Virginia SCC Waste Allegations: Support Contract - 8NEWS - WRIC | News Where You Live

8News Investigates: Virginia SCC Waste Allegations: Support Contract

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RICHMOND, VA—After an 8News Investigation uncovered highly questionable behavior by a state agency that has its hands directly in your wallet, 8News Investigative Reporter A.J. Lagoe continued to dig deeper into how Virginia's business watchdog does business itself.

The Virginia State Corporation Commission (SCC) regulates the rate Virginians pay for their electricity, how much the phone company can charge residents and how banks and insurance companies do business.

"It's responsible for regulating some very important aspects of people's lives in Virginia," said Del. Scott Surovell (D-44th).

But an 8News Investigation uncovered the SCC, which is supposed to be regulating best business practices for companies in Virginia, is itself practicing some eye brow raising business.

As 8News continued to dig through SCC documents, we continued to find more questionable actions surrounding the contract they entered in to with CGI Technologies and Solutions Inc.

"It certainly looks like government waste," said Mike Thompson, the Executive Director of the Thomas Jefferson Institute, a government reform group.

In April 2012, once the e- file project was complete, CGI was given another sole source.

It was a no bid-contract worth $1.4 million to "provide support services." Those services included providing knowledge transfer, operational & production support and enhancements, none of which were specified in the contract.

CGI employees were paid $175 an hour to do the support work, but invoices 8News obtained show not a lot of support work being done.

In April 2012, some 6.5 hours of support help was provided, but flipping through the next 10 months of invoices—May 2012 through February 2013—8News didn't find a single other hour of support work that was done.

It's a discovery that leads to one conclusion.

"Clearly that indicates the agency was doing the support work" - said Thompson.

CGI only did 153 hours of knowledge transfer to SCC employees, employees who SCC insiders say don't even actually do support work on the e-file system.

Invoices show all of CGI's time, 5,281 hours worth, was used on enhancements to the system they'd already been paid millions of dollars to design and build.

Agency insiders, who tell 8News they can't be quoted by name for fear of losing their jobs, say this is a "clear case of government waste" and "employees here can do the work necessary, and consultants making hundreds of dollars an hour aren't really needed." They continue, adding "upper management knows about it and continues to push it forward."

The SCC contends its "typical business practice and common sense to keep the expertise of the vendor who built the program available" and fortunately "problems have been minimal and that is why so few hours have been billed"

But red flags were raised.

According to emails 8News obtained, on February 20, a SCC employee asks Chief Technology Officer, Janet Lafleur, if she can "document why CGI's service continues to be needed" when the services were needed for support and knowledge transfer yet "invoices indicate CGI hours were primarily for enhancements." The employee also asks for documentation on "why the 1.4 million for the renewal is needed?"

Despite the concerns raised internally, the email chain shows only some verbiage was changed on the procurement document and that's it.

Janet Lafleur writes "let's get this renewal issued". For taxpayers, that translates to another $1.4 million payout.

"The documents you've uncovered raise some pretty important questions," Del. Scott Surovell (D-44th) told 8News.

SCC insiders, claim instead of a $1.4 million support contract, the SCC could simply have paid CGI their hourly rate for those 6.5 hours of support.

It's a finding that suggests the SCC seems to think money grows on trees, or perhaps in their case, power lines.


Copyright 2013 by Young Broadcasting of Richmond

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