Page 118 is the next section that is not obviously part of the 'collective bargaining' section of this bill, which as I've stated I will come back to after completing the rest of the bill. I am hoping to be able to finish this review before Gov. Walker releases his actual budget and then review the information contained in that budget as well, but I can't make any guarantees of this at this point as I also have some other projects that I have to complete this week. I am also still interested in finding a supporter of this bill to clarify/debate some of the points of this bill, but thus far I have not had much success in getting volunteers for the project.
Section 365 is found at the bottom of page 118. Much of the first portion of this section deals with appointment/election, salaries, and employment status of judicial employees such as Assistant District Attorneys. The salary information basically just outlines that the pay rate for positions such as Assistant District Attorneys will be based on a statewide pay scale and the ability for municipalities to set their own pay scales will be required to be within this pay scale. This makes sense to me, as allowing more affluent communities to pay their attorneys a much higher rte may limit the ability of poorer areas to attract highly qualified applicants. The Director of the Office of State Employment Relations sets and monitors these pay scales, which seems to be the appropriate department for this type of issue.
Page 120 begins a discussion about staffing at a variety of state departments and commissions. Section 9101 (after section 369, not sure why there was such a significant change in the section numbers here) references that any staffing needs at the Wisconsin Employment Relations Commission will be evaluated by the Department of Administration. The positions to be eliminated are all determined by the Secretary of Administration, so the departments themselves will not determine which positions it is most appropriate to eliminate, an important thing to keep in mind. It's easiest to summarize the individual department changes by each department, these are not necessarily in the exact order they appear in the bill:
-Department of Administration - This section also authorizes the creation of additional full-time employee (FTE) positions within the Department of Administration, including the creation of 1 FED position and 4 PR positions. I find this odd in a bill that is supposed to be used to limit/decrease state spending. It may be that these positions are required for some project that is not outlined in this bill, but the responsibilities of these positions are not outlines at all in this bill.
-Department of Agriculture, Trade, and Consumer Protection – The two subsections of this section are a bit confusing. It appears that FTE staffing to this department is decreased by 3.0 GPR positions
for general staffing but then INCREASED by 3 GPR positions specifically to be unclassified division administrators. This seems to be decreasing staff while increasing management, which I find odd for a 'budget balancing' bill, but again the responsibilities of the created positions are not outlines so perhaps they are not superfluous. It's also possible that this is simply to re-assign people who would be considered part of a collective bargaining unit into another 'non-union' classification.
-Department of Children and Families – This department will have 1 PR position, 1.85 GPR positions, and 0.15 FED positions eliminated for (apparently) general staff while increasing the 'unclassified division administrators' for this department by the same amount. The same concerns as I outlined for the Department of Agriculture apply here as well. Section 9208 (page 134) also outlines an increase of $37,000,000 for the second fiscal year to support an increase in the earned income tax credit program.
-Department of Corrections – The same theme repeats again. This department is decreased by 3 GPR positions while increasing 'unclassified division administrators' by 3 GPR positions. Adult Correctional Services (section 9211, page 135) would receive a direct increase in funding by $19,537,900 as well as several potential transfers from appropriation accounts.
-Department of Financial Institutions – FTE positions in this department are decreased by 2 PR positions while increased by 2 PR 'unclassified division administrators'.
-Department of Health Services – FTE positions are decreased y 1 FED and 2 GPR positions while being increased by 1 FED and 2 GPR 'unclassified division administrators'. Funding for Community Aids Appropriation (page 137) will be decreased by $3,100,000 in the second fiscal year while the funding for Medical Assistance General Purpose Revenue Appropriation would be increased by $127,000,000 in the second fiscal year. Medical Assistance Administration Appropriation ill be increased by $16,000,000 and Income Maintenance Appropriation will be increased by $2,500,000.
-Office of the Commissioner of Insurance – FTE positions are decreased by 2 PR positions while being increased by 2 PR 'unclassified division administrators'.
-Department of Natural Resources – FTE positions decreased by 3 SEG positions while increasing by 3 SEG positions for division administrators.
-Public Service Commission – Decreased FTEs by 3 PR positions while increasing by 3 PR positions for division administrators.
-Department of Regulation and Licensing – Decreased by 2 PR positions and increased by 2 unclassified division administrator PR positions
-Department of Revenue – Decreased by 3 FTE GPR positions and increased by the same number for 'unclassified division administrators'.
-Department of Employment Relations – Decreased by 1 PR position while increased by 1 PR position for a division administrator. This section also requires that the Department of Employment Relations investigate offering a low-cost insurance option and/or a high-deductible plan with a Health Savings Account (has) option as well as study the feasibility of requiring state employees to receive health coverage through a health benefits exchange. I am not familiar enough with benefit exchanges to complete a review of this requirement at this point, but I'm hoping to come back to that in the future.
-Department of Tourism – Decreased by 1 GPR position while increased by 1 'unclassified division administrator'.
-Department of Transportation – Continuing the theme, this department is decreased by 3 SEG positions while being increased by 3 SEG positions for division administrators.
-University of Wisconsin Hospitals and Clinics Board – The first section of this portion establishes that when this bill takes effect, any employees of the UW Hospital Board are transferred to be employees of the UW Hospital and Clinics Authority. There are not FTE changes explicitly listed for this department.
-Department of Workforce Development – FTE positions are decreased by 2 PR positions and increased by 2 PR positions for 'unclassified division administrators'.
-Wisconsin Quality Home Care Authority – This bill merges the assets, liabilities, and property of this department into the Department of Health Services. There are no FTE changes explicitly listed, so the assumption is that the current staff of this department would remain as they are currently.
-Joint Committee on Finance – Finding for the Federal Program Supplement will be decreased by $37,000,000 and the General Purpose Revenue Funds General Program Supplementation program's funding will be decreased by $4,590,400.
There are several requirements for departments to 'lapse' a specified portion of their budget during the fiscal year, but I didn't think it was necessary to list all of those changes as well as the direct increases/decreases listed in the bill.
