Establish Statutory Guidelines for State Agency Advisory Committees


The Legislature should establish statutory guidelines for state agency advisory committees and eliminate unneeded committees.


Background
Advisory committees in Texas government are created through a variety of mechanisms including governor s executive orders, statutory creation, agency initiation or board initiation. Many state agencies have the authority to establish advisory committees to au gment agency and board expertise in particular policy areas and to provide assistance to the agency in obtaining provider and consumer viewpoints concerning major agency programs. There has been considerable variation in the way such entities are used and in the level of review of the entities to determine whether their continuation is warranted. A survey of 78 agencies identified 338 committees with a total of 4,035 committee members. These committees operated at an estimated cost to the state of $3.3 mill ion in fiscal 1991.

Advisory Committee Problem Areas
A number of problems and areas of concern were identified with the current use of agency advisory committees, without a periodic concurrent analysis of the continued need for existing committees. For ex ample, in 1984, the Sunset Commission review of the Texas Department of Health (TDH) noted that TDH used approximately 30 advisory committees at the time. In fiscal 1991, TDH reported using 62 advisory committees, more than double the number used eight yea rs ago. A 1991 State Auditor s Office review of the advisory committees established to provide support or information to the Texas Higher Education Coordinating Board (THECB) indicated that 70 advisory committees (five required by statute) comprised of mor e than 1,400 members were established during the 1988-89 biennium. According to the fiscal 1991 survey, THECB reported 61 advisory committees made up of 797 members.

There are several reasons for the use of advisory committees. The Legislature, faced with budgetary constraints, may establish advisory committees by statute as a less costly means of addressing new problems or issues as they occur. Existing committees est ablished by statute, however, can continue until legislation is passed to abolish them. W ith more pressing legislative priorities and often a limited amount of documented expenditures by the committees, there is little incentive to focus on the abolition of statutory committees. Advisory committees may be subject to review by the Sunset Commis sion, but such review generally occurs every 12 years.

A survey of 78 state agencies indicated that few agencies have a reliable system for compiling standard information on all existing advisory committees. Many agencies could not readily report the actu al number of committees in existence, without conducting additional research. Other states have attempted to resolve the growing number of advisory committees while maintaining those that serve a significant state purpose. For example, the Florida legislat ure acted to abolish almost half of the advisory committees serving the Department of Health and Rehabilitation. In Michigan s Department of Social Services, statewide advisory committees have been discontinued. Within Texas, the Department of Insurance ha s imposed a significant control upon the growth in the number of its committees by establishing its own internal sunset date on the committees as they are appointed.

A second problem identified with advisory committees is the lack of a standard method for reimbursing committee members and identifying other costs to an agency for supporting the committees. Some committees are prohibited from receiving compensatory per d iem or travel expenses. Other committees are limited in statute to specific reimbursement amounts for compensatory per diem, travel or both. The Comptroller s Claims Division indicates that the management of the current reimbursement system is complex and costly. For example, when an advisory committee member seeks reimbursement for expenses, the Comptroller s office must research whether the member has been confirmed by the Senate, if this is required, and the appropriate allowable reimbursements, which change from committee to committee.

While Article V of the General Appropriations Act sets out specific standard provisions for state agency employees, agency heads, members of state boards and commissions and members of the Legislature, there is no standard approach for reimbursement of advisory committee members. Data provided by 78 agencies surveyed showed the average reimbursement to members in fiscal 1991 was about $210 per member. Extrapolating the cost of reimbursement to the 4,035 committee members that were identified through a Texas Performance Review (TPR) survey, total reimbursement costs can be estimated at $847,000. In some cases agencies reported that they did not reimburse their committee members.

However, the costs to reimburse committee members for some Texas Education Agency (TEA) and all of THECB committees, while not reported, are indirectly coming out of general revenue. For example, TEA reported that some members were reimbursed from employin g school districts or Education Service Centers. The THECB says it does not reimburse its members; however, these members are most lik ely reimbursed by the institutions of higher education which they represent. Expenses are usually paid out of local funds and the university may, at their option, request reimbursement from general revenue funds to repay local funds. As an example of an ap proach used by other states to control these costs, the New Jersey legislature mandated that reimbursement of advisory committee members be discontinued completely.

