Wohlgemuth's legacy

We've just barely started down the road of privatizing the Texas Health and Human Services Commission (THHSC), and already the savings we were promised for doing so are turning into an illusion.

The $45 million in savings Texas' Health and Human Services Commission hoped to realize by privatizing its payroll and human resources operations will be far less, according to a state auditor's office report to be released next week.

The audit, a draft of which was obtained by the Express-News, said a substantial amount of the projected savings evaporated after "errors and complete data" were considered.

That version of the audit said the commission would save only $1.1 million over five years. The commission disputed that number.

The report also questioned the commission's process for awarding the contract to Convergys, an international outsourcing company that also runs Florida's payroll and personnel systems.

Off by a factor of 40. That's pretty impressive. You could have probably just fired a couple of managers and gotten the $220K per year savings that we're actually going to see.

Those who oppose the state's rush to privatize say that same faulty analysis is allowing the commission to claim $646 million in savings by laying off 2,500 state employees, closing dozens of offices around the state and farming out eligibility work to four privately-run call centers under a five-year $899 million contract with Accenture.

I discussed that $646 million fantasy back in July. Anyone still believe that number is operative?

Privatization was sold to taxpayers and legislators as a major savings, Sen. Elliot Shapleigh said Wednesday. Shapleigh was part of a Senate finance subcommittee that attempted to reform the way Texas awards private contracts. The effort failed.

"Instead, professional and proven state employees were cut and politically chosen vendors were awarded (contracts) with little or no savings to the taxpayers," he said.

Funny how that seems to happen, isn't it? Who would ever guess that connections and cronyism would count for more in the handout of megamillion-dollar contracts than merit? Shocking, just shocking.

I've titled this post for former State Rep. Arlene Wohlgemuth, author of HB2292, which was the genesis of all this nonsense. Let me just say again how lucky we all are that Rep. Chet Edwards sent her back into private citizenhood last November.

Carlos Guerra has more. Here's a statement (PDF) on the draft report from the Center for Public Policy Priorities. Thanks to The Jeffersonian and The Red State for the links.

Posted by Charles Kuffner on September 30, 2005 to Budget ballyhoo | TrackBack