Open Government

WPC's Center for Government Reform's mission is to partner with stakeholders and citizens to work toward a government focused on its core functions while improving its transparency, accountability, performance, and effectiveness for taxpayers.

Open Government Blog

Federal Transportation budget going broke....again

June 25, 2009 in Blog

From AASHTO....

On June 24th Deputy Secretary of Transportation John D. Porcari sent a
letter to the chief executive officers of every state department of
transportation in the country advising them of an impending cash shortfall in
the Highway Trust Fund (HTF). The HTF is the federal funding source for
thousands of state highway projects, which support hundreds of thousands of
jobs, across the country.

The Deputy Secretary's letter put all state DOTs on notice, warning that
instead of sending states overnight reimbursements for transportation
investments, the Federal Highway Administration could begin to ration state
repayments; possibly shifting to weekly or bi-weekly payments in the event that
state reimbursement requests exceed the cash available in the Highway Trust Fund.

Faced with the same crisis ten months ago, Congress transferred resources
from the general fund back into the HTF to prevent a shutdown of the Federal
Highway Program.

Using general fund dollars for the HTF can be dangerous at the federal level. Once the subsidy from the general fund reaches a certain amount, it triggers a provision that forces all future allocations to become subject to the regular budget process. This means transportation funding will have to compete with every other federal program, like defense and health care.

King County's sci-fi construction projects: Hulk, Jabba, Kahn and Kirk

June 25, 2009 in Blog

Earlier this week the State Auditor's Office released an accountability audit on King County's compliance with state laws and regulations and its own policies and procedures. The results weren't pretty.

According to the audit:

"Our audit found County officials should improve oversight and safeguards over its cash receipts, expenditures and assets. In many instances, oversight and safeguards were impaired by a lack of sufficient monitoring to ensure policies are complete, followed and staff is adequately trained to operate within those policies.

Further, County officials do not consistently provide or enforce performance measures or expectations in holding staff accountable. As a result, the County exposes itself to greater risk of loss, less ability to control expendi!
tures, and increases the risk for non-compliance with laws, regulations and contractual requirements. Consequently, our audit identified 12 findings."

The Auditor also attempted to conduct a performance audit of the County's construction management practices but terminated the audit "because the County was unable to provide complete and timely access to files and records related to construction projects" that the auditors requested.

Though a long list of problems was identified, perhaps the most curious finding of the audit concerned the County's management of construction records. From the audit (emphasis added):

"For the files we could access, we observed one file group where the naming conventions did not reflect what project or projects the file contained. The files observed were named after popular science fiction characters. >

County personnel stated the County does not have !
standard procedures for naming, organizing and storing electronic records and does not have protocols for file protection or shared drive access and permissions.

Instead, individual project managers are permitted to name their files whatever they want, organize them however they want and establish whatever restrictions to access they want."

So what sci-fi projects was King County engaged in?

In response to an email inquiry the Auditor's office said the files referenced above were named: Hulk, Jabba, Kahn and Kirk.

Though the County may escape the Wrath of Kahn, the wrath of voters is another story. In light of this audit you may start hearing them channeling the Hulk: "D!
on't make me angry, you wouldn't like me when I'm angry."

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Some sensible tax reform in Seattle?

June 23, 2009 in Blog

Seattle Today's Seattle Times reports that Seattle Mayor Greg Nickels, along with City Councilmen Tim Burgess and Richard Conlin, are going to work towards abolishing the $25 per employee "head tax" within Seattle city limits.

While I and WPC mainly focus on state-based policy, with my work in the small business community I feel safe asserting that this "head tax" was one of the worst business tax policies I have ever seen. The level of frust!
ration and outrage from small business owners regarding this tax was just about the same as, if not stronger than, their dislike of the state's Business and Occupation tax.

Really, the head tax was a punitive response against employers for the "privilege" of hiring employees within city limits. The reason? Because these employees commuted from outside the tax's jurisdiction, therefore employers are responsible for the damage done by their employees' commutes to the local environment. This is why exemptions were in place for employees who walked, rode the bus, carpooled or biked to work.

It's good to see policymakers in the Emerald City realize the tax made Seattle that much less competitive. Now, if the city would just come to its senses on the "square foot!
age tax."
 

