JAC Agency Hearings JAC Index 12-06-17pm Wednesday, December 6, 2017 Agenda: PM 006A & 006B – Boards and Commissions 072 – Wyoming Retirement System 006 – Department of Administration and Information Dean Fausset, Director of A&I provides brief overview of Board and Commissions; A&I has 18 supported boards; second classification of boards are not supported by A&I Pari-mutuel commission will be having their own hearing at a later time Nicholas: let’s proceed (5:00 mins) Fausset: Discusses A&I supported boards; explains the format of the spreadsheet handout provided by A&I Fausset: Spending authority for credit cards fees; licensing boards are in the process of implementing an automated licensing system developed by a company named Aluminum for $350,000. The system will be up and running by next fall. Website updates; cloud storage; etc. These boards are funded through other sources of revenue and are not funded by general funds. Sommers: Percentage increase? Nicholas: Fund balances; add two more columns Fausset: Board of Architects, Board No. 12; credit cards fees; new credentialing system; $7,008 Schwartz: How are they managing these funds? The various balances; money market account. Kevin Hibbard: Pooled funds Sommers: Are credit card fees increasing across the board? JoAnn Reid: The boards that are requesting funds for updated credit card systems are doing so due to the old system being outdated and a security concerns. Landen: Maintenance credentialing system? Reid: It’s split equally between all 18 boards Fausset: Board of Podiatry has several exception requests; credit card fees; maintenance agreement for credentialing system; administrative services; travel; dues and registration; ETS; $16,280 Larsen: Why the increase to A&I? (17:00 mins) Reid: requires more staff time, etc. Fausset: Chiropractic Examiners; $1,080 for ETS Fausset: Board of Dental Examiners; credit card fees, credentialing system; travel; professional development; $5,930 Nicholas: Why is ETS increasing charges? One time funding? Credit card fees? 5% or 10% Reid: This is a first time ask for the boards who are requesting the ETS funds. The money for the credit cards are the fees being charges by the credit card processing system. The vendor Alavon (sp?) is the vendor that the State has always used. Sommers: Podiatry Board increasing their fees without increasing their licenses Schwartz: Account balance Reid: Cash balance vs. spending authority Fausset: Board of Funeral Services Practitioners; ETS Larsen: Declining balance; cash reserves Fausset: Board No. 36 Midwifery; $9,864 Nicholas: How many members does that board have? Fausset: 7 board members; 14 licenses currently (30:00 mins) Fausset: Board No. 43; $5,208; Board No. 56; $11,426; Board 58; $20,2065; Board No. 62 Physical Therapist; no exception requests; Board No. 64 Hearing Aid Specialist; $5,414; Board No. 65 Athletic Trainers; $5,414 Sommers: What’s the explanation for the increase in licenses in the athletic training world? Landen: 71 athletic trainers? Fausset: Board of Psychology; $19,334; Mental Health Professionals; no request; Veterinarian Medicine; one request; Board of Acupuncture; no exception request Fausset: That concludes the A&I supported boards Burkhart: Have any of the supported board reached the point where they can be an independent board? Reid: It makes it more economically feasible for boards to pool together their resources rather than become independent and take on staff salaries, copy fees, license fees, phones, etc. Fausset: We track the staff time for each board and they’re bill accordingly Sommers: Out of state travel and accountability? Fausset: A&I works with each board to ensure that they are using their funds appropriately Reid: Out of state travel primarily associated with participation in national association meetings; travel for members is subject to board approval; the executive directors monitor that and there is oversight from A&I. Fausset: We’ll now move to the independent boards (44:00 mins) Fausset: Board of Barbers; $2000 for additional training Burns: How many barbers are there in Wyoming? 134 licensed barbers in the state Fausset: Real Estate Commission; $168,252 for new FTE position Nicole Novotny Smith, Executive Director for Wyoming Real Estate Commission provides explanation of the need for new position; new duties for appraisal management companies under federal law; significantly increased number of complaints. Dockstader: How much savings have you had in order to justify adding a new position? (1:00 hour) Larsen: What’s the reason for the sharp increase in complaints? Burns: Would this new person deal with complaints or licenses? Wilson: Wyoming Fair Housing Act of 2015; do that affect your agency at all? Sommers: What’s the trend line on real estate licenses? Fausset: The next board for consideration is No. 19 Professional Teaching Standards; new position Nish Goicolea, Executive Director for the Professional Teaching Standards Board provides an explanation for the need for an AWEC position and other fees Sommers: Credentialing teachers in relation to computer science (1:12:36) Goicolea: We understand the history of this issue