Comments to Chamber Meeting of Business, Non-profit and Legislative Leaders 12/16/15

In opening, I’d like to make just a couple of points. They are similar to the points I made to your Legislative Commission on Government Efficiency. There are three legs to the government management stool. The executive and the legislative branches focus too often on two of the three: spending and revenue. The orphan leg is enhanced agency leadership, best-practice management, accountability, which you will hear more about, and transparency, in short, doing more, better, and with the same amount of money.

Even if we amend our outdated tax code, revenue is not going to bloom, nor are social safety net needs going to shrink in the foreseeable future. Our demographic and economic trend indicators simply don’t foresee either. There are examples of doing things better: Dept of Environmental Conservation, Agency of Transportation, and Agency of Human Services are all aggressively trying to improve both process and measure outcomes.

But we have complex legacy systems and a politicized and overprotective work culture that drains resources, even as they offer opportunities for reinvention and cost cutting… if we are willing to take risks.

In public education with Act 46, we are focusing both on quality and cost of education and we must stay the course. Our nostalgia for small and our “local control” mythology only deficit our kids.

In healthcare, aside from our dismal ineptitude at managing IT contracts, we are making process at transitioning from an expensive chain of competing hospitals to an affordable, integrated, and appropriately-scaled healthcare network.

The unsustainable VT State College System and Dept. of Corrections are two examples of complex systems that hide significant opportunities. Intransigent problems often mask significant opportunities.

We spend $160M on corrections and $88M on higher ed., which doesn’t say much for our priorities or our intelligence. Four of our six State colleges are struggling. Luckily, they are geographically dispersed around the state. Could they not become regional hubs of economic renewal by partnering with regional or recruited businesses by expanding customized workforce training and invention in shared lab and classroom spaces, while still offering their signature degrees?

We’re spending $80K per woman, per year to keep women in cages in South Burlington with no path to reentry and most of those women suffer from either addiction, physical and sexual abuse, mental illness or are being held pass their sentences for lack of housing, could we not make smarter use of that $80,000?

What if two of our State Colleges, currently withering and cutting curriculum for lack of enrollments were to custom design a secure reentry curriculum for nonviolent offenders, educating them, offering a redemptive path, and teaching them trades, while maintaining strict oversight and accountability. By paying full tuition to those colleges at $15K per year, giving the offenders a living stipend of $20K, paying a mentor $5K and spending $5k on weekly drug testing and oversight, we would save $35K a year per prisoner and begin reintegrating non-violent offenders back into their families, communities, and our economy. The children of female inmates cost us another $6,000.

Finally, I would remind you that the largest employer in the State is the State, followed by UVM Medical Center, the precarious Global Foundries and then UVM, Shaws, Rutland Medical Center, and Middlebury College. You will note that the lion’s share of Vermont employment is coming from government, education and healthcare. This trend will only continue with current age-birth demographics.

If we want to grow the economy and attenuate expenses in the social safety net, which we know are one and the same, we must break down the silos between the non-profit sector, the business community and government.

In a state of 620,000 people with a declining birthrate, an ageing population, declining college enrollments, shrinking retail commerce, chronic underemployment, and a budget of $5.2B, we can do better than what the Governor asked for yesterday – an increase of $89M in spending. We must assemble the best minds in our three sectors and confront inevitable change and look at new ways to grow our economy and better spend our limited revenues.

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