BILL REQ. #:  H-0961.1 

Read first time 02/11/2005.   Referred to Committee on Appropriations.

     AN ACT Relating to greater fiscal responsibility in state budgeting through zero-based budget reviews; adding a new chapter to Title 44 RCW; providing an effective date; and declaring an emergency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   It is the intent of the legislature to provide improved means of review by which to evaluate the budget requests of state agencies. The legislature establishes the zero-base and modified zero-base budget review process to help the legislature establish priorities in the expenditure of public resources for state programs and services.

NEW SECTION.  Sec. 2   The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.
     (1) "Review" means a modified zero-base budget review or a zero-based budget review, as appropriate.
     (2) "Committees" means the appropriations committee of the house of representatives and the ways and means committee of the senate and the committees' respective staffs.
     (3) "Modified zero-base budget review" means a written document prepared by the staff to the committees that contains an analysis of the budget and the programmatic and fiscal basis of the agency on which the review is conducted. A modified zero-base budget review may consider the agency's past and current incremental funding.
     (4) "Zero-base budget review" means a written document prepared by the committees that contains an analysis of the budget and the programmatic and fiscal basis of the agency on which the review is conducted. A zero-base budget review shall undertake this analysis without regard to the agency's past and current incremental funding.
     (5) "Program" means a group of agency services designed to accomplish specific public goals and result in specific public benefits.
     (6) "Level of service" means the relationship between the resources budgeted and the actual service activity delivered by the authorized service provider or agency. This relationship is measured in terms such as, but not limited to, response time, system capacity, application or permit processing time, per staff workload, and statutory service requirements.

NEW SECTION.  Sec. 3   (1) In the omnibus operating budget bill or in other legislation, the legislature shall identify agencies on which a zero-base budget review or a modified zero-base budget review shall be conducted during each fiscal year of the biennium. When specifying agencies on which the review will be conducted, the legislature shall seek to complement and avoid duplication of the activities or the proposed activities of the joint legislative audit and review committee under chapter 44.28 RCW.
     (2) The committees shall jointly conduct the reviews of state agencies and programs as specified by the legislature under subsection (1) of this section.
     (3) The reviews shall be provided to the committees either by September 1st following the fiscal year in which the review takes place, or as specified in the omnibus operating budget bill or in other legislation.
     (4) The house of representatives and the senate may contract with public and private independent professional and technical experts as necessary to complete the review.
     (5) Each agency receiving appropriations in the omnibus operating budget bill shall be reviewed at least once during the six-year period beginning on July 1, 2005, and at least once every six years thereafter.
     (6) When conducting the review, the committees shall consult with the joint legislative audit and review committee. The review is intended to complement, and not to duplicate, performance audits and performance reviews conducted by the joint legislative audit and review committee under chapter 44.28 RCW.
     (7) To facilitate the review, the director of financial management shall cooperate with the committees to establish the method and format for the reporting of agency information. The director of financial management and all agencies shall comply in a timely manner with requests by the committees for information related to the review.

NEW SECTION.  Sec. 4   A modified zero-base budget review shall include, but is not limited to, the following:
     (1) A statement of the statutory basis and the history of each program within the agency that is being reviewed, including the extent to which the program or expenditures are required by state, federal, or local law;
     (2) A description, with supporting cost and full-time equivalent staff data, of the activities performed in each program, the specific services provided, and the populations served by those services;
     (3) An analysis of the major costs and benefits of operating each program within the designated agency including subprograms within the programs where applicable, and the rationale for specific expenditure and staffing levels;
     (4) An analysis estimating each program's administrative and other overhead costs;
     (5) An analysis of levels of service provided; and
     (6) Where applicable, an analysis estimating the amount of funds or benefits that actually reach the intended recipients.

NEW SECTION.  Sec. 5   A zero-base budget review shall include, but is not limited to, each of the components of the modified zero-base budget review in section 4 of this act in addition to the following:
     (1) An analysis of the quantified objectives of each program within the agency;
     (2) An analysis of the activities that are intended to accomplish these objectives;
     (3) Indicators of quantified measures of effectiveness and efficiency of achievement of these objectives;
     (4) The level of funding and full-time equivalent staff required to accomplish each activity, without regard to past incremental levels of funding; and
     (5) If the legislation requiring the review specifies alternate levels of funding for the agency, an analysis of the agency budget at the different level of funding.

NEW SECTION.  Sec. 6   Sections 1 through 5 of this act constitute a new chapter in Title 44 RCW.

NEW SECTION.  Sec. 7   This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and takes effect July 1, 2005.