Changes to the Employee Trust Fund are more significant so I wanted to designate a large section to these changes after outlining the changes to other departments. These changes are explained starting in section 9115 (at the bottom of page 123). For simplicity in the coming description, think of the state health plan as having 3 tiers of plans available. Tier 1 is the lowest employee premium costs, tier 2 is the middle, and tier 3 is the highest employee premium costs. This section outlines that employees covered under the state employee health plan will have premiums of $84/month for individual ($208 for family) coverage under any of the tier 1 plans, $122 individual/$307 family for the tier 2 plans, and $226/individual and $567/month under tier 3 plans. I assume that these amounts meet the percent contribution that Walker has insisted are necessary for balancing the budget, although I would need to know the dollar amounts that are currently required to state that for certain. Teaching assistants, graduate assistants and employees-in-training in the UW system (as defined in Section 40.02 (25)) are required to pay 50% of these costs. This section also allows for retroactive premium withdrawal from paychecks if 'an employer is unable to modify payroll procedures in sufficient time to collect employees' increased share'. The current date for the increased employee contributions to take affect is listed as March 13, 2011, which does not coincide with the actual fiscal year that would start on July 1. It's unclear why this change would take affect so far in advance of the actual fiscal year, but I assume it is to help cover the budget shortfall that is predicted for the remainder of this fiscal year.
Changes to the Wisconsin Retirement System proposed in this bill include instituting a vesting period for employer contributions to the retirement system on an employees behalf. This period is not explicitly stated, although examples of 1, 5, or 10 years are listed. A vesting period is fairly common in private industry for employer contributions to retirement accounts, although many companies institute the vesting as a percent of contribution per year of employment vs. an all-or-nothing approach. This bill does not state if the vesting would be phased in per employment time or an all-or-nothing vesting, presumably because the charge of this bill is to require the evaluation of the option and therefore doesn't completely outline the option itself. This section would also allow for review of the health insurance credit program (the use of banked sick time to cover premiums in retirement) that I wrote about earlier. There is also a short reference to allowing employees to not make required contributions in (apparent) exchange for limited retirement benefits.
It appears that this bill includes several strategies and ideas to deal with the expected increase in insurance premiums and administration costs in the future. One strategy would allow the use of $28,000,000 in reserves from the Wisconsin Retirement System to be used to reduce employer costs for providing group health insurance to state employees. Although this may help to avoid cuts in the future, I'm always leery of using a surplus from a system that retirees depend on to fund other projects. There have been issues in the past questioning the legality of using Wisconsin Retirement System funds for other budget issues (but I still have to research those past issues further to determine if this would fall under the same concerns). This bill also requires that the Group Insurance Board design health insurance plans for 2012 that reduce premium costs by at least 5%. While this could be a significant cost savings, it is important to point out that one of the surest ways to decrease the cost of an insurance plan is to cut benefits, increase out-of-pocket expenses like deductibles or copays, or both. This could significantly increase the costs to plan members over and above the required increase to premium payments, as well as opening questions of how the benefits to be provided are reviewed.
The changes discussed above basically take us through the remaining portion of the Budget Repair Bill. The final 5 pages outline general changes, reiterate what sections apply to collective bargaining, and define the term of employment of Supreme Court judges in terms of eligibility for the Wisconsin Retirement System. The final section of this bill to be covered is the highly contentious 'collective bargaining' section that takes up the central portion of the bill. By the time I have that section completed, hopefully the actual budget itself will have been released so that I can evaluate that as well in the context of the authorities outlined in this bill.
Monday, February 28, 2011
Saturday, February 26, 2011
Part 3 - State Medical Assistance (pg 40 - 58)
We left off at page 40, the section of the bill that explains how retired employees can use accumulated sick and vacation time as credits toward their insurance in retirement. The majority of this post focuses on the potential changes to Medical Assistance in Wisconsin. I decided that I will skip the section of the bill that deals with the collective bargaining rights and come back to that at the end. I think that it's important to go through the lesser known portions of the bill. There are some portions of the bill that I will cover in this section that are less explicit in dealing with collective bargaining, they cover issues of insurance selection. The discussion of the collective bargaining rules and restrictions has the potential to get very contentious, and I'm still hoping to find a bill supporter as a co-author for this write-up to give a more rounded evaluation.
Page 40 and 41 continue the discussion about the use of sick time to cover insurance. Page 42 (Section 101, 40.51) references the selection of health care coverage an employer (other than the state) can offer employees. Employers are steered to the group insurance board (which I discussed in Part 1). This section gives individual departments the ability to establish their own eligibility rules and contribution requirements, which allows for some flexibility to meet the department needs. This section also explicitly restricts an employer from paying more than 88% of the average premium for the insurance plan, enforcing the employee contribution of at least 12% that Walker insists is necessary. The group insurance board in this section is also given the ability to designate the insurance terms for graduate assistants, teaching assistants, and employees-in-training in the University of Wisconsin System. The board is required to consult with the UW Board of Regents when making these decisions, so it is possible that the questionable non-partisanship of the group insurance board may be balanced by the recruiting requirements of the UW system.
Section 112 starts at the bottom of page 44 and relates to potential changes to the state of Wisconsin's Medical Assistance program (Badgercare, Medicare, Seniorcare, etc.). The first portion of this section is devoted to outlining the study of various types of potential changes to these programs that should be investigated. It is easiest and most accurate to copy this section here, so:
“The department shall study potential changes to the Medical Assistance
state plan and to waivers of federal law relating to medical assistance obtained from
the federal department of health and human services for all of the following
purposes:
1. Increasing the cost effectiveness and efficiency of care and the care delivery system for Medical Assistance programs.
2. Limiting switching from private health insurance to Medical Assistance programs.
3. Ensuring the long−term viability and sustainability of Medical Assistance programs.
4. Advancing the accuracy and reliability of eligibility for Medical Assistance programs and claims determinations and payments.
5. Improving the health status of individuals who receive benefits under a Medical Assistance program.
6. Aligning Medical Assistance program benefit recipient and service provider incentives with health care outcomes.
7. Supporting responsibility and choice of medical assistance recipients.”
If any of these studies find potential increased efficiency and/or cost efficiency for these programs, this bill gives authority to make a multitude of changes to the program, such as:
“1. Require cost sharing from program benefit recipients up to the maximum allowed by federal law or a waiver of federal law.
2. Authorize providers to deny care or services if a program benefit recipient is unable to share costs, to the extent allowed by federal law or waiver.
3. Modify existing benefits or establish various benefit packages and offer different packages to different groups of recipients.
4. Revise provider reimbursement models for particular services.
5. Mandate that program benefit recipients enroll in managed care.
6. Restrict or eliminate presumptive eligibility.
7. To the extent permitted by federal law, impose restrictions on providing benefits to individuals who are not citizens of the United States.
8. Set standards for establishing and verifying eligibility requirements.
9. Develop standards and methodologies to assure accurate eligibility determinations and redetermine continuing eligibility.
10. Reduce income levels for purposes of determining eligibility to the extent allowed by federal law or waiver and subject to the limitations under par. (e) 2.”
