THE GOVERNMENT PERFORMANCE PROJECTReport Card: Maryland FINANCIAL MANAGEMENT: A- Maryland's official sport is jousting, but there isn't much jousting over revenue: The state forecasting team, which includes both executive and legislative members, does an excellent job. There is a solid structural balance between ongoing revenues and expenditures, and recent surpluses, adding up to nearly $200 million, have been used to build reserves and accelerate a planned tax cut. (They didn't increase the cut—just did it a little more quickly.) "This was financially prudent," says Fred Puddester, secretary of budget and management, "because it didn't give long-term revenues away." Meanwhile, Maryland has an exceedingly plush rainy day fund, currently at about 8 percent of general fund expenditures. The state has a long history of excellent financial reporting, and has received a certificate of achievement from the Government Finance Officers Association every year for more than a decade. Small weakness: There is no central oversight of contracts generated by state agencies. The agencies do train some of their officials in contract management, but Maryland would be well served with some more controls here, including more performance-based contracting. CAPITAL MANAGEMENT: A- The capital planning process is top-drawer. Maryland's Office of Capital Budgeting and Department of Transportation create five-year plans based on agency submissions. While many states have five-year plans that consist of one year of reality and four years of fantasy, Maryland's long-term plan is sufficiently realistic to earn respect in most quarters. The only problem in this category has to do with maintenance. As the secretary of budget and management says, "There is constantly a backlog in maintenance. We typically get to life-safety and deterioration of building projects." But as in most places, it's not easy to get the legislature to spend the money. HUMAN RESOURCES: B A huge transition began here with the Personnel Reform Bill, signed by Governor Glendening in 1996. Though the state still does a lot of old-fashioned testing for jobs, the process has been devolved down to the agency level for harder-to-fill posts. Job announcements are posted on the Internet, and the descriptions can be modified to recruit for specific needs, such as the ability to speak a foreign language. Maryland's pay systems have been stultifying, and worked against motivating employees with pay raises, since about six out of 10 employees capped out at the top of their salary range. That will be changing, effective next July. Fortunately, for some time managers have beeen able to promote internally without central approval, though those promotions were subject to central review. A new personnel evaluation tool has been put into place, with employee performance standards drawn from job descriptions and individual employee goals tied to agencies' strategic plans. Supervisors are to be evaluated not just by their bosses but also by their employees, and reviews will be ongoing throughout the year. The state has just begun to utilize pay for performance. Training procedures are good in Maryland, with special attention devoted to clerical workers. This effort grew out of concerns in the General Assembly that these employees were being left behind, without the skills needed for the next century. MANAGING FOR RESULTS: B- Maryland has no strategic plan right now, but it is currently in the first year of a three-year phase-in process. State officials have solicited a great deal of public input through hearings, surveys, the Internet and focus groups, and key goals have been prepared for all agencies. In contrast to previous efforts, all agencies and programs are involved, results-oriented measures are being emphasized over simple workload indices, and the budget process is being tied in. Maryland plans on adding objectives and performance indicators for the fiscal year 2000 budget. About 1,000 state employees have taken a multi-day seminar at the University of Baltimore to gear up for the effort. Performance measurement has some good models in the state in the areas of education and the environment, where the effort has been reaping dividends for years. INFORMATION TECHNOLOGY: C The information provided by Maryland's accounting system isn't sufficient for individual agencies; many build their own as a result. There is no statewide human resources information system. When the state went through collective bargaining recently, and unions asked for data, it was a time-consuming task to pry it out. However, the state is designing a comprehensive, online budget-preparation system. There's little standardization here outside of mainframes. Even e-mail uses different software, making message-sending a sometimes frustrating effort. Though the Office of Information Technology manages all telecommunications, voice and data transmissions are managed as separate entities. Major acquisitions follow standard, cumbersome and time-consuming procurement laws. On the positive side, the state has relatively strong training efforts; it pushes agencies to make sure that they provide ample instruction. The state's fast-moving efforts at managing for results are likely to be helpful in identifying the actual benefits of technology systems. And Maryland does a reasonably good job of sharing information with its citizens over the Internet. AVERAGE GRADE: B
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