Licensing and certification seeks transfer flexibility amid staffing shortfalls; committee told contract inspectors cost far more than state hires

The Department of Health and Welfare asked the Joint Finance-Appropriations Committee on Jan. 13 for a supplemental exemption that would permit the Division of Licensing and Certification to transfer personnel dollars to operating-expenditure categories. The division said the flexibility is needed so it can continue to use contract nurses to meet federally required inspection schedules when it lacks full-time personnel.

Legislative Services analyst Alex Williamson said Licensing and Certification is authorized 71.9 FTP with a 13.9‑position vacancy reported at the time of the budget submission. The division historically has contracted registered nurses to conduct surveys and inspections when staff vacancies prevent the division from meeting inspection timelines. The 2024 supplemental had asked to transfer about $400,000 from personnel to operating to fund contract nurses; the department used roughly $300,000 and reverted about $100,000.

Director Alex Adams told the committee that contract inspectors cost significantly more than state employees doing the same work'he cited contractor rates around $90 to $95 per hour compared with about $35 per hour for state staff. Adams said the division's turnover rate has improved substantially, falling from roughly 21% during the pandemic period to 7% most recently, but that occasional reliance on contracted inspectors continues in order to meet federal inspection frequency requirements. Adams also noted that every other state agency has legal authority to transfer personnel costs to operating; the Department of Health and Welfare is the only agency with an explicit restriction in statute, he said, and requested the committee consider the department's exemption request.

Analysts and lawmakers asked the director to provide additional detail on how much has been spent on contract labor versus in‑house staff for inspections and whether the supplemental is intended as a recurring fix or a bridge until more full‑time hires are made. The governor recommended both the supplemental and a similar ongoing request. Committee members said they want an accounting of past transfers and the program's ongoing staffing plan before making a final decision.