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February 11, 2003
GovPro Newsletter
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Tuesday, February 11, 2003

Volume 2, Issue 4

Welcome to the GovPro Newsletter brought to you by the Penton Government Media Group. Look forward to news, resources, product and supplier information, and links relating to the government market.

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CONTENTS

-Blood From a Turnip: State Budgets

-PAs Plastic Problem

-Happy Campers

-News of the Weird

FEATURES

BUDGET SQUEEZE FIRST ON NCSL TOP TEN ISSUES FOR 2003

Blood out of a turnip. Toothpaste from a flattened tube. Water from a stone. Gold from a miser. Add a new item to the "tough things to squeeze" list: state budgets in 2003.

The National Conference of State Legislatures (NCSL) in its forecast of the top 10 state legislative issues for 2003, notes that state legislators around the country will have a common dilemma this year. Declining revenues and growing demands will cause each of the 50 states to make tough budget choices as they attempt to close an estimated $17.5 billion budget gap in the next six months and craft a balanced budget for what is expected to be a leaner fiscal year in 2004.

"State legislators will have to make important decisions on health care, education, election reform, sentencing and homeland security issues this year," said William T. Pound, NCSL's executive director. "But every issue state lawmakers debate this year will be influenced by the budget."

Legislatures in all 50 states will convene next year, 42 of which begin before January 21. About 1,750 new state legislators will take the oath of office this year, the highest turnover in at least 30 years, due in part to term limits and redistricting. Also, 120 of the top 320 state legislative leadership posts will be taken over by new legislators this year.

NCSL ranks 2003 issues:

Budgets--States will be working to erase at least a $17.5 billion shortfall between now and the end of the fiscal year. This comes after erasing nearly $49 billion already this fiscal year. Two-thirds of the states report revenue collections below forecasted levels in the early months of the fiscal year. Nearly every state has a balanced budget requirement.

Sales tax structure--States have taken the lead in developing a blueprint for streamlining sales and use tax collections across the country, a move that would help local retailers stay competitive with online businesses. States and local communities lose an estimated $16.4 billion annually in sales and use tax revenue to online sales.

Education reform--With the enactment of the No Child Left Behind Act of 2001 by Congress, states must find ways to meet federal requirements that include subject testing, yearly progress reports, and reaching minimum proficiency levels. The lack of a federal budget agreement leaves states in a quandary on how to reach those goals.

Rising health care and Medicaid costs--When the economy goes down, state health care costs go up. Medicaid accounts for about 15 percent of the average state's general fund budget. Increases in health care and prescription drug costs combined with flattening revenue projections will force state legislatures to make tough decisions, especially when it comes to Medicaid spending.

Election reform--States must comply with the Help America Vote Act, passed by Congress last year. The act requires states to meet minimal standards by 2006, yet Congress has not appropriated money to the states to pay for those mandated reforms.

Homeland security--State efforts to respond to threats of domestic terrorism continue in 2003. Legislators must decide whether to sacrifice other programs in order to pay for terrorism and public health defense efforts.

Crime and sentencing-- Due to two recent U.S. Supreme Court decisions, states will need to rethink their approach to the death sentence. With correction costs under close scrutiny, states may consider treatment and rehabilitation instead of incarceration for first-time drug offenders.

Clean air and the environment--With air quality reaching levels poorer than at any time in the last decade and water demands increasing due to severe droughts across the nation, legislators must weigh the potential costs and benefits of short- vs. long-term consequences.

Welfare reform--While states wait for Congress to appropriate federal block grants for the Temporary Assistance to Needy Families (TANF) program, the economic climate will require them to look for savings in state welfare programs.

Privacy--A national security crisis, increasing use of the Internet, sharing of health records and the question of employers' rights to gather information on employees, continue to make privacy issues a hot topic in legislatures. More than 400 bills related to Internet privacy were introduced in legislatures in 2002, with more action expected this session. Also, expect more legislation to control e-mail spam.

NCSL is the bipartisan organization that serves the legislators and staffs of the states, commonwealths, and territories. NCSL provides research, technical assistance, and opportunities for policymakers to exchange ideas on the most pressing state issues and is an effective and respected advocate for the interests of the states in the American federal system.

STATE AUDITOR URGES P-CARD OVERHAUL

If you think there's no such thing as a free lunch, you probably don't work for the Pennsylvania Department of Transportation. In one year alone, PENNDOT spent at least $87,500 on catered lunches, breakfasts and snacks for PENNDOT employees and others, according to the preliminary results of a special audit released today by Auditor General Robert P. Casey, Jr. At the same time, PENNDOT officials spent at least $62,500 on embroidered shirts, jackets, patches and tote bags, and at least $78,000 on fancy business accessories, novelties and gifts-including engraved business card holders and squeezable stress relievers in the shape of convertible cars.

Casey's audit-which began in September 2002 and is ongoing-is examining PENNDOT's use of over 1,000 Commonwealth purchasing cards between June 16, 2001 and June 15, 2002. Casey took the unusual step of releasing his preliminary audit findings now so that Governor Ed Rendell and PENNDOT Secretary Allen Biehler could begin taking corrective action immediately, rather than waiting until the audit is completed. Casey today also released a summary report of four additional purchasing card audits he conducted covering 1998-2002.

"To date, our PENNDOT audit has found that nearly 70 percent of the credit card purchases we sampled were abusive, improper or excessive and served no public purpose," Casey said. "Their only purpose was to promote PENNDOT and to feed, clothe and entertain its employees. There is absolutely no justification for spending taxpayers' money on the personal expenses of state employees.

