House Approves Government Financial Service Reforms

OKLAHOMA CITY (April 19, 2011) – The Oklahoma House of Representatives has approved legislation designed to transform inefficient state agency financial services systems.

Senate Bill 541, by state Rep. Jason Murphey, (R-Guthrie) and state Sen. Anthony Sykes (R- Moore), was proposed following a report by the Hackett Group, which demonstrated massive inefficiencies in the way state agencies conducts financial services.

The report compared Oklahoma agencies’ financial services processes to those of other public and private sector peer organizations of like complexity. The report demonstrated the inefficiencies by stating that it costs Oklahoma taxpayers $20.05 to process one accounts payable invoice while comparable peer groups pay $3.58 for each similar service.

"It is incredible and unacceptable that Oklahoma taxpayers are paying nearly six times the cost of what comparable groups are spending for that same process," Murphey declared. "This legislation is designed to fix that."

The study also stated that Oklahoma state government has a significantly higher number of full time employees employed to conduct these operations than peer organizations. Oklahoma processes 2,039 accounts payable occurrences for each employee while peer groups are able to account for 15,693 of these same processes with each employee.

The House approved Senate Bill 541 by a vote of 61-34. The legislation now returns to the Senate for additional consideration.

Analysis shows SB 541creates the Oklahoma Innovation, Efficiency and Accountability Act of 2011.  The measure authorizes state agencies to accept an electronic signature in the application process for any license or permit.  The measure clarifies the circumstance under which use of the Trip Optimizer system of the Department of Central Services is required to include travel exceeding 100 miles per day by a state employee who is not driving a state-owned or –leased dedicated vehicle.

The bill also requires the Director of OSF, by January 1 to publish a financial services cost performance assessment that documents each appropriated state agency’s cost for providing financial services.  Agencies that rank in the bottom 10% of the cost performance assessment will be required to contract with OSF for the provision of shared financial services if the Director of OSF determines that it will result in cost savings to the agency.  The State Regents for Higher Education and institutions within the Oklahoma State System of Higher Education are exempt from this requirement.