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Wednesday, Aug 20, 2014
Commentary

When government, outsourcing and technology meet, it isn’t always pretty

Published:

If you’ve been paying any attention at all to the news over the past month, you’ve been bombarded with account after account of the bungled rollout of the Affordable Care Act’s website.

I must admit, I wasn’t particularly shocked or dismayed that there were technological glitches. Perhaps because of my time in the Florida Legislature, I rather expected them.

Government functions are large-scale and complex. Due to the rallying call for smaller government over the past two decades, government agencies and state legislatures have attempted to privatize many of their functions.

Stroll down memory lane with me as I recall several of Florida’s attempts to contract out the revamping of government services or administrative functions through the use of technology.

Let’s start in 2000 with the push from the Governor‘s Office of Policy and Budget “to look at programs, services or activities that could offer benefits and savings by involving private sector providers … thus reducing costs and improving efficiencies within state government.”

We have since learned that privatization seldom delivers on the promised savings and often costs much more than anticipated. Glitches and rough starts come with the territory.

In 2008, The Council on Efficient Government issued a report to the governor on three such projects:

MyFloridaMarketPlace was intended to automate the state’s procurement process to make it more cost effective and timely. The primary vendor, Accenture, saw its initial five-year contract of $92 million revised upward to eight years at $114 million.

Under People First, the state turned over its entire human resource operations to an outside vendor, Convergys. The initial result was a decline in service levels and an increase in dissatisfied state customers. It eliminated more than 1,200 full-time employees across 30 agencies. Problems began to emerge, such as chronic payroll errors, insurance cancellations, over withholding of taxes, duplicate salary payments and long waits and wrong information on the help line.

It took a couple of years to correct these problems, and the price went up. The initial seven-year cost of $287.6 million increased to a nine-year cost of $350 million.

The Aspire project was intended to replace the state’s 25-year-old legacy accounting and cash management system. The new system was expected to track all financial transactions in a state with a budget exceeding $70 billion. Bearing Point was awarded the project.

The initial six-year cost of $68 million rose to $100 million. In 2007, then Chief Financial Officer Alex Sink stopped the project, declaring the privatization effort an expensive failure. By that time, $89 million had been spent.

Sometimes a project does precisely what it is supposed to do and still gets the ax. Case in point: Transparency 2.0, which was chronicled in a Florida Trend article in July 2013.

The Legislature passed a law in 2011 requiring the creation of a Web portal that enables the public to access the state budget. The Florida Senate contracted with a firm called Spider Data Systems and paid $5 million to develop Transparency 2.0.

Despite the side story that the Senate’s chief of staff gave a no-bid contract to his friend who was a partner in Spider, the Transparency program worked really well. The First Amendment Foundation and Integrity Florida, two proponents of open government, praised the website and claimed it would save the state millions and provide easy access to budget information for Florida’s citizens.

The contract with Spider was abruptly ended even though the program worked perfectly. Perhaps those who do business with the state were not pleased with all that pesky transparency.

Which brings us to a few weeks ago, when the state’s unemployment claims system was shut down for a week as the state switched to a new system. The state contracted with Deloitte Consulting to develop Connect, a $63 million computer program. Deloitte is experiencing problems with its work elsewhere, including the updated benefits system in Massachusetts.

The launch in Florida did not go smoothly. The state is adding phone lines, extending call center hours and bringing in additional staff to address the confusion. The site has been unable to recognize a claimant’s personal information. Complaints about wait times, system crashes and error messages dotted social media and led frustrated people into packed unemployment offices.

The workability of Connect is critical since Gov. Rick Scott mandated that all new claims had to be filed online.

Sound familiar?

Paula Dockery is a syndicated columnist who served in the Florida Legislature for 16 years as a Republican from Lakeland.

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