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A
Record of Reform
VDOT
isn't the only star in state government. The
Warner administration has built a strong record of
cutting costs and improving performance.
We
share your enthusiasm for the culture change begun by
Phil Shucet at the Virginia Department of
Transportation ("The
Shucet Effect," Aug. 8, 2005).
In
fact, Gov. Mark R. Warner has set high
standards for performance across state government,
instituting a management agenda that holds every
agency and its leadership accountable for meeting
specific annual goals and objectives.
Culture
change requires tenacity, and our administration
is committed to business-like reforms. For
instance:
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Throughout
the painful budget reduction process in 2002,
we forced agencies to re-examine longstanding
practices and explore opportunities to bring business
principles to state government. Some of these
reductions actually improved the effectiveness
of certain agencies. By re-thinking the way we
operate, we were able to eliminate redundant
management layers in the Department of
Environmental Quality and the Department of
Corrections.
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We
have launched a first-ever review of the
Commonwealth’s real estate holdings, marking
the first time that the state has made a
comprehensive effort to locate, organize and
analyze the land and real estate assets owned
and rented by the state through an
enterprise-wide effort. Our private- sector
partners estimate the state could save $68
million or more over the next decade by
implementing a Real Estate Portfolio
Management system. As a result of this effort,
we have documented about $7 million in
cost avoidance on recent lease agreements and
renewals.
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Virginia
has been a national leader through innovative
use of the Public Private Education Facilities
and Infrastructure Act of 2002 (PPEA). This is
a new approach to partnering with the private
sector on major construction projects, and it
promises to cut project time by approximately
25 percent while reducing overall project
costs. Using PPEA, the Commonwealth is
transforming nonperforming and underperforming
capital assets through the restoration and
renovation of four historical and
architectural buildings on Capitol Square.
These buildings include the Old State Library
& Archives, the Old Finance Building, the
Washington Building and the Capitol.
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The
Commonwealth has been a pioneer in the use of
public/private partnerships to help address
many of the Commonwealth’s critical
transportation priorities. The Public/Private
Transportation Act of 1995 (PPTA) allows VDOT
to partner with the private sector to build,
improve, maintain and operate transportation
projects more efficiently. Two projects, I-495
Hot Lanes and I-395/95 Hot Lanes in Northern
Virginia, are under development. The use
of the “high occupancy toll” or “HOT”
lanes concept is being developed to reduce
congestion and improve mobility in the area.
Before construction can begin, an in-depth
traffic and revenue study and other steps must
be taken to determine the viability of the
concept. Should these steps proceed
successfully, construction could begin in late
2006 or early 2007.
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Over
the life of this administration, we have
eliminated or merged 70 duplicative or
unnecessary boards, commissions and state
agencies. As part of a comprehensive 2003
reform agenda, we won legislative support for
a proposal to restructure overlapping
workforce training services, improving
accountability and delivering workforce
services more effectively and efficiently. Our
reforms included the appointment of a single
coordinator to streamline 22
state-administered workforce training programs
formerly scattered across ten agencies and
three Cabinet secretariats. In addition, we
created a commissioner of veterans’ services
to oversee all state services for Virginia’s
780,000 military veterans. This allowed us to
eliminate two agencies and three oversight
boards that were part of the previous,
duplicative system of veterans’ services.
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In
2003, we launched the “Ask Why” campaign,
sponsored by the Virginia Governmental
Employee Association in conjunction with the
Virginia Department of Human Resource
Management. The initiative encouraged our
employees to “ask why” the state was
performing certain functions, and it
ultimately generated more than 750 specific
proposals to promote efficiency and improve
customer service. For example, after an
employee suggested we review the use of
toll-free telephone lines across the
enterprise of state government, we identified
and eliminated 63 unnecessary or little-used
toll-free telephone lines, saving $103,589
annually. At the conclusion of the “Ask
Why” campaign, we singled out nine state
employees for special recognition for
suggestions that, when implemented, netted a
combined $1 million in immediate annual
savings and long-term savings projected at
$4.2 million. In fiscal year 2004, 342
suggestions were submitted through the
Commonwealth’s employee suggestion program.
Seventeen of the suggestions were approved for
implementation and saved the Commonwealth
$118,882. A total of $9,565.14 was awarded to
employees in addition to days of leave and
certificates of recognition.
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Virginia
is a national leader in technology, and our
administration has implemented an aggressive
management agenda that relies upon best
practices from the private sector and a vision
that government should take an enterprise-wide
approach to IT. We created the Virginia
Information Technologies Agency (VITA) to
re-organize a $900 million annual enterprise
that previously had been administered
separately across each of the 90 agencies in
state government. Fiscal Year 2005
savings are estimated at $23.4 million, with
cost avoidance estimated at $1.5 million for
FY 05. By the end of this decade, we expect to
see $138.3 million in outright savings and
almost $5 million in cost avoidance.