I'm hoping to review the current state Medical Assistance codes soon to determine how many of these potential changes are already in existence and how many would be new potential changes to the program. While some of these potential solutions are concerning, such as requiring managed care plans in areas with limited doctor availability, others (like changes to reimbursement models) seem like they would be common review processes. Any changes like those listed above are supposed to be submitted to the joint committee on finance for review prior to taking effect, but if the joint committee on finance doesn't schedule a meeting within 14 working days to review the rule, the rule takes effect without any further review (“(d) Before promulgating a rule under par. (c), the department shall submit to the joint committee on finance the proposed rule and any plan that the department develops as a result of the study under par. (b). If the co-chairpersons of the committee do not notify the department within 14 working days after the date of the department’s submittal that the committee has scheduled a meeting for the purpose of reviewing the proposed rule or plan, the proposed rule may be promulgated and
any plan may be implemented as proposed by the department”). This could lead to the potential of changes to Medical Assistance without a complete review. If the committee does notify the department that they have scheduled a meeting to consider the changes within 14 days, the rule may only be implemented if it is approved by the committee. If any of the rules considered do not meet federal guidelines, the bill requires that the department submit a waiver request to the federal government.
Another concerning statute in this part of the bill states “the department may promulgate a rule under par. (c) as an emergency rule... the department is not required to provide evidence that promulgating a rule under par. (c) as an emergency rule is necessary for the preservation of the public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated”. While the ability to make short-term changes to a state program during emergencies is understandable, the lack of a requirement to prove the 'emergency' leaves a concern of abuse of this section. These emergency rules would remain in effect either until their repeal date is reached or they are accepted as permanent rules, but there is no information in the bill as to how the repeal date would be determined and/or how the department would determine this repeal date, so the 'emergency' rules could in fact be in effect for quite some time.
Starting at section 15 the Bill outlines general guidelines for payment for medical services under Medical Assistance. Basically it seems geared at explicitly stating that providers treating Medical Assistance patients can be paid up to, but not more than, their standard per visit rate. This seems to make sense, as paying a provider more than they would get for standard visits would not be a cost-saving measure. Ultimately the department determines the pay rate for each service, and one would anticipate that rate would actually be below the flat fee that the provider would normally charge. There's a small section (49.45) that references payments to pharmacists who identify cost-saving measures for people on Medical Assistance. It doesn't clarify what type of cost saving measures they envision, but I'm assuming it's things like steering patients toward generic alternatives and/or counseling services for chronic medication usage. This has the potential to have some significant cost impacts, as pharmacists are in a unique position to counsel patient's about medications. Section 122 also limits the cost of prescription drugs for a person on Medical Assistance to $12/month if that person designates and uses a single pharmacy for all of their prescription needs, but this amount can be changed by the rules process discussed above.
From this point to page 58, where the retirement and pay/collective bargaining for public employee section starts, there are multiple small sections about identifying eligible participants for Medical Assistance, more clarification of payment schedules, etc.
Page 40 and 41 continue the discussion about the use of sick time to cover insurance. Page 42 (Section 101, 40.51) references the selection of health care coverage an employer (other than the state) can offer employees. Employers are steered to the group insurance board (which I discussed in Part 1). This section gives individual departments the ability to establish their own eligibility rules and contribution requirements, which allows for some flexibility to meet the department needs. This section also explicitly restricts an employer from paying more than 88% of the average premium for the insurance plan, enforcing the employee contribution of at least 12% that Walker insists is necessary. The group insurance board in this section is also given the ability to designate the insurance terms for graduate assistants, teaching assistants, and employees-in-training in the University of Wisconsin System. The board is required to consult with the UW Board of Regents when making these decisions, so it is possible that the questionable non-partisanship of the group insurance board may be balanced by the recruiting requirements of the UW system.
Section 112 starts at the bottom of page 44 and relates to potential changes to the state of Wisconsin's Medical Assistance program (Badgercare, Medicare, Seniorcare, etc.). The first portion of this section is devoted to outlining the study of various types of potential changes to these programs that should be investigated. It is easiest and most accurate to copy this section here, so:
“The department shall study potential changes to the Medical Assistance
state plan and to waivers of federal law relating to medical assistance obtained from
the federal department of health and human services for all of the following
purposes:
1. Increasing the cost effectiveness and efficiency of care and the care delivery system for Medical Assistance programs.
2. Limiting switching from private health insurance to Medical Assistance programs.
3. Ensuring the long−term viability and sustainability of Medical Assistance programs.
4. Advancing the accuracy and reliability of eligibility for Medical Assistance programs and claims determinations and payments.
5. Improving the health status of individuals who receive benefits under a Medical Assistance program.
6. Aligning Medical Assistance program benefit recipient and service provider incentives with health care outcomes.
7. Supporting responsibility and choice of medical assistance recipients.”
If any of these studies find potential increased efficiency and/or cost efficiency for these programs, this bill gives authority to make a multitude of changes to the program, such as:
“1. Require cost sharing from program benefit recipients up to the maximum allowed by federal law or a waiver of federal law.
2. Authorize providers to deny care or services if a program benefit recipient is unable to share costs, to the extent allowed by federal law or waiver.
3. Modify existing benefits or establish various benefit packages and offer different packages to different groups of recipients.
4. Revise provider reimbursement models for particular services.
5. Mandate that program benefit recipients enroll in managed care.
6. Restrict or eliminate presumptive eligibility.
7. To the extent permitted by federal law, impose restrictions on providing benefits to individuals who are not citizens of the United States.
8. Set standards for establishing and verifying eligibility requirements.
9. Develop standards and methodologies to assure accurate eligibility determinations and redetermine continuing eligibility.
10. Reduce income levels for purposes of determining eligibility to the extent allowed by federal law or waiver and subject to the limitations under par. (e) 2.”
I'm hoping to review the current state Medical Assistance codes soon to determine how many of these potential changes are already in existence and how many would be new potential changes to the program. While some of these potential solutions are concerning, such as requiring managed care plans in areas with limited doctor availability, others (like changes to reimbursement models) seem like they would be common review processes. Any changes like those listed above are supposed to be submitted to the joint committee on finance for review prior to taking effect, but if the joint committee on finance doesn't schedule a meeting within 14 working days to review the rule, the rule takes effect without any further review (“(d) Before promulgating a rule under par. (c), the department shall submit to the joint committee on finance the proposed rule and any plan that the department develops as a result of the study under par. (b). If the co-chairpersons of the committee do not notify the department within 14 working days after the date of the department’s submittal that the committee has scheduled a meeting for the purpose of reviewing the proposed rule or plan, the proposed rule may be promulgated and
any plan may be implemented as proposed by the department”). This could lead to the potential of changes to Medical Assistance without a complete review. If the committee does notify the department that they have scheduled a meeting to consider the changes within 14 days, the rule may only be implemented if it is approved by the committee. If any of the rules considered do not meet federal guidelines, the bill requires that the department submit a waiver request to the federal government.
