July 28, 2009
July 28, 2009
Moratorium placed on personal service contracts; use of temporary employees limited
LANSING - Governor Jennifer M. Granholm today issued Executive Directive 2009-3 to further reduce state spending by mandating reduced contract expenditures and limiting contractual and temporary employees. The action builds on steps already taken to address sharply declining state revenues.
"Economic conditions facing the citizens and government of our state have caused serious and immediate fiscal difficulties for our state budget," Granholm wrote to her appointees. "While the federal American Recovery and Reinvestment Act of 2009 will aid the state's response in important ways and soften the blow of the economic crisis, this new, onetime federal assistance is temporary and not sufficient on its own to restore stability to the state's finances. We must redouble our efforts to reduce expenditures and reform the way in which state government delivers vital services."
The governor's directive seeks to reduce contract spending by 5 to 10 percent, places a moratorium on new or expanded personal services contracts, and severely limits the use of temporary employees. The directive also requires the Office of the State Employer and Department of Management and Budget to enforce the directive by regularly monitoring hiring requests and state spending.
Granholm's directive is just the latest step taken to make state government more cost-efficient. Last December and this past May, the administration issued executive orders cutting state spending by more than $400 million. Another executive order issued July 13 eliminates the Department of History, Arts and Libraries - the third state department to be eliminated during the governor's tenure. The governor also has issued numerous directives to reduce state spending on items such as travel, training and supplies, including 10 directives in 2007 that remain in effect.
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