S.C. Statehouse Report
Sunday, July 31, 2005
VIEW: http://www.statehousereport.com/columns/05.0731.inspector.htm

COMMENTARY
State needs performance review office
By Andy Brack
SC Statehouse Report

JULY 31, 2005 - - South Carolina government could save millions of dollars a year and become more efficient, effective and responsive to taxpayers if it invested in a permanent office to review agency performance.

It's working in other states. So why can't it work here?

Starting in 1991, Texas institutionalized a permanent performance review process that has generated dozens of reports and saved billions of dollars. Now called Strategic Policy Initiatives, it is a division of the Texas Comptroller's Office and focuses on reviews of government agencies, programs and operations, and recommends improvements to increase efficiency and effectiveness.

Over the last three years in New Mexico, Gov. Bill Richardson hired outside consultants to work with government employees to identify savings and figure out ways for agencies to operate better. In a state that has about half of the budget of South Carolina, the project delivered two reports with more than 130 recommendations for $500 million in savings over five years. Lawmakers have implemented more than 80 of 92 recommendations in the first report and reaped about $75 million in efficiencies and savings in the first year.

S.C. Gov. Mark Sanford called for a similar process with his MAP Commission (Measurement, Accountability and Performance) study at the beginning of his term. Unlike the Texas and New Mexico reports, however, the South Carolina study was run by business people, not experts in the field of performance reviews. While they identified millions of savings, some of the conclusions drawn were hard to replicate because they provided inadequate documentation or source data.

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In other words, Sanford was onto a good idea, but it was done "on the cheap," which produced results that weren't as helpful as if professionals had done the work.

That being said, the governor was onto something. Buried in last year's executive budget was a recommendation to spend $400,000 for a new office called the State Inspector General to look for "waste, fraud and abuse" in executive agencies. Similarly, a House restructuring bill (H. 3009) calls for a similar office, but estimates annual expenses could reach $1.1 million to do it right.

As one of the consultants who participated in one of the New Mexico studies, it's heartening to see South Carolina want to invest in a process to review how agencies are performing because such oversight encourages optimal functioning. However, it seems South Carolina policymakers are missing the point with the way they're defining the proposed process.

The House bill and governor's proposal focus on a new oversight agency to review "waste, fraud and abuse," a term that has become a political cliché. Both call for a state inspector general for six years to be appointed by the governor and approved by the Senate. Both suggestions have problems.

First, focusing on waste, fraud and abuse is setting a negative mission for a new agency. It highlights a belief that the framers of the new job assume there are millions of dollars of waste, fraud and abuse with state money and that they'll root it out. In reality, however, budget cuts over the last few years have trimmed a lot of the fat in state agencies. In reality, gargantuan sums of state money are not being wasted by state agencies. Because their resources have been cut over and over, they can't afford to waste lots of money.

A better solution to this problem is to make the mission of a new agency focus on improving performance, highlighting efficiencies, identifying best practices and finding ways to improve customer services for taxpayers. In other words, define the new agency with a positive mission, as was done in Texas and as was the overarching theme behind New Mexico's project.

Second, by putting the agency under the governor's control, there's a strong likelihood the agency itself could be abused politically as a hammer to nail any state operation a governor didn't like. Lawmakers should consider another structure that creates a non-partisan Inspector General's office that uses outside professionals to conduct independent, verifiable reviews of key agencies.

If the state invested $1 million a year in a new independent Inspector General's office, it likely can reap $100 million annually in efficiencies, improving customer service and boosting performance of state agencies. And, of course, it will be able to find any "waste, fraud and abuse" that does, in fact, exist.

RECENT COMMENTARY


 McLEMORE'S WORLD
7/31: Hands-free phoning

Another great cartoon from Bill McLemore:


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 FEEDBACK
7/29: Hypocrisy among morality police

A few months ago, State Senator Chip Campsen sought to pass legislation enacting criminal penalties against clergy who conduct marriage ceremonies for same-sex partners on the stated basis that there is no point in making something a crime unless penalties are enacted to prevent the crime from occurring.

This is part of a Statewide (and maybe Regional or National) trend to legislate morality. But, somehow those who are trying to come up with new and sundry ways to criminalize acts which offend their moral sensibilities are ignoring the fact that we already have laws on the books of this nature that are rarely (if ever enforced). For example:

SC Code Ann. § 16-15-60 (1976, as amended) titled “Adultery or fornication” provides:

Any man or woman who shall be guilty of the crime of adultery or fornication shall be liable to indictment and, on conviction, shall be severally punished by a fine of not less than one hundred dollars nor more than five hundred dollars or imprisonment for not less than six months nor more than one year or by both fine and imprisonment, at the discretion of the court.

SC Code Ann. § 16-15-80 provides, "Fornication" is the living together and carnal intercourse with each other or habitual carnal intercourse with each other without living together of a man and woman, both being unmarried.

Former Lt. Governor Bob Peeler has admitted that he committed adultery. And while Governor Sanford's [former] Spokesperson Will Folks has denied that he committed Domestic Abuse, evidence suggests that he is guilty of the crime of fornication. So why isn't Campsen calling for the prosecution of the former Lt. Governor and Mr. Folks? Could it be because they are white, male, Republican, heterosexual Conservatives?

Mr. Peeler has been quoted as saying that his situation is a “private matter.” And well he should given that he would apparently be facing multiple counts of adultery if the applicable law were applied strictly. Maybe he would be interested in helping repeal this silly law and in convincing Senator Campsen not to try to enact any more silly laws.

-- Name withheld upon request, Summerville, S.C.

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KEEPING TRACK
Ahead on Santee Cooper

This section tracks past forecasts by Statehouse Report with other media reports:

In Statehouse Report:

5/15/05: Public service has one master, not two: "While all of this has been going on, some members of the Santee Cooper board (i.e., Gov. Sanford's appointees) have become increasingly activist in nature. Charges are flying that board members are micromanaging on everything from corporate contributions and power contracts to working intimately on a privatization study...

"Santee Cooper's struggles should serve as a reminder to members of state governing boards that public service requires them to carry out two duties. First, there's a "duty of care," which calls for board members to ensure an organization is running effectively and efficiently. (This gives an entrée for meddling.) But board service also carries a "duty of loyalty," which means members must serve the interests of the organization over interests of anyone else, such as a governor."

In The Post and Courier

7/19/05: Santee Cooper directors, governor blamed in report. "A bipartisan panel of five state senators was scheduled to release a report this morning saying Santee Cooper board members repeatedly and recklessly mismanaged the state-owned utility for more than two years, capping a months-long investigation that included 22 hours of hearings and about 10,000 pages of e-mails and documents.

"The statement, written by Sen. Luke Rankin, said bullying by a few rogue board members jeopardized the power company's stellar credit rating and could have been costly for taxpayers and the utility's customers and bondholders. The report also said those directors deflated morale at the utility while pursuing a political agenda for Gov. Mark Sanford, who appointed them to their posts."


SOUTH CAROLINA SCORECARD

Here's a "thumbs up" and "thumbs down" related to various political events from the past week:

Thumbs up

Lee. Hats off for the public service of Rep. Brenda Lee, who resigned this week for a state job.

Thumbs down

Wilson, Brown, Inglis, Barrett. It's a shame that South Carolina's Republican congressmen didn't have the backbone to stand up for American workers by voting for the bad CAFTA agreement. Just this week, a study showed hundreds of thousands of Southerners lost jobs due to CAFTA's older brother, NAFTA.

HHS. The state may cut Medicaid benefits for the state's poorest that might affect one in five South Carolinians. More.

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