Cost Saving Measures

 There are three major areas where substantial cost savings can be realized, as well as miscellaneous areas where savings should occur.

1. Consultants/Contracts Expense

2. Commonwealth Vehicles

3. Workforce and/or Scheduling Adjustments

1.Consultants/Contracts

·         Computer Systems Consultants, in general should be eliminated and the work brought into the commonwealth.  With technological advances and computer software designs becoming more and more necessary, why does the Commonwealth continue to hire consultants and then remain obligated to that consultant for systems’ maintenance and upgrades when they could hire designers to create what is needed and maintain and upgrade in-house. 

·           In SWIF, there are two contracts for the same service, and it can be done by commonwealth employees.  They are the  Med Risk and IMC contracts for SWIF.  SWIF has contracted with both IMC ( Physician to Physician Case Management) and Med Risk (PPO Services) to provide services designed to ultimately get the injured worker back to work. Only one of these contracts is needed. At a cost of $5 million for each contract, the cancellation of one would save $5 million dollars.

o   The problem that SWIF is going to run into is that the IMC physicians are going to be contacting the Med Risk providers which will cause confusion because the PPO in and of itself sets standards and treatment guidelines that reduces the risk of over treating injured workers.

o   Because these guidelines and standards are already established under the PPO there is no need for IMC to be contacting the PPO providers trying to direct the claimant care. 

·         Both of these companies are designed to do the same thing. It is not logical that SWIF would knowingly enter into contracts with 2 different vendors to try and accomplish the same result, particularly when their own employees can do the job.

One commonwealth employee states:  “I have worked for almost 17 years and have paid my own bills and investigated my own claims in all that time. We could save money there by allowing us to continue to do our jobs.”

·         In Penn Dot, Consultants get paid no matter what the quality of the work is, and they are typically paid higher to do work the department could do cheaper if the complement was increased. There are many instances where plans have come to the department from a consultant to be checked and are marked up and sent back. After the corrections are made, the consultant sends it back for checking again. The plan is checked and there are still a lot of mistakes meaning the plan has to be sent back again to be revised. This goes on until it is either resolved or just “pushed” through to meet the letting date. One of the reasons for this is consultants have to know the standards for various states and also do work for many other facets. No one has a good understanding of what the department standards are. If department personnel do the work, since they have more knowledge of what is expected, they can remedy issues sooner with less time and resources       

Trash collection contracts

·         Every agency contracts trash collection individually. Why not contract with cities/boroughs/townships for all agencies?

 Snow and mowing removal

·         Why can’t Penn DOT do snow removal, mowing, rather than have agencies contract out

2. Commonwealth Vehicles

    Unless commonwealth vehicles are used, by the employee, for travel from home to various work locations, as typically done by field employees, the vehicles should be parked at headquarters and picked up there for use for commonwealth business.  A few examples of abuse of commonwealth vehicle use follow.

·         In Agriculture, there are managers that travel long distances from their home to headquarters, on a daily basis, using these taxpayer vehicles at very little cost to themselves, but at substantial cost to the commonwealth.

·         In DCNR, management employees have full size, diesel trucks. Why is this necessary?

·         In Probation and Parole, the Board Secretary has a car to travel back and forth from work.  This car should be parked at headquarters for her use when needed for Commonwealth of PA business, not used to provide her personal travel. 

·         Many mid level managers are driving State vehicles home every night, when they seldom leave home and go to any work location other than their headquarters location. One manager drives from Berwick to Hamburg and back every day at the taxpayer’s expense. He drives a 4x4 Dodge Durango which gets about 10 MPG. 

·         More than 5,000 state employees get take-home cars with free gas and maintenance. The state has more than 13,000 vehicles costing more than $17 million to maintain. 391 state employees, not including law enforcement, have state vehicles with confidential plates, which they drive, at any time, including holidays and weekends, for their personal use, at the commonwealth’s expense. 

3.   Workforce Scheduling Adjustments

·         Review the management to rank and file ratio.  In some areas in Penn Dot, for example, they have eight (8) managers to manage 12 employees;  in some areas there is one (1) manager for every two (2) employees.

*   In Probation and Parole, three (3) Regional Managers were hired at Pay Range 11. They never had the Regional Manager position before.   Are they really necessary?

*  In Probation and Parole, there are 10 Districts but 19 Directors in Central Office.   Is it necessary to have two Directors for each of 9 out of 10                Districts?

·         Offer employees a liberal LWOP, with benefits option.  Many employees would be interested in reducing their work hours on a temporary basis.   Allow employees the option of working less paid hours per pay period, for a specific period of time.  For example, allow 40 hour per week employees to work 35 hours and 37 ½  hour per week employees to work 32 ½ hours.  If only 15% of the AFSCME work force was interested in taking advantage of the reduced work schedule, the total number of hours saved would be the equivalent of  335 annual salaries, at an average of  $35,771.00 each for a total savings of  $11,983,285.00.

·         Reduce the work week for staff to 4 days a week, where feasible.  This will save on vehicle wear, fuel to do field work, overtime costs and call offs.  More work can be done in one day, eliminating second trips to finish a job, and personal errands can be done on the extra day off. 

·         In DPW, in the Office of Income Maintenance, clerical work should be assigned to clerical employees, in the County Assistance Offices, rather than to case workers, who make substantially more money.

·         Hire clerical employees to do clerical work, not only in the County Assistance Offices, but statewide, rather than fill vacancies with higher paid employees, who are then assigned clerical work because there is more clerical work than higher level work available.

 Misc. Areas of Cost Savings

·         Transfer the Legislative surplus, at least in part, to the General Fund.

·         Delay the construction of a new PEMA Eastern Area Office until the economic climate improves (frees up over $1M) Some believe that this project is under-funded, as is.

·         Stop bonuses to staff of Bureau of Integrated Enterprise System (IES) who administer SAP.

·         Cut back or eliminate the food and travel/overnight expenses for Board, Commission and Advisory Board Members for Commonwealth Agencies.  For example, in PSERS, from $2,000.00 to $4,000.00 per month is spent for food and expenses for Board Members.  This type of spending goes on with Board and Commission members in many other agencies and it should be stopped. There are hundreds of Board, Commission and Advisory members to the agencies in PA, who are paid travel, food and lodging, at substantial and unnecessary expense. Some major cut backs should occur in these areas.

·         Use an energy efficiency expert to evaluate each state office for money savings on such things as electricity use, most cost effective lightning, most cost effective heating systems.

·         Rescind the bonuses planned for the 21 investment staff, at the Public School Employees' Retirement System. The bonuses ranging in amounts from $9,720 to $106,223 are to be paid through bi-weekly pay adjustments from now through June 30.  The bonuses are to end in 2009, but are any still to be paid between now and the   “ending date?”

·         Discontinue award ceremonies until the department is more stable.

o   Star of Excellence awards. There is a lot of time, effort and costs associated with this.

o   The Districts have Safety Days. There was a suggestion to make sure the day is filled with topics related to safety. If that is not possible, then cancel it.

·         Heating systems - we run the air conditioner in the middle of winter.  It's a bad system that needs fixed.

·         Cancel the Governor’s Holiday Open House and save the money spent for the entertainment, utilities and food.  Look at the cost for all the Governor’s lunches/dinners, etc. that are billed back to the individual agencies.