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Commission recommends more accountability in use of state fees

Commission recommends more accountability in use of state feesThe State Agency Fee Commission on Tuesday approved recommendations aimed at creating transparency and accountability in how fees are used, putting together guidelines for all agencies as well as specific recommendations for the four the commission reviewed this year.

One of the main purposes of the fee commission was to create an informed community of advocates and legislators that would educate others and champion the commission’s recommendations in the legislative session.   But only two of the six lawmakers appointed to the committee will be returning next year.  That could make it much harder to turn the commission’s recommendations into legislative action, said Spencer Kamps, commissioner and lobbyist for the Homebuilder’s Association of Central Arizona,

“It’s always difficult,” he said. “It’s important for anyone involved with the budget that they are educated on the recommendations of the fee commission. [We'll] just hope for the best.”

The only two returning lawmakers are Rep. Katie Hobbs, a senator-elect in the new Legislative District 24 and Sen. Jack Jackson of the new LD7.  Both are Democrats.   Because of the way commissioners are appointed, it’s possible that only one of them will serve on the commission.

The Senate President and House Speaker are both allowed three appointments to the commission, with no more than two from the same party. If Senate President Andy Biggs chooses to maintain the ratio of two Republicans and one Democrat on the committee, he will have to remove either Hobbs or Jackson, since Hobbs is switching chambers.

Appointees who will not be returning to the commission are Rep. Lori Klein, defeated in her LD1 race against Republicans Andy Tobin and Karen Fann; Rep. Terri Proud, who did not run for re-election; Sen. Frank Antenori, defeated by Democrat David Bradley in LD10; and the commission chairwoman, Rep. Amanda Reeve, who was defeated by Democratic Rep. Eric Meyer and Republican Rep. Kate Brophy McGee in LD28.

The commission’s annual report, the draft of which was revised and approved Tuesday, was put together by the Governor’s Office of Strategic Planning Budgeting under commissioner John Arnold, the agency’s director. Kamps said he hopes that since the agency did the heavy lifting on reviewing the agencies and the report, there will be a solid foundation of advocates going forward.

Commissioners generally recommended that an agency’s fees should only support the program for which the fees are collected, ensuring that the general fund does not benefit from those fees and that they don’t subsidize other programs. Commissioners recommended that the general fund should not support specialty programs that benefit a specific industry and that those programs should be supported by fees.

The commission recommended that where possible, fees be kept in separate funds that are not washed through the general fund so it is easy to track how the money is spent. They also recommend that fees be kept low enough to cover only the cost of a specific program.

In applying these recommendations to the Department of Financial Institutions, State Lands, Weights and Measures, and the Department of Environmental Quality based on the OSPB reviews and presentations that took place earlier this year, DFI and W&M took center stage.

The commission recommended reorganizing the Department of Financial Institutions to have separate fee funds for transparency’s sake and prohibiting the agency from using money from civil penalties to support general operations.  The purpose was to remove a potential conflict of interest for the agency.

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