DHHS commissioner says privatized welfare-to-work program worth extra costs

Source: Paul Merrill, WMTW News 8 Portland, January 19, 2017

A new privatized welfare-to-work program will be worth the extra millions of dollars in costs, according to Maine Department of Health and Human Services Commissioner Mary Mayhew. The current program, called Aspire, costs about $10 million a year. The state has signed a contract with the company Fedcap that could be worth as much as $62 million over the next four years, a 55 percent increase over Aspire. … The company will open 16 centers across Maine in the coming weeks to help people transition from welfare to work. Collins said he believes his company can do a better job than state-run programs. … Mayhew said the Fedcap contract is incentive-based to make sure Maine gets its money’s worth. Christine Hastedt, of Maine Equal Justice Partners, said LePage administration policies have pushed thousands of people off state welfare, but said she is optimistic about the public-to-private transition. … Hastedt hopes Fedcap will be able to successfully deal with Mainers who have serious mental and physical barriers to employment. … Collins said his workers have yet to encounter a situation they can’t handle. … Mayhew said former Aspire program workers transitioned to other jobs within the DHHS. Fedcap hired 10 Aspire workers, and a handful left state government, Mayhew said.

‘Donald Trump Before Donald Trump Became Popular’ Wants To Privatize Maine’s Welfare
Source: Donald Cohen, Huffington Post, November 3, 2016

LePage sees the resemblance. He’s called himself ‘’Donald Trump before Donald Trump became popular,” and “Baby Donald.” But his harshest trait may be his scorn for society’s most vulnerable. LePage wants to privatize one of Maine’s welfare programs by handing it over to a nonprofit, Fedcap, which has faced a dozen lawsuits since 2013 alleging workplace discrimination and wage, disability, and personal injury disputes. The program helps the nearly 5,000 Maine families receiving Temporary Assistance to Needy Families (TANF) find jobs and other community resources, and has the second highest work participation rate in the country. In the Public Interest’s latest report, How privatization increases inequality, describes how, in recent years, a number of states have outsourced important functions related to assisting families at or below the poverty line. Too often, the impact has been tragic. … LePage’s love for privatization runs deep. He’s received campaign money from the country’s largest private prison company; created privately run online and charter schools; put the state’s wholesale liquor business in private hands; proposed a privately run mental health hospital; outsourced the operation of a major bridge; and privatized a program that provides transportation to medical appointments. …


Editorial: If privatization is so great, why won’t the LePage administration share information?
Source: Bangor Daily News, October 31, 2016

Gov. Paul LePage’s administration has given little explanation as to why it has changed longstanding contracts and outsourced government services. The administration has touted and ramped up competitive procurement but has not made it easy for the public to see which private organizations won state contracts and why. The administration’s decisions affect state services that thousands of Maine residents rely on and have altered the way millions of taxpayer dollars are spent. If LePage is confident that his contract awards are improving the state of Maine, he has no reason to shield them. … More than a year later, the LePage’s administration is apparently still in the process of creating the rules needed to implement the new law but is not saying when that work will be completed. Whether it’s refusing to talk to media, limiting the amount of information his administration releases to legislators or equating FOAA requests to a form of “ internal terrorism,” LePage has routinely dismissed the public’s right-to-know since taking office in 2011. … If the administration today were as transparent as LePage promised the state would be when he ran for office in 2010, the public would already have online access to all contract decisions. The public would be able to see how the administration is spending its tax dollars. Without public oversight of contract awards, there’s a higher risk of government officials awarding contracts for personal gain. Such actions are responsible for billions in lost public U.S. dollars each year. There is no evidence LePage or anyone from his administration has engaged in such unethical practices, but the public has a constitutional right to make sure. But, in 2013, Citizens for Responsibility and Ethics in Washington ranked LePage as the second worst governor in the nation in terms of transparency, cronyism, pressuring public officials and mismanagement. The lack of transparency and accountability has only worsened since then. …

Under LePage administration, state work being funneled to private sector
Source: Scott Thistle, Portland Press Herald, October 25, 2016

