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The one thing that made our task more difficult was that we had no precedents to follow. No similar system has even been undertaken by any state government. It was necessary, therefore, for us to proceed cautiously, and necessarily without haste. Such radical changes as were made in our system could not be produced suddenly, or without systematic and fixed effort. Neither could these changes be made without a moderate exhortation or protest. The change had to come slowly in the ordinary course of practical development. In my opinion we are moving towards better things. Our level of standards is rising, and we look to the future with confidence and hope.

The Department of Finance is an entirely new function in Illinois State government. It took over no work performed by any board or commission. There were no precedents or set rules to follow. As created by the Civil Administrative Code the department discharges supervisory rather than operating functions. Its work brings it into intimate contact with the remaining eight departments and other departments and commissions rather than with the public.

DUTIES OF THE DEPARTMENT.

Its duties more specifically are:

(1) To prescribe and install a uniform system of bookkeeping, accounting, and reporting;

(2) To examine into the accuracy and legality of the accounts and expenditures of other departments;

(3) To examine and approve, or disapprove, all bills, vouchers and claims against the other departments;

(4) To prepare a budget for submission to the Governor; and (5) To formulate plans for better coordination of departments.

In addition to performing such specific duties the director acts as the financial advisor for the departments directly under the Governor's control, and as an observer for him.

The Civil Administrative Code recognizes that discretion is to be given the Director of Finance in prescribing financial and accounting details, making these uniform throughout all the departments.

Practically all of the powers of the department are vested in the director who by rules and regulations provides how such powers shall be administered.

It develops as a matter of common sense rather than law that the other departments consult the Department of Finance before undertaking any unusual matters having to do with these expenditures.

Weekly meetings of the directors have been held and have served to bring out questions of financial policy. In many cases where the Director of Finance has rules on a subject it has been necessary for him to make thorough investigations of the matter in question and all affairs relating to it. These investigations may have ranged from the quality. of goods that were supplied in connection with a small bill, to the effects of a given policy of far reaching consequence.

The scope of the Department of Finance in its powers to conduct investigations is most thorough. Nearly everything done by any depart

ment finally comes as an expense to be passed upon by the Director of Finance. Thus it will be seen that systematic and thorough investigations are often necessary to put the Department of Finance in possession of facts essential to an equitable decision.

The assistant director was charged with the duties of prescribing and supervising the system of bookkeeping and accounting; the forms and accounts and financial reports and statements. In the discharge of these duties it was necessary to devise and install a system of reports from all departments under the code with the necessary blanks. A plan which was devised has proven successful. With possible modifications, reports can be made invaluable in determining the condition of each division in the code department.

MONTHLY REPORTS.

Blanks were also prescribed for the monthly reports, which show not only the expenditures made at the end of each month from July 1, 1917, to the date on which the report was made, but also the bills which have not been paid, and the amount of the contracts which have been entered into or actual orders placed, and for which the goods and invoices have not been received. These reports state the amount of each appropriation which is available for any further expenditure.

The Military and Naval Department was not under the Civil Administrative Code, but by instruction from the Governor, this department prescribed a system of accounting and financial control. Since January 1, 1918, reports have been made by the Adjudant General giving the condition of the financial affairs of his office at the close of each month.

Monthly reports of the same kind are being received from other boards and commissions whose vouchers are subject to the approval of the Governor.

On June 30, 1918, careful summaries were made and the different tables made up by this department from reports received, give the amount of money unexpended or saved by each division from its various appropriations covering the seven standard accounts called operating accounts.

These are:

Salaries and Wages;

Office Expense;

Traveling Expense;

Operating Supplies and Expenses;

Working Capital;

School Supplies;

Repairs.

Equipment, Buildings and Land were not included except where specifically shown.

Appropriations necessarily had to be and were made by the Fiftieth General Assembly on the then existing basis, and when some 30,000 wards of the State must be cared for, the cost cannot be considered, but the needs must be met.

Economy has been practised and savings made where they were never made before, but no extraordinary results can be cited because of more than extraordinary conditions.

The Civil Administrative Code has now been in operation through an entire biennium but the condition of the market for all supplies and materials which the State has had to purchase has been abnormal so that any comparison between the expenditure for the biennium closing June 30, 1917, and the purchases made since that date do not give any satisfactory results. Neither would a comparison between the expenditures of one year in the biennium ending June 30, 1917, and the expenditures of one year of the present biennium be satisfactory because of the tremendous increase in the cost of everything purchased by the State.

It has therefore seemed to us that the most tangible way to determine the real value of the code up to this time lies in the following facts:

The Governor, any State officers, any member of the Legislature or any private citizen can at this time apply to the Finance Department and be given the exact condition of the appropriations which were made to each division of the State Government which is under the operation of the code, as to the amount of money expended, the amount of money involved in the invoices which they have for supplies received and which have not been paid, the amount of money represented by contracts of all kinds which have been placed and for which supplies have not been received and the amount of money still unexpended.

This control of expenditures and the ability to know at all times. the financial condition of each division is something which has not been. attempted heretofore, and as far as we are informed, is not carried to the extent in any other state that it is in Illinois.

In order to make our plan of operation more successful, this department on February 15, 1919, began to pass upon requests made by divisions for anything and everything which they proposed to purchase, so that we not only know what they have done after the expenditure is made, but we know what they propose to expend before the materials. are purchased.

