FARGO-Gov. Doug Burgum sees a jumble of disconnected "information silos" when he looks at the towering North Dakota Capitol-an obstacle to collaboration and efficiency he seeks to knock down as he begins to reshape state government through the budgeting process.
Burgum, who campaigned on a platform to reinvent government, wants to trim the state's taxpayer-supported workforce by 5 percent as part of his quest to slash $125 million from the general fund, and another $50 million from the state university system. But the entrepreneur-turned-governor believes attrition through natural turnover and looming retirements will mean few, if any, employees will have to be let go.
In preparation for drafting his first budget, Burgum has issued guidance calling for small state agencies to reduce their requests for the 2019-21 budget by 5 percent and is asking larger state agencies to cut their proposed spending by 10 percent as the state is forced once again to tighten budgets because of revenue shortfalls tied to faltering oil and ag sectors. Programs like K-12 education and Medicaid will be excluded.
As a contingency, he is asking agencies to have plans to trim an additional 3 percent when presenting their 2019-21 budget requests. The reductions follow a series of cuts in recent years, including slashing the general fund from a record $6 billion to $4.3 billion for the current biennium.
That draconian exercise in rapidly shrinking government, which followed a dramatic increase in spending in prior years, came during last year's 80-day legislative session, a feat Burgum described as "heroic." It was accomplished by cutting spending by $3.5 billion and tapping $500 million in reserve funds.
But now those budgetary "cream cans" have been emptied, requiring deeper cuts to keep the budget in balance, said Burgum, who met Thursday, April 19, with The Forum of Fargo-Moorhead Editorial Board to outline his budget aims.
'A cultural shift'
As Burgum's team reviews budget requests, they will be looking for ways to eliminate low-priority items, efforts that have been continued more through bureaucratic tradition than because of compelling need, the governor said.
"We want to have a conversation about what the least important thing is," in identifying cuts, Burgum said. "That's what zero-based budgeting is all about."
Although the state must deal with revenue scarcity, ideas and solutions are abundant, Burgum said. "There's ways to do it better, faster, cheaper than before," he said. "But it's going to take some changes."
One of those changes, he said, will be an openness to embracing changes and innovation. "It's a cultural shift," Burgum said.
Personnel-the state has more than 16,000 employees, including the university system-comprise 55 percent of the state's budget.
"So we have to look at that," Burgum said.
The 5-percent reduction in state employees should be easy to achieve. Last year, the turnover rate among state employees was 12.7 percent, and 12 percent of the state workforce is eligible for retirement-a rate that will increase to more than 20 percent in the next five years as more baby boomers reach retirement age, Burgum said.
Thus, despite the reduction in workforce, he added, the state likely will be hiring, not firing.
In partnership with the Legislature and North Dakota Public Employees Retirement System, Burgum wants to increase the "value proposition" for state employees, who will be fewer in number but will have more flexibility and have an attractive career path as well as benefit package.
An Amazon-like experience
In realigning the state budget, the state will not just be cutting money, but also will be redirecting some of the $175 million to be saved from reductions elsewhere, said Joe Morissette, Burgum's budget chief.
"There's going to be a reinvestment," Morissette said. "A focusing on new priorities."
The drive to streamline government will use information technology to enable greater collaboration and efficiencies, Burgum said.
"We have a lot of opportunity for improvement," said Burgum, whose business background included years as a software executive and board member of technology companies.
Burgum's team is working to unify-not consolidate-information technology systems among his cabinet's departments. North Dakota government has 165 websites, none interconnected, and is running many outdated "legacy" software systems.
Moving much of the state's computing into the "cloud"-using remote servers to store, manage and process data-would improve performance, save money and increase security, Burgum said.
Ultimately, Burgum's goal is to create an online experience for state government services that has the ease of the online shopping experience of Amazon Prime. The government of Estonia has been recognized as a trendsetter in the field, and its former leader is now at Stanford University, a school Burgum attended. Burgum hopes to meet with him soon.
Burgum concedes that he will have to persuade people to move in the direction he's charting.
"It all comes down to culture, leadership, vision," he said. Primarily, he added, "It's going to be how do you move people," not technology.
"We've got to create a market where people want to do it," Burgum said.