THE GOVERNMENT PERFORMANCE PROJECTReport Card: Georgia FINANCIAL MANAGEMENT: C+ Georgia is a mixed bag in the management of its finances. With triple-A ratings from Moody's, Standard & Poor's and Fitch, it can boast top-notch management of its long-term debt. It keeps good track of agency spending patterns and has decent reserves, with the rainy day fund at 3 percent and a separate reserve for lottery-funded programs (which take care of scholarships, capital construction and school technology). On the negative side, the state's annual financial report comes out slowly—often about a year after the fiscal period ends. This problem may be alleviated by the introduction of the new statewide accounting system (see information technology below). Somewhat more serious, last year's report from the state auditor detailed at least half a dozen major shortcomings in the state's financial systems. Particularly troublesome were observations that Georgia "did not facilitate recording encumbrances in conformity with generally accepted accounting principles" and "did not maintain adequate systems to determine the accuracy of the amounts of sales-based taxes collected by the Department of Revenue." The state remains somewhat control-oriented, with agencies locked into line-item budgets. Approval is needed from the budget office, and sometimes the legislature, to move money around. CAPITAL MANAGEMENT: C There is no effort to prioritize capital projects in Georgia at the state level. Instead, the government engages in an annual internal debate over which agency requests will be funded and which will not. Long-term analysis is done by the agencies themselves, which submit five-year plans to the Office of Planning and Budget. An inventory of capital assets exists, but it, too, is not centralized and is maintained only at the agency level. Similarly, there is no central knowledge of how much deferred maintenance there is, or whether maintenance funding matches needs. The state has had some trouble in the past getting projects done on time and on budget. Technical schools have been one particular sore point. Georgia is now emphasizing better pre-design on major capital projects to define scope and cost prior to approval, in an effort to make better estimates of both time and money. HUMAN RESOURCES: B- While other states have been reforming their civil service laws, Georgia went to the edge: It eliminated the civil service code entirely for state employees hired after July 1, 1996. For the moment, the state is in the awkward position of inhabiting two worlds: The vast majority of its employees are still protected by civil service, and the last of those won't be gone for decades. Meanwhile, there is no real evidence yet as to how well the new personnel process is working. Soon-to-be-replaced computer systems are proving a serious hindrance in developing the needed data. Georgia deserves great credit for having the guts to embark on a reform of these dimensions; further praise, however, will have to await conclusive evidence about the results. One clear bright spot is that the state recognizes the need for solid training. In fact, the personnel evaluation system now in place requires that any employee who is considered deficient in an area receive immediate training to facilitate improvement. MANAGING FOR RESULTS: C+ While Georgia does have a statewide strategic plan, it would appear to be little more than the governor's vision, without much involvement by others. Legislation in 1993 required "outcome-based budgeting" and directed the governor's office to move ahead in that direction. A half-decade later, that effort appears to be gaining momentum, with a strong concentration on measuring results instead of just activities. The most recent gubernatorial budget, which was delivered to the legislature last month, was the first one in which a wide variety of performance measures were included. While it's too soon to tell whether the legislature will really pay attention to this effort, more and more agencies are telling the Office of Planning and Budget that they are finding the exercise very useful. INFORMATION TECHNOLOGY: C Georgia does not currently have an integrated information system. But it expects to integrate accounting and personnel data by July of this year, and that should make a big difference. The state is also developing a policy for data warehousing; within the next couple of months, it will be accepting bids for the first phase of a warehouse to help agencies get easier access to information. Though the state has a CIO, the position's involvement varies depending on the agency. Agencies don't develop IT plans, per se—they create overall strategic plans that give directions and goals, and the IT plan is just an attachment. There is no statewide IT training, and it can be difficult for employees to free up the time to take necessary training. Historically, Georgia has done little follow-up to see whether results provided by technology investment were commensurate with promises made, outside of the legislative Department of Audits' Performance Management Division. It is attempting to implement such a system now. On the executive side, officials insist, however, that even without the system, they are capable of sensing what works and what does not. "If it were a failure, it would be noticed," says Tom Wagner, director of research and analysis for the Office of Planning and Budget. AVERAGE GRADE: C+
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