Gov. Enacts Few Reform Proposals

By Jordan Rau

Aug. 22, 2005 12 AM PT

Times Staff Writer

SACRAMENTO —

Though he came into office promising to reshape a state bureaucracy he compared to “a mastodon frozen in time and about as responsive,” Gov. Arnold Schwarzenegger has yet to embrace the bulk of the recommendations his own experts offered a year ago.

Schwarzenegger’s California Performance Review last August proposed reconfiguring the state’s disparate and sometimes redundant agencies into 11 unified departments. It also suggested 279 specific ways it said would make government more efficient and save $32 billion over the next five years.

The plan was supposed to help Schwarzenegger fulfill his pledge, made two months after he was sworn in, to do more than tinker with the state’s bureaucracy.

“Every governor proposes moving boxes around to reorganize government,” he told legislators in January 2004. “I don’t want to move boxes around; I want to blow them up.”

But most of his ambitious proposals to reshuffle state agencies have not been enacted or have been downscaled. Schwarzenegger has substantially rejiggered only one area of government: the state’s prison system, which has been troubled by overcrowding, management problems and lapses in medical treatment.

Both allies and critics say the other changes his administration has enacted -- including several dozen that his task force suggested -- are comparatively modest.

The administration has adopted a multi-state lottery system, eliminated 11 largely dormant state panels, reduced the backlog of uninvestigated complaints against contractors and other professionals and sold unused state property.

Michael Alpert, chairman of the bipartisan Little Hoover Commission, which reviewed many of the proposals, said Schwarzenegger’s reorganization effort is “the largest endeavor of this type in at least 40 years, but it didn’t blow up the boxes.”

The administration is finding that some of the reforms are saving less money than originally estimated. The governor has abandoned other proposals after failing to persuade legislators in both parties to go along. And in several cases, he now opposes ideas he originally championed.

Schwarzenegger aides insist they are just in the beginning stages of reform. But they downplay the task force’s promises of vast savings, saying instead that their primary goal is to make state agencies run more efficiently and become more responsive to citizens.

“Many of our agencies that are extremely complex are still evaluating the thousands of recommendations,” said Terry Tamminen, Schwarzenegger’s Cabinet secretary. “There may have been a misunderstanding that somehow if you get this many hundred pages of documents, that government can implement it overnight.”

Sen. Chuck Poochigian of Fresno, a Republican ally of the governor who sits on the Little Hoover Commission, conceded that “the huge dramatic sea change in the way the government does business has not occurred.”

But Poochigian said that the administration has made progress and still has time. “There’s so much attention being given to the [Nov. 8] special election, if the governor is viewed as being very strong politically after that, then I think there certainly is the possibility that these dramatic shifts could take place,” he said.

The administration cannot say how much money overall its changes have saved or cost.

In several individual cases in which officials have quantified the costs, actual savings have proved quite different from the amounts projected in the report. Selling surplus state property, for example, reaped $137 million, nearly three times the $47 million the task force predicted, officials say.

But the administration says it will save $50 million over two years by employing a more sophisticated strategy of purchasing equipment, known as “strategic sourcing.” The task force had forecast $96 million in savings by this month.

There has been no action on some of the proposals that the task force said would save the most money, including changing the enrollment rules for kindergarten so that some children would delay starting school by a year. The task force said that restricting kindergarten to children who are 5 by Sept. 1 instead of Dec. 2 would save the state $2.7 billion over five years.

To gauge the administration’s progress, The Times examined 39 specific recommendations the task force made. For those recommendations, the task force had predicted substantial costs or savings in the fiscal year that ended June 30, indicating that the report’s authors believed those changes could be quickly initiated.

The task force predicted the state would have seen $1 billion in savings through 28 of the recommendations, which range from the specific (use digital photos instead of film) to the grand (make state employees more efficient through better technology, training and management). Of those, eight have been completed, eight are underway and work has not begun on the other 12, according to the governor’s office.

The administration also appears to be behind on implementing changes that, in the short run, would cost the state more because of start-up costs.

