Efficiency and Accountability in State Government

Yesterday at the State House, the Senate unanimously approved significant, fundamental changes in how state government operates. I am proud to say we passed legislation I filed in April to update the Commonwealth’s antiquated finance laws and implement performance measurement requirements for all government agencies and programs to improve efficiency, transparency and accountability.

The laws governing our state finances have never received a comprehensive update, and it’s about time we do it. It’s also time we start requiring all state-funded agencies and programs to measure performance and outcomes, and invest only in those that are meeting their goals and are performing at a high level. If we’re putting taxpayer money in, we need a better idea of what’s working and what isn’t. That’s what this bill does for us.

The legislation requires government to use data to regularly evaluate the productivity, successes and failures of agencies and programs, and it establishes a special commission to make decisions about the ongoing need for existing state agencies and boards based on their core missions and performance.

By updating finance laws from the early 1900s to reflect how we do business today, the bill pushes government agencies toward electronic accounting and reporting with the elimination of outdated paper-based systems. It also moves the Commonwealth away from traditional “maintenance”-based budgeting with a requirement for “zero”-based budgeting.

In zero-based budgeting, instead of relying on the previous year’s budget as a starting point, a budget starts from zero and builds to a number that reflects performance data and the evaluation of current needs and functions. Specifically, this bill requires the governor to file a zero-based state budget starting in fiscal year 2017 for the first year and then at least once every four years after that.

The bill also requires the distribution of unrestricted local aid monthly rather than quarterly beginning in fiscal year 2013 to help municipalities better identify their available cash flow while also reducing the state’s reliance on short-term borrowing.

This reform legislation is a major and unprecedented step for Massachusetts and has received high praise from business groups, including the Associated Industries of Massachusetts, which called the plan “a significant and constructive contribution toward reshaping state government to meet the challenges of our times,” and the Massachusetts Competitive Partnership, which said the legislation “will help make our Commonwealth much more effective and efficient in the future.”

The bill is good policy for the Commonwealth, and I am hopeful the House will take it up soon and we can get it to the Governor for his signature.