How Easy is to Rellocate on Tata Consultancy Service

The long-awaited modernization of the state's unemployment system, which struggled to keep up with the burden of job losses during the pandemic, will be led by a company that has done similar work in other states.

Tata Consultancy Services was awarded the multimillion-dollar contract to overhaul the outdated technology serving the Kansas Department of Labor's unemployment programs, the state agency announced Tuesday.

"I promised that we would not kick the unemployment modernization can down the road any longer," Gov. Laura Kelly said in a statement. "This is another significant step we are taking to fix the antiquated system and keeps that promise to Kansas employees and businesses."

Tata Consultancy Services, or TCS, was selected after an open-bid process. They brought a resume that included past work to modernize unemployment insurance systems in Connecticut, Maine, Mississippi, Missouri, New York and Wyoming.

"The selection of this vendor allows us to begin the work of modernization quickly so that we can ultimately better serve Kansans," Kelly said.

The Capital-Journal previously reported that the four finalists competing to modernize the system had all struggled with similar work in other states. The other three firms were Accenture, FAST Enterprises and Sagitec.

"We have made a significant amount of progress in a short amount of time and today's announcement is just the latest example of this work," Secretary Amber Shultz said in a statement. "We are committed to ensuring that our state is poised to address the challenges of today, but also the needs of tomorrow. Never again will Kansans be left behind during their time of need."

An agency spokesperson said the vendor contract is not yet public. The modernization process is expected to take three to five years.

Antiquated IT system's troubles

The antiquated IT mainframe computer system used to process unemployment insurance claims dates to the 1970s.

The Kelly administration has been quick to point out that a previous KDOL modernization attempt started in 2005 under former Gov. Kathleen Sebelius before it stopped in 2011 under former Gov. Sam Brownback.

"The state was close to modernizing our unemployment system before the previous Administration stopped the process in 2011," Kelly said.

What happened:Kansas' outdated unemployment system has history of broken contracts and millions wasted

The agency's news release blamed the troubles during the pandemic on the unfinished past project.

"The decision to end the modernization process in 2011 directly led to the system failures that occurred during the height of the pandemic," the KDOL statement said, "when the state's unemployment system all but collapsed under the weight of record unemployment rates and the implementation of over a half-dozen new federally created pandemic unemployment systems."

New claims swelled from 3,000 in February 2020 to 66,000 a month later.

The agency also struggled at preventing fraudulent payments during the pandemic. A legislative audit released in August estimated as much as $700 million in unemployment benefits had been lost to fraudsters. The system blocked about $2 billion in bogus claims.

KDOL had pegged the fraud figure at around $290 million. State officials also argued that the antiquated IT system made it more difficult to prevent fraud.

What to know about Tata Consultancy Services

While KDOL became a political punching bag while administering state and federal programs, including pandemic unemployment assistance, TCS boasts that its unemployment insurance system "successfully processed exponential increases in unemployment claims at the onset of the pandemic."

In a news release, TCS said its cloud-based system "will significantly improve user experience and help combat fraud" in Kansas.

The company said its system offers online self-service functions that include the ability to file new claims, check the status of benefit payments and file appeals. KDOL can save taxpayer money with new electronic correspondence.

Previously:Four finalists are competing to modernize Kansas' unemployment system. Each has struggled in other states.

"Unemployment Insurance is a critical safety net for thousands of Kansas residents every year," Robert Kane, a TCS official, said in a statement. "They deserve a secure, world-class system that enables them to file claims and receive payments seamlessly.

"We look forward to working alongside the dedicated Kansas Department of Labor modernization team to transform the way they serve Kansas citizens and employers."

TCS, as well as the other vendor options, have had troubles in other states.

TCS started work in 2013 on a project for Maine, Connecticut, Rhode Island and Mississippi, a joint venture to save money that still set cost $90 million. When the software went live in 2017, claimants complained they didn't get their benefit checks and couldn't access their accounts.

More:With record-low unemployment amid 95K open jobs, lawmakers pass bill to move Kansans off food stamps

A Maine Department of Labor memo outlined technical issues with the software, and the state legislature's house speaker alleged that "TCS developed a faulty product."

A company spokesperson did not immediately respond to a question of whether Kansans should anticipate similar problems with this project and if technical difficulties are to be expected when taking on such large projects.

Jason Tidd is a statehouse reporter for the Topeka Capital-Journal. He can be reached by email at jtidd@gannett.com. Follow him on Twitter @Jason_Tidd.

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Source: https://www.cjonline.com/story/news/politics/2022/04/05/kdol-chooses-tata-consultancy-services-kansas-unemployment-insurance-system-overhaul/9469130002/

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