Unemployment Trust Fund Draining Faster than Anticipated

June 23, 2009 in Blog

This past legislative session, the legislature passed HB1906 which temporarily increases the amount of unemployment insurance (UI) checks by $45 as well as raised the minimum insurance benefit amounts by drawing down the state's health UI trust fund. The $45 is temporary, however, and only extends to the end of the year. At first this was part of the Governor's plan to help stimulate the economy. As I pointed out, however, raising unemployment insurance benefits doesn't fall under the category of economic stimulus. It's just increasing government benefits.

That being said, I was less concerned about this legislation because our state's UI trust fund was over $4 billion at the beginning of the year (which has since declined to about $3.7 billion). This means the state has about 18 months worth of benefits available in the trust fund. This is 50% more than the Department of Labor recommends (12 months).

The original fiscal notes on HB 1906 calculated the draw-down rate at 7.5% unemployment, but Washington's unemployment rate has not been below 7.5% since December 2008. Therefore, the state is drawing down from the UI trust fund faster than anticipated.

According to the Employment Security Department, the March forecast shows a 24% bump in the cost of the temporary!
benefit
. The Department uses these forecasts to guesstima!
te costs and November's forecast showed a $187 million cost for the $45 temporary increase in UI benefits (through 2011) but now that has been updated to $231 million. Again, this is off of the March forecast, so the June forecast released last week will most likely increase these costs. ESD won't have that information available for a few weeks.

True, a $231 million hit to a reserve fund of $3.7 billion is not a huge amount. But the latest ESD Economic Update also contains information that based off of this year's 1906 and 5963 legislation, the trust fund could dip as low as 11.7 months by calendar year 2011 -- or $2.4 billion. This would put the tru!
st fund below the DOL recommended levels.

Why is this a concern? Because unforeseen expenses can lead to tax increases. And since employers pay 100% of UI premiums do we really want to make the cost of labor even more expensive?

Baird tries again for budget transparency

June 19, 2009 in Blog

Washington Congressman Brian Baird (D) once again introduced a resolution this week calling for a 72 hour review period on legislation. Baird's House Resolution 554 is co-sponsored by Rep. John Culberson of Texas (R). Here is the full text of the proposal as introduced on June 17:

RESOLUTION

Amending the Rules of the House of Representatives to
require that legislation and conference reports be available on the
Internet for 72 hours before consideration by the House, and for other
purposes.

SECTION 1. PURPOSE.

    The purpose of this resolution is to:

      (1) Modernize the operations of the House of
      Representatives using information technology that has transformed and
      increased the efficiency of many aspects of American society such as
      financial services and markets, transportation, manufacturing,
      agriculture, and commerce with consumers and businesses.

      (2) Slow the explosive growth of the
      $11,000,000,000,000 national debt of the United States, reduce
      excessive annual budget deficits, and control the size and scope of
      government by ensuring that there is adequate scrutiny of proposals for
      new and amended laws, taxes, and expenditures.

      (3) Enhance public participation in American democracy
      and improve the quality of proposed legislation by allowing the
      opportunity for its review by State and local government officials,
      small business owners, large business leaders, journalists, scientists,
      academics, labor leaders, nonprofit organization leaders, authors of
      weblogs, and interested citizens.

      (4) Help restore public trust in government and enhance
      respect for the House of Representatives and the Congress by ensuring
      that their operations are conducted with the openness, order, and
      dignity befitting the world's oldest democracy.

SEC. 2. AMENDMENTS TO RULE XIII REGARDING AVAILABILITY OF LEGISLATION AND REPORTS.

    (a) Clause 4 of rule XIII of the Rules of the House of Representatives is amended--

      (1) in its side heading, by inserting `legislation and' before `reports';

      (2) in paragraph (a) by striking subparagraph (1) and inserting the following new subparagraph:

    `(1) Except as specified in subparagraph (2), it shall not
    be in order to consider in the House a measure or matter until 72 hours
    (excluding Saturdays, Sundays and holidays except when the House is in
    session on such a day) after the text of such measure or matter (and,
    if the measure or matter is reported, the text of all accompanying
    reports) have been made available to Members, Delegates, the Resident
    Commissioner, and the general public pursuant to subparagraph (3).';

      (3) by adding at the end of paragraph (a) the following new subparagraph:

    `(3) Without further amendment before floor consideration,
    the full text of the measure or matter and each committee report
    thereon shall be posted continuously by means of the Internet in such a
    manner that they are conveniently accessible using existing technology,
    anonymously and at no cost, in a format that is searchable by text.';
    and

      (4) in paragraph (c), by striking `the third calendar
      day' and inserting `at least 72 hours' and by striking `on' and
      inserting `after'.

