3,200 exemptions thawed state’s attempt at a spending freeze

  • By Jerry Cornfield Herald Writer
  • Tuesday, August 2, 2011 12:01am
  • Local News

OLYMPIA — Edmonds Community College trustees wanted to hire their new president.

Gov. Chris Gregoire wanted to travel to China on a trade mission last year.

And just a few weeks ago, state Department of Health officials wanted to replace a broken refrigerator storing critical bacteria specimens.

But they all needed to get an OK from Washington’s budget director, in writing, during a 16-month freeze on state spending for hiring, travel and large purchases.

Nearly 3,200 requests for exemptions were granted, and a couple of hundred turned down, during the freeze that ended June 30, according to information posted online and collected from agencies.

Though the number may make the policy appear to have been too porous, lawmakers and state officials said it worked well enough to save millions of taxpayer dollars by deterring spending throughout government.

“Should it have been tighter? Certainly. It was a shot across the bow to everybody that this was a serious situation,” said state Sen. Steve Hobbs, D-Lake Stevens, who served on the Senate Ways and Means Committee when lawmakers passed the freeze. It came as the panel wrestled with a multibillion-dollar budget shortfall.

“To me, it was successful. It made department heads and agency heads a little more fiscally responsible. They had to dig in,” he said. “It did achieve temporary savings until we passed much deeper cuts later in the year.”

Rep. Barbara Bailey, R-Oak Harbor, a member of the House budget committee who voted for the freeze, said this week she didn’t realize how many exemptions were granted.

“It is a fine line between what constitutes critically necessary and unnecessary spending,” she said. “With so many (exceptions), it does beg the question of whether there may have needed to be a little closer scrutiny. It’d be worth going back and doing an assessment of how it really worked.”

House Bill 2921, which took effect in mid-March 2010, aimed to save $45.4 million. State officials say it did save money, but how much is hard to quantify.

It banned most state agencies from creating new jobs or filling vacant ones, signing personal service contracts with private vendors, purchasing equipment greater than $5,000 in value and traveling out of state. It also established a process for obtaining exceptions for “critically necessary work.”

The freeze didn’t completely halt hiring, travel or buying. It did seem to have a chilling effect on spending habits of agency leaders who, when faced with having to justify an outlay covered under the freeze, didn’t do so.

State budget director Marty Brown and his predecessor, Victor Moore, handled and signed off on the vast majority of the requests. Ironically, one came from Brown, who wound up hiring a temporary employee to help deal with the volume of paperwork. By the end, requests filled 16 large three-ring binders, he said.

The law also directed some departments, as well as the House and Senate, to handle exemptions internally. Each authorized exception is posted online and can be read at www.fiscal.wa.gov.

Jason Mercier of the Washington Policy Center, a business-oriented think tank, said the freeze was a “useful tool” to slow unnecessary spending but not an efficient money-saving method.

“When you’re seeing the number and amount of exemptions, it shows that this is not the best approach to take to control spending, and it gets heavily into micromanaging,” he said.

Exemption requests began arriving in the Office of Financial Management even before the freeze took effect. One of the first came from State Auditor Brian Sonntag, who received an exemption for signing personal service contracts with firms enlisted to do performance audits.

All in all, the bulk of the exemptions dealt with day-to-day operations of state government.

Requests dealing with hiring covered a gamut of jobs, from a cow milker at a Washington State University dairy to the presidents of seven community colleges, including Edmonds.

When State Sen. Nick Harper, D-Everett, took office, he needed one for a legislative assistant, and when the aide to Rep. Mike Hope, R-Lake Stevens, left for a new job, Hope sought an exemption to employ a replacement.

Requests regarding travel covered overseas trips by the governor, education conferences for teachers and annual meetings of commissions. Equipment purchases involved trucks, snowplows and computers.

While there’s no freeze in effect now, another could be needed if the economy doesn’t turn around.

“It’s something we should use sparingly, but we might have to look at it again after the (revenue) forecast in September,” Hobbs said. “For now, I think we can hold off.”

Jerry Cornfield: 360-352-8623; jcornfield@heraldnet.com.

More online

To read the exemptions, go tinyurl.com/WAfreezethaw.

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