Under the Dome

House budget would put a wrench in McCrory’s reform effort

Gov. Pat McCrory’s signature reform program for government efficiency could be in trouble after a legislative committee approved a draft budget that doesn’t fund its essential personnel.

McCrory, in his recommended spending plan for the next biennium, had requested seven new positions to “institutionalize” the work of the North Carolina Government Efficiency and Reform initiative, or NC GEAR.

“The General Assembly decided we weren’t going to do that,” said Rep. George Cleveland, an Onslow County Republican, of the $872,000-a-year request.

Cleveland is a chairman of the House Appropriations Committee on General Government, which like other legislative panels spent Thursday reviewing packages of state government spending proposals for the next two fiscal years.

While officials in the administration say NC GEAR, established by the legislature in 2013, pays for itself by finding savings in state government, Cleveland and other lawmakers are skeptical of the program’s impacts. “I just do not see it happening,” he said.

The new positions would go in the Office of State Management and Budget, which houses NC GEAR. Instead, the committee is proposing just one new position in OSBM, an $82,359-a-year job to help with strategic budgeting.

State Budget Director Lee Roberts said he didn’t want to sound alarms over the future of the program. He noted the committee’s spending proposal marks just one step in a lengthy budgeting process.

But he emphasized the requested positions are necessary for NC GEAR’s potential and that the program is by nature worth the expense.

“NC GEAR demonstrates about $15 million of savings in year one, and about $57 million of savings in year two, of the biennium,” he said by phone. “And about $615 million in savings over 10 years in present value terms. That’s not a nominal number.”

NC GEAR in March issued a report to legislators outlining how the state can realize those figures. Initial recommendations included privatizing the state’s motor fleet and managing cultural and natural attractions together.

But legislators on a state government program evaluation panel earlier this month gave it an icy review, saying they were underwhelmed by the recommendations.

“Frankly, the report may well be a waste of money unless it reports bold and innovative ideas,” said Sen. Fletcher Hartsell, a Cabarrus County Republican.

Sen. Ralph Hise, a Mitchell County Republican, criticized the work for being absent of any big reform ideas for Medicaid, “which is probably our biggest budget issue in the state,” he said.

But Joe Coletti, NC GEAR’s deputy director, told the committee the philosophy was to start with government basics rather than grand overhauls.

Some NC GEAR recommendations did, however, make it into Thursday’s general government spending draft. Key among them was establishing a new, cabinet-level Department of Military and Veterans Affairs, something McCrory pushed in his State of the State speech in February.

As laid out in the committee report, the department would have four new positions and several transferred employees from existing departments that do related work. The entire Division of Veterans Affairs would be transferred to the new department, which is supposed to improve services for the more than 110,000 active duty members and 770,000 veterans who call North Carolina home.

“This realignment will improve execution of state functions for key populations and state employees,” said the NC GEAR report. “The Secretary for Military and Veterans’ Affairs would be able to coordinate with other Cabinet members as a peer.”

Its first-year budget would consume about $7.3 million, most of it transferred from the Division of Veterans Affairs budget, according to the spending report.

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