As indicated above, it is always difficult to show by figures exactly what has been accomplished, especially if an attempt is made to compare with some other state for some certain period, or to compare figures in our own State for two different periods, because so many different things may enter into two sets of figures.

Therefore, we can but believe that the accomplishments cited above are really of more value to us, and to any commonwealth where they propose to attempt something of the kind than mere figures which might be furnished.

THE NEW BUDGET SYSTEM.

It is with considerable satisfaction that this department refers to the work accomplished through the first State budget. So far as we know the adoption of our recommendations of appropriations for all State purposes by the General Assembly is the only instance of the kind in the United States. Some states have their budgets but in no case has the General Assembly accepted the recommendations for a budget so completely as was done by the Fifty-first General Assembly, just adjourned. Much time and care was spent in the preparation of a budget and every item contained in the $62,000,000 appropriation bills

was thoroughly investigated. The appropriation committees of the Senate and the House of Representatives used due care and precaution in re-investigating the recommendations and much to our gratification, approved them almost in total. Few changes were made by the appropriation committees without consultation with this department. In other words, complete harmony existed between the appropriating bodies of the General Assembly and this department. Our recommendations for office expense, traveling expense, operating expense, and repairs and buildings were accepted almost entirely without change.

In addition to the budget being a great aid to the appropriation committees, it was possible for us to keep the Governor continually advised as to the gross amount of appropriations passed and pending from time to time, thus enabling him to approve or disapprove appropriation bills as they were passed with full knowledge of the probable total.

The appropriations for the biennium beginning July 1, 1919, are as follows:

Appropriations payable from General Revenue Fund.
Payable from Special Mill Tax Funds:

State School Distributive..

$45,111,239.01

University of Illinois.

PAYABLE FROM RECEIPTS OTHER THAN TAXES.

Operation and maintenance of Illinois and Michigan Canal.
Fire Prevention...

Industrial Revolving Fund..

Construction and maintenance of State and Federal Aid Roads (Pay-
able from automobile licenses)

Construction of Federal Aid Roads (Payable by Federal Government)
Bond Issues:

Highways

Waterways

12,000,000.00 5,000,000.00 $62,111,239.01

$ 100.000.00 195.660.00 1,000,000.00

17,251,678.36 12,100,000.00

60,000,000.00

20,000,000.00

WORK OF THE DEPARTMENT OF PUBLIC WORKS AND

B

BUILDINGS.

BY FRANK I. BENNETT,

Director of Public Works and Buildings.

Y THE PROVISIONS of the Civil Administrative Code, the handiwork of Governor Frank O. Lowden, and made the cornerstone of his administration, the Department of Public Works and Buildings is charged with the duty of supervising State projects in the nature of public improvements. Hence, the present building plans affecting highways, the waterway and State buildings are proceeding under its direction. No statement of what is to be done, or what already has been accomplished, would be complete, however, without a reference. to the tireless zeal of Governor Lowden in seeing the plans completed and actual work begun. His has been not only the creative genius, but also the guiding spirit.

Indicative of the wisdom of the movement to launch upon a great, post-war building program was the absence in the legislative session just closed of any serious opposition to the road or waterway appropriation bills. These measures were passed almost unanimously. Certain

changes, to satisfy minor objections, were necessary by amendment, but no obstacle was put in the way of final passage of construction bills.

The ending of the war caused a reversal in the labor market everywhere. Returning soldiers, sailors and marines were seeking employment in every city and town in the State. The same question occurred to all who studied the problem: Why not begin road building and other public improvements now while there is need for work among men just out of the service? The query was an apt one, and every legislator answered it with his vote. The action of the Legislature in making appropriations for big construction works by stimulating trade and allaying industrial unrest, undoubtedly has had an excellent effect on the morale of both capital and labor.

But the determination to build roads and to dig the waterway and to improve the properties of the State did not grow out of a desire simply to give employment. It came as a definite call of duty which had been growing more and more insistent through recent years. Illinois highways have been called "disgraceful" and have been subject to unsavory comparisons with those of other states. By a system of automobile license fees, a previous Legislature provided adequate funds for roadbuilding, the use of which was imperative.

Early in the last legislative session, the entire building program was menaced by what appeared to be a disposition on the part of dealers in cement and other building materials to extort prices which would have been prohibitive. Immediately a legislative investigation was set on foot which resulted in the suspicion that an agreement existed among cement manufacturers. The committee made no direct charges, but it did discover facts highly illuminative. Growing out of the inquiry came a law signed by the Governor, which enables the State to engage in the manufacture of building materials for use in public improvements. The State is, therefore, in a position to establish a plant or plants for making cement or other materials if at any time this appears expedient.

No state in the Union is entering upon a more extensive road building program than Illinois. For State aid highways alone. $60,000,000 in bonds was authorized by the Fifty-first General Assembly. While this amount will not be expended in the biennium, the entire amount was appropriated so that the Highway Division should not be restricted in the amount of actual construction it may do before another Legislature convenes in 1921.

As previously stated, the money for this enormous road undertaking is to come from the funds obtained from automobile license fees paid into the State treasury through the office of the Secretary of State who administers the automobile laws. Therefore, because the autoist, who will profit most by hard roads, is to pay for them there can be no opposition from the tax payer.

In addition to the sixty millions of dollars for State aid roads Federal funds are available to match State funds bringing the total possible to use for hard road construction for the next biennium up to approximately $87,000,000.

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