and we are working hard to get it up and running; working with ETS to get the system launched; possible new website. Board adopted new rules regarding computer science and explanation. Nicholas: Are these emergency rules or standard? Are they on your website? Goicolea: Standard rules and they are posted online. Larsen: Computer science teacher are still required to have a teaching degree? Burns: What’s your source of funding? Larsen: Accreditation issues? Fausset: Next board is the Board of Cosmetology; they have several exception requests; $50,180; (1:24:24) Fausset: Board No. 48 Mixed Martial Arts; no exception requests Burns: Is someone from MMA board present? Amateur fights, etc. Nicholas: Callback Fausset: Board No. 52 Board of Medicine Wilson: Update on Interstate Medical Licensure bill of 2015 Kevin Bohnenblust, Executive Director of Wyoming Board of Medicine: slower start than expected due to FBI background checks, but it’s starting to pick up and work well Schwartz: Residency of practicing physicians? Bohnenblust: Provides information on credit card fees for processing licenses; they generally run around 3% of the transaction; additionally, HB62 brought reforms to licensing board to be audited by the Department of Audit for things like out of state travel etc. Fausset: Department of A&I and every single board was audited as a result of this legislation Schwartz: Who pays for the audits? Bohnenblust: The boards pay for the audits Fausset: Next board is the Board of Nursing Cynthia LaBonde, Executive Director of Wyoming Board of Nursing addresses question from Nicholas on WYPAP Larsen: Interstate nursing compact? (1:35:28) Burns: Nursing school tuition? Traveling nurses? Nursing shortage? Larsen: Do we have enough medical facilities for nurses to complete their clinicals? LaBonde: Not exactly; many schools are going to a simulated patient program Landen: Has the Brand (accelerated nursing) program been effective? How many nurses has that program produced? Jennifer Burns, Practice and Education Consultant for Board of Nursing: About 20 students per semester with 100% pass rate Schwartz: How to you plan to address your shortages within your accounts? Fausset: Board of Pharmacy; no exception requests Wilson: Tele-pharmacy and how that’s working Mary Walker, Executive Director of Board of Pharmacy: There are 3 sites that are interested but it’s had struggles getting off the ground. Fausset: Board of Certified Accountants; no exception requests; Board of Outfitters; request funding for ETS charges; Board of Nursing Home Administrators; $15,000 Burns: Does this board certify nursing homes or nursing home administrators? Bonding? Are they required to be licensed in other states? Maxine Hernandez, Executive Director for the Nursing Home Administrators: We certify the administrators; 96 licenses Fausset: Board of Occupational Therapy; $22,000 Burns: Why the increase in this board’s budget? A&I? Supplies? Hernandez (also the Executive Director of Board of Occupational Therapy): We need to send board members to national conferences. A&I helps with the accounting services. Fausset: The board was underfunded and we needed to raise the fees Fausset: The Board of Professional Geologist; $54,108; additional time to enter licenses into the system Nicholas: We are going to move 072 Retirement System up since they have folks from out of town, but we won’t be going through their budget; we’ll do 006 A&I’s budget after that (1:55:00) BREAK Nicholas: Welcome to the 072 Retirement System; they will do a brief presentation so they can catch their flight Laura Ladd, Chairman of the Board: Introduces some of the staff members in the room; please refer to the packets dated December 4th,; transition to Northern Trust; consideration of a contribution rate increase of 50 basis points; 16.62%; we recommend cost-sharing equally between the employer and the employee Larsen: Why do you recommend a split for the increase? When would we become 100% funded? (2:01:00) Ladd: We believe the increase is necessary to gain funded status and historically we have always recommended splitting it equally between employer and employee. Landen: Basis points? Burkhart: What is the current funded status? Ladd: 78% Wilson: Asset allocation? Tom Chapman, Investment Committee Chair: As of September 30, asset allocation is approximately 46.5% equity; 24% fixed income; 11.5% private markets; 18% market alternatives; remainder in cash Ladd: Provides overview of investment program Chapman: Provides overview of performance based compensation which was requested by legislative liaisons; attract, retain, and engage and effective workforce Sommers: How do you determine their base salaries? Nicholas: the legislature sets the salaries (2:30:00) Burkhart: How many University of Wyoming graduates work in WRS? Ladd: 4 of 8 of our staff came from UW Nicholas: We may approach this with a two-tier approach; but we need to understand all the pros and cons of proceeding Nicholas: We will reschedule 072 Retirement System’s budget presentation for another time BREAK (2:36:00) Fausset: Provides an introduction of A&I and key staff; we only have 4 exception requests in our