House Interim Committee on Appropriations

House Interim Committee on Appropriations
Charge

Conduct a review of performance-based budgeting and strategic planning, as currently implemented. Review the original goals and theories supporting these processes and assess the extent to which goals have been attained. Develop performance measures to assess future success of the planning and budgeting processes.

Recommendations

Include benchmarks similar to those in Vision Texas which have a more direct link to agency-level measures, most easily accomplished by establishing numerical targets to benchmarks in each of the eight functional areas of Vision Texas.

Implement an intent rider in the General Appropriations Act that directs each state agency's regulations to correspond with their agency mission.

Implement a provision in the General Appropriations Act that requires contractors throughout the state to achieve performance targets established by state agencies.

Require the LBB and the State Auditor to work with all agencies to ensure not only that agency-level performance measures actually provide relevant data for the function they were originally intended to measure, but that the reporting process is as clear, simple, and efficient as possible.

Use, as stipulated in Article IX, Section 59, of the General Appropriations Act, concrete rewards and penalties for both excellent and unsatisfactory performance.
Charge

Review the overall salary and benefit levels of state employees and assess how they compare with the private sector.
Recommendations

Implement three salary schedules into the General Appropriations Act. The State Auditor's Classification Division will be responsible for implementing the new schedules on September 1, 1997.

Set a cap for all raises that is a sum certain percentage of the total salary expenditures for the previous year for each agency.

Add language to the General Appropriations Act that authorizes the Office of the State Auditor to delete vacant exempt positions that are no longer used.

Reinstate the step adjustment provision.

Add an additional salary step to Schedule A employees.

Require that any merit raise have written justification.
Charge

Review special issues related to state compensation, including merit pay; salary increases for exempt employees; the achievement bonus program; severance pay and "golden parachutes"; non-monetary emoluments such as housing or personal services; and parity in compensation for similar work performed at different agencies.
Recommendations

CONTRACT ISSUES AT INSTITUTIONS OF HIGHER EDUCATION

Discourage institutions of higher education from entering into contractual employment agreements with their administrators.

Provide, when a contract is warranted, statutory guidance when all or a portion of the employee's compensation is derived from appropriated funds.

Contracts should not exceed three years in length, severance payments upon termination should not exceed the discounted net present cash value of the contract at a market interest rate, and no contract, settlement agreement, severance package, or reclassification should be deemed or labeled confidential.

Impose policies which stipulate that contracts providing for development leave should conform to Sections 51.103 - 51.108 of the Education Code. Employees who do receive development leave should obligate themselves to provide an equal amount of time in service to the institution or repay the cost of the development leave.

Impose policies which stipulate that tenure to administrators under contract should be awarded academic tenure in a manner that is consistent with awarding tenure for teaching faculty.

Impose policies which stipulate that salaries paid to administrators returning to teach, should not exceed those of others in the department with similar qualifications and duties.

Provide the governor with the statutory authority to remove appointed governing board members for cause, such as failure to attend meetings, felony indictments, moral turpitude, criminal convictions, and/or willful failure to comply with the law

SEVERANCE PAY AND SETTLEMENT AGREEMENTS

Require in the General Appropriations Act that each state agency, including each state-supported institution of higher education, immediately report to the Legislative Budget Board the existence and content of any settlement agreement with a current or former employee of the agency that settles a claim or potential claim that the employee has or may have against the state, the agency, or an employee or official of the agency.

Require by general law, that a state agency, including a state-supported institution of higher education, proposes to reassign the executive director, president, or other administrative head of the agency to do other duties, may do so only after the governing body of the agency approves the proposed reassignment.

Require by general law that a state agency, including a state-supported institution of higher education, proposes to enter into a consulting services contract with a former executive director, president, or other administrative head of the agency, may do so only after the governing body of the agency approves the contract and only after the agency has notified the Legislative Budget Board of the proposed contract.

Clarify statutorily that settlement packages are not confidential and are subject to the Open Records Act.

CLOTHING ALLOWANCES

Remove the provision from the General Appropriations Act which allocates payment of nurses uniforms at MHMR (because their nurses do not wear uniforms).

Eliminate the practice of purchasing uniforms for persons employed by TXDOT who work at Texas visitor centers along Texas highways. TXDOT, when directed to stop the practice, should have the discretionary authority to raise the salaries of current employees who would experience a financial loss as a result of this change.

Direct each state agency providing clothing allowances to review its policy, and submit its review to the Legislative Budget Board and the Govemor's Budget Office no later than January 14, 1997. Upon review, each state agency should submit a list of administrative changes or statutory requests needed to guarantee equity amongst its employees.

HOUSING BENEFITS

Require each state agency, including each state-supported institution of higher education, providing housing, housing allowances and/or utility reimbursements to review carefully its existing policies, and subsequently submit a list of administrative changes or statutory requests needed in order to implement fairer and more cost-effective policies.

