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Ivey study group recommends major consolidations, reforms to state agencies

MONTGOMERY, Ala. – The Governor’s Study Group on Efficiency in State Government delivered its final report to Gov. Kay Ivey Wednesday, in which it recommended significant consolidations and reforms to several state agencies, as well as improved benefits for state employees.

Created by Ivey in January via executive order, the study group was tasked with exploring ways in which to improve government efficiency, with a particular focus in determining whether there were executive-branch entities with overlapping functions. The group also explored ways to reduce the turnover rate of state employees, which in 2021, the most recent year of conclusive data, was at an all-time high of 15.2%.

Consolidations, reforms

“Inertia is a powerful force; a body in motion tends to stay in motion, a body at rest tends to stay at rest,” said Alabama State Treasurer Young Boozer, the chair of the study group. “For a body to move, force must be applied to the mass; the work of the committee is the force and catalyst for the change.”

Held at the State Capitol building in Montgomery, what was the final meeting of the study group saw Doryan Carlton, chair of the study group’s Consolidation and Elimination Subcommittee, present findings on what state agencies should be consolidated.

Young Boozer, State Treasurer and chair of The Governor’s Study Group on Efficiency in State Government, adjusts his glasses during Wednesday’s meeting.

Recommended state agency consolidations included the merging of “certain health and human services into the Department of Human Resources,” and consolidating “specified historic parks and entities into the Department of Conservation & Natural Resources,” among others.

While Carlton said she could not publicly share the specific entities recommended for consolidation, a copy of the final report obtained by Alabama Daily News reveals that the Child Abuse and Neglect Prevention and Senior Services departments were recommended to be consolidated with the Department of Human Resources.

Furthermore, the study group also recommended consolidating the Historic Blakeley Authority, the Alabama Historic Ironworks Commission, and the St. Stephens Historical Park entity into the Department of Conservation and Natural Resources.

The state’s regional workforce boards created under the Workforce Innovation and Opportunity Act were also recommended to be reformed by reducing the number of state career centers across the state. While the report doesn’t specify by how much, it does say Alabama should “move to more of a ‘one-stop shop’ concept, rather than continuing to fund several brick-and-mortar career centers.

The report also recommends consolidating many of the stand-alone occupational and licensing boards that regulate and collect fees from dozens of professions. The suggestion is similar to one proposed by Sen. Chris Elliott, R-Josephine, in the spring legislative session. It failed but he’s said he will bring it back in 2024. Separately, Elliott last week said he’d sponsor legislation to stop state licensing boards from hiring lobbyists to influence the Legislature.

Elliott is on the Legislative Contract Review Committee, which monitors state contracts, and last week questioned a state Pharmacy Board contract for legislative consulting with lobbying firm Southern Group for $160,000.

“At the end of the day, all of these costs are on the backs of small business owners, whether it’s the pharmacists or the cosmetologists or the locksmiths,” Elliott told Alabama Daily News.

Outside of consolidations, a major reform in how state agencies are funded was recommended by the study group as well.

For many state agencies, occupational licensing and regulatory boards, revenue collected through licensing fees and civil penalties are automatically appropriated to the respective entity’s budget by the Alabama Legislature. This funding mechanism, the study group argued in the report, creates a problematic incentive structure for executive-branch entities.

“This arguably creates an incentive for the boards to seek as many penalties as possible,” the report reads.

In its recommendation, the study group instead suggested that all executive-branch entities should be forced to seek its appropriations through the Legislature, eliminating the incentive to “over-penalize licensees.”

State employee retention

The State Employment Subcommittee, another subcommittee of the study group, presented its own findings as to how to improve recruitment and retention of state employees.

Despite wages for Alabama state employees rising from an average of $49,197 in 2019 to $52,393 in 2021, turnover has increased during that same time period by 33%, from 11.4% to 15.2%.

Kathleen Baxter, the chair of the subcommittee on employment, opened her presentation with several recommendations.

“As we went through all the research, we found that there were several things that we thought would be a good idea to do; one is to hire an independent and outside entity to look into how we do things, what is best practices, what are other entities doing that could make our state the best it could be,” Baxter said. 

Kathleen Baxter, chair of the subcommittee on employment for The Governor’s Study Group on Efficiency in State Government.

Offering paid parental leave to all state employees – which it does not do currently – was one recommendation, as was the increase of the amount of sick leave employees can accrue, from four hours and 20 minutes per pay period to six hours.

Paying state employees time-and-a-half for overtime work was another recommendation, as was tuition reimbursement. Returning all state employees to the state’s Tier 1 retirement plan – which allows employees to retire earlier and is currently eligible only to employees hired prior to 2013 – was another recommendation.

Chairman Boozer applauded both presentations, and said he was reminded of the importance of enacting change in government.

“We know that life is change, and we know that COVID began a global change,” he said. 

It will be up to Ivey which recommendations she will ultimately move forward. 

Link: Efficiency Study Group Report 11-08-23

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