THE GOVERNMENT PERFORMANCE PROJECTReport Card: Arizona FINANCIAL MANAGEMENT: B- Arizona's budget stabilization fund is now at a lofty 7 percent. Recent budget surpluses have bolstered the fund and also have allowed more than $1 billion in permanent tax cuts to be distributed to Arizona taxpayers since 1993. The state's finances are in balance (although they may be threatened by a series of legislative moves to lengthen prison sentences). There is no consensus revenue estimate. The budget office and legislature each do their own, and the two are usually averaged out. In 1997, state revenues were 7 percent higher than expected. Last year they came in a tad below estimates, and the present forecasts anticipate a similar result this year. Arizona provides agencies with a good deal of budgetary flexibility. As long as they perform well, they are allowed to receive one lump sum for operating expenditures. They also have been given the ability to retain specific savings at year's end, though agencies have been reluctant to take advantage of this offer. It seems they're leery of letting legislators know they have excess cash for fear that it will be taken away from them in the following budget cycle. Contract management has improved with more centralization, but agencies still complain that it takes too long to process requests for proposals. The governor has indicated that one of her priorities over the coming year will be contract reform. Cost accounting, which is not supported by current technology, is also an area ripe for improvement. CAPITAL MANAGEMENT: D+ Though the state has designed an impressive planning exercise for its long-term capital needs, the legislature generally has ignored the plans in favor of tax cuts. Even the Joint Committee on Capital Review in the legislature has recently been ignored by the full House and Senate. Right now, only prisons and schools (both required by court order) are getting the funding they need for capital projects. This is not purely a policy decision; it has real-world costs. The state is relying ever more on leased space to house its agencies, and so prices are escalating. Services suffer, too. The Department of Administration now has employees in seven different buildings—not a model for efficiency. Meanwhile, without a solid base for capital management—for example, there is no state architect position—large projects often come in above estimates. On the bright side, the legislature has been doing a pretty good job at funding "building renewal"—handing over a lump sum to the Department of Administration to take care of major repairs, upgrading and replacement. The legislature fully funded requests for major building maintenance needs in 1999. Unfortunately, it still does far too little in preventive maintenance. If it ain't broke, they don't even consider fixing it. HUMAN RESOURCES: C+ Arizona's automated hiring system is great. Resumes are filed in a central database, agencies enter the skill-sets needed and the system spits out appropriate names. Unfortunately, the state doesn't start recruiting when an agency is aware of an upcoming opening, only after the central office has been notified that the vacancy has actually occurred. Then, budget office approval is required. So the process still takes too long. Curiously, given its automated hiring, Arizona is far short on other useful data. It doesn't have a handle on its turnover rates, for example. There is a new employee appraisal system. Agencies can give raises up to 5 percent, with the ability to base them on performance (in years when the legislature sees fit to fund the raises). Legislation passed last year gives the state the potential to remove many positions from civil service regulation. Out of some 35,000 positions all told, about 5,000 are now filled on an "at will" basis. MANAGING FOR RESULTS: B- The state is getting steadily better at figuring out how well its programs are performing. A master list of 1,000 programs and sub-programs provides descriptions, missions and many goal-oriented objectives. This list is available on the Internet, complete with an automated tracking system. Although the actual measurements tied to those objectives are often relatively primitive, they have been improving—perhaps a result of extensive training offered in this area to agency personnel. All 109 agencies are required to generate their own strategic plans, which are centrally reviewed. Although there has not been a statewide strategic plan, in November the governor's office started to develop statewide goals and performance benchmarks. INFORMATION TECHNOLOGY: D+ "We've got a big hole to dig out of. But we've established the direction for digging out of the hole," says John McDowell, deputy director of Arizona's Information Technology Agency. All of the state's major systems are woefully out of date, with the exception of the excellent hiring system in human resources (see above). The 1999 legislature will act on a proposal for a new package designed to give both the human resources and financial management agencies an integrated system that will meet more of their current needs. Up to now, Arizona's telecommunications has been owned and managed on a decentralized basis, with eight or 10 different systems for each agency, a prescription for chaos. But the Department of Administration is attempting to set up a single statewide telecommunications system. AVERAGE GRADE: C
GOVERNORSMain introduction page | Governing home page
Copyright © 1999, Congressional
Quarterly, Inc. |