Another concerning statute in this part of the bill states “the department may promulgate a rule under par. (c) as an emergency rule... the department is not required to provide evidence that promulgating a rule under par. (c) as an emergency rule is necessary for the preservation of the public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated”. While the ability to make short-term changes to a state program during emergencies is understandable, the lack of a requirement to prove the 'emergency' leaves a concern of abuse of this section. These emergency rules would remain in effect either until their repeal date is reached or they are accepted as permanent rules, but there is no information in the bill as to how the repeal date would be determined and/or how the department would determine this repeal date, so the 'emergency' rules could in fact be in effect for quite some time.
Starting at section 15 the Bill outlines general guidelines for payment for medical services under Medical Assistance. Basically it seems geared at explicitly stating that providers treating Medical Assistance patients can be paid up to, but not more than, their standard per visit rate. This seems to make sense, as paying a provider more than they would get for standard visits would not be a cost-saving measure. Ultimately the department determines the pay rate for each service, and one would anticipate that rate would actually be below the flat fee that the provider would normally charge. There's a small section (49.45) that references payments to pharmacists who identify cost-saving measures for people on Medical Assistance. It doesn't clarify what type of cost saving measures they envision, but I'm assuming it's things like steering patients toward generic alternatives and/or counseling services for chronic medication usage. This has the potential to have some significant cost impacts, as pharmacists are in a unique position to counsel patient's about medications. Section 122 also limits the cost of prescription drugs for a person on Medical Assistance to $12/month if that person designates and uses a single pharmacy for all of their prescription needs, but this amount can be changed by the rules process discussed above.
From this point to page 58, where the retirement and pay/collective bargaining for public employee section starts, there are multiple small sections about identifying eligible participants for Medical Assistance, more clarification of payment schedules, etc.
Friday, February 25, 2011
Budget Repair Bill Part 2 (Pages 21 - 40)
So moving on with our dissection of the Wisconsin Budget Repair Bill. I'll be covering pages 22 through 40 here. Much of this section revolves around accounting standards, which I'll admit to not being that familiar with. I'll try my best to translate it, but if anyone out there has a different interpretation of one of the sections I cover, please let me know. I'm debating whether I'm going to keep going through the bill in order and cover the collective bargaining section next (as it starts around page 59) or, since that is the part that has been in the news the most, skip that section for now and continue on with the lesser known portions of the bill. I'd come back to the collective bargaining portion in the end if that is the case. Let me know if you have any preferences. I plan to post the next section later this weekend.
The first thing to note on page 22 is that “This section does not apply to the sale of any state−owned heating, cooling, and power plant. Any sale of such a plant is governed exclusively by s. 16.896”. I'll get to section 16.896 soon enough, but keep this exclusion in mind as we discuss the upcoming portions. I'll admit that it's unclear if that means that anything listed in the next sections CANNOT be applied to state utility plants or if that just means that whatever the current process is stays in place. I'm hoping that it's the later, because section 41 of this bill is what authorizes the state to “furnish engineering, architectural, project management, and other building construction services whenever requisitions therefor are presented to the department by any agency”. Any funds received for these services is to be deposited into the general fund as revenue. If utility plants are excluded from this portion and the current procedure is not 'grandfathered' in, this could mean that the state does not have to pay for services to the utility plants. I find it hard to believe that is the intent of this section, if the state is not responsible for state power plant costs then who is? However, alternative interpretations are important to consider, and one alternative is that this portion of the bill essentially cuts off funding for state utility plants. This is more concerning when coupled with the 'sales' provision that will be discussed shortly.
Page 23 discusses the fees that are allowed to be charged to an agency each fiscal year, basically outlining budgets in very rough (no actual numbers) terms. This section does allow departments to charge agencies a 'premium' for certain services, including investigative services, litigation costs, data processing and staff support, and the cost of insurance contracts. Although the charges for these services are to be allocated annually, the bill also allows for departments to periodically assess agencies a portion of the expenses incurred by the department. I assume this is to allow for 'unpredicted' expenses to be 'billed' in a timely manner, such as increased security costs for an unexpected event, disease outbreak, or natural disaster.
Page 24 starts the section that covers the sale of state-owned utility plants. Besides the collective bargaining section of this bill, this is probably the portion that has received the most (but still not much) attention. This section provides the ability for state-owned “heating, cooling, and power plants' (I'll just say utility plants for short) to be sold to or contracted to a private entity “with or without
solicitation of bids, for any amount that the department determines to be in the best interest of the state.” I think the most concerning portion of that sentence is the 'without solicitation of bids' portion. Typically when an asset is being sold the goal is the accept the highest offer on the property. This section would allow that utility plants could be sold without asking for multiple offers, essentially making it a 'first come, first served' type of sale. The argument has been made that the offers that would be received for these plants would be minimal because of necessary technology upgrades and concerns about updates to federal pollution guidelines, but I don't think these arguments alone legitimize not even asking for competitive bidding on the sales. Plus, there is a high potential for abuse in this scenario. With no true oversight allowed for in these sales, it is entirely too possible that the sales would be available first to political contributors and/or that the offers would be outrageously low. Saying that the amount only has to be determined to be 'in the best interest of the state' doesn't really give a lot of guidance into the anticipated purchase price. Plus, the sales are excluded from needing approval or certification of the public service commission, again leaving no true oversight into the sales. Any utility plant sale is “considered to be in the public interest and to comply with the criteria for certification of a project”. The assumption made by this section is that any utility plant sold is a good thing, although it is not outlined as to how that determination was made. I'm assuming the argument is that a private company could operate the plants more efficiently than the current public process, but as there are no provisions for maintaining the current staff after the sale, efficiency changes would have to account for the potential training of new employees, plus there are no provisions the ensure that the cost of the utilities provided would not greatly increase when managed by a private company, potentially costing the state more in the long-run.
This section also states that any outstanding public debt on any utility plants sold would be covered by the net proceeds of the sale. Ideally, this would encourage some competitive bidding as one would assume the state would want to sell the plant for enough to at least cover this debt. However, there is no indication of what happens to that debt if the sale price of the plant does not cover the debt itself. If the sale is still determined to be 'in the best interest of the state', does that debt that is not covered by the sale price then get added to the general state debt? As there is no provision stating sales cannot take place for less than the amount of outstanding debt, this is an important question to answer.
