House Bill 1062 – Rep. Micon:
Creates the privatization review committee (committee). Requires a state agency to develop a privatization plan before privatizing any state program. Requires a state agency to hold a hearing on the plan and report the results of the hearing to the public and the committee. Requires the committee to: (1) review a privatization plan before the plan is implemented; and (2) make advisory recommendations to the governor. Provides that a privatization contract may not extend beyond June 30 of a year in which a governor next takes office.
The committee consists of 3 members each from the majority and minority parties of the House and Senate (total 12) as well as 1 labor representative, 1 business representative, and 1 university representative (all 3 of whom are to be appointed by the legislative council.)
Before a state agency privatizes, it would have to prepare a plan that lists the program’s revenues and expenditures for the past 2 years, a list of the state employees currently administering the program and the estimated effect of privatization on the employee; a list of the program’s assets and proposed disposition; an estimate of the cost savings or additional costs from privatization; an estimate of changes in individual wages and benefits; description of how the proposed privatization will deliver the same or better services at a lower cost; and information on whether the contract is going to an out of state business. The committee will hold a hearing on the plan and provide an advisory recommendation to the governor. Finally, a privatization contract cannot extend beyond June 30 of the year in which the next governor’s term begins.
I’m not a privatization advocate by any means, but this seems to go overboard in the other direction. A governor takes office, directs a privatization plan to be created with information that makes privatization politically unpalatable at best, and then a hearing has to be held and then the contract can’t extend beyond the Governor’s current term of office.
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O.k., the above were my thoughts initially, but I just read a detail that makes the plan much more palatable to me — it applies only to contracts with a total dollar amount in excess of $15 million. I still think limiting it to the current governor’s term is probably unduly restrictive, but if $15 million is involved, the rest of the safeguards probably are not unduly burdensome. I’d probably put the time limitation at something like a 10 year cap. Sure, it ties the hands of the next governor, but I think that to remain practical, some possibility for longer term deals have to be available. On the other hand, tying up state assets for generations (75 years in the case of the Toll Road) is unacceptable as well.
[tags]Privatization[/tags]
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