Friday, February 13, 2009

Workforce Development Conflict Of Interest Inexcusable

After reading the AP story this morning about a $2.8 million computer software contract the Indiana Department of Workforce Development awarded to a company owned by the agency's IT Director, I can't help but ask if there is anyone in state government who gives a damn about ethics and conflicts of interest. Ken Kusmer writes:

A former top official in the Indiana Department of Workforce Development initiated a $2.8 million state contract that ultimately went to a company he had just sold, violating federal and state rules at a time when Gov. Mitch Daniels was ordering higher ethical standards for his administration.

A U.S. Labor Department audit obtained by the Associated Press found the agency's former director of information technology, Roy Templeton, still held a financial stake in @Work Solutions Inc. when it received the contract for a case management system in June 2006. The company was formed when Templeton sold In Touch Information Services Inc. and In Touch Information Services of Kentucky Inc. and the two were combined.

State officials say Templeton was removed from the team evaluating bids after he informed them that his former companies would seek the contract for the computer system, which manages information on job training, education and other services. But they say Templeton never disclosed that he was still collecting monthly payments from the sale.

Templeton said he was upfront about owning the companies and the potential for conflict of interest before he took the state position.

"The fact [is] that even before I was hired I made the issue of me owning these companies known ... prior to Governor Daniels taking office," Templeton said in a phone interview last night. "So when I was approached about this position I did my level best to make this position known, that I owned these companies and it may represent a conflict of interest and talked about it from the very get-go and saying I would do everything I could to sell the companies so that conflict wouldn't be there."

He said he agreed to take monthly payments to "facilitate the sale" and for tax purposes. "But no aspect of it, and only tonight did I discover, that from the auditor's point of view that I still had an interest in those companies, which I was unaware of.

"Ron Stiver, who was commissioner of workforce development at the time, said he "went above and beyond in taking appropriate measures to ensure there was no conflict of interest."

Those steps weren't sufficient, according to the audit released Dec. 17 by the Labor Department's Office of Inspector General.

I agree with the federal government's Inspector General. If Templeton did as he says he did and disclosed the potential conflict before he went to work as head of IT for Workforce Development, then he should have never been hired for this job. There is an appearance that the entire reason for him being tapped for his job was the fact that he was part of a company that had a software product desired by the agency. Where the hell was our state's Inspector General while all of this was happening? "Indiana Inspector General David Thomas said initially that he did not learn of the audit and Templeton's conflict of interest until contacted this week by the AP," Kusmer writes. "He later said he thought current Workforce Development Commissioner Teresa Voors might have mentioned it once." "I do remember they said the feds were looking at something," Thomas said, but he could not recall if it was the matter involving Templeton. That's inexcusable. People have charged that Thomas sees his job more as a "cover-upper" than an "open-upper." I'm beginning to think they might be on to something.

What makes this all the more worse is the fact that this agency has been so badly mismanaged. Changes were made in the delivery of unemployment benefits that has really come back to bite the state hard in the ass now that unemployment in this state is soaring to record numbers. The state became one of the first in the nation to have to borrow money from the federal government because our trust fund ran dry, an outcome everyone in the know saw coming at least two years ago. Now, who is going to pick up the $2.8 million tab to repay the federal government for this bone-headed contract?

As an aside, I've privately been telling people that the Daniels' administration's worst fear could be realized if the Obama administration picks Linda Pence to become the new U.S. Attorney for the Southern District of Indiana. You can bet she will be all over a case like this if she is chosen for the job, or she or whoever else is chosen for the position should be. I suspect Pence would also look into the awarding of FSSA's privatization contract to ACS, the company which employed former FSSA Secretary Mitch Roob, who is now running IEDC, immediately before he jointed the administration. There is nothing some Democrats in Washington and Indiana would like to see happen more than destroying Gov. Mitch Daniels' record in the Hoosier state. Indiana politicians have been very lucky for the past few decades in that the only people typically appointed to the U.S. Attorney's job in Indianapolis are political hacks who bury all of the big public corruption cases and only go after the small cases where dispensable people are involved.


Paul K. Ogden said...

People should read my post on David Thomas, Inspector General:

He is not the most ethical guy to say the least.

Excellent post.

Diana Vice said...

Well, there goes my hopes that the Inspector General will take the illegal no-bid scheme perpetrated by the Wilson Education Center seriously. They hired lawyers with connections inside the statehouse. We need the feds to take a look at all the crap going on in Indy.