THE GOVERNMENT PERFORMANCE PROJECTReport Card: West Virginia FINANCIAL MANAGEMENT: B Long saddled with a reputation for financial management that ranged from the inept to the corrupt, West Virginia is making a commendable effort to get its house in order. The state's books are now in solid structural balance, and revenue and expenditure estimates have been reasonably accurate—although Medicaid remains a problem, running more than 8 percent over budget in the most recent fiscal year. In the wake of a $200 million scandal in its investment portfolio 10 years ago, the state now has a genuinely responsible investment management board. There are contingency reserves equal to 3.6 percent of general fund revenues; the money has been used to deal with emergency flooding costs, but the fund is generally replenished when money is withdrawn. While pensions are still deeply underfunded, the state has set in motion long-term efforts to address the problem. In the bad old days, it could take four months just to get West Virginia's government to pay a bill. Now, boasts Dorothy Yeager, deputy secretary of the Department of Administration, "it can make your head spin how quickly bills can get paid." CAPITAL MANAGEMENT: C+ Though West Virginia provides capital maintenance funding out of rents paid by the agencies, it still has a backlog of renovation needs that were previously deferred. There is no unified capital improvement plan, though agencies create prioritized capital requests for a five-year period and update them annually. This is a state where the legislature has always involved itself in capital management, in an informal but powerful way. According to budget director Roger Smith, "the senators and delegates visit state properties, even when they're not in session, and see what the problems are. When they do come to Charleston, they have a good idea of needs." The state often hires outside project managers as consultants to track the status of projects. HUMAN RESOURCES: C+ West Virginia adopted a centralized personnel system as part of a 1989 reform effort. The Division of Personnel was established, and a goal was set to reduce the number of classification titles from 1,800. The state is now down to 750. Recently, a number of agencies—though not all—have made progress in speeding up the hiring process by streamlining a labyrinthine approval process that sometimes required 14 separate signatures to hire one new worker. A major problem remaining is that of salaries: Though agencies are permitted to award higher pay for good performance—and West Virginia has developed a performance-evaluation system—no money for it has been provided by the legislature. No bonuses are permitted by state law, though conflicting legal language on this issue is being investigated. There is minimal workforce planning of any type, but the state has recently done salary surveys to compare its pay to market rates. Training has been a reasonably high priority, and managerial training particularly appears to be on the upswing, with a basic supervisory program required (and given at no cost to agencies through the division of personnel). MANAGING FOR RESULTS: C All departments, agencies and programs in West Virginia have goals and plans for accomplishing those goals. The state doesn't have a formal strategic plan. But the governor develops his own, consisting of goals and objectives he personally wishes to accomplish. The state started its efforts in performance measurement three years ago and is focusing on measures that can be directly tied to individual agency efforts, such as the number of workers in training programs who are able to find jobs. Though measures have had little impact on legislative funding decisions, by the budget director's estimate, about half the agencies do a pretty good job at measuring results, a quarter are working on improvements now, and the remaining quarter are dismal. Thus far, measurements have been used just to report on past performance, but the coming budget will include targets for future work. INFORMATION TECHNOLOGY: C The state has reasonable management of its information technology, with a chief technology officer reporting directly to the governor, as well as centralized efforts to set policies and standards. West Virginia does a good job at training IT workers with limited resources. It even has a pretty good four-year enterprise-wide Information Technology Plan. Still, too many sensible plans wind up buried in a pile of dead dreams. "I just came from a budget hearing," Sam Tully, the chief technology officer, reported recently. "That's when the administration determines we don't have enough money to fund these things. So, we do it with less, or don't do it, or let it wait a year." Though the state plans to get a better human resources information system, that process has been delayed. Two agencies are actively pursuing data warehouses, but there's no assurance right now that either will get funding. Meanwhile, procurement policies designed to avoid corruption also can make any sizable purchase into a nightmare of red tape. Legislation in this state holds individuals personally responsible for any purchasing foul-ups. This inclines managers to drag as many people into the approval process as possible. "Hell," says one observer, "you're putting your house on the line." AVERAGE GRADE: C+
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