Critics question costs of Brown executive orders
SALEM — Gov. Kate Brown recently signed three executive orders as part of her "Series of Cost Savings Across State Government" initiative — touted as a broad effort to save money to help close the $1.6 billion budget shortfall and improve Oregon's long-term finances.
Brown still hasn't provided estimates for how much money could be saved as a result her directives, but critics say some requirements set forth ultimately do little to address the upcoming budget crisis or the state's overall financial operations.
That's because the orders call for some practices that already exist and, in two instances, may cost the state more money, at least in the short-term, according to public records provided to The Associated Press by Senate Republicans and interviews with the Department of Administrative Services, the state's chief administrative agency.
In the April 27 executive order, Brown called for biannual reports of public versus private-sector employee compensation and she also laid out what the "salary pot" of money used in collective bargaining should include — practices that have been in place for the past two budget cycles, according to a recent email from DAS and Legislative Fiscal Office officials in response to inquiries from Senate Republicans. The most recent employee compensation report was released in November and is publicly available on DAS's website.
"I think the executive order in a lot of those areas was trying to memorialize those best practices we've actually done over the last several years," said George Naughton, the statewide chief financial officer at DAS.
What doesn't already exist is the order's call for the creation of a new statewide employee training program. In the email to Senate Republicans, DAS officials explained they "did not rule out seeking additional funding in 2018" but won't know for sure until the end of the calendar year when they've identified which trainings exist and which ones they still need.
Bryan Hockaday, a spokesman for Brown, says the orders, through small cost-saving actions, help direct agencies on how to be better stewards of taxpayer dollars, and do so consistently statewide.
"In the past, state agencies often carried on this mission without any clear goals, coordination with other agencies, or direction from the Governor," Hockaday said in a statement. "Governor Brown codified these best practices by executive order to hold state government accountable when they were not before and identify additional efficiencies and cost savings to better serve Oregonians."
Jonathan Lockwood, spokesman for the Senate Republican caucus, says Brown's orders are merely "gimmicks and excuses that clearly fail to solve the pervasive problems plaguing Oregon's credibility and security."
Brown's May 5 executive order calls for a renewed effort to collect outstanding debt owed to the state — about $3.3 billion total. The order requires state agencies to report how they'd be impacted by Senate Bill 89, a bill under consideration that'd streamline the state's debt-collection process and potentially cost the Department of Revenue an additional $2.4 million plus another 15 positions.
In her April 20 executive order, Brown calls for a 10 percent cut to state-funded travel expenses — a $30.6 million cost to the general fund in the 2017-19 budget. DAS spokesman Matthew Shelby says a 10 percent reduction could save up to $3.1 million if all three branches of government participated. Brown's order applies only to certain agencies under the executive branch.
Another section of Brown's cost-saving order calls for agencies to "immediately conduct a review" of any unused or under-utilized office and storage space, although it did not say what should be done from there.
"It's going to be hard in the short-term to peg real cost savings," Shelby said. "There is a statewide standard that DAS has but there is no requirement that agencies follow it ... and so I think this order is telling them to take a harder look at their best practice and see if they can't make that work."
Some savings could be realized from the order's call for a hiring freeze from May 1 through June 30. About 120 external job openings, out of more than 400, have been removed as a result, but Shelby and Naughton say they won't know the savings until after the freeze is over, when the next biennium begins.
Also, lawmakers will ultimately decide those savings because many of those jobs affected by the hiring freeze have already been accounted for in the "current service level" budget — meaning, they're baked into the funding that agencies have already requested for the next two-year cycle. The current service level budget is also the source of the upcoming deficit: it's the difference between what agencies say they need, $3 billion more than the current 2015-17 budget, and what the state actually will have, which will be short by $1.6 billion.