SAGE Commission Recommendation #43 gets a road test (sort of).
This space reported two weeks ago that the administration is experimenting with a new approach to the state budget. The result will be, in effect, a hierarchy of citizen needs, as determined by the people who serve them. Not the elected ones, but a committee of agency heads assigned to evaluate the state’s existing programs, and prioritize them. The members, one presumes, are right now embroiled in the very difficult conversations elected officials would prefer to skip.
The experiment bears more than a passing resemblance to SAGE Commission Recommendation #43. It’s not #43 – at least not exactly. But SAGE (the Governor’s appointed Spending and Government Efficiency Commission) did suggest a priority-based method of budgeting, a key element of the state’s current project. When the work is complete, the programs will fall into three categories.
The top category is comprised of the most critical state services. Or as retired Budget Director Perry Comeaux puts it, “Come hell or high water, we have to do them.” Comeaux supervised the SAGE team that worked on budgeting issues, and is aware that his successor, current Budget Director Andrew Clinger, is hewing close to SAGE #43.
In a cycle like the one we’re about to enter, the money could be used up as soon as the most critical programs have been funded. But there is a category B, which can be funded next.
Comeaux describes category B as follows: “We really ought to do this if we can. It’s important. It makes lives better.”
Category C, he says, is the “When pigs learn to fly list. If, miracle of miracles, we end up with the money left over, we’ll do it.”
“The first thing you have to do is have those painful conversations about what’s critical and what isn’t,” said Comeaux.
His SAGE research centered on Arkansas, where they’ve been having those conversations since 1945. The Arkansas Revenue Stabilization Law is a 55-year old requirement that spells out three priority levels for funding, and is credited with delivering balanced budgets year after year. In his State of the State speech last year, Arkansas Governor Mike Beebe described the cuts other states were being forced to make, and boasted to the assembled that “we are in an enviable position. We don’t face those problems.”
Indeed, as the fiscal year dwindled to its final day lat month, Arkansas closed with $23 million in the plus column, Budget Director Mike Stormes told the Reasonable Reporter this morning. Which is not to say that the state has been exempt from falling revenues. The Revenue Stabilization Law requires immediate cuts if revenues begin to fall below the forecast. Arkansas performed three rounds of cuts during the past year, as its staff economists revised the forecast downward three times, said Stormes.
That brings us to the reason Nevada is not following the Arkansas model. Such systematic cutting would require a revision to Nevada statute. An additional feature Nevada can’t emulate is one-year limit on appropriations, with an interim legislative session approved by Arkansas voters, for lawmakers to deal only with appropriations for the second year of the biennium.
Nevada Budget Director Andrew Clinger has opted instead to follow Washington state’s model. (Washington’s priority-based budgeting picked up an Innovations in American Government Award earlier this decade from the Ash Institute for Democratic Governance and Innovation at Harvard University’s John F. Kennedy School of Government.)
The goal is the same, and the system has passed muster with the Washington’s legislature, according to a written statement by Victor Moore, who was the state’s Director of Financial Management at the inception of POG budgeting (priorities of government).
“While some legislators had feared that the POG was simply a way to camouflage harmful budget cuts, the clear, nonpartisan goals chosen by the governor helped to convince legislators that the POG existed to serve the state’s interests,” Moore wrote.
Whether Nevada legislators embrace priority-based budgeting remains to be seen. The challenge awaiting them in 2011 would seem to suggest they have no choice. Former Budget Director Comeaux says that’s what he thought in 2009, but the lawmakers found a way around the most painful decisions.
“But the longer this downturn lasts,” he said, “the closer we’ll get to the point where they don’t have any choice.”
There is a five-minute audio file posted here from an interview with Clinger about Nevada’s budget project.Explore posts in the same categories: Uncategorized