Governor Moves to Assert More Control Over Independent Agencies

Having completed a “top-to-bottom review” of more than 200 arms of state government, Gov. Bill Haslam is moving to assert more direct control over their operations and reduce their numbers.
His move has stirred some bipartisan unease among legislators and outright opposition from representatives of some professions and industries regulated by the boards and commissions impacted.
About 140 job positions would be abolished in 22 different governmental organizations.
In general, critics see Haslam’s legislative proposals as an unwarranted assertion of executive political power that undermines the independent operations of agencies. These agencies, they believe, are working well and, in most cases, operate on fees collected from regulated industries rather than general tax dollars.
The governor says it’s simply a matter of bringing more efficiency and effectiveness to elements of the state bureaucracy that have gone for decades in some cases without change. He also wants to assure they are “fulfilling the purpose they were originally intended to when they were created.”

Two bills are involved.
One is HB2385, which deals only with the Tennessee Regulatory Authority, the largest agency facing an overhaul. The TRA has a budget of $8.6 million in the current year and a staff of about 70 employees overseeing everything from natural gas companies to suburban sewer systems and phone calls by telemarketers. Haslam’s proposed budget for next year would reduce TRA spending by more than $600,000 to $8 million, most of that reduction proposed by TRA itself.
TRA Chairman Kenneth C. Hill made clear in a legislative hearing last week that he does not agree with Haslam’s bill to transform the TRA. The agency is now allotted four full-time directors, each paid $150,000 annually, and no executive director. Haslam’s bill would eliminate the full-time directors and replace them with a board of five part-time directors, each earning $38,000 per year, and a full-time executive director, appointed by the governor.
Haslam says TVA’s part-time board serves as a model. Hill says that only one other state in the nation, Delaware, has a part-time utility regulatory agency and that state has found it doesn’t work and is moving back toward a full-time board. The board’s duties require both expertise and a commitment in time that part-time officials may lack, he said.
Under current law, the governor and the speakers of the state House and Senate share authority to appoint TRA directors. Hill was appointed by Senate Speaker Ron Ramsey.
The speakers would continue to share appointive authority of the part-time directors under Haslam’s proposal. But some critics say the governor’s power to name the executive director, who would oversee daily operations, would effectively give him control.
A spokesman for Ramsey said the Senate speaker “believes it makes more sense to have the board (of the TRA) appoint that (executive director) position and has expressed that preference to the governor.”
The other bill is SB2249, a sweeping overhaul of other boards and commissions with 49 sections. Among the major changes:
n The governor would appoint executive directors of four boards, taking that authority away from the boards themselves. Those boards are the Tennessee Higher Education Commission (THEC), the Tennessee Commission on Aging and Disability, the Tennessee Arts Commission and the Tennessee Commission on Children and Youth.
The boards have executive directors now who would be subject to dismissal by the governor if Haslam’s bill passes. Addressing specifically a question about Rich Rhoda, longtime director of THEC, Haslam said the move is “about structure, not personalities.”
n Members of the governor’s cabinet would appoint executive directors of six other boards, a move that would “provide more accountability,” according to an administration document.
Those boards are the Peace Officers Standards and Training Commission (POST), which oversees certification of law enforcement officers and their training; the Tennessee Corrections Institute, which oversees jail operations; the Board of Accountancy, which licenses and regulates certified public accountants; the Council on Career and Technical Educationl; the Conservation Trust Fund Board; and the Commission on Firefighting Personnel Standards and Training.
n Six current boards would be merged into three “for increased efficiency” under the legislation.
The Water Quality Control Board, which deals with water pollution rules and regulations, would be combined with the Oil and Gas Board, which oversees drilling for gas and oil.
The Petroleum Underground Storage Tank Board, which regulates gasoline holding tanks at gas stations statewide, would be merged with the Solid Waste Disposal Control Board, which oversees landfills.
The Conservation Trust Fund Board would merge with the Conservation Commission.
Legislators say they have begun to hear complaints and concerns from representatives of the professions and industries overseen by the boards and commissions, including lobbyists. Some legislators have an indirect personal interest.
House Democratic Caucus Chairman Mike Turner of Nashville, for example, is a firefighter by profession and thus subject to oversight by the Commission on Firefighting Personnel.
The present setup, that allows such boards to select their own executive director, assures the chosen individual has needed expertise, “gives them autonomy and makes them less political,” Turner said. He added that similar concerns are voiced by other impacted industries and professions.
“I guess their ox is getting gored,” he said.
Will Pugh, a veteran Knoxville CPA who has served on both the state Board of Accountancy and its national counterpart, said in a call to a reporter that the state panel has progressed from “a laughingstock” in the eyes of the national association in decades past to a present state of professionalism.
Pugh said he was concerned that the governor’s move would destroy independence and have the impact of “dragging down what we had a lot of trouble building up.”
Interviews with several Republican legislators found none voicing outright opposition to Haslam’s plan, but some expressing misgivings.
“This is going to require a lot of studying,” said Rep. Glen Casada, R-College Grove, who chairs the House Health and Human Resources Committee. “Some legislators don’t understand why we would want to give away all that authority (to the governor).”
House Speaker Beth Harwell said she supports some of the governor’s plans, such as giving him authority to name the THEC executive director. Because the governor already has power to appoint the overseer of K-through-12 education — the state’s education commissioner — it :”makes sense” that he should have similar power over the overseer of higher education, she said.
Harwell said other provisions of the governor’s plan will be addressed by legislators on a “case-by-case basis.”
In a conversation last week, she said, Haslam indicated to her a strong commitment to his plans for THEC, the TRA and the Commission on Children and Youth. On other panels, she said, the governor indicated a willingness to consider options.
Haslam spokesman David Smith, responding to a reporter’s request for comment on the proposals, made a point of declaring, “It is noteworthy that there are no decreases or eliminations of any legislative appointments.”The balance of power between the legislative and executive branches of government has long been a sensitive subject.
While the Haslam plan does not directly strip legislators of any appointive or oversight authority over boards and commissions, some lawmakers say it does so indirectly by giving the governor more power over day-to-day operations through executive directors.
“What are we trying to do here? Ease back to the days of Buford Ellington?” said House Minority Leader Craig Fitzhugh, D-Ripley. “We have a fair balance now with some legislative oversight. We don’t need to dilute that.”
Democrat Ellington was governor in the 1960s, when legislators launched an ultimately successful move to assert more control over state government operations. Before that, Democrat-controlled legislators were widely viewed as simply rubber-stamping virtually everything that Democratic governors proposed.

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