You just think there might be some more inefficiencies?
by Steve Mastro
State to save by closing storage
Gov. Rendell put the figure at $4 million. Changes in the way office supplies are purchased eliminate the need for 13 warehouses.
Associated Press
HARRISBURG - Changes in how the state buys office supplies will allow it to shed or reuse 13 warehouses and save $4 million annually, Gov. Rendell said yesterday.
Under a contract awarded last year, office supplies are now purchased when needed, not stored in bulk, and are delivered directly to state offices by the supplier, officials said.
That eliminates the need for a warehousing network that state officials say is cumbersome and lagging behind a private sector that, over the last decade, has consolidated its shipping to save money.
Rendell noted that the $4 million savings is small compared with the state's $23 billion budget, but the money will be well-used. For instance, $4 million can pay for 11,000 children to receive after-school tutoring, he said.
"These savings have a direct benefit in human terms," Rendell said.
The cuts will be added to a growing list that Rendell has said he hopes will reach $1 billion in annual savings on government operations by the end of his four-year term next year.
The total annual savings so far is about $350 million and could reach $500 million by the end of the year if the administration can force pharmaceutical companies to lower the prices they charge the state, Rendell said.
The shuttered warehouses are all in the Harrisburg area, said Don Cunningham, the state secretary for general services. The 40 warehouse workers will be transferred to different state jobs, officials said.
About two-thirds of the warehouses were leased, while the rest are owned by the state. The state-owned spaces can be sold or reused, Cunningham said.
Formerly, office supplies were delivered to one of the Harrisburg-area warehouses, each of which served a particular state agency. The supplies were then shipped to a county-based warehouse before being shipped again to a state office.
Supplies were bought in advance, and sometimes pens sat for so long that the ink dried out before they arrived at an office, Rendell said.
At other times, state workers would get so frustrated waiting for supplies to arrive that they would buy the items from a retail outlet, Cunningham said.
Under the new system, many of the county-based warehouses are no longer needed, officials said. The state has hired a consultant to advise it on how to use its properties in a more efficient way.
That means looking at 9,000 state-owned buildings and 1,400 leased properties, state officials said.