Gov. Paul LePage’s administration has increasingly moved to have private companies and nonprofits do the work of state government, from dispensing welfare benefits and providing mental health programs to running prisons and operating a drawbridge. But LePage is hardly alone in his quest to privatize some of the functions of state government. In the past decade, governors around the country, Republicans and Democrats alike, have looked to the private sector for ways to save taxpayer money or improve the delivery of services without increasing costs. … What’s less clear is how well privatization works. The record is mixed, with some public-to-private transitions moving smoothly and efficiently, while others break down, leading to more spending on services rather than less. … In Maine, it’s difficult to track whether privatization is increasing, said David Heidrich, communications director for the Department of Administration and Financial Services, which administers most of the state’s contracts. The LePage administration announced last month that it had selected a private company to operate the state’s ASPIRE program, under a $62 million contract that could eliminate 50 jobs in the Department of Health and Human Services. ASPIRE finds jobs for people who receive financial assistance through the federally funded Temporary Assistance for Needy Families program. The ASPIRE contract was the latest of several privatization moves that LePage has made since he took office in 2011. The administration also has created privately run virtual and charter schools; put the state’s wholesale liquor business in private hands to generate money to pay off hospital debt; proposed a privately run mental health hospital to handle forensic patients currently in Riverview Psychiatric Center; outsourced the operation of Casco Bay Bridge to a Florida company; and hired private vendors to manage the MaineCare program that provides transportation to medical appointments. …

Editorial: LePage ensures that sound policy won’t get in the way of welfare privatization agenda
Source: Bangor Daily News, September 16, 2016

We hope Maine arrives at an arrangement with Fedcap that results in a program that promotes not only efficiency in administration but also provides the appropriate kind of help so low-income Mainers receiving assistance can escape poverty. But we have doubts on both counts. When the LePage administration announced its ASPIRE privatization plans last winter, it did so without a convincing rationale. The administration never made it clear what a contractor would do more effectively or more efficiently than the state could by keeping the program in house. … For a program that should be about helping people escape poverty, Fedcap’s job training and placement program, as outlined in its bid proposal, is remarkably light on the intervention that can make the most consequential difference in someone’s life and help her escape the seasonal, low-wage economy: education. The most common vocational training Fedcap outlines lasts six to 12 weeks, and the longest educational pursuit the proposal appears to allow lasts up to a year — not enough time for an assistance recipient to attain a degree. … On the efficiency side of the ledger, we have difficulty seeing how a contractor’s plan to rent 16 new offices instead of use existing state offices in all of the same cities and hire 140 employees to replace 81 state positions represents an optimal use of taxpayer dollars. It would, however, continue a LePage administration pattern of not allowing sound policy to get in the way of its ideologically driven plans for Maine’s assistance programs. …

Maine DHHS says outsourcing will provide more services to ASPIRE
Source: Don Carrigan, WCSH, September 14, 2016

The state Department of Health and Human Services says hiring a private contractor to take over part of a major welfare program will improve and expand the services to thousands of people. Maine DHHS is negotiating the final details of a contract for a non-profit group from New York to manage part of the ASPIRE program. DHHS intends to contract with Fedcap Rehabilitation Services for case management of the roughly three thousand people on ASPIRE, which is part of the larger program called TANF. … Advocates for the poor, including Chris Hastedt of Maine Equal Justice Partners, have raised concerns about the outsourcing plan. Hastedt says she is worried that some essential services may be neglected because of a sole focus on having people find jobs. Mary Mayhew insists the contract with Fedcap will provide more services than DHHS says it currently can. It will also need more money. DHHS officials say the state spends about $10 million per year on those case management services, with the work done by department staff. The bid from Fedcap is for more than $62 million over four years.  The Maine State Employees Association, the largest state worker union, says 51 DHHS employees stand to lose their jobs when the state outsources the case management services. …

Contractor says it plans to hire 140 Mainers to staff welfare-to-work program
Source: Kevin Miller, Central Maine.com, September 13, 2016

