Assemblyman Boyland: Ending the Practice of High-Priced Consultants Will Save at Least $250 Million, Make Government More Efficient

March 12, 2009

Assemblyman William Boyland, Jr. (D-Kings) announced that a proposal to be included in the state budget will reform the way the state handles technology procurement – saving the state at least $250 million over three years and making government more transparent and less costly.

“New York State is falling behind other states in getting value for its procurement dollar, particularly in technology,” Assemblyman Boyland said. “With the state facing a record budget deficit, every dollar counts. We currently have contractors and consultants on the state payroll doing jobs that should be done by state employees for up to 40 percent less. This system needs to be overhauled immediately, which is why we require all agencies spending over $15 million annually on outside IT contractors to reduce such spending by 50 percent by April 1, 2012.”

Assemblyman Boyland said the state is paying premium prices for consultants who burrow themselves into agencies and do the work of state employees in the technology sector. While such contracts appear limited in time, they are often renewed automatically. Currently, the information technology skill development and training provided to state employees is sporadic and insufficient to keep the state workforce up-to-date technically.

“The plan will require agencies that contract out their IT positions to include a specific plan in those contracts to train state employees. This will reduce future dependence on contractors and bring cutting-edge technology to the state workforce in a less expensive way,” Assemblyman Boyland said. “Keeping technology jobs in-house will ensure state dollars are being spent to develop the skills of state employees, not line the pockets of private contractors.”

The procurement reforms:

• require the Office for Technology (OFT) to produce a plan to create an enterprise technology for the state that will make technology purchases by different agencies compatible and less expensive and detail a technology skills assessment and plan to meet the state’s future technology needs;
• allow OFT to enter into centralized technology contracts that will permit state agencies and local governments to take advantage of bulk purchases in order to purchase technology more cheaply – saving municipalities between 20 and 40 percent on IT purchases;
• require all agencies spending over $15 million per year on outside IT contractors to reduce spending on such contractors by 50 percent by April 1, 2012 – saving the state up to $36 million during 2009-10 as contracts come up for renewal;
• mandate Request For Information meetings be held for all contracts over $5 million;
• create a chief procurement officer within the Office of General Services (OGS);
• adopt OGS-recommended uniform bidding thresholds;
• require OGS to report on improvements in standards, best practices, usage of technology, and a strategic plan to increase centralized aggregate purchasing;
• require separate budget line items for outside workforce contracts; and
• institute mandatory yearly reporting, starting Dec. 31, 2009, from each agency that procures over $1 million annually in IT services.

State agencies also frequently use their own independent technology infrastructure for a variety of services including server and e-mail applications – consolidation of these services through OFT would save the state at least $51.5 million annually.

Procurement is currently managed through the Office of General Services and is hindered by excessive reliance on manual procedures and inconsistency. This legislation will reform the process to include standard forms, terms and conditions, improved utilization of technology, and increased opportunities for bulk purchasing, Assemblyman Boyland said.

Assemblyman Boyland said based on savings Pennsylvania achieved by applying similar procurement spending reforms, the state expects to save a total of $180 million over the next two fiscal years, and between $40 and $50 million annually thereafter.

“Bringing technology work in-house will help grow our workforce and improve transparency in our government,” Assemblyman Boyland said. “This cost-saving legislation will develop the information technology skills needed to keep the state workforce up-to-date.”

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