budget totaling $55 million, the rest are Section 320 reductions; I will address the Alverez Report and Employee Group Insurance towards the end of the discussion. Fausset: A&I’s budget is $770 million, which is a fairly sizeable budget; 88% of A&I’s budget comes from the Group Health Insurance, $675 million; A&I has eliminated 10 positions and transferred another position Larsen: Updating software and computers? Sommers: Have you realized all of your Section 320 cuts? Fausset: We have. Nicholas: You’re increasing fees paid to A&I by licensing boards and I don’t see that reflected in your budget. Rory Horsley, Chief Financial Officer, A&I: We are not increasing fees to boards, we are simply correcting their budgets due to them being underbudgeted and previously we used B-11s. (3:00:00) Nicholas: Eliminating the printing of budget books, page 29 Discussion on number of budget books printed, etc. Fausset: Risk Management funds and 320 reduction; Central Mail; software assurances; leased space Nicholas: Don, how does the CREG deal with income that’s turned over? Don Richards: There is about a $500,000 differential with CREG Fausset: Penny plan and increasing costs associated with leased spaces; we lease about 825,000 square feet statewide, the average cost is about $13.87 per square foot; federal funding; the agencies with the most leased space are Workforce Services, DFS, Department of Health, Department of Corrections. Larsen: How do we ensure that this leased space is being properly cleaned etc.? Fausset: We have worked with the Attorney General’s Office to strengthen our contracts among other things; the average cost for leasing commercial space in Cheyenne is $18.86 per square foot Nicholas: What’s the total square footage of what the state leases? Fausset: 279,000 square feet (3:33:00) Fausset: Discussion on motor pool; mileage; rate structure; scheduled maintenance; rental fleet Nicholas: Does this include the vehicles for school districts, etc.? Fausset: The telematic system on our vehicles allows us to better manage our fleet and has provided greater efficiencies in general Schwartz: Fuel economy? Hybrids? Electric vehicles? Walters: Have you considered selling all state vehicles and leasing the entire fleet from a private company? Larsen: How about going directly to the manufacturers? (3:54:50) BREAK Fausset: Page 62 General Services Division; page 65 Rockwell Building in Sheridan; page 68; page 72; page 74 utilities; page 78 construction management division moved over to state construction department; page 89 human resources; page 91 professional services; page 92 distance learning program (4:04:30) Fausset: Page 96 administrative services unit – Group Insurance Program; rate increase Ralph Hayes, Director of State Employees Group Insurance at A&I provides context for rate adjustments; costs are mostly driven by chronic illnesses or sudden serious illnesses Landen: Would modifying deductibles make an impact on this calculation? Walters: Usage by employee vs. members of the family? Fausset: Wyoming has one of the highest health care costs of any state in the country; it’s driven by rising health care costs and the amount of claims being made Hayes: Non-disclosure agreement and healthcare data from Cigna Nicholas: What are the data points and where are we going with this? (4:23:43) Anne Ladd, Wyoming Business Coalition on Health: utilization trends; data points; reports from Cigna Nicholas: Let’s discuss this further during a callback Fausset: page 101 employee life insurance; page 106 health insurance spending authority (4:30:00) Nicholas: Building reserves as rates continue to increase Wilson: Can any of this be invested in the state agency pool? Kevin Hibbard: State agency pool Fausset: page 111 dental insurance; increased spending authority Larsen: Increase on health insurance Don Richards: Borrowing authority Fausset: Page 115 disability / vision insurance; page 119 flexible benefits; page 123 economic analysis division, exception request Sommers: Cost of living Fausset: Page 126 software assurance agreement; page 130 state library, reduction of $87,808; page 133 library trust account; page 138 library federal funds account (4:39:00) Nicholas: Could you comment on the (government efficiency) Alverez report? Motor pool? Grant office? Performance based budgeting? Fausset: Organizational; ratio of supervisors to employees; definition of a supervisor; classification study; word of caution; employees eligible for retirement; centralization; lack of HR technology; fiscal; motor pool; benefits; wellness program; high cost of health insurance (4:55:00) Sommers: Health insurance; Alverez report Fausset: Greater efficiencies could be found in technology systems that sync up and share data. Grant management program; monitor federal grants; procurement and economies of scale; idea festival / suggestion awards program; managing surplus; space utilization study; motor pool; performance-based budgeting; (5:15:00) Nicholas: Written response from A&I to the Alverez report Don Richards: Agency audit reports; 072 Retirement System reschedule; tomorrow (12/7/17) is all UW and associated agencies ADJOURNMENT (5:19:00)