VERIZON BUILDING: A tale of government ‘transformation.’ Not.


Great reporting today from the Arkansas Democrat-Gazette’s Michael Wickline on a legislative audit of Governor Hutchinson’s vaunted “transformation” of state government and its supposed streamlining of 42 agencies into 15 departments.

The audit casts doubt on a claimed $57 million in cost savings. Not surprising,  particularly given the fattened salaries that went to people at the top of the state food chain. Have we really eliminated any agency? Or just rolled them into a larger agency with more assistant chiefs, a la university bureaucracies?


Some personnel reductions are claimed, but salaries overall rose and the audit said it couldn’t conclude the reductions were all directly related to “transformation.” Senior-level jobs remain in appropriations even if unfilled. Agencies also couldn’t document many of the claimed savings in the required annual report. Some money identified as savings was merely redirected, not eliminated, the audit said.

The full audit report is here. It doesn’t include an evaluation of what improved services had been achieved by the transformation. That will come later. It should make for interesting reading.


Also remember: $57 million is chump change in a general revenue budget of almost $6 billion. And danged if the total budget for 2021 isn’t up about $200 million from the previous year.

I was particularly interested in the review of the state’s poor handling of real estate under the Hutchinson administration (some pre-transformation, a Hutchinson spokesman alibies).

As Wickline noted, rental savings from various moves have been slight. And those savings overlook big blunders.

The biggest was the purchase of the Verizon Building at an inflated price, which required going into debt to sell bonds to finance the purchase for 30 years. The building was bought for an industrial prospect, Raytheon, that didn’t materialize. To cover bonus baby Mike Preston’s mistake (a purchase option would have been a wiser move), they moved state agencies into the building. Not enough to occupy all the space, however.


And that doesn’t begin to be all of the negative fallout. The Verizon purchase meant the state vacated not only buildings owned and leased by private interests, sometimes for less cost, but also vacating state buildings on the Capitol Mall and downtown. They are now empty. Guess what? Space aplenty is available in cratered downtown Little Rock. It is not exactly a seller’s market, thanks in part to the state’s “transformation.” The audit also says it will take almost 10 years for payback of the more than $6 million spent in relocation costs.

And that still isn’t all. Among the streamlining was a move of the Insurance Department. That cost the state Teachers Retirement System a prime tenant for a building the public agency owns. Other ill-considered empire-building also has left the state holding undeveloped land on the north side of the Capitol complex.

More streamlining like this and the state will be bankrupt.

The article notes that Workforce Services is soon to depart its space in a state building on the mall to help fill up the Verizon white elephant.

And speaking of Workforce Services: You won’t find the state bragging about how transformation has improved the operation of that agency, which handles unemployment benefits in Arkansas. Or it shouldn’t. Unemployment benefit processing is still a disaster, to hear frustrated claimants tell it on this monumental tale of woe, a forum of comments on one of our blog posts.

An early blunder in a poorly designed website led to a security breach. And security problems were so widespread that the review process for renewing benefits has become so intense and complicated that people are waiting weeks for relief, with solid answers hard to come by from the state nine months later. Just last week, the state announced still more glitches in the verification process.

Here’s just one story of someone trying to access Mike Preston’s streamlined “worker services” agency:

yesterday I waited an hour to speak with someone, I told her to look at my profile, It has been stuck on approved for seven weeks, I asked i, advised that all my documents have updated from pending approval to uploaded, tax documents, and my statement for self employment … all I wanted to know is if they have all needed, becuase I received a successful submitted when I downloaded and checked back… I/ve been thru the not entitled to , approved, just waiting on processing payment.. she reviewed all .. she said I was fine, that anyday now payment should be processed…she also told me that anyday know the payment should process… she apologized for the hot mess this has turned into… she was very pleasant, of course, I told her I will be positive and hope for the best…. I am down to my last dollar, I can’t even go on a job request or referral, I have no gas money to go… I have nothing or no one to help.. single 60 year old who is a Airforce Vet. but not retired… I have no children to qualify for assistance.. so , I can’t get a loan, I can’t get tanf or tea… I can’t find a new gig at this time, no one has anything.. I put in 20 resumes a day, I do not ahve family that would even care to help me out.. financially, because its just the way they are… I would not dare to ask.. I do not have a significant other, Not old enough to go ahead to retire.. worked all my life never having to reach out for help.. and like you say, I can’t get it after all these years, no way are the leaders of this great nation really concern with us being out on the streets, I bet they have all they need, I only have a camper that is what I stay in, I am late on the lot rent now 3 mos. My car died, can’t fix it … no money for parts even if I knew how to fix … went thru this winter weather two days with out food no help no way to get anywhere, and let me tell you it got cold in this I do not want to lose faith in my country … but it seems to me the immigrants can get more than my old behind.. so should I denounce my citizenship burn my ids and re enter this great country as an illegal alien to get the benefits offered as an immigrant? set me up and start over again? NO… just give me my benefits after all the years paid in ..? should I have to wait till , I really believe this could have been handled better .. Other states are not having this issue, only 3 states which includes ARkansas, are this delayed .. its crazy… It is true I have been told so many different excuses on what is going on… I really do not care about that, I want to know when I will get my money.. Its crazy… ARkansas systems are old and should have been updated ages ago… the money is just misallocated as we all know .. used somewhere else, cause direct deposits are done … andy time, they upload foods stamps on the day your benefits are due… weekend holidays ,, so I just don’t get why they can’t put the money in the account so we can take care of business… not only does it hurt us but our bill need to be paid , so everyone is hurting, but the leaders of this great country, So now the weather is the issue we did not get paid this week ? right… still no can tell us when we will get paid, last I was told the more times you upload your document the lomger the delay .. to verify them each time its uploaded, if you have already submitted docs required … the documents will shouw in your pua profile… pending review or uploaded by imaging … you should not have to do only one time,, I believe we are told what ever the customer service wants us to hear.. but the customer service can only tell us what we already see in our pua profile… unlock aa online profile from logging in with wrong password, but really , they only know what we see ourselves… next step is to get a sign and head to the capital… just park my camper there.. if I had the money to move it I would go park it at a meter pasted it posters begging for my money, cause I am tired of the struggle…
Good luck all have a bless day, be positive, I wish you all well and those out there with prayers

I’m sure Amy Fecher, Hutchinson’s $159,000 secretary of transformation, can explain how this is an inaccurate picture of transformed Arkansas government. I can get her a name if she’d like to go out to her camper lot to explain.