Governor Requires Agencies to Prove Consulting Needs

By MIA GOLDBERG

Governor David A. Paterson has issued an Executive Order tightening the standards for hiring private consultants by state agencies that could save millions of dollars a year.

THOMAS DiNAPOLI: Consultants not always the answer.

"I want to make it clear to the citizens of New York and also to our government leaders that we face serious economic difficulty in the coming months and years. Particularly in these challenging fiscal times, we must closely scrutinize every spending choice our state government makes," said Governor Paterson. "Agencies should only use contractors if it is clear they are necessary or will provide savings to taxpayers. This Executive Order will help to ensure that."

'Must Be Justified'

As part of the order, a task force will be created to review all private consulting contracts whose personnel costs exceed $1 million annually. "The order only recommends the use of outside contractor work if the contractor will be more cost-effective, efficient or necessary to protect public health and safety," according to a statement issued by Mr. Paterson's office.

Agencies that enter into these contracts must justify within 10 days their reasons for hiring private consultants rather than state employees - information which must also be made available to the public and posted on agency Web sites to improve the transparency of the process. The task force will meet at least four times a year to evaluate and make recommendations for each contract. Beginning Oct. 1, 2009, the findings will be publicly reported annually.

State agencies employed more than 23,000 private consultants between 2006 and 2007, according to a report by the Office of the State Comptroller, at an estimated cost of $704 million. "Our audits have found that the use of consultants isn't always the most efficient use of tax dollars," State Comptroller Thomas P. DiNapoli said in a statement.

PEF Advocated on Issue

The Governor's order was applauded by the president of the Public Employees Federation, Ken Brynien. At an Albany rally last month, Mr. Brynien said that the state could save $765 million over the next three years by using state employees rather than private contractors. An OSC salary comparison found that the state Insurance Department pays private consultants $184.29 per hour on average, the highest of any state agency. The average rate for a PEF member employed by the Insurance Department is $48.48, yet the ratio of private vs. public workers is nearly 4:1.

"This is a great day for New York state taxpayers and its public servants," Mr. Brynien said in a statement praising the Executive Order. "It ensures the taxpayer gets the best value and it's an acknowledgement of the efficiency of public employees."

Mr. Brynien said that much of the savings could come just by replacing information technology and engineering consultants - the two agencies the task force must "specifically examine" under the Executive Order, since the use of consultants is particularly widespread in those areas.

PEF is the state's second-largest state-employee union, representing 58,000 professional, scientific and technical workers.