Connell Outlines Policy Recommendations in California G.O.L.D. Report
Growth, Opportunity, Leadership and Dependability Plan Tackles State
Management Needs
SACRAMENTO, Calif., Jan. 3 /PRNewswire/ -- State Controller
Kathleen Connell today unveiled a series of policy and legislative reforms she
plans to pursue in the 2000 legislative season. Connell's initiative package
includes bold ideas to ensure continued statewide prosperity, improve
California's long-term planning, and increase government responsiveness by
identifying and proposing solutions to key strategic management needs facing
the state.
"In this period of unprecedented economic expansion, now is the time to
take bold steps to make certain that California remains competitive in the
global marketplace of the 21st century," said Connell. "We cannot afford to
neglect the obvious need for sound capital management. California must
implement a plan to effectively utilize its current economic blessing, and
bolster assistance to its businesses, its residents and local governments.
Now is the time to lay the groundwork for a new Golden Age in California."
Connell presented her legislative and policy reform measures, which focus
on the state's bifurcated financial management system, in her California
G.O.L.D. report. Key concepts of the plan call for innovative reforms in
areas of fiscal and capital management, information technology and health
services management, and investment decision making.
"As State Controller, I am keenly aware of the additional growth potential
California could enjoy once reform of its disconnected financial management
system occurs," said Connell. "This plan challenges government to match the
creativity and responsiveness of the private sector."
Major components of the Controller's comprehensive reform recommendations
include:
-- Capital Outlay Prioritization -- There is no documented statewide
policy for identifying and prioritizing General Fund financed projects, nor a
system for assessing and then prioritizing all needed projects in the state.
Without policy, there is no basis for allocating funding for infrastructure
improvements.
-- Alternative Work and Transportation Credits -- The state should
encourage alternatives to travel during peak commute times. California should
consider offering tax credits to employers who allow telecommuting and
flexible work shifts in specified traffic congestion zones.
-- Capital Debt Management Commission -- The number of California's
financing authorities have grown significantly with overlapping jurisdictions
and redundant functions. There's no single control agency to oversee and
coordinate debt issuance and no accountability to the people of California.
The state should establish a Capital Debt Management Commission to oversee all
debt issued by the state and provide a 5-year strategic plan to allocate debt
and guarantee debt authority for future needs.
-- Revamp Medi-Cal Reimbursement Rates -- A Controller's 1996 audit found
that Medi-Cal reimbursement rates for medical supplies are inflated and
outdated. Medi-Cal providers have received markups as high as 500% of the
actual costs for medical products. Connell estimates that Medi-Cal could
realize more than $100 million in annual savings by paying rates more
reflective of current market values. Next to education, Medi-Cal represents
the largest outflow of public funds -- more than $20 billion in state and
federal funds in FY 99-00. Fraud in the Medi-Cal program has been well
publicized. Audits from the Controller's office have identified $143 million
in overpayments and saved an additional $322 million from stopping additional
improper payments.
-- Long Term Care Insurance -- Long-term care (LTC) services for residents
costs California approximately $5 billion per year. California needs
legislation to allow tax deductions and business incentives for employers who
offer LTC insurance as a benefit. This would substantially expand LTC
coverage, help employers retain employees and reduce state costs.
-- Direct Contracting Health Care -- Public perception is that HMOs have
failed to provide quality, low cost care -- while simultaneously posting
record profits. As Chair of the State Teachers' Retirement System's Health
Benefits Committee, the Controller has pushed for a statewide health care plan
for teachers -- none exists currently. To alleviate problems associated with
HMOs, Connell is proposing a direct contracting model used successfully in
other states to link teachers directly to consortiums of doctors and other
health care professionals, restoring the doctor-patient relationship.
-- 5-Year Information Technology Strategic Plan/Competition for Tech
Services -- The state should develop a strategic plan for its use of
technology to keep pace with rapid technological services. Individual state
organizations are required to have strategic plans, however the state needs to
view technology as one entity, from the perspective of the public, not as a
group of independent departments. Also, current state information technology
departments should be expected to market their services in competition with
the private sector to ensure costs savings and quality control.
-- State and Local Government Finance -- The Controller released two
reports, SMART and SMARTER, which address the need to rectify the decades-long
imbalance in state and local government financing. "Local governments should
be guaranteed a funding floor," said Connell.
SOURCE California State Office of the Controller
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Related links:
http://www.sco.ca.gov
CONTACT:
Byron Tucker, or Susie Wong, both of the
Office of the Controller, 916-445-2636
NOTE TO EDITORS: Full report and other recommendations available
at http://www.sco.ca.gov.
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