BILL ANALYSIS HUMAN SERVICES H.B. 2777 By: Junell 4-14-97 Committee Report (substituted) BACKGROUND During the 74th Legislative Session, House Bill 1863 passed, which included language to initiate privatization studies to determine the feasibility of integrating eligibility determination and service delivery. The State Council on Competitive Government has been working for over a year and a half to develop an RFO (Request For Offers) which would privatize not only the computer system, but personnel doing intake as well. Agencies have paired with private corporations to prepare for bidding on the privatization of the various functions. While the original intent was to reduce overlap and create a system capable of handling one stop enrollment, the work of the council has greatly expanded the privatization to include many jobs currently held by state employees. Issues as to whether a private company would hire the current state employees at their existing pay and benefits, or even retain positions in the current locations, cannot be answered or resolved until a detailed RFO is let and awarded. The proposed elimination of state jobs has unduly led to alarm and concern of many state employees that upon implementation they will be without employment. For over a year, many state employees have felt uncertain as to their future. In addition, the federal government has failed to meet several self-imposed deadlines for approval or denial of the proposed RFO, and the State is no closer to obtaining an integrated computer system to streamline and reduce duplication. By returning the focus to beginning with the development of computer system and examining job privatization in the future, the state would both remove much of the ongoing anxiety among state employees concerned for their employment and allow for more rapid federal approval. PURPOSE As proposed, HB 2777 grants the authority to the Health and Human Services Commissioner to determine the development of an integrated enrollment system and the implementation of such a system with federal approval. RULEMAKING AUTHORITY It is the opinion of the committee that this bill does not expressly grant any additional rule making authority to a state officer, department, agency or institution. SECTION BY SECTION ANALYSIS SECTION 1.Amends Chapter 655, Acts of the 74th Legislature, Regular Session, 1995. Section 9.12(b) is amended to allow the commission to use the savings resulting from streamlining in eligibility determination and service delivery to further develop the integrated system and to provide other services as determined by the General Appropriations Act. Section 9.12(d) is amended to direct the commission, upon consultation with the governor and Legislative Budget Board, to contract with local governments or other entities to conduct integrated eligibility determination and to operate the service delivery system. Further, the section is amended to require federal approval, in addition to a determination by the department that contracting would be more effective, for the commission to contract with a private firm to develop computer systems and provide technical support for automation of the eligibility system. SECTION 2. Emergency Clause. COMPARISON OF SUBSTITUTE TO ORIGINAL SECTION 1: (d) In the first sentence, replace "State Council on Competitive Government" with "governor and the Legislative Budget Board." (d) In the last sentence, instead of adding "local government, or other appropriate entity," add "to design and develop computer hardware and software for and provide technical support related to the integrated eligibility determination system," and delete "conduct application processing."