Grading the States introduction THE GOVERNMENT PERFORMANCE PROJECT Report Card: Rhode Island GOVERNOR Lincoln Almond (Republican, elected 1994) LEGISLATURE House — 84 Democrats, 16 Republicans Senate — 44 Democrats, 6 Republicans FINANCIAL MANAGEMENT: B- Rhode Island’s financial management is being held back by decades-old technology, which forces it to rely on paper for processes that other states computerized years ago. Managers sometimes have to go to great lengths just to find information when legislators ask for it. It’s a shame that the state has such poor tools to work with, because many of its financial practices are pretty good. Its rainy day fund is filled to the statutory maximum, and up to 2 percent of each year’s revenue goes into a capital spending fund, relieving the pressure for additional debt. Bond ratings aren’t the best, but they’re on the way up. And Rhode Island produces a very public and honest long-term projection of revenue and expenditures. It shows that the state faces a $184.7 million revenue gap in 2002; untended, the gap will grow to $259 million in 2005. That’s not happy news, but at least the state is confronting its problems. “We’ve tried not to succumb to the temptation to be unrealistic,” says Rosemary Booth Gallogly, the deputy budget officer. CAPITAL MANAGEMENT: C+ For years, agencies in Rhode Island submitted careless and inaccurate funding requests for capital projects. The exact numbers didn’t matter because they knew the projects wouldn’t be approved anyway. Now funds are available, but the problem is that the agencies have little experience in developing realistic funding requests. The amount appropriated often turns out to be substantially less than what’s needed. Other projects have to be delayed to make up for the shortfall. So the state is trying to give itself a crash course in capital planning. Larger agencies are being asked to assist smaller ones in cost estimating, and the state budget office has developed a project scoring system to help prepare five-year capital plans. Rhode Island is working on a state inventory of facilities, which should help prioritize its needs. Even with dollars a little easier to come by, money is still insufficient to bring roads and bridges up to good condition. For bridges, the price tag will be especially high. Recent Federal Highway Administration data revealed that 50 percent of them are deficient. HUMAN RESOURCES: C- Hogtied by a rigid civil service system and a plethora of separate unions and bargaining entities, Rhode Island has long had the flat-out worst personnel operation of any state in America. It may still be among the worst. But it is finally making progress. The state has expanded its job-applicant pools and added automation to the hiring process. Filling an ordinary job used to take six months; now it can be done in under 60 days. An aggressive community outreach program has doubled the number of minority hires in two years. After years of neglect, management and supervisory training have been instituted, with three departments starting as pilots. A new human resources information system is being installed to replace the hodge-podge of paper-driven processes the state has been burdened with. Having said all that, Rhode Island remains miles behind the better-performing states. There is still no way to monetarily reward superior performance, as promotions and raises are based entirely on seniority. For those state workers who are union members — a large chunk of the work force — there isn’t even a performance-appraisal system. And there is the specter of demographic chaos: This is the oldest state work force in America, with an average age of almost 50, and a third of all employees are expected to leave in the next five to seven years. MANAGING FOR RESULTS: C Rhode Island started managing for results in 1996, and while it’s not at the head of the pack, the state is at least keeping up with national trends. This year, for the first time, all agencies — including the courts — will be required to include performance reviews as part of their budget submissions. Although actual use of performance measures is increasing only slowly, benefits are beginning to be felt. In 1999, for example, the Department of Health made a successful case for additional food inspectors on the basis of statistics that showed the prevalence of food-borne pathogen-related illnesses. While there’s no requirement that agencies do their own strategic plans, most of the larger ones have them, and two important ones that don’t — Corrections and Labor and Training — are working on them. Statewide, there is no formal strategic plan. INFORMATION TECHNOLOGY: D “We can’t afford to save money,” says one state employee here. That’s the story of IT in Rhode Island. In a tight fiscal environment, the legislature does not appear to understand the value of technology, and has methodically not appropriated adequate funds for that area. For example, aside from tax payments, the state currently offers no significant online transactions. Why is it lagging? “It’s a question of money and staffing,” says Barbara Weaver, the state’s CIO. “We have fewer employees in the IT operations than we had several years ago.” In this kind of environment, it’s no surprise that there is little cost-benefit analysis for IT projects; and no enterprise-wide review of IT investments after the purchases are made. This would save money in the long run, but would take additional staff now. One notable bit of progress here is the upcoming addition of a financial management information system. The current system, Weaver says, “is so old that it is not capable of answering the kinds of questions that people ask these days.” AVERAGE GRADE: C Copyright © 2001, Congressional Quarterly, Inc. Reproduction in any form without the written permission of the publisher is prohibited. Governing, City & State and Governing.com are trademarks of Congressional Quarterly, Inc.