Tennessee lawmakers renew push for guardrails on state outsourcing

Tennessee lawmakers renew push for guardrails on state outsourcing

October 21st, 2017 by Andy Sher in Local Regional News
Richard Briggs

Richard Briggs

Photo by Associated Press /Times Free Press.

NASHVILLE — Members of a legislative study committee told Haslam administration officials Friday the Tennessee General Assembly needs greater say over state outsourcing on the front end and said he and colleagues will have a revised bill that provides it when they return in January.

"We really would like the state to prove when we're going to outsource something that it's not a job that can't be done just as well by state employees," said Sen. Richard Briggs, R-Knoxville, the co-chairman of the panel.

Briggs added that "if all of those things are equal, we're going to give the benefit of the doubt to people who work for us already."

The study committee was created after a version of the bill stalled amid stiff opposition by Republican Gov. Bill Haslam and administration officials this spring. Among other things, it called for an economic analysis of plans to outsource services now carried out by the state.

Administration officials slapped the bill with a fiscal "flag," arguing it would be too costly to do because, among other things, it would require hiring 15 analysts.

Since becoming governor, Haslam has embarked on any number of outsourcing ventures, the biggest being a massive agreement on facilities management of major state office buildings with Chicago-based real estate giant Jones Lang LaSalle.

And now, the governor is in the midst of a drive to outsource facilities management by JLL, which won a statewide contract, at public universities and colleges in areas ranging from janitorial services and grounds keeping to building maintenance and HVAC services.

Lawmakers said Friday that with outsourcing contracts running into the hundreds of millions of dollars and generating huge controversies exploding in their laps, the executive branch needs more review.

The amendment under consideration Friday was suggested by the Tennessee State Employees Association. Briggs said it needed to be pared down and given more focus.

Following the meeting, General Services' Chief Procurement Officer Mike Perry said he couldn't really speak to the amendment.

"We really don't have a comment because we haven't read it," Perry said.

He said the administration did have concerns about the original proposal, saying "we articulated those [concerns, as did other departments], but this new amendment we haven't seen. It sounds like it's rather lengthy."

Earlier in the meeting, Rep. Darren Jernigan, D-Nashville, raised multiple concerns about the higher education outsourcing.

Noting that JLL is subcontracting much of the work, Jernigan raised questions about one of the subcontractors, Diversified Maintenance Systems, pointing to a series of news accounts about its treatment of employees or job applicants.

One account related how the company is currently being sued in federal court in Maryland by the U.S. Equal Employment Opportunity Commission, which charged the firm with racially discriminatory hiring practices against blacks.

"Does that not concern you about the record of some of these contractors?"

Replied Paul Krivacka, the Central Procurement Office's lead attorney and director of Category Management: "I don't know the circumstances."

The attorney noted it is "not uncommon" for employees to file lawsuits. Moreover, Krivacka said, the JLL contract "adequately protects the state interest."

While the University of Tennessee System has put all of JLL's proposals online, Jernigan complained he has been unable to get access to the company's pitch to Tennessee Tech in Cookeville.

Tennessee Tech is one of six universities spun off from the Tennessee Board of Regents system last year, with all six having self-governing boards appointed by Haslam.

JLL's bid for janitorial services and grounds keeping for the University of Tennessee at Chattanooga was more than $260,000 over what the campus currently spends. JLL did, however, come in at about $41,000 less on student housing services.

JLL said the company could have come out looking better had UTC offered it the opportunity to provide its costs on physical plant and other services. But Haslam has repeatedly said publicly it's up to institutions to decide what services make sense for them when it comes to outsourcing.

Contact Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow him on Twitter @AndySher1.