Of 11 task force recommendations that carry substantial first-year charges, only one, allowing drivers to renew their licenses over the Internet, has been completed, the governor’s office said.

Four others are underway, but the administration has not begun work on the six remaining suggestions that contain initial costs, including creation of a standardized criminal background check to be used by all agencies and unifying the state computer system that processes workers’ compensation claims.

The administration is moving forward with some of the task force’s longer-range proposals. Six are pending in the Legislature. They include proposals that would create one-stop licensing centers for businesses and eliminate “unnecessary” reports to legislators.

Officials also say the changes they have made thus far are important. “We have been able to pick up many of the recommendations of [the task force] and put them on the ground,” said Fred Aguiar, secretary of the State and Consumer Services Agency. “We’re pleased with how it’s moving.”

The grander part of the task force report proposed dramatic rearrangement of California’s sprawling bureaucracy. “California’s state government is antiquated and ineffective,” the report said. “It is bureaucracy at its worst -- costly, inefficient and in many cases unaccountable.”

But aside from the prison reorganization, the governor’s efforts have not lived up to the task force’s vision.

Earlier this year, the Legislature approved Schwarzenegger’s plan to consolidate the state’s two general purpose data centers and its telecommunications unit into a new Department of Technology Services.

The Little Hoover Commission, which is charged with promoting efficiency in government, endorsed that plan but noted that it qualified only as a limited reform.

“Importantly, even supporters of this plan say it does not go far enough to strengthen the state’s structure for developing and using technology in ways that will meaningfully improve government performance,” the commission concluded.

Far harsher criticisms compelled Schwarzenegger to withdraw two proposals earlier this year.

The governor nixed his plan to reshape the state’s energy offices after both Atty. Gen. Bill Lockyer and the Legislature’s lawyers concluded it would violate the state Constitution by transferring the authority of the Public Utility Commission to the administration.

Schwarzenegger withdrew his proposal to abolish 88 boards and commissions, many of which regulate California professionals. Substantial opposition came from the people whom the boards regulate, as well as from consumer advocates, who complained that the public would have less say if professional discipline and rule-making were taken over by agencies that report to the governor, as the task force recommended.

Four months later, in June, the administration struck a new stance. Aides told the Legislature that Schwarzenegger wanted not only to retain several of the boards he had slated for elimination but to bolster them. The administration proposed consolidating some boards and transforming the leaderships of others -- including the ones that regulate doctors, dentists and osteopaths -- to include more members of the public than practitioners.

Those suggestions are meeting resistance from the Democrat-dominated Legislature and powerful practitioners’ lobbies, including the California Medical Assn.

“We really think the [medical] board needs to have a solid foundation of physician expertise to do its job,” said Jack Lewin, the association’s chief executive.

In late June, an Assembly panel rejected Schwarzenegger’s changes, which lawmakers said came too late after they had held public hearings. The administration has threatened to veto legislative plans to extend the life of the boards if the changes are not incorporated.

“The medical board is a perfect example of a board that has dragged its feet when it comes to responding to complaints,” Tamminen said. “It doesn’t take a medical professional to realize something is wrong. That doesn’t mean we won’t listen to professional advice.”

A continued stalemate would turn regulatory responsibility over to bureaus within the Schwarzenegger administration, the proposal the governor first offered. That is because the medical board and several others are to be disbanded next year if they are not reauthorized through legislation.

“We have no understanding of why that has come about at the last minute,” said Sen. Liz Figueroa (D-Fremont), who heads the legislative panel overseeing the boards. “Our decision is to continue working as we have. I can’t be intimidated by the governor’s veto threat.”

(BEGIN TEXT OF INFOBOX)

Slow progress

A year after the California Performance Review proposed an overhaul of state government, many of its suggestions remain unfulfilled.

Enacted proposals include:

* Reorganizing the state prison system

* Joining a multi-state lottery game, Mega-Millions

* Offering amnesty for delinquent taxpayers

* Allowing drivers to renew licenses over the Internet

* Booking state travel online

The administration says other changes are being implemented. They include:

* Making state workers become more efficient through better technology, training and management

* Using digital photos instead of film