Editorial: No-bid contract is troubling

Gov. Jeff Colyer gets mostly solid marks on improving transparency and openness in state government.

His executive orders at the start of his tenure eliminated fees for the first 100 pages of documents requested under the Kansas Open Records Act, required employees of the governor’s office to use only official email accounts to conduct state business and created a centralized website where all open meeting notices of executive branch agencies will be posted. During this session the Legislature, with Colyer’s support, passed bills that made police video recordings and records pertaining to deaths of children in the care of the state more open to public scrutiny.

But the Colyer administration’s decision to outsource the job of modernizing and maintaining software that runs the state’s tax collection system to a Canadian firm in what was essentially a no-bid contract fails the transparency test. The software dates back to 1994.

Kansas Revenue Secretary Sam Williams said he followed all state purchasing rules when he awarded the $48 million contract to CGI Group, one of several firms involved in the troubled launch of the federal government’s healthcare.gov website in 2013. The contract for maintaining and supporting the software that runs the tax collection system will result in 56 information technology workers in the agency losing their jobs.

Williams said contracting the work of maintaining and supporting software will allow the Department of Revenue to focus on its core competencies: collecting taxes; issuing driver’s licenses; issuing and regulating liquor licenses; managing the state’s property valuation system, which both the state and its 105 counties rely on for levying property taxes; and working with the Legislature in developing tax policy.

“I am not an Oracle. I am not an Apple,” he said. “And so if I’m trying to get resources to creating software, I’m taking resources away from those core competencies where I can compete for the right people, for the talent and so forth.”

Williams said state procurement laws allow agencies, in certain cases, to negotiate with companies with whom they already have a working relationship, especially if it’s believed no other company is able to perform the same task. The software currently in use was designed by American Management Systems, which was acquired by CGI in 2004. As a result, CGI became the owner of the software, and so he said it was reasonable to contract with that firm to modernize the system.

The Department of Administration posted notice of the contract, which opened a seven-day period during which other firms could file an objection and ask to be given the opportunity to submit other proposals. Only one firm filed an objection, and the Department of Administration determined that company could not perform the job.

Still, awarding a $48 million state contract to a company with a less than stellar history without a true bid process is no way to champion open government. Hopefully, the Colyer administration will implement a more open process in the future on behalf of state taxpayers.


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