Florida to ink IT outsourcing deal in two months

Florida plans to award a groundbreaking outsourcing project for information technology services to two firms later this summer, said Kim Bahrami, Florida's chief information officer.

The award of the MyFlorida Alliance project will follow a 60-day period in which the state will validate the financial aspects of the contract it's negotiating with Accenture Ltd. of Hamilton, Bermuda, and BearingPoint Inc. of McLean, Va., Bahrami said in a June 6 interview. The Florida State Technology Office, which she heads, announced last week its intent.

Under the proposed contract, Accenture will provide applications management in support of the state portal as well as manage the delivery of e-government services, while BearingPoint will provide desktop management, e-government services and desktop services for maintaining and improving services delivered through the state technology office's data center.

Bahrami declined to provide an estimated value of the contract, although research firms that track state government IT opportunities believe the seven-year project to be worth $80 million.

Several other firms that were in the final running for the award will have substantial roles on the project as subcontractors. NIC Inc. of Overland Park, Kan., will provide portal expertise, Affiliated Computer Services Inc. of Dallas will provide help-desk support services, and WorldCom Inc. of Ashburn, Va., will provide security solutions, she said. ACS is on both BearingPoint's and Accenture's teams.

The Accenture team includes NIC, Science Applications International Corp. and WorldCom, according to the state technology office. The BearingPoint team includes Dell Computer Corp., Hewlett-Packard Company, IBM Corp. and Unisys Corp. More than 30 companies will have big roles in the project when it is awarded, Bahrami said.

The contract likely will be a mix of traditional time-and-materials and shared-risk plans, Bahrami said. In the latter approach, a contractor pays the costs associated with project development and implementation and recovers the costs from revenue generated by the project once it is up and running.

Florida will collect fees from e-government transactions and other services and pay the contractors from those funds, she said. "It's not the kind of [project] where dollars are going to go right into the pockets of the companies involved," she said.

Bahrami described the state's strategy as "partial outsourcing," and said reports by media outlets that described it as "privatization" were inaccurate. Under the agreement being negotiated, the state likely will transfer about 150 technology jobs to the contractors and will retain ownership of its Shared Resource Center in Tallahassee, she said.

She said the state is embracing an outsourcing approach for several reasons, including better service delivery for citizens, increased business opportunities for citizens and state employees, higher quality services at reduced cost and the chance to leverage commercial best practices.

For example, the state expects to reduce the cost of a technical support help-desk call by more than half, from $13 to $6, she said.

"We aren't looking at a huge infrastructure that is hard to replace and refresh," she said. "We're looking at a utility model where we buy things by the drink."