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Garofalo bill seeks to reduce, restructure leadership positions at DEED, Commerce

Garafolo bill seeks to reduce, restructure leadership positions at DEED
MinnPost photo by Ibrahim Hirsi
State Rep. Pat Garofalo: “What this bill does is it reduces the amount of administrative overhead … so we can reprioritize those dollars to provide actual services to taxpayers.”

State Rep. Pat Garofalo has introduced legislation seeking to eliminate some senior leadership positions at the Minnesota Department of Employment and Economic Development (DEED) and the Department of Commerce.

DEED's current leadership team consists of 27 positions, including Commissioner Shawntera Hardy, an assistant commissioner, three deputy commissioners and executive directors who oversee the organization’s key divisions and lead workforce development and economic equality efforts across the state. The assistant commissioner heads up economic equity and opportunity efforts. The deputy commissioners consist of a chief operating officer and deputies who lead workforce development and economic development. 

The Commerce Department has 10 executive leaders, including Commissioner Mike Rothman, four assistant commissioners and three deputy commissioners.

HF 1005 would allow just one deputy

The bill, House File 1005, seeks to limit the commissioners to one deputy and amend the existing structure of leadership positions — proposing the creation of assistant commissioners in place of the other deputy commissioners.

“We’re always looking for ways to provide better value to the taxpayers,” Garofalo, R-Farmington, told MinnPost. “So what this bill does is it reduces the amount of administrative overhead … so we can reprioritize those dollars to provide actual services to taxpayers.”

Currently, deputy commissioners at both departments make between $125,000 and $130,000 in annual salary and assistant commissioners make about $112,000, according to a January report on state employee earnings. 

The governor appoints the agency’s commissioner, who then hires an assistant and deputy commissioners. Last year, Gov. Mark Dayton appointed Hardy — who had served as a deputy chief of staff in his administration — the DEED commissioner.

Governor opposes bill, calls it micro-managing

The governor’s office, not surprisingly, opposes the bill. Dayton spokesman Sam Fettig stated in an email to MinnPost that the governor “disagrees with legislative attempts to micro-manage Executive Branch agencies. He believes that the role of the Legislature should be to define agencies' duties in Statute and appropriate them the funds for those purposes.”

He added: “The managers of those Executive Branch agencies should be able to decide how to structure their organizations to most effectively perform their responsibilities.”

There have been similar attempts in the past that proposed to reshuffle and reduce department heads at DEED, said Garofalo. But this time around, he added, he’s optimistic about passage. If that happens, the proposed changes would go into effect in 2019. “There’s an opportunity to reprioritize these dollars for things like fraud enforcement or for economic development,” he said. “We think those are higher priorities than administrative salaries.”

Bruce Corrie, an economist who has closely followed DEED and state legislators for decades, said he hoped the bill would have focused more on improving the quality of the department’s service in the community rather than reducing the number of commissioners.

“As a priority for the long-term economic vitality of the state,” he said, “I think the bigger question is, ‘What’s the quality of the people in leadership positions and how accessible are they to the community?’ That’s what I think is the big challenge.”

Dane Smith, president of the St. Paul-based advocacy group Growth and Justice, said the department is leading efforts to minimize workforce shortage and racial disparities — important issues to the state government and business leaders. “It’s hard to see how removing deputy commissioners with those special responsibilities helps those policy objectives,” he said. 

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Comments (4)

Too much Overhead

If we don't need the overhead, get rid of it. Nothing in the story tells us we do not, or we do need these high-paying positions. What exactly have they done, specifically, to earn the high salaries?

Why this and why now?

I seriously wonder is Rep. Garafalo has any idea how many of his constituents rely on DEED for services. Did he look at the extensive need for more robust Vocation Rehabilitation to address the huge pool of developmentally disabled young adults trying diligently to enter the work force instead of being exploited through Workshops? This is the door to a job for many. With a rapidly changing economy and workforce how is it a good time to downsize the very lean and highly accountable agency addressing this? I tend to believe that Rep. Garafalo is very wise on and with the paper documents but not so much in the actual real-time administrative working of the services he is typically eager to cut.

The Proper Lens

With which one should view Garofalo is the ALEC lens. Any time he proposes new legislation, the first questions one should ask him is whether or not he is pushing ALEC legislation.

How many front line workers,inspectors teachers etc

could be hired with the money saved from eliminating these executive positions.

Private industry eliminated a lot of senior & middle management and put the money (at least some) into more front line employees that actually interact with the public and into automating systems so people could do more online.