Any profits from the sale of utility plants (after all state and federal debts on the plants are paid off), is to be deposited in a 'budget stabilization fund'. This sounds fine to me, although I would need details as to what the 'budget stabilization fund' is to be used for, how the funds are to be managed or invested, and who is responsible for overseeing this fund. Later in this bill (pages 25-26) it appears that the Secretary is given oversight of any profits from these sales, and any agency that wants to use the funds from sale of utility plants must petition for approval from the Secretary. If an agency's utility plant is sold, they do not have the ability to use the profits from that purchase on agency projects without Secretary approval, even though it appears that the agencies themselves have little to no say in the decision to sell that plant. Essentially, this takes away the agencies plant AND any benefit they might get from the sale. On one hand this could be good as it may minimize the temptation to sell plants for short-term gain, but on the other hand it seems that the agency should see some benefit from the sale if they have no ability to stop it.
The purchaser of any state utility plant is subject to any provision that the state feels it is necessary to place on the sale, including submitting to any rulings of the public service commission. So although the public service commission is essentially unable to weigh in on the sales before hand, they are allowed to chose to oversee the plant after the sale. This seems appropriate, although I'm unclear why they are then excluded for say in the sale if they are later allowed to oversee the plant anyway. If they are good enough to manage it after the sale, shouldn't they maintain that jurisdiction before and during the sale as well? This section also states that unless it is agreed to “between the parties' (I assume this means the state department overseeing the sale and the purchaser), the purchaser of the plant is required to keep them in good repair and continued operation to “provide adequate...power to meet the state's current and future needs”. This avoids someone purchasing the plant just to shut it down and then charge the state facility served by that plant to purchase power from another location. However, if the state and the purchaser agree to closing the plant, that is still a possibility.
The Secretary also has the ability, after the sale of a utility plant, to decrease the number of full-time positions in the plant by whatever number he/she feels necessary. I think the intention is to allow the Secretary to eliminate any positions in the agency that were associated with the operation of the utility plant, so again the issue of training new employees and it's impact on efficiency (and safety) at the plant rears it's head.
Page 27 starts a section that (indirectly) deals with the major collective bargaining section that is later in the bill. Although this section doesn't deal with collective bargaining rights, which is what is getting the majority of the current press coverage of this bill, it does deal with things like collective bargaining notice, administrative costs, studies, etc. This section requires notification of the end of a contract period and the reopening of negotiations, but does not give a time frame for that notification or outline the required methods of notification. Without this being outlined, it is possible that the contract could expire, minimal notice could be give (say, with a single announcement posted on a board down a lightly-used hallway) and therefore discussion would be limited. I'd like to think that wouldn't happen, but the pessimist in me requires that I point out that possibility. Any funds necessary to complete actuarial and other types of studies relating to insurance and retirement must be approved by the secretary of administration. It makes sense that someone would have to approve the distribution of these funds, but I would want assurances that the determination is not made based on political ideals. It is easy to imagine an administration only approving funds for studies done by groups that share their ideological or political beliefs, which is not the way to get accurate or unbiased information.
Page 29 refers to collective bargaining grievance arbitration, stating that agencies will reimburse the state for the costs of arbitration. This section seems a little odd to me, seeing as later in the bill the collective bargaining rights are limited to simply wages. It is possible that there would be arbitration necessary on that topic, but as little else will be available for arbitration it seems almost unnecessary to have the stipulation as to who pays for said arbitration.
Page 30 refers to the refinancing of existing state debt. This is the portion that Gov. Walker believes required that the Bill be passed by Friday, February 25th in order for the debt to be amortized. This section allowed for $474,000,000 to be contracted for debt incurred before July 1, 2011. I have heard the best explanation of this portion is to think about a mortgage. If you have 10 years left on your 30-year mortgage, you have a set payment you make each month. You can refinance that 10 years of remaining debt out another 30 years, your payments each month/year will go down but the overall amount you will pay on this debt will increase because of the interest you will pay for the 'new' 20 years of the loan. In essence, this doesn't reduce your debt, it just reduces the payments you make each month. I can't take credit for that explanation, a Republican explained it to me, but it seemed the clearest way to cover that portion of the bill. Most people have a general understanding of loans and interest.
The bottom of Page 32 introduces the discussion of salaries for appointed positions in government, as long as those appointed positions are not subject to a collective bargaining agreement. I won't go into all the details of what each rank of government is eligible to be paid, but I will say that the pay appears to be based on what the highest rank would get paid, with each rank below that getting a salary range 'one range below' the preceding rank. On one hand this seems appropriate, the higher rank you have in any company the higher your pay scale, in general. However, there is no detail as to what a 'range' is considered in actual dollars and cents, so it is possible that the pay differences could be minimal OR extreme. Also, there is no mention of a potential cap on the salaries of the top rank, leaving a potential for skyrocketing costs if an agency head is appointed at an inflated pay rate. The Secretary of Administration is responsible for approving the funds for the agencies and a 'board' is responsible for reviewing the pay ranges. This board also has the ability to establish salaries for new appointments or increase salaries as they see fit to 'correct a salary inequity or to recognize competitive factors', leaving potential abuse for political appointees to be paid inflated rates.
Page 34 has a provision that is easily overlooked, but I find interesting. “The board shall not permit a facility that would be privately owned or operated to be constructed on state−owned land without obtaining prior approval of the building commission... the board may sell or dispose of such property as provided by law, or any part thereof when in its judgment it is for the best interests of the system and the state.” There is an exception to this, that being the state utility plants. So not only does this reinforce the limited oversight into the sale of state utilities, but it also gives the board the ability to approve the sale of any state property simply by determining its in the state's best interest. This could include state forests, state-owned parks and wildlife preserves, state commercial-zoned properties, etc. The only restriction, besides the 'best interest' clause, is that if there is a physical building on the property the sale must be approved by the building commission. The Natural Resources Manager in me is picturing clear cutting state forests and hotels in Devil's Lake State Park, but hopefully that is just my pessimism talking. But it is important to consider that this bill does not DISallow that type of activity...
