When Mayor Greg Ballard announced his office had finished its proposal for modernizing city parking, the news elicited the expected litany of complaints:
Parking meter prices would double in some areas; the contract would last 50 years; another public entity was being sold into corporate stewardship.
But, for some, Mayor Ballard's pick to lead the citywide upgrade is the most disturbing part of the plan.
If the name Affiliated Computer Services (ACS) sounds familiar, there's a reason: ACS, a Xerox-owned company based in Dallas, was IBM's partner in Governor Mitch Daniels' botched attempted to privatize welfare services at the Family and Social Services Administration (FSSA). The millions lost in taxpayer dollars notwithstanding, the FSSA deal was a disaster for thousands who needed medicaid, food stamps and other aid before the $1.16 billion deal was finally scuttled last year.
The mayor's parking proposal was submitted Monday (Aug. 23) to the City-County Council, which must approve the deal. But recent boondoggles related to ACS's operations with FSSA have some convinced the mayor's choice is just another example of the cozy relationship between Republican lawmakers and their corporate favorites.
Councillor Joanne Sanders, Democratic minority leader of the City-County Council and a member of the administration and finance committee, said she had "grave concerns" about the deal with ACS.
"Once again, the only preferred vendors, as I see it, that this administration chooses are those that are well entrenched with the Republican Party, either at the state or local level," Sanders said. "And I have to ask myself, are they selling off all our assets while they can to ensure that they get the benefit from it in the long run?"
ACS was in charge of call centers during the IBM-FSSA partnership and of compiling data on welfare eligibility among other things. But before long, inefficiencies the privatization was supposed to ameliorate just got worse.
The percentage of mishandled food stamp cases shot up – from 4.38 percent in January of 2007 to 18.2 percent in January 2009. Reports surfaced that disabled Hoosiers were going without benefits. Class action lawsuits were filed. In recent months, the federal government even fined the state for bungling aid to so many.
Daniels ultimately killed the IBM-led deal in 2009 once it became clear his experiment in welfare privatization had collapsed. IBM was fired, and the governor moved forward with what it called a "hybrid" system in ten Indiana counties: part public, part private, with ACS left in place to provide most of the staffing.
Given the company's past failings, the mayor's decision to go with ACS on the parking revamp has opponents like Sanders wondering what – other than pure cronyism – could have driven the mayor's decision.
The common denominator
At the time of the IBM deal, Mitch Roob was the common denominator between the government and ACS. A former high-level executive at ACS, Roob was selected by Daniels to head the FSSA at the time the no-bid deal went down. Common wisdom among the governor's opponents was that Roob was greasing the wheels for his former associates.
After leaving the FSSA, Roob took over the Indiana Ecomonic Development Corporation (IEDC). Roob held the position when the Daniels administration decided to fire IBM and keep ACS – a move that raised more than a few eyebrows around the statehouse.
The decision to keep ACS drew criticism from both sides of the aisle. Gail Riecken D-Evansville, told the Evansville Courier Press in 2009 she was not happy with the decision to keep ACS in the fold. "There is no point in allowing these kinds of mistakes to continue," she said. "And we should not tolerate any involvement by entities that have a spotty track record."
Even some Republican lawmakers agreed. In a report by the Associated Press, Suzanne Crouch (R-Evansville) said many legislators were suspicious of the ACS relationship. "People are uncomfortable that ACS is still in place and that they were brought on board by former Secretary Roob," she said.
State assembly members promised last October to scrutinize ACS carefully, but little has materialized. Roob, meanwhile, still holds his position at the IEDC today, though a spokesperson for Roob insists the agency was not involved in helping devise the parking plan or in the selection of ACS.
Dubiousness seems to follow Roob wherever he goes. Last spring, an investigation by WTHR, the local NBC affiliate, discovered that the IEDC was padding its job creation numbers with jobs that were promised, but never materialized. WTHR estimated that "approximately 40,000 jobs promoted by the state have not materialized years after they were announced."
Roob said he could not back up his agency's jobs statistics with specific details. "We don't share it with the public.," he told WTHR. "That's confidential information."
As for ACS, its troubles across the years are myriad and well-documented. In 2006, a backup data tape was stolen from ACS, exposing credit card numbers used in transactions at Denver International Airport, according to a report by the Rocky Mountain News.
That same year, a desktop computer containing the names and Social Security numbers of as many as 1.4 million people was stolen from an ACS office in Colorado, where the company processed child-support payments for the state.
Scandal rocked the company in 2006, when its chief executive and chief financial officers were forced to resign after corrupt stock option practices within company leadership came to light.
A 'good reputation'
The Ballard administration maintains there was nothing improper about the selection process for the parking deal, which officials emphasize will affect less than 30 percent of pay parking in Indianapolis if approved.
Michael Huber, the city's deputy mayor for economic development, explained that ACS' upgrade proposal was chosen from among 16 bids, made by companies from around the state, around the country, and around the world.
ACS, he said, was simply the most qualified.
"We looked at the number of cities that they had served before, and their operating history in those cities of running the parking systems, and (ACS) had a really solid operating history," Huber said.
When asked about ACS's history with the IBM and the FSSA – and whether or not it was a concern for the Mayor – Huber admitted it was a "fair question," but that ACS had a "good reputation" with regard to building and administering parking systems, specifically.
The company has already handled parking in a number of major cities, he noted, including San Fransicso, Los Angeles, Boston, Washington D.C.
"They had the most competitive financial proposal, according to our calculations," Huber added. As it stands now, the deal would boost city coffers by $35 million up front, with additional shared revenues over time, all of which will go toward infrastructure improvements. The deal is also projected to save the city $40 million in operating expenses, and includes other local and women- and minority-owned businesses. (For more details, see the city's parking proposal Web site, www.indygov.org/parking.)
Chris Gilligan, corporate communications manager for ACS, pointed to the technology the company offered as part of its proposal. That will almost certainly include electronic, multi-space meters that accept credit or debit cards, and may incorporate things like solar and pay-by-phone technology.
Like Huber, Gilligan noted the company's long and broad history of municipal parking management.
ACS has been in the parking business for over 25 years, serving 24 cities and 18 airports in the United States, along with several international clients. "Our plan is simply to improve traffic flow and modernize the city's parking capabilities," Gilligan said.