Insure that future state appropriations do not encourage an expansion of state-supported housing for employees.

TRAINING STIPENDS

Require by general law that an employee of a state agency, including an employee of a state-supported institution of higher education, who is trained or educated at the employing agency's expense and who does not perform the employee's regular duties for at least three months during the period of training or education, must work at least one month for each month that the employee was trained or educated, or must repay the agency for the cost of the training, including the amount of the employee's salary during the training period.

Require by general law that a state agency, including a state-supported institution of higher education, spend money for the training or education of its employees only if it has adopted rules related to that training or education.

OVERTIME PAY

Require state agencies to report to the Appropriations and Finance Committees a list of employees whose annual overtime compensation exceeded 25% of their base salary or non-overtime compensation, along with a brief explanation of the reason for the above normal levels of overtime.

MEMBERSHIP DUES

Prohibit state agencies from paying fees or membership dues to organizations that pay all or a portion of the salary of a person required to register with the Texas Ethics Commission as a lobbyist.

HOUSEKEEPING AND REFERRING TO THE GENERAL APPROPRIATIONS ACT

Delete Rider 36, which provides for the monetary compensation of Mental Health and Mental Retardation Department (MHMR) patients or students at any state facility who are assisting in the operation of the facility as part of their therapy.

Delete Rider 18, which provides for charging fees to MHMR clients for the use of barber and cosmetology facilities.

Delete Rider 22, which provides for the transfer of state employees from the closing of two state schools, Fort Worth and Travis.

Delete Article IX, Sec. 116, which provides for a clothing allowance for nursing uniforms for those nurses required to wear a uniform at MHMR.

Combine Riders 20, 30, and 40, which relate to medical care for Texas Department of Criminal Justice (TDCJ) employees on the job and could be combined into a single rider.

Delete Rider 25, which provides for compensatory time for TDCJ employees working on state holidays and which is duplicated in Article IX.

Delete Rider 31, which allows TDCJ to hire wardens at any step within the classification schedule.

Delete Rider 13, which provides for the increase in salaries of all commissioned Texas Parks and Wildlife Department peace officers if persons in similar positions in other state agencies are granted increases in pay. The committee is recommending a parity schedule for all law enforcement officers which will make this rider unnecessary.

Delete Rider 15, which provides for a clothing allowance for Department of Transportation travel counselors and tourist bureau supervisors.
Charge

Review the state's means of overseeing the planning and implementation of major information systems by state agencies and institutions. Include a history of the state's efforts to accomplish such oversight. Review projects that have not met goals, including timeliness and budgets.
Recommendations

AGENCY INFORMATION RESOURCES PLANNING AND REPORTING REQUIREMENTS

Require each agency to have a plan on file with the Department of Information Resources (DIR) before the agency comes to the legislature for funding; no requests for appropriations will be considered unless the project is in a plan approved by DIR; a state agency may not spend appropriated funds for information resources purchase or maintenance unless approved by DIR.

Require agencies to define quantitatively the expected outcomes and outputs for all automation projects at the outset, monitor costs, and evaluate the final results to determine whether expectations and benefits have been met.

Encourage agencies to use an independent consultant, giving preference to using an interagency contract with an agency that is qualified by DIR with expertise in information system development, to analyze contract amendments independently if the expertise is not available within the agency.

Require agencies to notify the Govemor's Office, Lt. Govemor's Office, the Speaker's Office, Senate Finance, House Appropriations, DIR, and the Quality Assurance Team (QAT) prior to amending a project when the amendment exceeds a 10 percent change. QAT must approve the amendment.

Encourage agencies to make information resource managers part of the executive level within the agency (Sunset Recommendation).

Direct the developers of the larger systems throughout the state agencies to establish regional networking analysis and teams to discuss the enhanced collection of data at the county and city levels.

Require each agency to perform cross-cutting, public user, lease option, system compatibility, outsourcing and privatization option, multi-agency coordinated data collection, efficiency of data collection forms, usage capacity, database integration, and feasibility analysis and include the information in their Biennial Operating Plan.

OVERSIGHT RESPONSIBILITIES

Require DIR to notify the governor, the LBB and the state auditor of any agency which is out of compliance with the rules and statute regarding the submittal of Information Resource Strategic Plans or Biennial Operating Plans.

Direct DIR to send letters approving or disapproving agency plans to the governing boards, executive directors and the information resource managers of each agency or university.

Amend the rider in the General Appropriations Act governing the Quality Assurance Team to direct the QAT to report to the Govemor's Office, the Lt. Govemor's Office, the Speaker's Office, the House Committee on Appropriations, the Senate Finance Committee, the governing board of the Department of Information Resources, and the Office of the State Auditor.

Require the State Auditor's Office to provide an independent evaluation of the post-implementation evaluation review process to ensure the validity of its results, and send it to Legislative Audit Committee.

