Kulongoski, told the newspaper.

Both governors are trying to “streamline” state government to make it more efficient. Daniels has pushed for outsourcing more state services – the Hoosier State already has privatized the 157-mile Indiana Toll Road – and called for small school districts to merge. Kulongoski wants to eliminate 18 state panels and commissions and suspend or consolidate dozens of others, KUOW radio reported.

But the going can be slow and the savings modest.

Kulongoski’s plan would save only about $20 million over two years. And Kulongoski’s counterpart to the north, Washington Gov. Chris Gregoire (D), found out that lawmakers aren’t always willing to go along with “streamlining.” Gregoire earlier this year proposed eliminating a third of the state’s nearly 500 citizen boards and commissions; the legislature got rid of just 18 of them, while Gregoire eliminated another 50 by executive order, according to KUOW .

In Louisiana, Gov. Bobby Jindal (R) this year created a new panel to address the question of where the state can find savings. The Commission on Streamlining Government this week heard some sweeping proposals from state Treasurer John Kennedy, who said the state should limit those on Medicaid to two emergency-room visits a year and require all prisoners to earn high-school diplomas to reduce recidivism, The (New Orleans) Times-Picayune reported.

In Michigan, a coalition of 13 business groups issued a series of reform proposals to cut state government spending, including trimming the number of school districts and privatizing more state services, the Detroit Free Press noted.

State and local government workforces are shrinking simultaneously for the first time since the early 1980s, according to the U.S. Labor Department – and despite some signs of hope in the economy, that trend is likely to accelerate.

Virginia Gov. Tim Kaine (D) on Tuesday (Sept. 8) announced he would lay off 593 state employees, The Roanoke Times reported. Tens of thousands of other state workers will be forced to take an unpaid furlough day in May. The moves come as Kaine tries to address a $1.5 billion shortfall; it’s the fourth time in the current two-year budget cycle that the governor has had to resort to cuts in spending.

In Louisiana, 515 workers from 23 state agencies will be laid off, according to The (Baton Rouge) Advocate . Most of the layoffs will hit health care workers, the Department of State Civil Service said, and 22 probation workers already have been let go.

While state and local workforces are shrinking, they are doing so at a rate of only about 1 percent, The Christian Science Monitor noted. That pales in comparison to what is happening in other sectors of the economy. But with state and local workforces growing substantially over the past two decades and localities traditionally reluctant to thin their police and firefighter ranks, “even modest reductions are causing…a stir,” The Monitor said.

And then there was one.

The governors of Arizona and Connecticut this month approved long-overdue budgets, leaving Pennsylvania as the only state without a final spending plan in place, more than two months into the current fiscal year.

But in Arizona, at least, the final budget may not be so final after all. Days after Gov. Jan Brewer (R) approved the budget – after making several key vetoes – legislative budget analysts issued a report estimating that the spending plan is still nearly $1 billion out of balance, The Associated Press reported.