THE GOVERNMENT PERFORMANCE PROJECTReport Card: Oklahoma FINANCIAL MANAGEMENT: B- Oklahoma budgets conservatively. It has a policy of spending, in a given year, only 95 percent of estimated revenues, plus whatever balance is left over from the year before. The state might be tempted to substitute this policy for a rainy day fund, but it has one of those, too, now at 3.4 percent of general fund expenditures. The biggest recent strain on the budget has been the prison-related costs of Oklahoma's hard-line crime policy. The corrections budget grew 19 percent in 1997 and 20.3 percent last year, though growth may now be slowing. Legislators are wrangling over some alternatives to incarceration that might prove easier on the state treasury in the long run. Merely looking at the long run is a bit of innovation for them; the legislature historically hasn't paid much attention to the future costs of current legislation, and Oklahoma has no formal fiscal-notes process in place. The state's cash and debt management policies are fine, but there's one more big problem looming: According to its auditor, the Teachers Retirement System has an unfunded liability approaching $5 billion. If Oklahoma doesn't increase its funding levels, the auditor warns, "the system will experience difficulty in meeting long-term obligations." CAPITAL MANAGEMENT: C Until 1992, Oklahoma all but pretended that it had no capital management responsibilities. In that year, it created a capital planning commission, which has improved the process enormously. The commission, which has membership from both the legislature and the private sector, has developed five-year statewide capital improvement plans. Agencies submit their own five-year request forms, with projects prioritized. But funding is still a major issue, particularly given a big backlog of problems resulting from years of prior neglect. "Everybody is crying for so much in operating needs, and the infrastructure stuff seems to go wanting," says Rollo Redburn, the budget division director. For fiscal year 2000, the state is asking agencies to spell out in great detail what they need to maintain their assets. Up until now, the state has had almost no information about this. The next step, of course, is to spend money where it's needed. For the past five years, the majority of maintenance needs have been deferred. HUMAN RESOURCES: C- State employees are paid about 10 percent below market rates in Oklahoma, and salary increases are usually less than 2 percent a year. Personnel officials want to give raises based on performance, and have developed a new measurement system to make this possible. But tying pay to performance is partially contingent on the dubious prospect of legislative funding. Meanwhile, performance bonuses aren't allowed under current law. Oklahoma offers agencies a choice of the top 10 available applicants for each job. It has one of the strongest veterans' preference laws in the country, which means that vets' names are automatically put at the top of the list regardless of how they score on tests. On the positive side, Oklahoma is proposing a cut in the number of classified positions from almost 1,500 to about 900. It also has decentralized testing to 17 local offices around the state. Perhaps most important, it has moved about a quarter of employees to non-civil-service positions, enhancing managerial flexibility. Supervisors must take four days of training a year, but there are a limited number of courses, so they tend to repeat the same classes every three or four years. The state doesn't conduct workforce planning, and it has no plans to do so. MANAGING FOR RESULTS: D+ Most Oklahoma agencies create output measures of some kind. But many are worthless—such as the number of letters handled in a month. Only about a quarter of the agencies use outcome indicators, according to the budget office, and even that may be an optimistic figure. There is no statewide strategic plan, and though the budget office has tried to get agencies to engage in strategic planning voluntarily, it has met with very limited success. Only about five out of 70 agencies that get general fund money have strategic plans in place. The relatively new Oklahoma Quality Improvement Task Force has recommended statewide strategic planning, as well as formalized efforts at performance measurement and auditing. INFORMATION TECHNOLOGY: C- Oklahoma operates an integrated network, called OneNet, which connects schools, courts, libraries, hospitals, and state, local and federal agencies across the state. Outside of OneNet, however, there is not a great deal of standardization in Oklahoma's IT systems. Agencies tend to migrate on their own to relatively consistent industry-driven protocols, but there are odd exceptions: Not long ago, the Oklahoma Senate decided to purchase an Apple-based system, while virtually everyone else in state government uses IBM-compatibles. Oklahoma's centralized accounting information system has a great deal of capacity to be used for agency management. But most managers don't take advantage of the opportunity. The personnel information system is utilized to a greater extent. The state has no chief information officer, though the director of information services in the office of state finance serves in a similar role. There is no statewide IT plan; all agencies submit separate plans that tend to focus on procurement. AVERAGE GRADE: C
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