Like Rose, who finally let go of her frozen lover Jack’s dead hand in the 1997 film Titanic, so too should the remaining people who think the State Contracting Standards Board (SCSB) is still a good idea finally let it go.
The Mirror on February 17 provided a good history of the travails of this failed enterprise. The failure is not the fault of those at the SCSB who have managed to valiantly keep going despite the lack of support. It’s hard not to feel bad for these people. Some believe their work is helpful. Their guiding statutes reinforce the perception of doing good, but even were the SCSB fully funded, it would have a net negative impact on government operations.
The SCSB was born like many laws and entities: as a political necessity in 2007 to “do something” after a scandal, horrendous crime, or disaster. In this case it was the crimes of the Gov. John Rowland administration which involved kickbacks, finders’ fees, and falsely justifying laying off unionized state employees in favor of private contracted workers. Doing something appeases the critics, puts changes on the books and then people can feel like they did something. If some political goals can be met, by all means proceed and ignore the complaints about sections of the bill that don’t seem relevant.
As an example of doing something in response to a crisis that turns out differently than intended, consider the following:
It is nearly politically undisputed today that the Anti-Drug Abuse Act of 1986, aka the crack cocaine laws, (passed by an overwhelming combined House/Senate vote of 489-18) and the later Violent Crime Control and Law Enforcement Act of 1994, aka the truth in sentencing laws, (passed by a narrower combined vote of 296-233) were if not out rightly racist in certain effects, were at least unintentionally racist by hitting Blacks hardest.
These laws were a reaction to a crack epidemic and burgeoning violent crime. At the time they were seen as important and necessary steps and certainly the Anti-Drug Abuse Act (the one that is considered more racist) was almost universally applauded. But the laws significantly increased the prison population where those with a minor criminal history could learn all day long from hardened criminals; while rehabilitation and job skills for those who will eventually re-enter society was de-emphasized.
Today, most people agree, at the least, that these laws could have been handled better. Oftentimes, a politically reactive law goes on the books, people feel better, and the law sits there harmlessly unused. But in other cases, these laws can do more harm than good.
And so it was with the SCSB. The bill proposed in 2007 had an attractive sounding title: “An Act Concerning Clean Contracting Standards.” We certainly want our contracts to be clean, clean, clean. Such as this “clean” requirement taken from the analysis prepared by the non-partisan Office of Legislative Research (OLR): “It requires all state contracts that take effect on or after the act’s passage to contain provisions to ensure accountability, transparency, and results-based outcomes.” Unopposable.
In reality however, the above was just one section of a 53-page, 14,989-word bill that was a duplicative hodgepodge of other agency’s duties as well as confusing and onerous bureaucratic policies and procedures. OLR rarely strays into language that sounds critical of the Legislature but in their summary of this law it wrote: “The act requires the board to ‘define the contract data reporting requirements to the board for state agencies.’ Although it is unclear what this actually means, it may mean that the board must inform state agencies of their duties to” report data on the number/type of state contracts, their client agencies; contractors’ names; the contracts’ terms/dollar values; services purchased, evaluations of performances, including suspensions or disqualifications and all contracts awarded without open competition, including the reasons and the names of the authorities that approved them.”
And this is only one small section of the law. Section C.G.S. Sec. 4e-16 (part of the codified public act) turns the contracting process over from state agencies to the SCSB and establishes an arduous set of cost-benefit rules, submittals, deadlines, and evaluations of agencies’’ proposed contracts. Agencies must submit their “new” contracting business case to the SCSB which gives it to its Privatization Subcommittee for a recommendation. The contract must ultimately be approved by the SCSB. It also allows a union to prepare a counter proposal under high cost privatizations. All with timeframes in between them all sucking away time, effort and resources. Reading the section will make your head spin.
How would you like to be the state worker/manager responsible for putting this and a bunch more requirements together every time you are expected to deliver a change, or improvement or required to expand agency duties? If you can, you will go with hiring state workers to avoid the stress, red tape and time drain. If you can’t reasonably avoid it, you will likely dread the decision to go with a contractor. Note that the SCSB law, like many laws – such as even the ability to unionize – excludes the legislative branch from having to live by them. Policy makers know they don’t want their work be slow and inefficient.
The solution to people breaking laws is to penalize or prosecute them. What Rowland and State Treasurer Paul Sylvester did was against the law, they were caught, and they both went to prison. When the Rowland administration laid off unionized state employees allegedly due to budget shortfalls, the unions sued and years later won their case. Doesn’t that mean the system worked? Unfortunately, people being human as they are, have always broken laws and will always break laws under any system.
Deterrence efforts such as the SCSB have an effect but it is counterproductive one. Maybe some wrong doing will be avoided (that’s good) but the cost to state operations is immeasurable (that’s bad). This is why Democratic administrations have opposed its staffing. I am sure that OPM, the right arm of the Governor, many of whose duties the SCSB usurps or duplicates, and who oversee executive agencies and hear the griping, is a prime opponent of the Board’s existence.
Another problem is that the law was intended to strengthen a key Democrat constituency – state unions (hence the almost party line vote in the House in 2007). Some Democrat legislators even aside from the union support believe in the Board’s usefulness but that is because they are policy-makers not executors – they make policy and don’t have to actually run the government like the Executive does. The Executive oversees many of the functions that are listed under the SCSB’s duties – that was destined for long-term failure.
Also, the current Board of 13 is made up of 11 Democrat appointments to two Republican appointments. According to the Mirror, one third of the appointees have ties to organized labor. Yet some Republicans have also signed onto the need to fund the Board and not weaken an important watchdog agency citing two developing potential Lamont scandals: the Colangelo/Diamantis hiring issue and the development of the New London Pier.
Such a stance by Republicans is just shortsighted politics in advance of the upcoming Governor’s race. The hiring scandal would never even have crossed the desk of a fully operational SCSB and the developing pier story was uncovered by the local newspaper. The SCSB would not have been involved. And if investigation rather than discovery is the aim, there are a myriad of ways to investigate. Both these scandals are already being officially investigated.
Contractors who generally employ non-unionized people have much more flexibility with their workforce and can achieve goals more quickly. Remember during the spring of 2020 when the CT Department of Labor’s computer handled pandemic unemployment checks? It “crashed four times… [and] follow-up calls” were “futile…because nobody picks up the phone or … the call drops.”
No, this doesn’t mean that some businesses will not charge what seems to be excessive and will seem to have too many sales people and executives. But here is the immutable problem: sometimes it’s better to hire people on staff, on-site full-time, potentially more invested in serving their fellow co-workers (sometimes not) along with future expertise on-site. But sometimes it’s better to hire contractors who tend to have more flexibility, are more likely to be advanced in their field to build a project, program, or computer system which enables them to complete projects faster. Compare this to their government counterparts mired in paperwork and fearful of criticism.
The right choice between the two is a case-by-case decision made by informed people at the agency level with some supervisory oversight (OPM). The legislature can also exercise its review ability at any time. That is what state managers are paid for: to make the calls on what will work best and what won’t. They won’t always get it right even with supervision – they are all human. Some level of that just has to be accepted.
I suspect that private sector managers make about the same number of mistakes as government managers but you don’t hear about those because the internal operations are private. According to the Bureau of Labor statistics only 55% of businesses make it to year five and only 25% of businesses make it to year 15. Government doesn’t have that option – they have to stay open. Plus, government workers never produce scandals anywhere near the size of Enron, Wells Fargo, the subprime mortgage crisis, etc.
There is no perfect system. But one built on duplicative duties is guaranteed to produce problems.
Alan Calandro is a former director of the Legislature’s nonpartisan Office of Fiscal Analysis.