Unda' The Rotunda 

Lean governmental machine?Otter's businesslike proposals may bring more challenges than solutions

In his State of the State speech at the start of the legislative session, Gov. C. L. "Butch" Otter said that a paradigm shift in the role of state government has begun.

If "paradigm shift" is code for "portable toilets"—a dozen of which now serve visitors to the Capitol Annex building—then I can see his point.

But Otter cites three sexier shifts: more customer focus, a reliance on data-driven policies and greater adherence to the proper role of government.

Otter quoted Thomas Jefferson during the speech: "A wise and frugal government, which shall restrain men from injuring one another, shall leave them otherwise free to regulate their own pursuits of industry and improvement, and shall not take from the mouth of labor the bread it has earned."

And then, in the same speech, couched in terms of personal responsibility, he advocated "reasonable adjustments in the share of health-care benefit costs for which all our state employees are responsible."

So much for bread.

Dona Van Trease, executive director of the Public Employees Association, is used to a more consistent nod to state workers in the State of the State.

"It's always, 'Our dedicated state employees—I want to give them a 2-percent raise,'" she said. "He's the first governor that's talked about cutting benefits."

Otter proposed a 5 percent hike in state worker pay with a partial cut in benefits.

Otter, who was profiled in the Libertarian magazine Reason during his last campaign—they called him the second-most Libertarian elected official after Ron Paul—often talks about making government lean and more businesslike. But many lawmakers on both sides of the aisle roll their eyes at this rhetoric.

"No one comes here and says 'I'm going to make a fatter, more sluggish government,'" said Rep. Maxine Bell, R-Jerome, co-chair of the budget committee. "Government is not easy to trim."

Even the Republican Caucus Chairman, Ken Roberts, said that while Idaho government could be run more efficiently, it is not bloated.

Otter got a lesson in the perils of trimming last spring when his administration issued a new policy on state worker prescription coverage. According to a notice from the state, the new plan would "help mitigate some of the insurance carrier's requested rate increase."

In April, the newly reorganized Division of Human Resources sent state employees a newsletter detailing the new policy: They would now have to pay up to $100 for drugs, including insulin, that were not specified on a list, have higher emergency room co-pays and would have to have some expensive procedures pre-approved.

Calls started coming in to the two groups that represent state workers, the Idaho Public Employees Association and the Service Employees International Union.

Van Trease said the revised plan would have cost her husband an additional $350 a month. She contacted lawmakers, including Sen. John Andreason, R-Boise, who co-chairs the Committee on Employee Compensation.

A month later, Human Resources had a change of heart. In another notice to workers, HR said that the higher costs would not be implemented immediately, but could be in coming years.

"We got word from the CEC co-chairs that that was not the direction they wanted us to go and that they wanted us to absorb all cost increases internally," said Teresa Luna, spokesperson for the Department of Administration.

Employee advocates were thrilled.

"It was the biggest victory that I've had since I've been with IPEA," Van Trease said.

That is, it's the biggest victory for the state employee association that is not a "union" in her 21 years there.

The other employee association—the union one—has been busy with a campaign of its own. On the day of the State of the State speech, 6,000 letters warning state employees about impending changes to their benefit package started arriving in mailboxes across Idaho.

Andrew Harndardt, SEIU president, said he got immediate responses to the mailing. His message: Otter's plan to pay state workers 5 percent more while charging them more for health insurance is not based on solid research.

"This is based on a heretofore imaginary concept that state employees should compare to the private sector," he said.

If the governor was serious about being competitive, he would look to pay and benefits packages in Oregon and Washington, Harnhardt suggested.

Andreason said that a group of lawmakers a few years ago figured state employees needed 5.8 percent per year raises for the next 10 years to be competitive. And no increase in health insurance costs.

Last year, Andreason fought to have Otter's 5 percent pay hike include benefits, and he expects to have another battle in his committee this year.

Legislators are looking askance at other Otter businesslike proposals, including his order while legislators were far from town, to split up the Human Resources staff into each of the state agencies.

The HR guy who deals with sexual harassment was shuffled off to the Human Rights Commission, a small agency that didn't have a desk for the guy. So they rented extra space and asked the Legislature to pony up some money for it.

Sandpoint Republican Sen. Shawn Keough had some pointed questions about the $6,000 charge.

"If this is existing workload and existing staff that's been shifted from the Department of Administration, then why didn't the money get shifted with it?" she asked, according to a Spokesman-Review report.

Keough is not the only one who is confused. The director of the Idaho Human Rights Commission said the human resources guy still works for the Division of Human Resources, but a Department of Administration spokesman said he works for the agency where he is housed.

Now that's customer service.

Otter has just proposed the first state budget to top $3 billion, a 10.9 percent increase from his first year as governor.

A lot of the new money will go to the 5 percent pay hike and to other costs that are considered "maintenance" costs.

But lawmakers caution the governor about assuming the private sector does everything better.

Lean and mean is fine if the state gets the job done. But outsourcing and cutting corners have cost Idaho federal funds and efficiencies in the past.

Moscow Rep. Shirley Ringo: "You have to be careful you're not getting lean and ineffective."

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