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    State may privatize personnel operation

    Instead of state workers, an Ohio-based corporation would be paid to handle the massive paperwork involved in state agencies' hiring process.


    © St. Petersburg Times,
    published September 7, 2001

    TALLAHASSEE -- Gov. Jeb Bush campaigned with a pledge to make state government leaner.

    Now, the Bush administration is poised to turn over a mammoth state job -- personnel services -- to a private company.

    For $40-million a year, Ohio-based Convergys Corp. says it will handle the paperwork associated with the state's 135,000 workers. The lucrative contract, which state officials say will save taxpayers some $20-million a year, would last for five to seven years.

    The details are being hammered out, and the contract could prove to be politically contentious.

    Each of the 30 state agencies still would have a personnel office, and managers there would handle hiring, firing, discipline and pay raises.

    "We are probably one of the first states to do this to this extent," said Fran Brooks, the state's human resources director. "The final decision on who to hire still rests with the state. They will simply process the applications, screen applicants for qualifications, and then forward those to managers."

    People who want a job with the state would be able to apply just once, instead of sending applications to 30 different agencies.

    The contract has to be approved by Bush, House Speaker Tom Feeney, Senate President John McKay and the heads of the House and Senate appropriations committees: Republican Rep. Carlos Lacasa of Miami and Republican Sen. Lisa Carlton of Osprey.

    State campaign records show that Convergys gave $500 each last year to Feeney and to Lacasa, among other legislators.

    Lacasa said Thursday he has some concerns about the state's move toward privatization. He said he hasn't yet reviewed the Convergys bid.

    "Even though I do think it could work, and could be more efficient, I am a little concerned about managing that contract if things go wrong," said Lacasa. "If you try to fire a company, they will come in with an army of lobbyists and try to extend the deadlines and change the laws. It's a nightmare."

    The Bush administration has been privatizing many state functions, from janitorial services to food services and social services. Florida's prison privatization, Lacasa said, hasn't lived up to its promise of saving money.

    "The privatized prison experience has been somewhat of a disappointment," Lacasa said. "We've transferred wealth from state agencies to the private sector. We're not in the business of transferring wealth. We're in the business of providing services."

    In January, Bush hired a new "efficiency czar," Ruth Sykes, to help streamline government. She quit the $95,000-a-year post just three months later, saying she couldn't support Bush's rush to privatize. Among the initiatives on which she and the governor parted ways: turning the state personnel system over to a private company.

    In all, 11 companies vied for the state personnel contract, and the state signed a letter of intent Wednesday to go with Convergys, a $2-billion company that handles personnel records for AT&T, General Electric and pharmaceutical giant Pfizer, among others. Convergys has operations in the U.S., Canada, Latin America, Israel and Europe. The company has four Florida offices, and would open a fifth in Tallahassee to handle the state personnel business.

    Convergys beat out IBM, Computer Sciences Corp. of California, and a Tampa company, Epix Holdings.

    Bush wants to privatize personnel services instead of spending an estimated $80-million to replace the state's 20-year-old personnel computer system.

    Brooks, the state's human resources manager, said state workers won't lose their jobs, even though some 1,200 people currently are doing personnel work around the state. Convergys, she said, has committed to hiring state workers at its new Tallahassee operation. The rest of the workers would be left in individual agency personnel offices. Some would be moved to other jobs in state government.

    She said the state will be able to cut its yearly personnel budget from today's $80-million to $60-million. The $20-million in savings, she said, could be redirected to other state needs.

    -- Researcher Cathy Wos contributed to this report.

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