Legislative Analyst's Office

Analysis of the 2000-01 Budget Bill
Department of Parks and Recreation (3790)

The Department of Parks and Recreation (DPR) acquires, develops, preserves, interprets, and manages the natural, cultural, and recreational resources in the state park system and the off-highway vehicle trail system. In addition, the department administers state and federal grants to cities, counties, and special districts that help provide parks and open-space areas throughout the state.

The state park system consists of 264 units, including 39 units administered by local and regional agencies. The system contains approximately 1.3 million acres, which includes 3,000 miles of trails, 280 miles of coastline, 625 miles of lake and river frontage, and nearly 18,000 camp sites. Over 70 million visitors travel to state parks each year.

The budget proposes $251 million in total expenditures for the department in 2000-01. This is an overall decrease of $289 million (54 percent) below estimated current-year expenditures. The budget proposes about $209 million in departmental support, about $22 million in local assistance and $20 million capital outlay expenditures. (Please also see the "Capital Outlay" chapter of this Analysis.)

The reduction of $289 million includes a decrease of (1) $150 million in support expenditures, (2) $79 million in local assistance, and (3) about $60 million in capital outlay expenditures. The $150 million net decrease in support expenditures reflects mainly one-time funding of $157 million in 1999-00 for deferred maintenance, while the $79 million decrease in local assistance reflects mainly a decrease of $62 million in General Fund expenditures for various local park projects.

Of the total proposed expenditures in 2000-01, about $83 million (33 percent) will come from the General Fund; about $83 million will come from the State Parks and Recreation Fund; and the remainder ($85 million) from various other state funds, federal funds, and reimbursements.

Update on Deferred Maintenance

All of the $30 million provided in 1998-99 for deferred maintenance has been expended. As regards the $157 million provided in the current year, the department has set priorities for all the projects it will do over a three-year period. We recommend that the department report at budget hearings on whether it will use department staff or contract out for project management for the deferred maintenance program, and the anticipated costs of each option.

As we discussed in our 1999-00 Analysis, the department began to accumulate a backlog of deferred maintenance in the 1980s when fiscal constraints led to the underfunding of the ongoing maintenance needs of the department. (Please see page B-74 in the 1999-00 Analysis for a more detailed discussion of the department's deferred maintenance.)

In 1998-99, the Legislature provided $30 million to begin to address the department's deferred maintenance needs. For 1999-00, the Legislature provided $157 million for deferred maintenance, including $10 million for natural resources (such as erosion control projects), and $10 million for cultural projects. The department has until 2001-02 to expend these funds. The department indicates that it plans to spend $30 million in 1999-00, $60 million in 2000-01, and $67 million in 2001-02.

1998-99 Funding Obligated. Our review shows that the department has used the 1998-99 funds ($30 million) for a variety of projects. These projects vary from major projects, such as $1.6 million for reroofing the Stanford Mansion in Sacramento to minor projects such as $5,000 for repairing entrance signs. Our review also finds that while all the funds are obligated, some of the 352 projects funded with that money are still ongoing in the current year.

The DPR Has Set Priorities and Identified Projects for Current-Year Funds. In order to be able to carry out an additional $157 million in deferred maintenance projects beginning in the current year, the department first created a comprehensive inventory of all deferred maintenance by developing a database that captures critical data about these projects, including a description of the project, its priority and cost estimate. Districts were directed to prioritize the projects within their jurisdiction, based on criteria including: health and safety, protection of facilities and improvements, and fire and life safety.

District priority lists were then reviewed at headquarters by a management team that has expertise in contracting, maintenance, and knowledge of overall statewide needs for the department. The team, in turn, generated a statewide priority list of projects to guide the use of the appropriated funds.

Project Management at Districts and Headquarters. Based on the statewide list of projects, districts were assigned projects to be completed and were given an allocation of funds for each project. Districts have the discretion to decide how to complete the work. Project work can be done by departmental staff, contracted out, or completed by the California Conservation Corps. Day-to-day project management, except for certain projects, is done at the district level. Project status is tracked by headquarters on a quarterly basis.

In addition to setting priorities and identifying projects, the department is in the process of developing a plan to manage the deferred maintenance program statewide. The department is currently deciding whether to use state staff or contract out for a construction project management firm to manage the program. Because of the magnitude of the program, we believe having a dedicated project management team for the programeither by contracting out or by dedicating in-house staff to ensure timely completion of a project within allocated resourcesis warranted. We recommend that the department advise the Legislature at budget hearings on whether it will use department staff or contract out for project management and the anticipated costs of each option.

Department Needs Staffing Plan To Handle Deferred Maintenance Workload

The department is not currently staffed to meet the increased workload related to deferred maintenance. Also the department may not be fully utilizing the California Conservation Corps (CCC) for deferred maintenance projects that match the CCC's available skills. We recommend that the department report to the Legislature in writing, prior to budget hearings, on its staffing plan, including a plan to use the CCC, for the deferred maintenance workload.

