~ DOER will be eliminated, functions transferred to Finance, Administration and Health ~

As part of his ongoing effort to make state government more streamlined, efficient and effective, Governor Tim Pawlenty today unveiled details of his proposed elimination of the Department of Employee Relations (DOER). The Governor first announced plans to shut down DOER and merge its operations into the other agencies in December.

“This move will increase efficiency and improve how we manage state government,” Governor Pawlenty said. “DOER Commissioner Pat Anderson has excelled at putting together a plan to work herself out of a job. Notably, the merger and elimination of DOER has bipartisan support in the legislature and the backing of important state employee union partners. It’s a great example of good government work.”

The legislation unveiled by the Governor today will eliminate DOER and transfer its functions to the Departments of Finance, Administration and Health no later than June 30, 2008. Many of the changes would be made even sooner. The bill is chief authored by Sen. Ann Rest (DFL-New Hope) and Rep. Gene Pelowski (DFL-Winona), chairs of the Senate State and Local Government Operations and Oversight Committee, and House Governmental Operations, Reform, Technology and Elections. Co-authors include Senate Minority Leader David Senjem (R-Rochester) and House Minority Leader Marty Seifert (R-Marshall).

Last month, when Governor Pawlenty appointed Pat Anderson DOER Commissioner he asked her to oversee a merger of the agency. Commissioner Anderson and her leadership team have been meeting with state agency commissioners, legislative leaders, union leadership and DOER employees to determine the best fit for DOER’s important functions at other agencies.

DOER’s main functions include human resource management and the state employee insurance division. It administers eleven labor agreements covering 37,200 state employees and a health insurance plan that serves 129,000 state employees and their dependents.

Governor Pawlenty is proposing legislation to streamline state government by abolishing DOER and transferring its functions to three other state agencies:

• Department of Finance: Labor Relations, Human Resources Management, Employee Insurance Divisions and Information Services – These divisions provide a complete human resource structure for executive branch employees, management, labor unions and employee health plans. Under the Governor’s proposal, the functions performed by these divisions will transfer to the Department of Finance. DOER and Finance currently work closely in the areas of personnel, payroll and collective bargaining.
• Department of Administration: State Employee Workers’ Compensation Program – The workers’ compensation program is self-insured and self-administered, providing state agencies with claims management and other services. The Governor is proposing to combine this program with the Department of Administration’s Risk Management Division, which handles the state’s property and casualty insurance. Combining these efforts will provide a more coordinated approach to workplace safety and risk management.
• Department of Health: Center for Health Care Purchasing – This unit works to make the state a more prudent and efficient purchaser of quality health care services. It closely works with staff from the Department of Health and will move to that agency in order to better assist decision makers and health care purchasers by providing information on the current health care market and ensuring the state’s health care dollars are spent wisely.

In addition, Governor Pawlenty’s budget proposal includes the establishment of a two-person Small Agency Resource Team (SMART) to begin to consolidate and streamline the human resources and financial management activities for the state’s small agencies, boards, and councils. DOER will supplement this effort by transferring five staff.

“This proposal represents a streamlined approach to personnel management, increased oversight of human resource functions and will allow for greater accountability in the Pawlenty Administration,” Commissioner Anderson said.

“The Department of Finance is known for its integrity in the use of state resources,” Finance Commissioner Tom Hanson said. “This merger demonstrates an effective, streamlined approach to state government that will further all of our agencies’ missions and goals.”

In 2003, the Pawlenty/Molnau Administration merged the Minnesota Department of Economic Security (MDES) and the Department of Trade and Economic Development (DTED) to create the new Department of Employment and Economic Development (DEED). Also that same year, the agency known as Minnesota Planning was eliminated and its functions were incorporated into the Department of Administration. In 2005, the Office of Environmental Assistance merged with the Minnesota Pollution Control Agency to become a combined agency.