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The Honolulu Advertiser
Posted on: Sunday, February 7, 2010

State needs push to get jobs on fast track

Hawaii news photo - The Honolulu Advertiser
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There's never been a more grueling test for Hawai'i's procurement process its means of issuing contracts for projects than the effort to get federal stimulus money spent quickly to create jobs.

But when a congressional panel ranks Hawai'i low for speed of spending stimulus funds, the inescapable conclusion is: We're just too slow at this. In its November study of spending on highways and bridges, for example, the House Committee on Transportation and Infrastructure ranked Hawai'i 48th.

Granted, the $787 billion American Reinvestment and Recovery Act is not easy to administer. State officials point to changing rules from the White House, and a system of reporting and disclosure that seems to be evolving on the fly.

Even so, there is much room for improvement, and it's up to the leadership in this state to help Hawai'i clean up its act.

Here are two ways:

• Push sluggish state agencies to take full advantage of Act 150, which streamlined procurement procedures for ARRA contracts.

• Consider centralizing the state's procurement function to make it more efficient and professional a key recommendation from a task force convened to "reinvent government" to cope with the fiscal crisis.

These efforts won't be easy. The goals of procurement are to issue contracts fairly, transparently and as quickly as possible; balancing all those needs can be complicated. Nonetheless, that's no excuse for inaction.

For its part, the Lingle administration has improved the fairness aspect. Among other changes, all contractors are now able to go on the State Procurement Office site and register for notices of any major project (over $25,000) that are available.

The state also is keeping on top of ARRA requirements and is on target to meet the critical "use it or lose it" funding deadlines.

But just meeting deadlines is not enough when the economy needs far more jobs, and more rapidly, than the state seems capable of delivering.

The governor's staff anticipated the problem last year and lobbied hard for the passage of Act 150. But few state agencies seem to be adopting the streamlined procedures available to them, said Mark Anderson, deputy director of the Department of Business, Economic Development and Tourism.

Anderson, whose main task over the past several months has been to keep up with ARRA requirements, said he believes individual agencies might be feeling too much pressure to meet all the federal requirements to develop smarter ways of handling contracts.

Terry Thomason, a private attorney with 32 years in contract law, points to an insistence by some state workers to handle contracts in piecemeal fashion instead of using some time-saving options that the law allows. For example, he said, some kinds of work lend themselves to arrangements akin to service contracts made in advance to cover a range of needs; when the need arises, work orders can go out quickly.

This bureaucratic inertia and unwillingness to innovate must be overcome.

The Task Force on Reinventing Government recommends "centralizing complex procurement in the State Procurement Office on a fee-for-service basis." This could make more manageable a state procurement code the task force says is too complex for many of the staff in various agencies to handle.

Recovery from a recession will take several years, so it's imperative to make the process more efficient. Hawai'i needs a boost in consumer spending, and that requires getting jobs on track. More than ever, that must be the fast track.