Department Has Hired Few Staff to Handle Additional Workload. Addressing the deferred maintenance workload requires staff time at all levels in the department including field personnel managing and working on the projects, as well as engineers, architects, and other support personnel in headquarters. However, the department has added only a limited number of staff to deal with the increased workload. Specifically, for 1998-99, the department hired 20 limited-term staff for the deferred maintenance workload. For 1999-00, the department requested and was provided 16 personnel-years for architectural and engineering tasks, eight of which are still vacant.

Most Work Done by Existing Staff. Our review finds that over half of the 352 deferred maintenance projects (funded with the 1998-99 appropriation) have been done by existing staff, redirected from other responsibilities. To complete the remaining projects, the department has also contracted out work (82 projects), used the Department of General Services (31 projects), employed the CCC (16 projects), and hired a small number of limited-term positions.

The department reports that when staff are redirected from routine maintenance work, that work is accomplished by other means. However, discussions with field staff suggest that staff are doing both routine and deferred maintenance work. Because the department's routine maintenance efforts are already understaffed (as discussed in the next section), we question whether staff can handle both the routine maintenance workload and the vastly increased deferred maintenance workload. While the overtasking of staff may be sustainable for the first round ($30 million) of projects, we do not believe that this is a viable strategy as the department works to address $157 million in deferred maintenance backlog over three years. Doing so could risk routine maintenance work falling behind, resulting in other deferred maintenance needs in the future.

Existing Staff Not Adequate for Future Workload. Recognizing that staffing is an important factor for completing the deferred maintenance projects, the department has asked each district to identify its staffing needs to meet the deferred maintenance workload. However, at the time this analysis was prepared, the department had not decided how to address potential staffing needs.

Because the department's plan calls for a doubling of the amount of work to be accomplished in 2000-01 ($60 million compared to $30 million in 1998-99 and 1999-00) and further increasing the amount to $67 million in 2001-02, it is essential that the department has the necessary staff to carry out this work. Accordingly, we recommend the department provide in writing, prior to budget hearings, a staffing plan that shows how it plans to accommodate the deferred maintenance workload.

Department Needs to Devise Plan for Using CCC. Given the staffing challenge discussed above, the CCC provides an excellent option for accomplishing some of the deferred maintenance workload. Although CCC members are not appropriate to work on all types of projects, our preliminary review of the department's list of identified projects suggests that many projects involve work that is (1) a good match with the core skills, competencies, and mission of the CCC; and (2) within geographical proximity to CCC sites. However, of the 352 projects being completed with the 1998-99 funding, only 16 projects have utilized CCC's resources. Projects completed by CCC crews include: trail repairs, replacing fences, and repairing stairs, fencing, and campsites.

Given that (1) some of the deferred maintenance work provides a good work and training opportunity for the CCC crew members and
(2) the department will need additional staff to accommodate the large workload, we recommend that as part of its staffing plan to the Legislature, the department report on its plans for using the CCC.

Ongoing Maintenance Needs More Substantiation

The budget proposal for $3 million for routine maintenance cannot be evaluated by the Legislature until the department provides an estimate of its total routine maintenance needs. We recommend that the request be denied absent the information on routine maintenance requested by the Legislature in supplemental report language contained in the 1999-00 budget.

The deferred maintenance backlog is due, in large part, to inadequate funding levels for past routine maintenance. The department's ongoing park maintenance program has been funded at $9 million annually for the last 16 years. This includes funding for all 3 categories of ongoing maintenance: (1) facility maintenance, (2) cultural resource maintenance, and (3) natural resource maintenance.

Legislatively Directed Report Not Completed. In the Supplemental Report of the 1999 Budget Act, the Legislature directed the department to report by January 10, 2000 on the total funding necessary to cover the costs for routine maintenance by categories of maintenance work. This information is intended to provide a basis by which the Legislature can assess the adequacy of the department's maintenance funding level. However, the department failed to provide the information.

Budget Proposes Increases for Routine Maintenance. The 2000-01 budget proposes to increase its base level funding for maintenance by $3 million, a one-third increase. The proposal includes funding for all three types of maintenance and 36 new maintenance positions. However, the proposal lacks basic information needed by the Legislature to evaluate the proposal. Specifically, the proposal does not include any information called for in the supplemental reportinformation on overall routine maintenance needs for the department, and how much is needed for each of the three categories of maintenance.

Recommend Denial of Proposal Absent Legislatively Required Information. Without the information the Legislature requested on routine maintenance, the Legislature cannot evaluate whether (1) the proposed amount of augmentation is appropriate and adequate to avoid future accumulation of deferred maintenance and (2) the department's proposed maintenance priorities meet the Legislature's priorities.

Absent that information, we recommend that the proposed augmentation be rejected.

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