Because advisory committees are not routinely funded by state appropriations, they must re ly on agencies for administrative (e.g., printing and facility use) and staff support. For example, TDH reported that their 62 committees made up of 831 committee members spends an estimated $815 per committee member in agency support costs . It is often difficult for an agency to estimate the cost or value of the staff support it provides to its advisory committees, as was found in the TPR survey. The average cost per committee for the provision of administrative and staff support was calcul ated at about $7,370. Extrapolating this figure to the 338 committees that were identified through the survey, agency administrative costs can be estimated at nearly $2.5 million.

A third problem relates to the overall effectiveness of the committees. Agencies generally use advisory committees as management tools to gain useful input in programs and policies; however, unlike other management techniques, such as external audits, an a gency has less control over the results of advisory committees. For example, advisory commi ttees tend to have more of a stake in how the regulations are drafted or how programs are designed than does an outside audit group. In addition, advisory committees volunteer their services and can withdraw at any time without any consequence. Therefore, although an advisory committee can provide useful information and support, the use of advisory committees tends to carry certain risks to the operation of the agency that do not exist in other management approaches. In addition, the agency and its board mu st have a clear idea of what each advisory committee is designed to accomplish.

A fourth problem is that there is often a lack of clear directives concerning how committees are appointed and their relationship to the policy-making role of agency boards. For example, because statutory guidelines and agency rules typically do not clarif y the role of advisory committees, input into the policy-making process made by an advisory committee can occur too late to be meaningful. In an earlier study conducted in 199 1 by TPR of 112 health and human services advisory committees, it was found that only 71 committees were created in statute, and of those, only 21 had well-specified expectations and requirements built into their statutory language. This language was typic ally characterized by a requirement for a specific product and a specified time frame in which the product should be completed. The remaining 50 committees were characterized by general statutory language which established no clear directives or role for t he committees. Furthermore, the fiscal 1991 survey results revealed that not all advisory committees furnish reports or recommendations of committee activities and accomplishments to their executive directors, commissioners or other elected officials.

A 1991 study by the State Auditor s Office of THECB s use of advisory committees suggested that advisory committees were the primary input in determining the information to be managed by THECB. While advisory committees allow THECB an opportunity to include institutions in the decision-making and planning processes, the auditor concluded that the advisory committees may overpower the use of strategic planning as a management tool. The State Auditor s Office concluded that the reliance on narrowly-focused advisory committees appears to dilute the effectiveness of the management information role by focusing on a particular function while overlooking the comprehensive needs of other users.

A final issue that relates to the effectiveness of advisory committees is the size and composition of the committee. The notion that decision making is most easily conducted when decision-making groups are reasonably small in size is generally accepted. While there may be exceptional reasons for appointing large committees, the size of the committee could interfere with effective decision making. There is also no standard requirement for the composition of advisory committees. For example, TEA has an average of 24 committee members per committee. The Textbook Proclamation Adviso ry Committee has reduced its membership from 148 in 1991 to 75 in 1993; however, the State Textbook Subject Area Committees increased their membership from 150 in 1991 to 180 in 1993.

For the continuation of a distinct board, commission or advisory committee to be justified, several criteria should be met. First, the entity must be providing an essential service to the state and/or the public. Second, the establishment of the entity and delivery of services through the entity must be the most effective and efficient way for the state and/or the public to receive the service. Generally, when another agency exists that performs the function or could perform the function at the same level of quality, there would need to be a compelling reason to set up new ent ities outside of or in addition to existing structures.

While there may be significant policy reasons for the establishment of a separate entity many forces within the state could ultimately hinder the success of the entity. For example, a board may be es tablished by statute with specific duties, but fail to receive funding to carry out its mission. Occasionally, an entity is established for the purpose of responding to anticipated federal funding or a known or anticipated state problem. Changes in the eco nomic, political or social environment could render the original purpose of the entity obsolete. Some boards are established to solve a current problem. Occasionally, the problem will be resolved or greatly alleviated and the need for the entity to continu e ceases. The TPR identified a number of entities that could be discontinued for one or more of the reasons discussed above.


Recommendations
A. To help control the growth in the number of agency advisory committees, limit costs and provide for better fiscal accountability for the committees in each agency, general state law should be amended as follows:

1. State law should be amended to prohibit the compensation of statutorily or agency-created advisory committees for services or reimbursement for expen ses incurred including travel or other business of the committees, except as specifically provided for in the General Appropriations Act. State agencies should request authority through the appropriations process to reimburse members of advisory committees they appoint. This recommendation, however, gives the Legislature the ability to determine the method of reimbursement that should be used for the committee members and permits better standardization and oversight of reimbursement methods.

