State Budgets

Do We Get What We’re Paying For?

By: Alaska State Senators Drue Pearce, Dave Donley and Sean Parnell

When it comes to funding state programs and services, Alaskans should get what they pay for. With this in mind, the Legislature implemented Results Based Budgeting last session. Results Based Budgeting is a new budget approach calling for accountability in state spending. Through it, legislators and state program managers establish precise methods of measuring whether state programs are truly delivering services that improve the well being of Alaskans.

In the fiscal year that just ended, the State of Alaska spent approximately $5.5 billion dollars of federal ($1.2 billion), state ($2.4 billion) and other funds ($1.9 billion). Where did five and a half billion dollars go?

End of year summaries tell us that approximately $1.2 billion was used to inflation proof the Permanent Fund and pay your dividends; $1.5 billion went to education, Medicaid and other formula programs; $500 million was earmarked for capital projects; and around $2.3 billion was spent on general government services.

Did we get our money’s worth? Shouldn’t we now be able to look back and see if the additional $1.5 million we spent on state troopers this year actually made the crime rate fall? Are child care benefits really helping people stay off welfare? What value do we get from $5.5 billion of spending?

Unfortunately, the answers to these types of questions will be put off to another date and time because Governor Knowles vetoed the implementation of these performance measures. Ironically, Governor Knowles had previously stated his support for the Legislature’s direction toward Results Based Government. He even signed into law Senate Bill 76 that started the ball rolling in the new direction.

But in the end, after hundreds of hours of meetings between legislators and program managers, the governor vetoed every single mission and measure set out in the budget document. In his transmittal letter, Governor Knowles claimed that the budget was an inappropriate place for the accountability measures.

On the contrary, legislators agreed budget bills are the appropriate arenas for missions and measures. In fact, this practice has been successfully used in other states including Texas, Oregon, Arizona, Alabama, Utah and California. Alaska’s budget is a working document, an agreement prepared by the legislature and signed by the governor – a tool to guide the activities of managers who affect the lives of Alaskans. This tool becomes more convenient and useful when missions and effectiveness measures are visibly linked to related spending allocations.

A mission statement clarifies the Legislature’s intent for appropriating money for a specific service. Performance measures further enhance those intentions by defining the results that are expected from services rendered. An appropriation bill that includes missions and measures immediately focuses the reader on the question of whether a given program is working as it is intended.

The Governor’s veto raised the question of whether setting out missions and measures are policy-making activities that fall under the powers of the legislature or the executive branch. Alaska’s constitution establishes the legislature’s policy-making authority (Article II Section 1). Not withstanding this, if the legislature is stepping into the executive’s territory by establishing accountability measures for programs within the budget, then we are left no alternative but to rely on the administrative agencies to set their own standards, monitor their own performance and report their successes and failures to the Legislature and to the public in a consistent, objective manner. Unfortunately, this is currently not happening. If it were, legislators would not have committed the long and tedious hours last session to create and pass Results Based legislation.

Elected officials expect program managers to align spending with results, but without precisely defining those results, miscommunication is inevitable. With state revenues declining, we must continually realign our policies and focus our service delivery efforts. Setting out missions and measures for our state-funded programs is an economical tool to accomplish this goal.

We believe the Legislature is on the right track in questioning whether we are receiving value for the billions of dollars the state spends each year. We will continue in our efforts to make Results Based Government a reality, despite the Governor’s opposition.

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Opinion editorial: Published in the Anchorage Daily News 11-17-98

Contact: Wendy Lindskoog, Senate Majority Press Secretary at 907/258-8184