Page 35 deals with insurance, specifically for part-time or limited term employees. The important topic here, in my opinion, is that although this bill no longer eliminates benefits for these employees it does potentially have a major impact on their benefits. Specifically, it allows the group insurance board to modify “the standard plan to establish a more cost effective benefit plan design or providing optional insurance coverages as alternatives to the standard insurance coverage when any excess of required premium over the premium for the standard coverage is paid by the employee”. Allowing modifications based on 'cost effectiveness' is pretty open. Lets face it, the most cost-effective option for the state would be the employees paying the entire insurance bill themselves, and this section essentially, if not explicitly, allows for that. The group insurance board would simply have to accept as the standard plan an insurance policy with so little coverage it is essentially useless and then offer a supplemental plan with decent coverage but highly increased employee contributions. This seems like an end-run allowing the previous exclusion of part-time employees from insurance coverage to still be possible. Unless I am mis-reading this section, “For each participating employee whose formula rate is determined under s. 40.23 (2m) (e) 2., an amount equal to one−half of all actuarially required contributions, as approved by the board under s. 40.03 (1) (e).” it also appears that part-time employees would be responsible for at least half of their insurance costs no matter what plan they choose or is chosen for them. Although it is understandable that part-time employees would pay more for their benefits, I would need to review the current benefit structure to determine if 50% is in line with the current benefits. This section ends with a description of how unused sick and vacation time can be used by a retired employee as 'credits' toward continued coverage of health insurance premiums.
There are lots of sub-sections in this bill, so I apologize if my review seems haphazard at times. In attempting to go through the Budget Repair Bill page by page, the flow of the explanation is not always smooth. As always, if you have any alternative suggestions or comments, please feel free to chime in to the discussion, but remember, I reserve the right to not approve any comment that is abusive, violent, or does not substantively add to the conversation.
The first thing to note on page 22 is that “This section does not apply to the sale of any state−owned heating, cooling, and power plant. Any sale of such a plant is governed exclusively by s. 16.896”. I'll get to section 16.896 soon enough, but keep this exclusion in mind as we discuss the upcoming portions. I'll admit that it's unclear if that means that anything listed in the next sections CANNOT be applied to state utility plants or if that just means that whatever the current process is stays in place. I'm hoping that it's the later, because section 41 of this bill is what authorizes the state to “furnish engineering, architectural, project management, and other building construction services whenever requisitions therefor are presented to the department by any agency”. Any funds received for these services is to be deposited into the general fund as revenue. If utility plants are excluded from this portion and the current procedure is not 'grandfathered' in, this could mean that the state does not have to pay for services to the utility plants. I find it hard to believe that is the intent of this section, if the state is not responsible for state power plant costs then who is? However, alternative interpretations are important to consider, and one alternative is that this portion of the bill essentially cuts off funding for state utility plants. This is more concerning when coupled with the 'sales' provision that will be discussed shortly.
Page 23 discusses the fees that are allowed to be charged to an agency each fiscal year, basically outlining budgets in very rough (no actual numbers) terms. This section does allow departments to charge agencies a 'premium' for certain services, including investigative services, litigation costs, data processing and staff support, and the cost of insurance contracts. Although the charges for these services are to be allocated annually, the bill also allows for departments to periodically assess agencies a portion of the expenses incurred by the department. I assume this is to allow for 'unpredicted' expenses to be 'billed' in a timely manner, such as increased security costs for an unexpected event, disease outbreak, or natural disaster.
Page 24 starts the section that covers the sale of state-owned utility plants. Besides the collective bargaining section of this bill, this is probably the portion that has received the most (but still not much) attention. This section provides the ability for state-owned “heating, cooling, and power plants' (I'll just say utility plants for short) to be sold to or contracted to a private entity “with or without
solicitation of bids, for any amount that the department determines to be in the best interest of the state.” I think the most concerning portion of that sentence is the 'without solicitation of bids' portion. Typically when an asset is being sold the goal is the accept the highest offer on the property. This section would allow that utility plants could be sold without asking for multiple offers, essentially making it a 'first come, first served' type of sale. The argument has been made that the offers that would be received for these plants would be minimal because of necessary technology upgrades and concerns about updates to federal pollution guidelines, but I don't think these arguments alone legitimize not even asking for competitive bidding on the sales. Plus, there is a high potential for abuse in this scenario. With no true oversight allowed for in these sales, it is entirely too possible that the sales would be available first to political contributors and/or that the offers would be outrageously low. Saying that the amount only has to be determined to be 'in the best interest of the state' doesn't really give a lot of guidance into the anticipated purchase price. Plus, the sales are excluded from needing approval or certification of the public service commission, again leaving no true oversight into the sales. Any utility plant sale is “considered to be in the public interest and to comply with the criteria for certification of a project”. The assumption made by this section is that any utility plant sold is a good thing, although it is not outlined as to how that determination was made. I'm assuming the argument is that a private company could operate the plants more efficiently than the current public process, but as there are no provisions for maintaining the current staff after the sale, efficiency changes would have to account for the potential training of new employees, plus there are no provisions the ensure that the cost of the utilities provided would not greatly increase when managed by a private company, potentially costing the state more in the long-run.
This section also states that any outstanding public debt on any utility plants sold would be covered by the net proceeds of the sale. Ideally, this would encourage some competitive bidding as one would assume the state would want to sell the plant for enough to at least cover this debt. However, there is no indication of what happens to that debt if the sale price of the plant does not cover the debt itself. If the sale is still determined to be 'in the best interest of the state', does that debt that is not covered by the sale price then get added to the general state debt? As there is no provision stating sales cannot take place for less than the amount of outstanding debt, this is an important question to answer.
Any profits from the sale of utility plants (after all state and federal debts on the plants are paid off), is to be deposited in a 'budget stabilization fund'. This sounds fine to me, although I would need details as to what the 'budget stabilization fund' is to be used for, how the funds are to be managed or invested, and who is responsible for overseeing this fund. Later in this bill (pages 25-26) it appears that the Secretary is given oversight of any profits from these sales, and any agency that wants to use the funds from sale of utility plants must petition for approval from the Secretary. If an agency's utility plant is sold, they do not have the ability to use the profits from that purchase on agency projects without Secretary approval, even though it appears that the agencies themselves have little to no say in the decision to sell that plant. Essentially, this takes away the agencies plant AND any benefit they might get from the sale. On one hand this could be good as it may minimize the temptation to sell plants for short-term gain, but on the other hand it seems that the agency should see some benefit from the sale if they have no ability to stop it.
The purchaser of any state utility plant is subject to any provision that the state feels it is necessary to place on the sale, including submitting to any rulings of the public service commission. So although the public service commission is essentially unable to weigh in on the sales before hand, they are allowed to chose to oversee the plant after the sale. This seems appropriate, although I'm unclear why they are then excluded for say in the sale if they are later allowed to oversee the plant anyway. If they are good enough to manage it after the sale, shouldn't they maintain that jurisdiction before and during the sale as well? This section also states that unless it is agreed to “between the parties' (I assume this means the state department overseeing the sale and the purchaser), the purchaser of the plant is required to keep them in good repair and continued operation to “provide adequate...power to meet the state's current and future needs”. This avoids someone purchasing the plant just to shut it down and then charge the state facility served by that plant to purchase power from another location. However, if the state and the purchaser agree to closing the plant, that is still a possibility.
