Wednesday, June 15, 2011
June Interim Session: Fire Escapes, Waste, Mission Creep, and Child Care Conundrum
I attended our interim session committee meetings today at the Capitol. Unlike last month, the agenda this time was full of interesting topics and lively discussion.
HB138 - Federal Receipts Reporting Requirements
One of the bills we discussed this morning is HB 138 sponsored by Ken Ivory. We passed this bill during the general session. The gist of the bill is to require state agencies to create operation plans for scenarios involving a 5% and 25% reduction in overall available budget. The point is that $5 Billion of our $12 Billion state budget comes from Federal sources. Given the ill health of our national fiscal situation, we want to have plans in place for the time when Federal funds are no longer dispersed to the states. This is a basic self-reliance plan.
Today we discussed implementation and how it would affect city and county governments and how we might go about requiring cities and counties to make contingency plans as well. The representative from the League of Cities and Towns was there to speak on behalf of the interest of cities and towns in the state. His message: "Thanks, but we can put plans together quite easily so there really isn't a need for us to report our compliance to you." I am always suspicious when someone says they will do something and then asks that they not be bothered reporting on whether they did it or not. With 200 municipal bankruptcies anticipated nationwide in the next year or two, complying with HB 138 even once every two or three years is probably not asking very much.
You can listen to the entire meeting HERE.
The next topic of lively discussion came as we talked about the status of unemployment insurance in the state. The trust fund that makes up the insurance base has fallen from over $800 million in 2008 to a projected $130 million next year. The state has been dispensing much more than it has been bringing in.
Benefit payments of unemployment insurance in Utah are the 16th highest in the nation with 50% of recipients using the full 26 weeks of payments that the state offers. Also, we discovered that the state routinely over pays benefits by about 6% of total disbursements and only collects on half of that through court action and sanctions. That basically means that 3% of our unemployment insurance goes to line the pockets of those who don't need it. It's wasted tax dollars.
The gentleman presenting on this issue talked about all the "stimulus" that unemployment insurance gives to the economy. One of my colleagues challenged that notion since the government is basically taxing businesses so it can pay people not to work. This is an issue that needs to be looked at more closely.
After our rancorous interrogation on the unemployment insurance topic, we were treated to a supposedly less controversial topic: The Dispalced Homemakers program. Well, at least the presenter thought it would be less controversial.
The program has been going on for 10 years and is under the umbrella of Workforce Services. Since the program is scheduled to sunset this year, they approached our committee today to ask for another 10 years of existence. The gist of the program is to help homemakers (non gender specific) who have been out of the workforce for eight or more years to reacquire skills so they can rejoin the work force. This sounds like a nice idea except for one thing: the program doesn't have enough people to help.
The program has been mostly over funded for 10 years by 15%-20%. Those funds have just been kept and kicked forward to future budgets. Since they were having so much trouble finding people to help, the presenter alluded to the idea that they would ask us to modify the requirements to expand the reach of their program. When I asked her what she had in mind, she thought they would reduce the requirement from eight years to two.
In my mind, this is mission creep. If tax dollars have proven not to be useful for their intended purpose, perhaps we should refund the taxpayers who are footing the bill for this ineffective program. I also suspect there may be duplication and redundancy in other programs the state offers though I can't provide any specifics. We do know that the private sector is providing services like this also.
When the vote came to extend the sunset, the committee, including myself, voted no. Workforce Services will now be compelled to find a sponsor who will put forward a bill next year to keep this program alive.
Public vs. Private Child Care Debate
Finally, we heard from a colleague on the touchy issue of the child care industry. There are private child care providers who are licensed, taxed, and regulated. Then there are non-profits and publicly subsidized child care facilities that compete directly in the market for money in this industry. The question proposed today is about the justice of having tax dollars compete for services provided by the public sector. It was a very interesting debate and I encourage you to listen. You will be surprised by what you learn. We will be discussing this more in the coming months.
You can listen to the lively discussion on Unemployment Insurance, Displaced Homemakers, and Child Care issues HERE (my comments start at 1:12:29).