FSSA, IBM and Gov. Daniels darkest hour

Other governors have faced similar dark moments. For Gov. Robert Orr, it came in December 1982 when the state faced bankruptcy and he had to call the General Assembly into session to pass record tax hikes during the last severe recession. For Gov. Evan Bayh, it may have been the days leading to the 1993 special budget session when he had to opt for the riverboat casinos. 

For Daniels, the FSSA welfare privatization deal was the culmination of a two-decade experiment in which elected leaders became “CEOs” and government functions were out-sourced to private vendors. When Indianapolis Mayor Stephen Goldsmith came to power in 1992, Daniels chaired his Services Efficiency and Lower Taxes for Indianapolis Commission (SELTIC), which resulted in the privatization of city swimming pools, golf courses and sign shops.

Another key player was Mitchell Roob who headed the city’s Department of Capital Asset Management and later Health and Hospital Corporation.  In the book “To Market, To Market: Reinventing Indianapolis,” Roob espoused Goldsmith’s theme of “reducing government control by turning the government’s business over to private interests.” The “thesis” of the administration was that “marketized” public service could be delivered at lower cost, without a corresponding decline in quality or quantity of services.

Now, flash-forward to 2005 when Daniels assumed office and Roob headed FSSA. Roob would say the three major figures – Daniels, Roob and Goldsmith – had simply “traded positions.” Daniels became the CEO; Roob headed FSSA; and Goldsmith became the adviser.

The other element to this picture is that between the Goldsmith mayoral administration and the Daniels’ governorship, Roob worked for Dallas-based Affiliated Computer Services Inc., which was eventually included in the IBM welfare deal. From the beginning of this affiliation, critics abounded. They pointed out that Texas had pulled the plug on a similar deal.

And that’s what happened here with the situation exacerbated by the Great Recession of 2008-09, as tens of thousands of Hoosiers lost their jobs, their paychecks, their unemployment and their security. The computerized eligibility system that Roob oversaw was rolled out in 59 of Indiana’s 92 counties. It didn’t include some of the state’s most populous counties such as Lake and Marion.

Republicans like State Reps. Suzanne Crouch of Evansville and David Yarde of Garrett were getting deluged with complaints. “For some time now, my constituents have had trouble obtaining food stamps and unemployment benefits from FSSA,” said Yarde.

While Daniels correctly states that the system he inherited was rife with fraud and inefficiency – telling me last summer that the old system was still getting more complaints from the counties yet to switch over – the problems with IBM and ACS can be appreciated by anyone trying to deal with any company where you can’t talk to a real person.

I recently tried to resolve a problem with my Internet and TV provider and spent more than an hour and still couldn’t get the problem resolved. Lois Rockhill, executive director of Second Harvest Food told the Anderson Herald-Bulletin: “People needing food stamps, cash assistance and health coverage have very little wiggle room. Falling through the cracks is almost like falling through the gallows with a noose around your neck. You are at the end of your rope. The very system that was created to help you ends up punishing you.”

Daniels will now seek a “hybrid” system where face-to-face contact is restored to FSSA applicants. He explained, “Those who raised concerns about service quality were correct and we appreciate their efforts. We’ll now take the best parts of the old and new and move ahead with a hybrid system in what amounts to a major mid-course correction. The easiest thing to do in a situation like this is throw your hands up and say, ‘Well, that’s as good as it can be.’ This has been a daunting thing all along, and it still is, of course. Our first attempt didn’t get us there, but we did get some positives out of it.”

Other Daniels’ efforts have seen ups and downs. The original revamping of the Bureau of Motor Vehicles was controversial and problematic. Today, I’m amazed I can get in and out of a license branch in a matter of minutes, not hours.

Getting new plates is one thing; the social safety net is something Indiana has to get right.

(The columnist publishes at www.howeypolitics.com)

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