Trump fires TVA chairman over IT outsourcing

NOTE: This article first appeared on

President Donald Trump announced the firing of the chairman and a board member of the Tennessee Valley Authority at a White House event on Aug. 3, partly as a consequence of an  IT outsourcing program that brought in three foreign-owned contractors to replace the work done by about 100 federal employees.

In June, TVA, which supplies electrical power to about 10 million customers across seven southern states, issued layoff notices to 62 workers based in Chattanooga and Knoxville, Tenn., which would take effect Sept. 1. According to TVA, 37 other workers found different jobs in the organization.

According to one of the TVA workers who spoke at the White House event, an additional round of layoffs was announced July 23, bringing the total number of jobs to be eliminated at TVA IT to more than 200.

TVA planned to outsource IT operations to three firms: CGI Federal, a subsidiary of a Canadian firm; Accenture Federal Services, whose parent company is headquartered in Ireland; and French firm Capgemini.

"Accenture Federal Services, which is based in Arlington, Virginia, has a contract with the Tennessee Valley Authority and is performing in compliance with the contractual terms requiring that the work be performed in the U.S.," the company said in an emailed statement. and directed further inquires to TVA.

Trump became aware of the issue through an advertisement from the group U.S. Tech Workers that aired on Fox News. That group's head, Kevin Lynn, told Trump at the White House event that the president was the target of the ad.

"In full disclosure, Mr. President, when we sat down with the Davis Agency constructing the ad, they said, 'Who's your audience?'  And I said, 'Just one person.'"

At the event, TVA workers explained that they had been asked to train their replacements, including employees including they expected were in the United States on special work visas called H1-B visas.

"All TVA employees are U.S. based citizens. All jobs related to TVA's Information Technology department must be performed in the U.S. by individuals who may legally work in this country," TVA Public Information Officer Jim Hopson told FCW in an email.

Trump also signed an executive order Aug. 3 that orders agencies to review whether any of their contracts rely on temporary foreign labor and if that practice results in the diminution of opportunities for U.S. workers.

TVA was in the midst of an appeal process about the outsourcing plan, Hobson told FCW, and the new executive order will factor into that review.

"The IT realignment process that initiated these conversations is not complete," Hobson said and explained that "no impacted employees will be released by the company until the process is complete and a final decision is made."

In previous reporting, FCW learned that TVA had determined that it was behind the curve in technology, relying on a mainframe and an internal software development team. The agency hoped to modernize via a shift to managed services.

Trump has already made one new appointment to the TVA board – Charles W. Cook Jr., the chairman of Bandwidth Infrastructure Holdings, LLC.

"If the TVA does not move swiftly to reverse their decision to rehire their workers, then more board members will be removed," Trump said.

About the Author

Adam Mazmanian is executive editor of FCW.

Before joining the editing team, Mazmanian was an FCW staff writer covering Congress, government-wide technology policy and the Department of Veterans Affairs. Prior to joining FCW, Mazmanian was technology correspondent for National Journal and served in a variety of editorial roles at B2B news service SmartBrief. Mazmanian has contributed reviews and articles to the Washington Post, the Washington City Paper, Newsday, New York Press, Architect Magazine and other publications.

Click here for previous articles by Mazmanian. Connect with him on Twitter at @thisismaz.

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