Saying "people are policy," Huntsman named 14 of his Cabinet members Wednesday. Utah's new governor kept seven of former Gov. Olene Walker and Gov. Mike Leavitt's closest advisers and picked a few executives from state political and financial circles - including Democrat and Administrative Services Director-designate D'Arcy Dixon Pignanelli and Insurance Commissioner-in-waiting Kent Michie, who has handled state bonding for years.

"One thing I've learned in the private sector is: If you don't make use of the best talent you have in your state, you will lose that talent," Huntsman said.

But the as-yet undefined policies the governor's inner circle will implement are raising hackles and fears - particularly in the Department of Community and Economic Development (DCED), which Huntsman has targeted for "quite considerable" restructuring.

Already Wednesday morning, Human Resources Management Director-designate Jeff Herring asked about 60 appointed workers in DCED to submit resignations, including Division of Business and Economic Development Director Jeff Gochnour, Utah Film Commission Director Leigh von der Esch, state history Director Phil Notarianni, Arts Council Director Frank McEntire and state Library Director Donna Morris. Those employees will learn their fate by the end of business today.

The governor, who campaigned on a promise to boost the state's economic prospects, proposes absorbing the economic development functions of that department into the Governor's Office. Then he would place senior adviser Chris Roybal in charge of tax reform initiatives, regulatory reform, a national network of Utah promoters and an entrepreneurs program.

Huntsman says he wants the state's economic development initiatives to "turn on a dime."

"He wants economic development under his thumb, in this office, where it can move on a moment's notice," said Chief of Staff Jason Chaffetz.

The structural change guarantees some DCED employees will lose their jobs. The 60 who submitted their resignations Wednesday represent one-fifth of the department's work force. DCED includes the state Library, Arts Council, Historical Society, Travel Council and Minority Affairs offices.

Media Relations Director Tracie Kayford was among those asked to resign. Those who will remain will be notified by phone or e-mail by the end of today. "They're going to do things very swiftly," Kayford said. "Morale is a little low as you can expect. I doubt that many of us will get a good night's sleep."

Huntsman spokeswoman Tammy Kikuchi said "no merit employees are being considered [for job cuts] at this point." Merit employees are protected by civil service rules, unlike those who serve at the will of the governor.

New DCED Director Sylvia Haro, whom Huntsman touted as the first Latino to sit on a Utah governor's Cabinet, will be left to administer community and arts development.

Although Utah Democratic Party Chairman Donald Dunn credited the governor for "crossing the aisle" to appoint Pignanelli, others question the diversity of his picks. Huntsman's Cabinet represents a net loss of women in top state jobs; he started with five and appointed three. But the governor says that will change.

"We're not finished building the Cabinet. It will look a little bit different than it does today," he said.

Some state employees have criticized Huntsman's abrupt process as corporately impersonal. The governor did not meet with most of the state executives he has fired, leaving that job to transition team members. Department workers were informed of his Cabinet picks through news releases.

Former Leavitt Chief of Staff Charlie Johnson remembers he or Leavitt talked to each of the directors they replaced. "It can be done a hundred different ways," Johnson said. "Some people are retained. Most people aren't. That's the nature of a transition."

Huntsman also has pinpointed Administrative Services - the nuts and bolts department of state government - for structural changes, many of which will require legislative approval. But Chaffetz said no Administrative Services employees are targeted currently for layoffs.

Pignanelli said she will refocus attention on information technology, making sure the division is oriented to customer service. "We exist to serve the other agencies to make sure they can do their job. If we don't do our job well, they can't," Pignanelli said.

The governor kept on Utah Department of Transportation Director Jon Njord and Department of Environmental Quality Director Dianne Nielson, in large part for their technical knowledge and experience.

"I hope it's a reflection of the fact that the work of the department has really been focused on ensuring that environmental quality and economic development are partners," Nielson said. "There's nothing more important than the quality of the environment."

Environmentalist Jason Groenewold questioned Nielson's appointment, noting the legislative auditor's scathing audit of Nielson's department released in May. "There have been serious problems within the Department of Environmental Quality that have not been addressed or resolved and Huntsman now owns those problems," Groenewold said.

But other environmental groups are willing to live with Huntsman's choices. Debbie Goodman, legislative lobbyist for the Utah Audubon Council called Natural Resources Director Mike Styler "a good appointment. I don't expect the governor to appoint someone who agrees with me on everything."