When Will The IBM-FSSA Debacle Ever End?

As many of our readers are undoubtedly aware. For the better part of the last decade now. We Hoosiers have been on the hook for well over a half billion dollar debacle because “Godfather” Governor Mitch Daniels and his stooge Mitch Roob had to enter into a boneheaded contract with IBM/ACS to privatize Indiana’s welfare system. We blogged about this last year and about a month became aware of some new developments in this case.

Rick Callahan writing for the Associated Press reported that Indiana’s Court of Appeals had upheld a previous ruling from August 2017 that IBM owed the state $78 Million. 

Callahan also reported:

The three-judge court also found that IBM is entitled to interest on nearly $50 million in state fees that Welch ruled Indiana owes the company. 

Judge Heather Welch had rejected IBM’s request for interest on those fees, but the appellate court reversed the decision and sent the matter back to Welch to determine the amount of interest IBM is owed. The court specified that the interest be calculated for the more than six years that have elapsed since another Marion County judge found in 2012 that Indiana owed IBM $49.5 million in state fees.

John Maley, one of the private attorneys representing Indiana in the case, called Friday’s ruling “a significant victory for Hoosier taxpayers.” He said the state’s attorneys believe Welch ruled correctly on the interest issue and that they will be conferring with state officials “regarding that narrow legal issue and possible further review.”

IBM spokesman Doug Shelton said the New York-based company is disappointed by the ruling and plans to appeal.

“IBM invested significant resources in its partnership with the state to help turn around a welfare system described at the time by Indiana’s governor as one of the worst in the nation,” he said in a statement.

Indiana and IBM sued each other in 2010 after then-Gov. Mitch Daniels, a Republican, cancelled the $1.3 billion contract that his administration reached with the company to privatize and automate the processing of Indiana’s welfare applications.

Under that deal, an IBM-led team of vendors worked to process applications for food stamps, Medicaid and other benefits. Residents could apply for the benefits through call centers, the internet and fax machines. But the contract was pulled in late 2009, less than three years into the 10-year deal, following complaints about long wait times, lost documents and improper rejections.

Not mentioned in the article is that former Assistant State House Assistant Leader Eric Turner had owned a building which was then leased by ACS to be used as a welfare call center. IR and the late great Gary Welsh have blogged about Turners legal and ethical issues.

It’s extremely frustrating to the IR crew and those of us on the front lines of fighting the most corrupt state government in the nation that this whole shit show over at FSSA is still going on. But as long as it is we and others like us will continue to report it. Don’t worry Gary. Your crusade will continue and intensify. Until our state is rebuilt. Good night and God Bless!