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Wayne Hammon


Wayne Hammon has had a tough couple of weeks. First, his boss Gov. C. L. "Butch" Otter, had Hammon, administrator of the state's Division of Financial Management, consider plans to hold back up to 2.5 percent of the state's general fund spending. Then the governor ordered a 1 percent holdback, with Hammon standing beside him to answer questions from the press. Then a couple of giant banks in New York City folded, Congress balked, and the market plummeted.

But that's all in a day's work for Hammon, an Idaho boy who worked on Capitol Hill for a few years before President George W. Bush sent him back to Boise to work for the U.S. Department of Agriculture. Then he got a job writing Otter's budgets. DFM is projecting less revenue for the coming fiscal year and will release the estimate in December. But Hammon still says, "Don't cash out your IRA. It's going to get better."

When you get in to work or when you get your paper in the morning, what do you look at first?

We get a clipping service, so we get clips from all the Idaho publications, and that's typically the first thing I read. I then read the local papers as well. Then I always do a market check ... where we at? By the time I get to the office, the market's about ready to open, so I always check to see what the overnights were, that kind of stuff. That's probably the first thing every morning.

What are you looking for?

I'm just looking for a major change. The state is so positioned that a bad day here or there is not going to change our economic outlook incredibly. But I'm looking to see, you know, I notice days when the Dow goes down 777 points, so a major change.

And a day like that, do you have to brief the governor? Did you sell?

When there is something big, that's typically my first call, find out where the governor is, how do I get to him. Yesterday, he was in Homedale so it was all on cell phones yesterday. But just give status reports as to what's going on, when he's not in the office, he's really good about keeping in touch with the chief of staff and say, "When you talk to the gov, I need five minutes," that kind of stuff.

How did you get into this kind of work?

That's a good question. I have a bachelor's and a master's in public policy, so it's kinda what I wanted to do in the very beginning. When I graduated from college with a master's degree, I went to D.C., and I was in D.C. from '95 through 2001, so six years.

Doing what?

I worked on the Hill the first four years. I worked for Senator Hatch from Utah and then Senator Craig, and then I was a lobbyist for two years. And when George W. Bush won, I was offered a couple different jobs inside the administration, and one of 'em was here in Boise, so I took the Boise job and moved back to Idaho. I was at USDA, Department of Agriculture. I was the state executive director of the Farm Service Agency at USDA, which is a political appointee position. So I did that for seven years and then there was an opening in Butch's office, and the governor asked me to come aboard.

So had you done financial analysis before?

At USDA, we handle a lot of money and we do a lot of—the biggest budget there is a loan program—so we're doing individual budgets on individual operations, that kinda stuff, and I've done a lot of budget management, nothing as big as I do now. I'm not an accountant or anything like that, but had worked with—on the federal side—had worked with some pretty big budgets before.

How do you go about forecasting the future state economy?

So, I'm very fortunate that although I'm not an economist or an accountant, I have very good economists and very good accountants that work for me. And so we monitor tax receipts. When someone pays sales tax, that money is collected by the State Tax Commission. DFM has built a long history of this stuff. It goes back to the '40s. And from that history we have built a model that predicts certain things, so we can say: Here's all the leading economic indicators ... joblessness, growth in certain industries, like the microchip industry, the timber industry, the agriculture industry, growth numbers. The computer model predicts a good case scenario, bad case scenario, and then the economists, after the computers are done, go in and make sure it makes sense, they logic proof it and go in, and sometimes we add money, sometimes we take money out, based upon what they know.

So as the administrator, I actually don't play a very big role in the forecast because we want the forecast to be above politics. It should be the same no matter who the governor is, it should be the same whether they are Republican or Democrat, so the forecast team—the state economist, his assistant, and the people on the tax commission—do the same every day, day in day out, regardless of who the administrator is. The forecast is, if you average the last 10 years, the forecast has been off just over 3 percent from actuals. And 3 percent over time, you know ends up, 1 percent is $27 million, so you know you can be up or down a hundred million real easy.

How is that similar or different from running a large business?

I don't know.

What is the difference between the Legislative Budget Office and you guys?

Well, we work together an awful lot. The main difference is who we report to. I work for Butch Otter. It's his budget that I'm building and his priorities. They work for the Legislature and sometimes the Legislature has different priorities than what the governor does. That's the main difference.

Are there certain areas where you regularly have different interpretations or numbers than the Legislative budgeters?

We work very hard to balance to them or they to us. We are constantly checking on it, and if there's a disagreement, we work very hard to get to that number. The disagreements we have with them are over policy. The governor wants a million dollars for this, they don't want a million dollars, or they want a million dollars for something the governor doesn't want to fund. But on the numbers, we work very hard to make sure the numbers match.

Is that the political part of your job?

It's also what makes DFM a great place to work. It's not just the state accountant. I also have a policy function and a political function as an advisor to the governor on various issues. Almost every policy decision has a budget decision that goes with it.