The Maine Department of Health and Human Services is finalizing a nearly $63 million contract with a New York nonprofit, Fedcap Rehabilitation Services, to operate the ASPIRE employment assistance program, which has repeatedly fallen short of meeting federal benchmarks. Now operated by DHHS, the program helps low-income individuals connect with job training, employers or education in order to transition them off the Temporary Assistance for Needy Families program. … But in its contract bid submitted to the state, Fedcap said its mission “is consistent with ASPIRE’s goal of gainful employment and work participation” and that the agency has helped place more than 14,000 TANF or other individuals in jobs since 2013. The organization stated that it plans to hire 140 Maine residents to work as Fedcap staff in 16 field offices. But Ramona Welton, president of the Maine State Employees Association SEIU Local 1989, estimated that 51 workers now handling the ASPIRE program could lose their jobs. Welton said she does not believe the contract being negotiated between DHHS and Fedcap includes any language allowing current employees to transfer their jobs to the nonprofit. …

LePage welfare privatization bid puts 51 state jobs on chopping block
Source: Christopher Cousins, Bangor Daily News, September 12, 2016

Gov. Paul LePage’s bid to privatize a work training program for welfare recipients is moving forward with up to 51 state jobs to be cut by the end of this year. LePage and his administration have been discussing privatizing the state’s ASPIRE program for months and are nearing approval of a $62.5 million contract with New York City-based Fedcap Rehabilitation Services, according to a report over the weekend by The Associated Press. … Ramona Welton, president of MSEA-SEIU Local 1989, which represents the majority of state workers, said Monday that 51 state jobs are on the line out of 81 positions in the ASPIRE program. The remaining 30 positions are unfilled because of retirements and resignations and have been left empty for weeks or months. … Neither the Department of Health and Human Services nor officials in the governor’s office responded to questions from the Bangor Daily News on Monday. DHHS announced the pending changes in January, stating in a news release that the ASPIRE program would be privatized and streamlined through the use of technology, innovation and collaboration with already established business and community partners. If the contract is signed, Fedcap would likely subcontract with nonprofits and community organizations to provide ASPIRE benefits. Currently, those benefits are offered in DHHS service centers, where ASPIRE employees are spread across Maine. ..

Gov. LePage to ‘privatize’ Maine’s $62.5M welfare program
Source: Marina Villaneuve, Associated Press, September 10, 2016

Republican Gov. Paul LePage wants to turn over the administration of Maine’s $62.5 million welfare program to a New York City-based nonprofit that’s faced a dozen state and federal lawsuits since 2013. Fedcap Rehabilitation Services acknowledges its recent litigation in its bid proposal to Maine officials while also describing its accomplishments. Since 2013, it’s paid out at least $403,000 in five settlements, the organization says. Court documents show the lawsuits include allegations of workplace discrimination and wage, disability and personal injury disputes. … Chris Hastedt of Maine Equal Justice Partners, a legal aid service, obtained a copy of the bid proposal through a public records request and expressed general concerns with turning over the federal-state program to the nonprofit. She says a contract with Fedcap could mean Maine’s welfare program will see higher administrative costs and diminished quality. … In its bid proposal, Fedcap says it’s secured more than 14,300 job placements for welfare recipients over the last three years, a record it says exceeds that of similar groups. Fedcap has a “very strong track record serving people with multiple barriers,” including the homeless, the organization says, and the Maine program will be run by a former Maine program leader, Christinei McKenzie. Fedcap says McKenzie will focus on creating a path out of poverty through work and job retention. … The governor’s efforts to reel in Maine’s cash assistance program fueled his 2014 re-election and gained praise from the Heritage Foundation and American Enterprise Institute. LePage has tightened welfare rolls, combatted fraud and redirected flexible federal block grants to elderly Mainers instead of “able-bodied young adults.” In January, Bethany Hamm, director of the state Office of Family Independence, told employees the move to privatization comes from the state facing nearly $29 million in penalties for not meeting federal standards. …