The Secretary also has the ability, after the sale of a utility plant, to decrease the number of full-time positions in the plant by whatever number he/she feels necessary. I think the intention is to allow the Secretary to eliminate any positions in the agency that were associated with the operation of the utility plant, so again the issue of training new employees and it's impact on efficiency (and safety) at the plant rears it's head.
Page 27 starts a section that (indirectly) deals with the major collective bargaining section that is later in the bill. Although this section doesn't deal with collective bargaining rights, which is what is getting the majority of the current press coverage of this bill, it does deal with things like collective bargaining notice, administrative costs, studies, etc. This section requires notification of the end of a contract period and the reopening of negotiations, but does not give a time frame for that notification or outline the required methods of notification. Without this being outlined, it is possible that the contract could expire, minimal notice could be give (say, with a single announcement posted on a board down a lightly-used hallway) and therefore discussion would be limited. I'd like to think that wouldn't happen, but the pessimist in me requires that I point out that possibility. Any funds necessary to complete actuarial and other types of studies relating to insurance and retirement must be approved by the secretary of administration. It makes sense that someone would have to approve the distribution of these funds, but I would want assurances that the determination is not made based on political ideals. It is easy to imagine an administration only approving funds for studies done by groups that share their ideological or political beliefs, which is not the way to get accurate or unbiased information.
Page 29 refers to collective bargaining grievance arbitration, stating that agencies will reimburse the state for the costs of arbitration. This section seems a little odd to me, seeing as later in the bill the collective bargaining rights are limited to simply wages. It is possible that there would be arbitration necessary on that topic, but as little else will be available for arbitration it seems almost unnecessary to have the stipulation as to who pays for said arbitration.
Page 30 refers to the refinancing of existing state debt. This is the portion that Gov. Walker believes required that the Bill be passed by Friday, February 25th in order for the debt to be amortized. This section allowed for $474,000,000 to be contracted for debt incurred before July 1, 2011. I have heard the best explanation of this portion is to think about a mortgage. If you have 10 years left on your 30-year mortgage, you have a set payment you make each month. You can refinance that 10 years of remaining debt out another 30 years, your payments each month/year will go down but the overall amount you will pay on this debt will increase because of the interest you will pay for the 'new' 20 years of the loan. In essence, this doesn't reduce your debt, it just reduces the payments you make each month. I can't take credit for that explanation, a Republican explained it to me, but it seemed the clearest way to cover that portion of the bill. Most people have a general understanding of loans and interest.
The bottom of Page 32 introduces the discussion of salaries for appointed positions in government, as long as those appointed positions are not subject to a collective bargaining agreement. I won't go into all the details of what each rank of government is eligible to be paid, but I will say that the pay appears to be based on what the highest rank would get paid, with each rank below that getting a salary range 'one range below' the preceding rank. On one hand this seems appropriate, the higher rank you have in any company the higher your pay scale, in general. However, there is no detail as to what a 'range' is considered in actual dollars and cents, so it is possible that the pay differences could be minimal OR extreme. Also, there is no mention of a potential cap on the salaries of the top rank, leaving a potential for skyrocketing costs if an agency head is appointed at an inflated pay rate. The Secretary of Administration is responsible for approving the funds for the agencies and a 'board' is responsible for reviewing the pay ranges. This board also has the ability to establish salaries for new appointments or increase salaries as they see fit to 'correct a salary inequity or to recognize competitive factors', leaving potential abuse for political appointees to be paid inflated rates.
Page 34 has a provision that is easily overlooked, but I find interesting. “The board shall not permit a facility that would be privately owned or operated to be constructed on state−owned land without obtaining prior approval of the building commission... the board may sell or dispose of such property as provided by law, or any part thereof when in its judgment it is for the best interests of the system and the state.” There is an exception to this, that being the state utility plants. So not only does this reinforce the limited oversight into the sale of state utilities, but it also gives the board the ability to approve the sale of any state property simply by determining its in the state's best interest. This could include state forests, state-owned parks and wildlife preserves, state commercial-zoned properties, etc. The only restriction, besides the 'best interest' clause, is that if there is a physical building on the property the sale must be approved by the building commission. The Natural Resources Manager in me is picturing clear cutting state forests and hotels in Devil's Lake State Park, but hopefully that is just my pessimism talking. But it is important to consider that this bill does not DISallow that type of activity...
Page 35 deals with insurance, specifically for part-time or limited term employees. The important topic here, in my opinion, is that although this bill no longer eliminates benefits for these employees it does potentially have a major impact on their benefits. Specifically, it allows the group insurance board to modify “the standard plan to establish a more cost effective benefit plan design or providing optional insurance coverages as alternatives to the standard insurance coverage when any excess of required premium over the premium for the standard coverage is paid by the employee”. Allowing modifications based on 'cost effectiveness' is pretty open. Lets face it, the most cost-effective option for the state would be the employees paying the entire insurance bill themselves, and this section essentially, if not explicitly, allows for that. The group insurance board would simply have to accept as the standard plan an insurance policy with so little coverage it is essentially useless and then offer a supplemental plan with decent coverage but highly increased employee contributions. This seems like an end-run allowing the previous exclusion of part-time employees from insurance coverage to still be possible. Unless I am mis-reading this section, “For each participating employee whose formula rate is determined under s. 40.23 (2m) (e) 2., an amount equal to one−half of all actuarially required contributions, as approved by the board under s. 40.03 (1) (e).” it also appears that part-time employees would be responsible for at least half of their insurance costs no matter what plan they choose or is chosen for them. Although it is understandable that part-time employees would pay more for their benefits, I would need to review the current benefit structure to determine if 50% is in line with the current benefits. This section ends with a description of how unused sick and vacation time can be used by a retired employee as 'credits' toward continued coverage of health insurance premiums.
There are lots of sub-sections in this bill, so I apologize if my review seems haphazard at times. In attempting to go through the Budget Repair Bill page by page, the flow of the explanation is not always smooth. As always, if you have any alternative suggestions or comments, please feel free to chime in to the discussion, but remember, I reserve the right to not approve any comment that is abusive, violent, or does not substantively add to the conversation.
