Texas re-starts child support program
The program is intended to more accurately track child support payments and investigate laggards. The feds fund two-thirds of the operating cost.
The upgrade lost the backing of the federal government in December amid cost overruns, delayed implementations and other inefficiencies. The government placed a freeze on funding its share of the costs amid concerns about numerous entities connected to the project, including the main contractor, Accenture.
The federal child support office said in a May 17 letter to the state that a new plan proposed by Texas “provides a clear go forward strategy focused on ensuring good management of the project as well as addressing and mitigating risk and issues going forward.”
The project remains five months behind schedule and at least $100 million above the estimated cost of $202 million.
The funding returns a week after Accenture sent a letter to the state threatening to walk away from the project. It outlined the work the company has done to put the project in compliance with any requirements in order to get the funding restored.
“While we have gone well above and beyond the call of duty throughout these circumstances,” the letter said, “we cannot continue to work without complete assurance that all of our efforts (past, present and future) will be paid in a timely manner.”
A company spokesman in Texas, Joe Dickie, declined an interview request. In an email, Dickie noted that a previous company had created the plan before Accenture came on board.
“Prior to Accenture engaging with the Office of the Attorney General of Texas to support the modernization of the Child Support program, the program was mapped out in detail by a privately-held company,” Dickie said in the email. “The plan was referred to at a hearing last December by the head of the Independent Validation and Verification review, Herb Krasner of the University of Texas, as not being ‘…worth the paper it was written on…’."
The plan was developed by Deloitte Consulting. A Deloitte spokeswoman, Courtney Flaherty, issued a statement in response to the allegation.
“Deloitte Consulting’s work on the Texas child support project was completed on time and on budget over three years ago,” she said. “Our work was validated and accepted by both the Office of Attorney General and the vendor responsible for delivering the child support system. As an organization deeply committed to the state of Texas and its communities for over 40 years, Deloitte flatly rejects mischaracterizations of our work with the OAG.”
Accenture came to the program in 2010, three years after it was launched, and records show many of the problems have occurred between that time and late last year, when the federal funding was frozen.
Regardless, the trouble is another demerit for Accenture, which has received millions of dollars in incentives, ranging from training reimbursements to tax credits, from municipalities as part of the company's winning bids on public projects.
Texas cancelled an $899 million contract in 2007 with the Chicago-based management and consulting group after a plan to upgrade technology in the state’s social services division was beset by technical problems.
That came after Accenture was given tax breaks and subsidies worth $1 million by the east Texas town of Athens in exchange for housing a call center there.
Accenture has received $12 million in subsidies from North Carolina, according to data collected by Good Jobs First, which tracks subsidies. North Carolina is where the group received a state contract to modernize its food stamp program in 2013. Backlogs soon plagued the system, and in December 2013, the U.S. Department of Agriculture, which manages the federal food program, threatened to pull funding from the state unless the jam was cleared.
In California, Accenture has received $1.2 million in subsides while a state audit released last year found that its Department of General Services entered into contracts with Accenture that “do not adequately protect the State.”
Despite a mixed record, Accenture and its subsidiaries have received billions in contracts from the federal government, including $25 million in funds from the 2009 “stimulus” package enacted under President Obama’s direction. Most notably, the company was hired to pick up the pieces from a failed first try at the technology behind Obamacare. Accenture was hired despite a prior audit at the U.S. Postal Service, which pointed out that the U.S. Department of Justice had settled a whistle blower case against Accenture in 2011.
In an internal letter, the Postal Service’s inspector general wrote to a supply manager that Accenture “agreed to pay the U.S. government $63.7 million to resolve allegations that it received kickbacks for its recommendations of hardware and software to the government, fraudulently inflated prices, and rigged bids in connection with federal IT contracts.”
Dickie, the Accenture spokesman, said in an email that the company is involved in thousands of projects at a time “and it is not fair or accurate to point to a small number of engagements as an indicator of our reputation and capabilities."
He added that “large-scale IT projects are complex in nature and sometimes encounter challenges, and we consistently work to identify and address issues as they arise.”