    (b) Rule XIII of the Rules of the House of Representatives is further amended--

      (1) in clause 5(b), by striking `and the Resident
      Commissioner' and inserting `the Resident Commissioner, and the general
      public'; and

      (2) in clause 6(c), by striking `or' at the end of
      subparagraph (1), by striking the period at the end of subparagraph (2)
      and inserting `; or', and by inserting before the period `a rule or
      order proposing a waiver of clause 4(a) of rule XIII or of clause 8(a)
      or 8(b) of rule XXII, unless a question of consideration of the rule is
      adopted by a vote of two-thirds of the Members voting, a quorum being
      present'.

SEC. 3. AMENDMENTS TO RULE XXII REGARDING AVAILABILITY OF CONFERENCE REPORTS AND AMENDMENTS REPORTED IN DISAGREEMENT.

    Clause 8 of rule XXII of the Rules of the House of Representatives is amended--

      (1) by striking subparagraph (a) and inserting the following new paragraph:

    `(a)(1) It shall not be in order to consider a conference
    report until 72 hours (excluding Saturdays, Sundays and holidays except
    when the House is in session on such a day) after the conference report
    and the accompanying joint explanatory statement have been available to
    Members, Delegates, the Resident Commissioner, and the general public
    pursuant to subparagraph (2).

    `(2) Without further amendment before floor consideration,
    the full texts of the conference report and the accompanying signed
    joint explanatory statement shall be posted continuously by means of
    the Internet in such a manner that they are conveniently accessible
    using existing technology, anonymously and at no cost, in a format that
    can be searched by text.';

      (2) in paragraph (b), by striking subparagraphs (1) and (2) and inserting the following new subparagraphs:

    `(1) It shall not be in order to consider a motion to
    dispose of a Senate amendment reported in disagreement by a conference
    committee until at least 72 hours (excluding Saturdays, Sundays and
    holidays except when the House is in session on such a day) after the
    report in disagreement and any accompanying statement have been
    available to Members, Delegates, the Resident Commissioner, and the
    general public pursuant to subparagraph (2).

    `(2) Without further amendment before floor consideration,
    the full texts of a Senate amendment reported in disagreement and any
    accompanying statement shall be posted continuously by means of the
    Internet in such a manner that they are conveniently accessible using
    existing technology, anonymously and at no cost, in a format that can
    be searched by text.'.

SEC. 4. PROTECTION OF CLASSIFIED INFORMATION.

    Nothing in this resolution or any amendment made by it
    shall be interpreted to require or permit the declassification or
    posting on the Internet of classified information in the custody of the
    House of Representatives. Such classified information shall be made
    available to Members in a timely manner as appropriate under existing
    laws and rules.

SEC. 5. SENSE OF THE HOUSE REGARDING AMENDMENTS.

    It is the sense of the House that, with the objective of
    preventing circumvention of clause 4(a) of rule XIII of the Rules of
    the House of Representatives that the Committee on Rules should develop
    standardized policies and procedures to require that proposed
    amendments (except those offered under an open rule) that are major in
    size, scope, or cost be posted on the Internet for an appropriate
    number of hours.

Additional Information
Web voters support 72 hour budget timeout

The tale of two Washingtons

June 18, 2009 in Blog

Perhaps one of the things most taken for granted about today's state revenue forecast is the fact that no one is fighting over the numbers. When the state's nonpartisan revenue forecast committee issues its projections you don't see dueling press releases from partisans claiming that the numbers are wrong and the state should instead base its projections on the source of a political party's choosing.

