Few ideas about ways to improve state or local management gain wide acceptance year after year after year. Many, like zero-based budgeting or total quality management, are touted as panaceas then seem to fade into the governmental sunset. Others gain traction over time--but not without a series of fits and starts.
We have noticed, however, one powerful management tool that has been used more frequently and to better effect on a steady basis over time: performance auditing and evaluation. Just 10 years ago, there were many in state government who assumed that anything with the word "auditing" attached to it was fundamentally a bean-counting financial function. No more. In an ever-growing number of states, the auditor's office, the legislature or another group now has the capacity to carry out reviews of various operations and, in that way, help government agencies deliver services as efficiently and effectively as possible.
In Colorado, for example, the state's legislative auditor is firmly engaged in the process. "That's where you find out if money is being spent the way it is supposed to, or whether you're getting the most bang for the buck," says Brad Young, former chair of the joint budget committee and the House appropriations committee. In 2004, more than 90 percent of the auditor's recommendations were accepted by state agencies, up from 81 percent in 2000.
Many of those recommendations also led to legislative change. One example: A performance audit of the state's lottery program in late 2003 found, among other problems, that the lottery's expenses had increased by 220 percent since 1983 but that the amount of money the lottery was providing for the state's programs had gone up by only 151 percent. The audit's findings led to a complete overhaul of the law governing the state's lottery.
Claire McCaskill, Missouri's state auditor, decided to increase her office's focus on performance-type audits. About a third of her staff's time is now devoted to the task. One close observer of the government noted that the audits "are probably the closest things we have to accurate information." A wide range of topics has been tackled, including examinations of the administration of employee benefits, of the state's oversight of charter schools, of tax credits and of water quality in state parks.
Don't misunderstand. The widespread acceptance of performance auditing is not all beer and skittles. In Michigan, the auditor general's office has had to cut its operations significantly, because of the state's ongoing budget problems. While audits can often save a state money, some legislators have welcomed the opportunity to put auditing on a diet. According to Lynn Jondahl, executive director of the Michigan Prospect, a nonprofit public policy think tank, when legislators have worked to get a program implemented, they're not all that anxious for it to be examined carefully, because that might threaten its continued existence--and their personal legacy.
Florida's Office of Program Policy Analysis and Government Accountability--one of the most impressive legislative oversight offices in the country--came under siege a few years ago. Governor Jeb Bush launched three unsuccessful attempts to either eliminate or vastly reduce the office--the most recent in 2003. Of that effort, Earle Klay, professor of public administration and policy at Florida State University, says: "I would use the word 'gut.'"
Fortunately, legislative support for OPPAGA was strong, and the governor seems to have rethought the matter. It was not put on the chopping block last year. Says Yvonne Bigos, a chief legislative analyst in OPPAGA's health and human services policy area, "OPPAGA has been successful in getting a lot of our recommendations implemented," such as a preferred drug list and removal of value-added contracts from disease management.
The beat goes on. Brian Sonntag, Washington State auditor, has been battling since his election in 1992 to gain full authority to do independent performance audits. "We were the only state in the country with a law in the books that specifically prohibited the state auditor from doing performance audits," he says. The state's legislative evaluation unit was doing excellent work when directed by the legislature to look at a program, but Sonntag wanted his office to have the authority to range more freely. Even after the legislature removed the prohibition, his office could only do audits as specifically directed and funded by the legislature. "That wasn't independent performance audit authority," Sonntag says. "Last session, they gave us authority to begin a statewide performance review leading to regular performance audits over state programs."
And that's not all. There's also a citizen initiative on the ballot in November that would give the auditor's office much broader performance authority of state and local governments throughout the state. "When it rains," Sonntag says, "it pours."