Informed Investments – A Renewed Emphasis on Optimization and Results

August 12, 2022

You’ve heard this one before. An agency or advocate comes to the Legislature for money:

  • Advocate – “We need money.”
  • Legislature – “How much do you need?”
  • Advocate – “How much do you have?”

Earlier this spring, the Legislature and Governor officially embarked on an effort to change this conversation. “Performance Reporting and Efficiency Requirements” (HB0326, 2021 GS) established May 1, 2022 as the date by which the Office of the Legislative Fiscal Analyst (LFA) and the Governor’s Office of Planning and Budget (GOPB) must begin evaluating and improving efficiency in government processes. By that date, staff had been implementing this bill, and its companion “Joint Rules Resolution – Legislative Procedure Modifications” (HJR006, 2021 GS), for more than a year. Combined, the bills do three things:

  • 1. Require state agencies to develop and report on key performance measures for state agency budgets included in appropriations acts;
  • 2. Establish that each new funding item in a Session will have at least one specific performance measure or deliverable as well as a target, upon which LFA and GOPB will follow-up a year after passage;
  • 3. Direct LFA and GOPB to select several process improvement projects each year and consult with agencies on how to apply management best-practices to optimize those processes. The bills then empower the Legislative Auditor General to revisit those improvements after-the-fact to be sure they are delivering as intended.

In the next few months, appropriators will hear more about line item performance measures in appropriations subcommittees. Staff will present a follow-up report on last year’s funding items to the Executive Appropriations Committee in September, and subcommittees should hear it the following month. In December, LFA and GOPB will tell the Legislative Management Committee the results of their 2022 process improvement consultations at the Division of Technology Services, State Medical Examiner, and Department of Transportation.

By next General Session, we hope to the conversation goes more like this:

  • Advocate – “We need money.”
  • Legislature – “What would it buy and how did you spend the money you already have?”