News about this election cycle was dominated by the gubernatorial races in Virginia and New Jersey and a handful of ballot initiatives in California. However, a little-known or followed initiative from Washington state could be the most promising piece of news. Its promise and importance for reforming government – making it more effective and efficient – are lessons for every state, including Maine.

Initiative 900 enacts performance audits of state and local governments. Maine recently passed a performance audit law. While the efforts are a good start, it doesn’t go far enough. Under the current rules, before an audit can occur, the Legislature must ask for it. Furthermore, it is not exactly clear what type of audits will be conducted. In that, is the audit conducted to ensure that a service “is performed” or is to seek or uncover waste and unnecessary spending, and identify steps to resolve such problems? While the first type is important to protect the public from corruption or abuse, the second audit type is more valuable to long-term reform.

In Washington, the differences are significant. For starters, the state auditor’s office would have sole control and decision making ability – who to audit and when. In addition, the entire state government will undergo an audit within eight to 10 years, and they’ll begin immediately.

Given the recent decision to begin audits, should Maine consider performance audits as well? Does Maine need them?

Yes, Maine should join the growing trend of states that utilize this powerful government reform tool. Experience from states throughout the county suggests that performance audits save money and improve the operational effectiveness of government operations.

Put simply, performance is a nonpartisan issue. Indeed, governors of both parties have long argued for and utilized performance audits in order to determine what works and what doesn’t. A top-down review of current programs should be done to evaluate effectiveness and efficiency.

For example, California is currently using a similar approach to tackle its massive deficit – a review of the state’s prison system led by former Republican Gov. George Deukmejian yielded 239 recommendations for improvements alone. Since 1991, Texas has used this review system since 1991, abolishing 44 agencies, consolidating another 11 and saving more than $13 billion. Kentucky saves about $140 million annually using performance audits, while, New Mexico saved $74 million in 2004 and is projected to save $443 million over five years.

Florida, which also has demanded results from agencies, was able to return more than $1 billion to taxpayers this year. Even the federal government has taken action. In the fiscal year 2005 budget, a similar performance review eliminated 13 federal programs, saving more than $1 billion.

To make a performance audit work, every agency, program and activity should be evaluated on three factors: performance, relevance and management efficiency.

Performance is easy to understand and see. Is the program or activity having a positive impact?

Relevance is a little trickier. Is the program a priority against other competing needs, or is it duplicative of other government programs?

Finally, management efficiency looks at the operations to see if there is another way of doing things, including public-private partnerships or privatization.

Debates on taxes and spending are divisive. However, we can all agree that if the state chooses to spend money, it should at least be able to show progress toward a goal, show that positive change is being made, and that our tax dollars are being used effectively and efficiently.

Chances are slim that any elected officials or administration members would stand up and say they’re not for performance and results or that they don’t want to make sure our tax dollars are spent effectively. So let us all embrace performance audits.

Over time, putting results and performance first will make Maine more efficient and, more importantly, more effective. A results-based approach is the most successful way to keep spending down and taxes low. Ineffective and wasteful spending will be halted, shrinking the reach of government and lowering the demand for future taxes while protecting the vital services government provides.

Geoffrey F. Segal is the director of government reform at Reason Foundation and a senior fellow at the Maine Heritage Policy Center.

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