Unfortunately the same can't be said about the debate occurring in Washington D.C. concerning the nonpartisan Congressional Budget Office's (CBO) projection on the cost of the health care reforms being considered. As noted by The Hill:

"Democratic leaders are growing frustrated with Senate Republicans and the Congressional Budget Office (CBO) for clouding prospects for timely passage of the healthcare overhaul by way of their critiques . . .

Democratic leaders have also grumbled about the CBO, which released an analysis Monday that may result in Senate Finance Committee Chairman Max Baucus (D-Mont.) delaying action on his panel. CBO has reportedly scored the Finance Committee’s proposals at $1.6 trillion, forcing Baucus to chop the package by $600 billion . . .

Growing frustrations with CBO have spurred some Democrats to consider shelving cost estimates from the agency and using projections from another source, such as the Office of Management and Budget (OMB), which is part of the Obama administration . . .

Peter Orszag, the director of Office of Management and Budget, however, has downplayed the possibility of using projections from his agency instea!
d of CBO.

'CBO scoring is going to be used in t!
his process,' Orszag said late Wednesday."

The whole point of nonpartisan forecasts is to help remove politics from the process and provide accurate information to the public and lawmakers. If those numbers get in the way of speedy action and instead force more thoughtful debate, the only losers are politicians --- not the taxpayers they serve.

Here are additional details on the CBO cost projections.

Has state economy hit bottom?

June 18, 2009 in Blog

Despite a drop in projected revenue, the state's top economist Dr. Arun Raha believes the worst is over. According to Raha the "free fall in the economy is behind us . .. decline in revenue is moderating."

That said, today's news creates additional pressure on the state budget. For the first time since the 2001-03 biennium (impacted by the 9/11 terrorist attack), traditional General Fund revenue collections are projected to be negative biennium over biennium as shown here:

  • 2001-03: $21,141 million (0.6% decrease)
  • 2003-05: $23,389 million (10.6% increase)
  • 2005-07: $27,772 million (18.7% increase)
  • 2007-09: $27,706 million (0.2% decrease)
  • 2009-11: $27,692 million (0.1% decrease)

The impact of this is a reduction in the amount of reserves available for the state to weather any unforeseen bad news. 2007-09 reserves are reduced to $218 million. 2009-11 reserves are reduced to a paltry $53 million, Both reserves are well below one percent of expenditures (a 10 percent reserve is recommended).This includes the constitutional rainy day account.

This past session the legislature changed the definition of the General Fund to include additional accounts. By adding those new accounts the revenue forecast is essentially flat as shown here:

  • 2005-07: $29,785 million (17.3% increase)
  • 2007-09: $29,812 million (0.1% increase)
  • 2009-11: $29,834 million (0.1% increase)

Meanwhile, the Chair and ranking member of the House Ways and Means Committee told the Association of Washington Business (AWB) they see no reason for a special session. As reported by Jason Hagey:

"State Reps. Gary Alexander, R-Olympia, and Kelli Linville, D-Bellingham, agree that Washington legislators should not convene for a special session this year, despite growing budget woes.

Linville told a meeting of the AWB’s Governmental Affairs Council that Gov. Chris Gregoire should use her limited authority to trim the budget enough to get through until January when the Legislature meets again for a regular session."

One of the options for the Governor is found in RCW 43.88.110:

"blockquote" style="margin-left: 40px;">"If at any time during the fiscal period the governor projects a cash deficit in a particular fund or account as defined by RCW 43.88.050, the governor shall make across-the-board reductions in allotments for that particular fund or account so as to prevent a cash deficit, unless the legislature has directed the liquidation of the cash deficit over one or more fiscal periods . . ."

Whether or not the Governor takes this action it is clear that additional reforms to the state budget will be needed to help put the state back on a sustainable spending path.

Louisiana tries to tax Internet access even if the Feds prohibit it. How? Through a "fee"

June 18, 2009 in Blog

For the last decade, the United States Congress has wisely chosen to prohibit states and local governments from imposing taxes on Internet access. As the Internet developed during the 1990s, one of the chief worries at the time, as established non-tech businesses integrated the world wide web into their daily activities was, "will we have to start paying for each email?"

Obama directs agencies to focus on performance

June 16, 2009 in Blog

With the threat from federal budget deficits growing each day, it appears the President is turning to the promise of performance-based budgeting as a solution.