A review of invoices from just 41 vendors has uncovered at least $252,000 in questionable purchases for food, clothing and frivolous novelties. In addition to designer golf balls, beach bags and buttermints, PENNDOT officials spent over $500 in public funds on a giant pair of ceremonial scissors.

Casey said that these purchases appear abusive, based on the nature and excessive cost of the items and the volume and frequency of the purchases. Other expenditures for gifts and novelty items also appear improper because the purchases apparently were split in order to evade the Commonwealth's $3,000 limit on Purchasing Card transactions.

"Unfortunately, PENNDOT's spending abuses are not isolated incidents," Casey said, "but rather, part of a disturbing pattern in the executive agencies that participate in the Commonwealth's Purchasing Card Program."

Casey has previously audited the program as operated within the Departments of Agriculture, Conservation & Natural Resources, Corrections, and Labor & Industry (Bureau of Labor Law Compliance). The 21 findings contained in those audits exposed over $1.2 million in abusive, improper and inappropriate spending for things like personal cell phone calls, fine china and crystal, casino trips and digital cameras.

Since the program began in 1997, cumulative expenditures have exceeded $500 million, growing from $2.05 million during the 1996-97 state fiscal year to $145.42 million during the 2001-02 state fiscal year.

"Fundamental reforms to the operation of the Purchasing Card Program could generate a significant amount of cost savings for the Commonwealth at a time when such savings are both sorely needed and difficult to identify," Casey said.

In the one-year period that Casey is auditing, PENNDOT had at least 588 cardholders who used at least 1,097 purchasing cards for over 162,000 transactions totaling approximately $43 million. (By way of comparison, the Department of the Auditor General has just one purchasing card assigned to the office director responsible for the department's purchasing.)

NEWS

SENIORS AND KIDS ENJOY CAMP

Because many seniors have become the primary day care providers for their grandchildren, especially in the summer months when children are home from school, the Baltimore County Department of Aging, in partnership with the Baltimore County Department of Recreation and Parks, the Commission on Arts and Sciences, Senior Citizens, Inc. (a nonprofit organization created to benefit needy seniors), and a grant from the Weinberg Foundation, sponsored a countywide intergenerational summer camp for grandparents and grandchildren.

The camp solved a number of problems. Senior citizens were able to enjoy their senior centers, and bring along their grandchildren. They could either be involved in a guided activity along with their grandchild as a part of the camp or they could do their own senior activity at the center knowing that their grandchild was being well-cared for by responsible staff, which consisted of one camp director and an assistant. These employees were hired and trained by the Department of Recreation and Parks and provided supervision, guidance and direction at all four locations.

Minimal attendance fees helped seniors living on fixed incomes, and allowed everyone to participate. The total attendance for the camp, including seniors and children, was 731 participants for all four locations. The cost for the camp, which included supplies at each location, transportation, special events, administration, and staff salary, was $14,000.

THOUSANDS TO PUT THEIR HANDS TO WORK FOR AMERICA

On September 20, 2003 thousands of volunteers will gather at National parks, monuments, wildlife refuges, forests, grasslands, marine sanctuaries, lakes, and reservoirs for the National Public Lands Day. Lands belonging to and enjoyed by all Americans will be refurbished, restored, or otherwise improved and enhanced in a singular, day-long country-wide effort called National Public Lands Day.

The event is the largest annual grassroots, volunteer activity mounted on behalf of America's special public places each year. In 2002, 11,000 trees, shrubs, and flowers were planted; 700 tons of trash collected; 78 miles of trails built or refurbished; and 400 birdhouses installed or painted as part of the effort. In all, more than $10 million in real work was accomplished. Event slogan is Helping Hands For America's Lands. The effort is directed by the private, nonprofit National Environmental Education & Training Foundation in conjunction with various other nonprofit organizations and federal, state and local public land agencies.

For information on the location of more than 500 sites, with at least one in every state, visit: http://www.npld.com or call 800-VOL-TEER.

NEWS OF THE WEIRD

Bizarre but true stories about real people.

http://www.govpro.com/GPRONewsletter/Article/28070/

LINKS

SNOW PLOWS AND ACCESSORIES

Meyer is the world leader in snow plows plus accessories, parts, spreaders, and controls for plows. Custom-designed Meyer snow plows fit exact vehicle frame and weight specifications.

http://www.meyerproducts.com/

C & H Distributors provide a fast, efficient way to purchase shelving, cabinets, packaging and shipping products, or office furniture. Visit: http://www.chdist.com/govt

Safety Storage manufactures prefabricated heavy-gage steel products and custom engineered building systems. Visit: http://www.safetystorage.com/

BENEFITS-DRIVEN PROCUREMENT, FEBRUARY 26, 27

World Research Group is pleased to announce its Benefits-Driven Procurement conference, scheduled for February 26-27, 2003 in Las Vegas. For more information, e-mail liz@worldrg.com.

PRODUCT SPOTLIGHT

M.L. Kishigo: Brite Threads high-visibility workwear.

http://www.mlkishigo.com

New Hermes: Engraving materials and technology.

http://www.newhermes.com

Pelican Products, Inc.: Lighting instruments and water-tight protector cases.

http://www.pelican.com

R.J. Thomas Mfg. Co.: Pilot Rock park and recreation equipment.

http://www.pilotrock.com

Sound-Craft Systems: Lecterns and presentation furniture.

http://www.sound-craft.com

Find information on advertising in the GovPro Newsletter on http://www.govpro.com or contact rhowlett@penton.com.

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