Gov. Asa Hutchinson recently announced a plan to streamline and reorganize state government. The last major reorganization occurred in 1972—nearly 50 years ago—when departments were reduced from 60 to 13.
Over the ensuing decades, state government has grown back like kudzu. We now have more than 40 cabinet agencies (the federal government only has 15) and over 300 boards and commissions.
The governor’s plan is part of the process of transforming state government. I am passionate about transforming state government, and have advocated for it since before I took office. That’s why I am grateful Gov. Hutchinson appointed me vice-chair of his Transformation Advisory Board that is making recommendations, some of which ultimately led to this plan.
There are four foundational reasons we must tackle transformation:
1.) We have a moral obligation to spend taxpayer dollars wisely. Citizens don’t have a choice whether or not they pay taxes: the least we can do is be as efficient as possible with their hard-earned tax dollars. While no elected official can look you in the eye and tell you every tax dollar is being spent in the most efficient way possible, that should be our ultimate goal.
2.) Reform done right results in improved services by a more responsive, transparent, and accountable government. We shop, bank, and check our kids’ grades online, so interaction with government should primarily be through our smartphones. Most people prefer renewing vehicle registration online instead of waiting in lines at a revenue office. Through a customer-focused approach, we can improve the way citizens interact with state government.
3.) By reforming government, we can spend less. We can cut waste, eliminate duplication, and invest tax dollars where they are most needed, as well as return dividends to Arkansans in the form of tax relief.
If you don’t believe Arkansas government spends too much, consider this: According to data from Governing magazine, Arkansas has the 21st most state and local government employees per 10,000 citizens. Neighboring Texas, which does not have an individual income tax, ranks 41st. Its state government is leaner and more efficient, and its citizens pay less in overall taxes as a result.
This doesn’t mean we need to lay off waves of state employees; it isn’t their fault that politicians have made poor decisions over the years. We simply need to reform state government as appropriate when employees retire or leave the workforce and use attrition to our benefit. Gov. Hutchinson began this process by instituting a state hiring freeze in 2015, reducing the number of state employees by over 1,400 positions and saving taxpayers over $47 million thus far.
4.) Other states are embracing transformation, so the competition is fierce. Indiana reduced its number of state vehicles by 21 percent in a few years. Tennessee saved over $40 million through real estate alone by improved management of buildings and energy costs. Louisiana has saved $70 million through IT consolidation efforts. As other states transform, we must become leaner, smarter, and more efficient, or risk being left behind.
Some assume “transformation” is just a euphemism for budget cuts and belt-tightening. While savings is certainly a byproduct of eliminating waste and duplication, transformation also yields better services for Arkansans. Everyone is familiar with getting fewer services in exchange for less taxes, but I’m talking about getting more services for less taxes. The combination of improved services for less dollars results in more value for the taxpayers. I call that doing more with less, and it’s what I have done in my office as lieutenant governor.
When I took office, I reduced my number of staff by 50 percent. I also voluntarily reduced my own budget by 16 percent and now return tax dollars to the Treasury every year. Yet the number of constituents we assist is as high as it’s ever been.
The problem with not transforming state government is it maintains the unacceptable status quo. Most Arkansans want to see changes. Some want lower taxes, some want more funding for highways, and some want higher salaries for teachers. The problem is that most things people want cost money, and our state already taxes and spends far too much. But if we transform by modernizing, reforming, and identifying cost savings and efficiencies, we can solve many of the challenges we face.
Transformation is not about cutting spending while leaving tired policies and processes in place. We have to innovate and modernize. We live in the era of Uber and iPhones. We can’t saddle ourselves with a state government bureaucracy largely designed during the Cold War. A more accessible and innovative state government will benefit Arkansans by allowing them to spend less time interacting with government and more time living their everyday lives.
Imagine that you hired a company to cut down trees, and instead of arriving with a chain saw, the workers brought an old-fashioned two-man cross-cut saw, making the job far more expensive and time-consuming than it should be. You might ask: Why are you doing things the old way?
In too many cases, that is the reality of government. In the private sector, market competition encourages companies like FedEx and UPS to innovate, to do more with less. But governments, like all monopolies, are immune to the incentives of competition, so change is rare and more difficult. In government, budgets typically grow year after year regardless of performance.
State government often does things the old way, and you, the Arkansas taxpayer, pay a premium for it. This old way of doing things represents an invisible but real line item in our state budget. I call that line item The Old Way, and we pay for it with the old way tax—the TOW tax.
The TOW tax potentially represents hundreds of millions of dollars, and we pay extra taxes so our government can continue to do things the old way. Every dollar we spend on the TOW tax is a dollar not returned to the taxpayer through tax relief or preserved for a core function of government like education, public safety, or roads.
Gov. Hutchinson has already gotten the ball rolling through agency consolidation and the state hiring freeze. He is now proposing the next step by reorganizing state agencies. This allows us to eliminate duplication, improve delivery of services, and enhance administrative support. Shared services in particular hold tremendous potential for savings: No one would put a kitchen in every bedroom of their house. Similarly, every agency doesn’t need its own human resources office.
Change is difficult, and every potential change in state government will be met with opposition by those who wish to maintain the status quo. But we must demand that state government transform so we can address the challenges we face. It’s the right thing to do, it will result in better government services, and it will save hundreds of millions of taxpayer dollars.
Tim Griffin is lieutenant governor of Arkansas.