Thursday, February 24, 2011
Bill Part 1 (through page 21)
I have been seeing many people on both sides of the debate argue that people need to 'ready the bill before they form an opinion'. Well, this bill is currently 144 pages long (http://legis.wisconsin.gov/JR1SB-11.pdf), most of it in legal-eze that is difficult to follow and read. I though it would be interesting to take the bill apart bit by bit and look at it in more detail. Although I will copy-paste some sections out of the bill itself to illustrate what I am talking about, I intend for this mostly to be a 'layman's terms' evaluation of the bill itself. If you want to read the entire legal section, you can find the bill itself on the WI Legislature Website. To start out, I figured it made the most sense to start at the beginning, page 8 is where the summary stops and the actual bill language start.
13.172
In this section, “agency” means an office, department, agency, institution of higher education, association, society, or other body in state government created or authorized to be created by the constitution or any law, that is entitled to expend moneys appropriated by law, including the legislature and the courts, and any authority created in subch. II of ch. 114 or subch. III of ch. 149 or in ch. 52, 231, 233, 234, 238, or 279.
The first portion of this section reaffirms that agencies are supposed to allow their employees to serve as election officials without loss of fringe benefits, seniority, pay, etc. However, it does reference that employees who are part of a collective bargaining unit are subject to the requirements of the collective bargaining agreement. Since, later in this bill, there are provisions that would remove collective bargaining rights from everything but pay, it is tricky to predict how this provision would impact these union employees. It could be that, since the collective bargaining agreement should only apply to pay, their employer will be required to allow them to be election officials. However, if the collective bargaining agreements are still allowed to contain provisions that are not actually subject to collective bargaining, it would be possible for employers to put in punishments for being an election official. I assume that federal guidelines preventing this would still need to be followed, but it is something to be aware of.
Page 9 starts the discussion about agency-owned properties and buildings. The sections of note here are provisions that would exclude agency buildings from being subject to local building codes other than zoning. This means that local governments would have limited ability to enforce local codes and guidelines in regards to building materials, construction supervision, permitting fees, etc. It's unclear, but implied, that this could also restrict the ability of local governments to enforce height, facade, and other restrictions that are often put in to avoid buildings being created that detract from local history or neighborhood design. This could make preservation of historic neighborhoods more difficult. However, allowing state agencies more flexibility in their ability to build facilities that better meet their needs could also avoid duplication of services and/or speed up the approval process.
Page 11 starts the description of several Boards, including the Legislative Fiscal Bureau (LFB) and Group Insurance Board (GIB). The LFB is descibed basically as a state audit agency that has the ability to access any documents of any agency that related to the agencies "expenditures, revenues, operations, and structure". Structure is not defined, so it could mean either the buildings 'structure' or the management/ staffing 'structure', or both. I was actually surprised that with all the other definitions in this bill, 'structure' was not clearly defined. This agency is 'strictly nonpartisan' according to the description, but certain factors discussed later make it impossible to determine how this nonpartisanship will be achieved or maintained. This section also defines a 'quarom' as a majority of the board, which again if the nonpartisanship charge is carried out should not be a concern. The GIB, however, is stated as being composed of 'the governor, the attorney general, the secretary of administration, the director of the office of state employment relations, and the commissioner of insurance or their designees, and 6 persons appointed for 2-year terms". As these positions are either elected officials or appointees, it is difficult to see how nonpartisainship will be achieved and/or maintained.
Starting on page 12 the bill outlines that the secretary and employees of the Department of the Secretary may enter agency offices and "'examine their books and accounts and any other matter that in the secretary's judgement should be examined and may interrogate the agency's employees publicaly or privately". It also states that employees of the agency being examined are required to cooperate with the investigation. These rules are understandable in the case of an audit-type investigation, and outlining every type of information that may be important for the investigation would be impossible and time-consuming, so giving the secretary the ultimate ability to decide makes sense from a time standpoint. However, there are no details outlining what safeguards are in place to avoid a partisanship issue, so the carte blanche ability to demand access could be a concerning consolidiation of power.
Page 14 contains an interesting provision stating “No change in the number of full−time equivalent positions authorized through the biennial budget process or other legislative act may be made without the approval of the joint committee on finance, except for position changes made by the governor”. Although this could mean that the governor could increase the staffing at an agency, it also could give the governor the ability to essential order an agency to decrease staffing without any legislative oversight or committee review. This could create an intersting dynamic of potential abuse, essentially allowing for the elimination of agencies the governor does not approve of/agree with by allowing him/her to limit their staffing to unsustainable levels. A section that appears to have had to potential to limit the ability to abolish positions appears to have been repealed. This section also contains a provision that limits pay increases to those within a predescribed pay range, which could help to eliminate unsustainable raises for employees, but it's unclear if this limit also applies to appointed positions vs. hired positions.
Section 27 (page 16) appears to be an efficiency issue, as it requires simply that any agency that recieves an improper invoice is required to notify the sender within 10 working days. There are no actually penalties listed for not meeting this 10-day requirement. Since many billing cycles are run on a 30-day timeframe, I'm unclear who is responsible for determining if the invoice is correct. The person responsible for sending payments on an invoice may or may not have first-hand knowledge of the project the invoice relates too so they may not be the best person for determining if the invoice is correct. However, designating a person with first-hand knowledge of each project and routing each invoice to that person for review seems like it would be an additional administrative hoop and might be difficult to complete in 10 days. It may be that agencies already have a requirement that invoices must be reviewed by a designated person and this just changes the required time frame, but I don't know that I've got the time or energy to dig through the statutes to find out. Efficiency can almost never be a bad thing, though, right?
Page 17 starts a rather extensive section dealing with how agencies deal with contractors, mostly relating to issues of discriminatory practices. Mostly this section outlines that contractors must not discriminate in their hiring practices, and that if they are suspected of discrimination an investigation will be conducted. If discrimination is found, the contractor is at risk of being placed on a 'black list' of unapproved contractors for future work. However, the contractor may still be paid the contract rate for the job with little to no financial consequence for the discrinimation. If the contractor works in several states, being 'black listed' in Wisconsin may not actually be a great financial burden and may not discourage discrimination. There is a statute in the bill that would allow for the agency to terminate a contract with a contractor in the case of discrimination, but that appears to be a last resort, probably to avoid the increased overhead and administrative costs in getting a new contractor to finish a job already in the works.
So there's my overview of the first 21 pages of Wisconsin's Budget Repair Bill. I'll post an overview of the next 20 or so pages soon. In the meantime, feel free to put forth any additional/contrasting interpretations you may have. Just be aware, I reserve the right to not approve/remove comments that do not add anything to the discussion itself. Statements just saying "Kill the Bill", "Go Walker", or using derogatory or abusive language will not be approved as they do not increase education or debate.
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