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We
also have been a national leader in shifting
customer service transactions onto the
Internet. The Virginia Department of Motor
Vehicles (DMV), for instance, is capitalizing
on technology to serve a growing population
while maintaining a level of service that
citizens demand. With more than seven million
customers, the agency has been successful in
providing Virginians with alternative methods
to renew driver’s licenses and vehicle
registrations, including Internet, touch-tone
telephone and mail options as well as
supplemental walk-in facilities administered
by agency contractual partners. In 2004,
customers conducted 43 percent of driver's-
license and 63 percent of vehicle-registration
renewal transactions without visiting a DMV
office. If these same customers had visited an
office instead, DMV would have needed an
additional 145 full-time equivalent staff
members to provide the level of service.
Similarly,
the Virginia Employment Commission has
implemented program changes that both improve
service and reduce the need for maintaining a
large number of offices. Internet claims filing
was introduced nearly three years ago, and the
General Assembly authorized VEC to open two call
centers to enable claimants to file claims with
the VEC via a toll-free telephone number.
Internet or telephone claims now account for
more than 65 percent percent of all claims filed
with the VEC, allowing the agency to reduce its
reliance on part-time employees and consolidate
or close several satellite offices.
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Through
our Virginia Partners in Procurement program,
the Commonwealth seeks to leverage its size
and buying power to drive down costs through
new and renegotiated contracts. So far, 96
statewide contracts have been negotiated for
product categories ranging from light bulbs to
uniforms. We have documented $15.4 million in
savings and cost avoidance in FY 2004 and
estimate $22 million for FY 2005.
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We
also have greatly expanded the use of
electronic procurement through our eVA
Internet buying tool, expanding access to
local governments and school systems. More
than 500 government agencies and institutions
now make purchases and transactions through
eVA, and there is a wide range of products
available, ranging from fuel, vehicles and
maintenance services to office supplies. In
2002, eVA was cited by the national Center for
Digital Government when it moved Virginia from
eighth place to first place in the nonpartisan
group’s "e-commerce and business
regulation" category. And in 2003, eVA
was recognized as the 2003 State Government
Innovator in the Digital Government Awards
presented annually by The Massachusetts
Institute of Technology.
eVA
provides a single registration for viewing all
business opportunities and receiving electronic
notification whenever a business opportunity is
posted. In Fiscal Year 2005, more than 311,000
individual orders totaling $3 billion have been
placed through eVA, reducing costs for goods and
services by $69 million. In addition, eVA
provides more opportunities for small
businesses, particularly women and minority
owned businesses. Improving supplier diversity
is a major priority of this administration.
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In
addition, we identified and aggressively
pursued collection of outstanding receivables.
Through more strategic selection of audit
targets, improved utilization of outside
collection agencies, partnerships with other
government entities, and upgraded technology,
we have been able to produce more than $100
million a year in collections of accounts
receivable.
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The
Commonwealth also has implemented a pilot
program of voluntary school efficiency
reviews, and internal and external management
auditors conducted operational reviews of
several local school divisions and identified
potential administrative savings that allow
more resources to be redirected to the
classroom. The following potential savings
have been identified:
New
Kent County: $238,000 annually (five percent
of non-instructional operating budget)
Roanoke
County: $295,000 annually
City
of Richmond: $2.1 million annually
Stafford
County: $1.7 million annually
Portsmouth:
$2.1 million annually
Surry
County: $428,500 annually
Spotsylvania
County: $2.5 million
These Warner
Administration efforts have been recognized and
validated. Perhaps most significantly, Virginia is
one of six states receiving the highest bond
rating, Aaa, from each of the three major
bond-rating agencies - Fitch, Moody's, and
Standard and Poor's. This coveted rating not only
identifies the Commonwealth as a well-managed
state, but also ensures that the state borrows
money at the lowest possible cost. The
Commonwealth and its localities save tens of
millions of dollars through lower interest rates
and more favorable borrowing terms due to this
prestigious rating.
Virginia
also received the top score in the Government
Performance Project’s “Grading the States
2005” report, the nation’s only comprehensive,
independent analysis of how well each state is
managed. The first such rating in four years
showed Virginia moving up to an overall score of
A-. Utah is the only other state with an overall
score of A-, but Virginia is the only state with
straight A’s across the board in all four
evaluation categories: money, people,
infrastructure, and information. In sum, Governor
Warner is insisting that Virginia government
continue to demonstrate a leadership role among
the states in management, transparency and
accountability, and all of these reforms are
designed to ensure that Virginia state government
provides full value to Virginia taxpayers.
--
August 23, 2005
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