Consider this June 11 memo to agency and department heads issued by President Obama's budget director Peter Orszag:

"Our goal is to build a transparent, high-performance government capable of addressing the challenges of the 21st century. The American people deserve a government that works, where the public interest is prioritized, where the impact of government spending is transparent and held to high, objective standards, and where results and good management matter . . . To be successful, we must focus resources on our highest national priorities, including investments in health reform!
, clean energy, and education. At the same time, we must enforce fiscal discipline, making sure that we invest in what works, do not waste taxpayer dollars on programs that do not work or are duplicative, and improve performance across the board."

One of the ways Orszag hopes to accomplish this is to focus agency attention on high-priority performance goals:

"Identification of agency high-priority performance goals is a first step toward developing the President’s agenda for building a high-performing government. There will be regular reviews of the progress agencies are making to improve performance in priority areas including problems they encountered and plans to address those problems. To prepare for these reviews, each agency is asked to identify a limited a number of high-priority goals and begin to define the strategies and means to achieve them . . . The agency goals identified for this !
purpose should generally have:
  • High direct value to the public or reflect achievement of key agency missions, as opposed to being focused on internal agency management or other administrative priorities.
  • Congressional authorization and appropriations required for successful implementation; though additional legislative changes may also be identified to contribute to success.
  • Coordination, operational, or other implementation challenges including across multiple agencies that once resolved, will likely lead to improved effectiveness or efficiency.
  • Performance outcomes which can be clearly evaluated, and are quantifiable and measureable in a timely fashion.
  • Significant challenges unlikely to be overcome without a concerted focus of agency resources."

Perhaps with an eye towards the spending problem in D.C., the memo goes on to direct agencies to prepare two alternative budget requests based on a freeze in spending and a five percent reduction.

Whether or not the President's proposed budget next year actually reflects this process, the information provided by agencies in response could prove to be invaluable for Congressional budget writers --- should they take the initiative to review it.

As we've previously recommended, Washington state lawmakers should also focus on agency performance when making budget decisions. Providing those who control the purse strings with this type of information allows them to make informed decisions on which purchases will deliver the highest results for taxpayers and those who rely on essential services.

Supreme Court orders Federal Way investigative report released

June 12, 2009 in Blog

So much for the wheels of justice turning slowly. Less than a week after hearing oral arguments, the State Supreme Court today ordered release of the findings of an investigation of Federal Way Municipal Court Judge Michael Morgan. The News Tribune (party in the case) explains the controversy in this editorial:

The fight over an investigation into the Federal Way Municipal Court could have broad implications for the public’s right to know everywhere in Washington.

Judge Michael Morgan is suing his own city and The News Tribune in an effort to keep a potentially embarrassing report under wraps.

The report, written by a Seattle attorney hired by the city, followed an allegation that the municipal court was a hostile workplace. The city was planning to release the document last year to The News Tribune m>, until Morgan intervened.

On Tuesday, he pleaded his case to the state Supreme Court, where it became evident that he is willing to try any legal theory to keep the report out of the public eye.

Morgan argues first that the record belongs to municipal court and therefore is not subject to the Public Records Act that governs executive-branch agencies.

He then goes on to assert that even if the record were subject to the public disclosure law, that the city has several excuses at its disposal for denying public access, among them attorney client privilege and employee privacy.

Judge Morgan is up for re-election in the August 18 primary. As a result The News Tribune asked the Court to expedite its ruling.

Obliging, the Court said today in its order:

"On June 9, 2!
009, this Court . . . heard oral arguments on whether the City!
of Federal Way should be restrained from releasing the Stephson Report --- a report written by Amy Stephson on her investigation into a Federal Way Municipal Court employee's hostile work environment claim --- in response to a public records request from The News Tribune. Because of the nature of this action, the Court has unanimously determined that the report be released immediately, with an opinion addressing this issue and other issues in the case to follow. Now, therefore, IT IS ORDERED that the stay issued by the Court of Appeals on April 15, 2008, preventing the City of Federal Way from releasing the Stephson Report is vacated. This is an interlocutory order which is not subject to a motion for reconsideration."

Pending the full ruling by the Court, this is a great development for open government.