2. The Governor s Office and the Legislative Budget Board should work together to identify advisory committees to be eliminated and recommend the reduction in the appropriations of each applicable agency from the General Revenue Fund or other applicable funds. If these agencies are not identified, the Comptroller of Public Accounts should be authorized to develop reductions in agencies budgets to achieve projected savings of $900,000 as estimated below.

3. State law should require agencies to put into place mechanisms for compiling information regarding advisory committees, including determining the costs to support advisory committees.

B. To address concerns identified regarding the overall effectiveness of the committees, state law should be amended as follows:


1. State law should require each board or commission of an agency with advisory committees to develop by rule a policy statement regarding the purpose of each of its advisory committees and how each advisory committee will report to the board or commissio n regarding the committee s work and performance.

2. In addition, agencies creating advisory committees should be required to establish a sunset date for each committee. As part of the internal sunset review, agencies should analyze the cost-benefit of the committee and abolish committees that have fulfilled their purpose or no longer serve a useful purpose.

3. State law should require that agency- or board-appointed advisory committees should be kept to a reasonable size that does not inhibit the dec ision-making ability of the committee and that the advisory committee should be structured in such a way as to provide for a balanced perspective of industry and consumer experts.

C. To address the need to abolish unnecessary advisory committees, the following entities outlined in Table 1 should be eliminated.

Table 1 - List of Committees Recommended for Discontinuation

Advisory Committee Number Recommended
(Affiliated Agency) of Members Action Reason

1. Transportation Audit Committee 50 Abolish The committee was given a charge to issue a report in 1985; the report is completed. The committee does not meet.

2. Campaign Finance Reform Unknown Abolish The task force has completed its duties. Task Force No need to continue.

3. Committee on Water Resource Unknown Abolish The committee completed its duties and is no longer needed.

4. Health Maintenance Organization 10 Abolish This committee has not met since July 13, Advisory Committee 1989. (Department of Health)


5. Criminal Justice Education Unknown Abolish The committee has not met in recent years.
Project Advisory Committee

6. Task Force on Public Utility 9 Abolish Task force has completed its work.
Regulation

7. Task Force on Waste Management Unknown Abolish Task force has completed its duties.
Policy

8. Texas Science and Technology Unknown Abolish Created in 1984, need no longer exists; other Council avenues available on an ad hoc basis for con- sultation if needed.

9. Texas State Complete Count Unknown Abolish Committee has completed its duties.
Census Committee

10. Welfare Reform Task Force Unknown Abolish Task force has completed its duties.

11. Design Advisory Panel 10 Abolish Members meet to advise the commission on (General Services Commission) the design concept and aesthetic merits of building plans. Other avenues exist for obtain- ing advice when needed.

Implications
The recommendation will require agencies and their policy boards to analyze the purposes and desired outcomes of its committees. The required evaluation process will force the periodic consideration of the work of each committee and the need for its continued operation. The result should be an overall decrease in the numb er of agency advisory committees and a concurrent decrease in state costs.


Fiscal Impact
The direct and indirect costs associated with maintaining the 338 advisory committees identified by the TPR survey is estimated at $3.3 million. This estimate does n ot include the total number of advisory committees in the state, nor does it include the number of advisory committees that were established in fiscal 1992. If 50 percent of the reimbursement costs to the committee members are eliminated, approximately $424,000 could be saved. In addition, if agency administrative and staff support costs could be reduced by 20 percent as a result of the reduction in the number and size of committees, additional savings of nearly $498,000 co uld be realized.

Total savings would amount to more than $900,000 per year when fully implemented. Savings estimated in this recommendation will be achieved in part by the efforts of the Governors office and Legislative Budget Board in identifying advisory committees to be eliminated which will result in reductions of the appropriations to each applicable agency from the General Revenue Fund and other funds.

Fiscal Savings to the Savings to Other Changes
Year General Revenue Fund 001* Dedicated Accounts or Funds* in FTEs

1994 $540,000 $360,000 0
1995 540,000 360,000 0
1996 540,000 360,000 0
1997 540,000 360,000 0
1998 540,000 360,000 0

* The savings will come from a number of different state agencies budgets. Sixty percent savings
were estimated for General Revenue and 40 percent savings were estimated for other funds.