October 12, 2011
Albany, NY

Governor Cuomo Announces Steps to Cut Waste and Improve Government Efficiency Expected to Save $600 Million Over Five Years

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Governor Andrew M. Cuomo today announced transformative steps that his administration is taking to change the way state government does business in order to reduce costs and increase efficiency. 


The reforms will focus on five specific areas, including transforming the procurement process by harnessing the state's full buying power to reduce costs, eliminating costly empty space leased by the state, modernizing information technology systems, improving customer service, and streamlining business services. These reforms are expected to save taxpayers $600 million in all funds over five years including $100 million in all funds over the next fiscal year.


"State government must be reinvented from top to bottom to cut inefficiencies and reduce waste," Governor Cuomo said. "We can no longer accept the status quo where the excess of government falls on the backs of taxpayers, who receive little in return. It is a new day in Albany, and these steps will transform government to work better for the people at a lower cost." 


The series of projects directed by the Governor are designed to make state government more responsive and nimble. Under the new approach to state operations, current procedures will be compared to best practices to identify ways to save money and find efficiencies. Performance metrics will be used to measure results, increase accountability, and evaluate effectiveness. The steps are designed to produce budget savings over a multi-year period while improving the delivery of public services.


Steps taken by the Cuomo Administration include:


Procurement Transformation


Governor Cuomo has initiated sweeping changes to the state government procurement process that focus on implementing best practices and identifying opportunities for savings. The new procurement process, called strategic sourcing, will leverage the state's buying power and balance the needs of achieving savings with the administration's policy goals of encouraging small businesses and MWBEs.


In June, Director of State Operations Howard Glaser and Budget Director Robert Megna asked all state agencies to suspend individual contract renewals and purchases in 15 categories, including food, IT services, software, and office supplies, and instead use the strategic sourcing method for procurement. Strategic sourcing uses a structured, market-based process to gather data and use the state's substantial buying power to secure the best value in purchasing. The initial purchases under strategic sourcing are targeted to save $100 million in FY 2012-13, and could produce almost $600 million in cumulative savings over 5 years.


Using strategic sourcing, the Office of General Services modified the road salt bidding process to generate $2.4 million in savings for the state and $7.1 million in savings for local governments. The contract had not been bid on competitively for nearly ten years and under the new process the state paid less per ton.


Real Estate Optimization


For years, New York State's real estate portfolio has been poorly managed, leading to vacancy rates greater than 25%, poor construction and building management, and misplaced investments in aging facilities. Upon taking office, Governor Cuomo ordered an extensive analysis to ensure government-paid-for space is fully-utilized. Efforts are now underway to move agencies in leased locations into state-owned buildings as leases expire.


A major restacking initiative has been launched to fill vacated state-owned office space in the Albany metropolitan region. The project will be conducted in 3 phases over the next 18 months and is projected to save $9 million in FY 2012-2013 and eliminate 3,000 empty desks. Plans are currently under review for a centralized real estate office that will coordinate management to drive efficiency, ensure proper financial stewardship, and improve customer service. Governor Cuomo's administration is continuing to review consolidation options for state-owned space in New York City. 


Technology Transformation


Governor Cuomo has launched five initiatives to consolidate information technology (IT) processes and infrastructure that will save hundreds of millions of dollars, implement uniform standards, and improve reliability and service. The Governor's actions are in response to reports that showed the old approaches to IT management led to inefficient and redundant delivery of services, hampering statewide technology initiatives and wasting taxpayer dollars. A recent audit revealed that although many of the state's thousands of computer servers operate at less than half-capacity, agencies continue to purchase new servers for data storage.


Five foundational projects have been launched: data center consolidation, enterprise identity and access management, email consolidation, help desk consolidation, and voice-over-internet protocol telecommunications. The projects are estimated to be completed within three years. Governor Cuomo has also directed state agencies to conduct a comprehensive software and hardware scan of department networks to create for the first time a statewide inventory of IT assets. This scan will form the basis for data center consolidation, elimination of duplicative software applications, and standardization of IT platforms.