Require DIR to provide an independent evaluation of the systems development processes, and to submit it to the Legislative Audit Committee.

Require DIR to establish competency criteria for information resource managers and project managers; require information resource managers to receive continuing education as directed by DIR.

Direct DIR to study the lease versus purchase issue and develop guidelines for agencies to follow.

Direct DIR to conduct seminars and/or briefings for information resource managers and chief financial officers to assist agencies in addressing information technology issues that may arise in the appropriations process to insure that all levels of the agency involved in requesting information resources system funding understand the agencies requests for appropriations in the context of the state's overall strategic plan.

STATEWIDE ISSUES

Direct DIR to examine alternatives to the current "Buyways" notification system to facilitate efficient asset management and use of the state's resources by other state agencies, political subdivisions, and the economic drivers at the regional level.

Require agencies to investigate data sharing possibilities within communities of like interest groups. DIR should assist agency workgroups.

Require that a business case be developed prior to spending funds on technical solutions to data sharing. Before large cross-agency databases are constructed, program areas should build a business case for sharing information and include it in the agency's Biennial Operating Plan.

Request the State Auditor's Office, working with DIR, to verify agency estimates to address the Year 2000 issue and give the quality assurance team oversight of the project. The project would require all agencies to appoint a point person to work on the project; request a report back to the finance committees January 1, 1997, on the status of agency response and estimates of Year 2000 costs; consider appropriating a sum of money to DIR to be apportioned out to agencies as the agencies address their particular needs; and require all future information resource purchases to be Year 2000 compatible.

Direct the Texas Department of Commerce to study the cost to license the software from the Canadians or similar software so as to implement it at a statewide level. Also consider seeking out similar software and interfaces that bring together the cross-cutting topics found in various information systems into one screen on a computer.

Amend the General Appropriations Act, Article IX, Sec. 83, to add "iv) a contract for major information systems," and ask LBB to track these contracts in their contracts database; ask the comptroller to work with DIR to ensure that USAS codes more accurately reflect information resources.

Ask DIR to consider a partnership with the state's software and electronics industry to construct a virtual and physical public policy institution, incubator, or evaluation program. The state should consider the creation of a statewide $10-$15 million information system evaluation fund to be matched by industry so as to leverage solutions and investigation in these areas. The State of Texas should receive ownership of royalties in proportion to the amount of money the state contributes to the partnership.
Charge

Review the efficiency of funding numerous local programs through councils of governments or other similar intermediary organizations. The committee should consider the accountability of the state, regional, and local entities for funds used for such programs.
Recommendations

Revise state statutes to give the state oversight of all funds provided to councils of governments, including local and federal funds.

Establish that the Governor's Office be the cognizant agency of the councils of governments.

Require one member of the governing board of each of the 24 councils of governments to be appointed by the governor. The appointee must reside in the service area of the COG.

Encourage each council of government to include on its governing board an elected official of the legislature from the council's service area.

Develop, at the State Auditor's Office, a standard formula by which to calculate indirect costs. A maximum indirect cost rate not to exceed a percent of chargeable salaries and/or a percent of total funds, shall be calculated and set by the State Auditor's Office. A list of allowable indirect costs shall be added to the council of governments statute, as well as a list of prohibitions. The Governor's Office shall be given authority, in extenuating circumstances, to make exceptions to the lists for a particular council.

Note: The following recommendations are proposed in the rules set to be published in the Texas Register to revise the Uniform Grant and Contract Management System. As the rules will not be published until after the conclusion of this interim charge, the committee recommends the following revisions to the council of governments' authorizing statute.

All Texas state travel guidelines as written in the General Appropriations Act and further detailed by the comptroller shall apply to the councils of governments, including, but not limited to, mileage reimbursement, per diem, and lodging reimbursement rates.

None of the funds received by a council of government shall be used for the purchase of alcoholic beverages or entertainment.

All applicable state statutes on competitive bidding and contracting shall apply to all councils of governments.

State laws applicable to nepotism shall apply to all councils of governments.

The provisions of Article IX, Section 5 of the General Appropriations Act relating to legislative influence, shall apply to all council of government employees.

All councils of governments shall adopt the state salary schedule, as laid out in the General Appropriations Act, 1995, containing a classification schedule and selected positions exempt from the schedule. Salaries for positions within the classification schedule may be less than, but may not exceed, those approved by the State Auditor's Classification Division and paid by the state for comparable work. Positions exempt from the classification schedule will be determined by the Governor's Office or the Legislative Budget Board. Salaries for exempt positions shall fall within ranges to be determined by the State Auditor's Office. All councils of governments shall submit a salary plan to the Governor's Office or Legislative Budget Board for approval.
Charge

Conduct active oversight of agencies under the committee's jurisdiction.
Recommendations

None.