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Procurement

Florida TaxWatch: Deloitte contract illustrates need for procurement reform | Florida

(The Center Square) – Procurement rules merit thorough review after revelations Deloitte secured another lucrative state contract while being sued by the state for its liability in Florida’s unemployment fiasco, groups across the state have said.

Florida TaxWatch (FTW), the Tallahassee-based public-spending watchdog, has joined the Associated Industries of Florida and others in citing Deloitte’s newest contract as an example of why procurement reform is necessary.

FTW has proposed guidelines designed to “increase contract oversight and safeguard taxpayer dollars for large-scale, multiyear state contracts” it will submit to state lawmakers to consider during their 2021 legislative session. 

“Our state government must be accountable to Florida taxpayers and show it can consistently make smart business decisions that protect their interests,” FTW President and CEO Dominic Calabro said Tuesday when releasing its latest brief, It is Time to Overhaul the State Procurement System.

The Florida Agency for Health Care Administration (AHCA) announced last month it awarded a $135 million contract to Deloitte for its Medicaid Enterprise Data Warehouse project despite Gov. Ron DeSantis ordering an investigation into the company for its role in the state’s unemployment fiasco.

Deloitte built the state’s CONNECT unemployment system with a $40 million bid in 2011 that swelled to $77 million by 2013. The system collapsed in March, leaving hundreds of thousands of jobless Floridians waiting weeks for first unemployment check.

“The decision by AHCA to award a $135 million contract to a company that is actively being investigated by the governor’s chief inspector general for its failure to perform on a different state contract is hard to believe and shows the dire need for state procurement reform,” Calabro said.

DeSantis said he would not have allowed Deloitte to bid for the AHCA project, but state procurement rules don’t allow the governor’s office to intervene in the process.

FTW’s recommendations include:

• Department/agency chiefs should be designated as executive sponsors for projects and be accorded “complete responsibility for the project and the authority to enforce terms and conditions of the contract.”

• Agencies should develop project plans that include “at a minimum, a well-developed and logical project concept; a well-defined scope of work; well-defined roles and responsibilities of key stakeholders; detailed project workflows and realistic and achievable project schedules; well-defined resource needs and allocations; well-defined training needs and a process for training stakeholders and end users; a well-defined and detailed process for communicating and managing change with stakeholders and end users; and a clear and detailed structure to be used to govern the project.”

• Projects’ “scope of work” should be divided into “discrete increments which will permit the final product to be delivered, tested, and accepted incrementally to increase the likelihood of success.”

• Agency chiefs should “identify key stakeholders, solicit their input during the planning phase of the project, and secure their commitment to make the project a success.”

• Establish a project management team responsible for the day-to-day management and maintenance of the project.

• All contracts “should address what happens at the end of the agreement. The state’s expectations with respect to its ownership of the intellectual property or its rights to use or modify the intellectual property under any license from the vendor should be expressly clear and understood.”

• Multiyear projects should be accompanied by multiyear financial models to cover the entire project life cycle.

• Agencies should establish a governance model/structure that “assigns accountability at each level of the project and provides a framework to guide decision-making, problem solving, and conflict resolution.”

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