The Legislative Council signed off Friday on the state Department of Human Services' proposed contracts for nearly $680,000 with companies in Mississippi and Chicago to provide financial staff and consulting services after last week's death of the department's chief financial officer.
The department is contracting with Mann Consulting, doing business as JHM Consultants LLC of Jackson, Miss., for $130,000, and with Navigant Consulting Inc. of Chicago for $549,937.50, with both contracts starting Monday and running through June 30.
In other action, the council also approved Gov. Asa Hutchison's request to transfer $10 million in rainy-day funds to the Department of Human Services' Children and Family Services Division to help the state's foster care program that officials said Monday is in a crisis.
Department Director Cindy Gillespie said the department and the state late last week "suffered the loss of a dear colleague and true public servant, Mark Story," who had served as chief financial officer and also was Medicaid's chief financial officer.
"Due to the recent business operations reorganization at DHS, the agency was moving through the process of building out Mark's vision of an enhanced finance team, but several key positions remain unfilled," Gillespie said in her letter dated Wednesday to Legislative Council co-chairmen, Sen. Bill Sample, R-Hot Springs, and Rep. David Branscum, R-Marshall.
"To manage the services and programs of DHS efficiently, the Office of Finance must forecast, manage, administer and implement its divisions' budgets and agency budget with extreme care and diligent oversight," she wrote in her letter. The department's budget totals more than $8 billion this fiscal year.
Department spokesman Amy Webb said these consulting companies are going to do the three jobs of the department's chief financial officer, deputy director of the Medical Services Division and chief financial officer of Medicaid.
"There will be more than three people from these companies assisting us, but they will not be full time. Some may only spend a small amount of time here," she said. "They are helping us address the work" of these three positions.
"These contracts are also going to assist with market analysis of the positions and recommending permanent hires," she said.
Webb said Story died unexpectedly and "prior to his passing, he had been trying to fill the Medicaid and deputy director positions. Other efforts, including national advertising, had been done on the two other positions, but we have not yet found qualified candidates."
While the department proposed the contracts with the two companies run from Monday through June 30, "if the agency is able to permanently fill and train the state employee positions impacted by either of these contracts, then services may be ceased and the contracts may be terminated," Gillespie said in her letter.
Story was paid a salary of $131,694 a year, according to the Arkansas Transparency website.
Before the Legislative Council approved Hutchinson's request to transfer $10 million in rainy-day funds for the Department of Human Services' Division of Children and Family Services, lawmakers asked no questions about it.
Hutchinson said in a letter to the Legislative Council's leaders that the money will be used to support the increased costs of the foster care program due to the growth in the number of children in care.
Since July 1, 2015, the state has placed $154.5 million in its rainy-day account and spent $107.1 million of that money, leaving $47.4 million in the rainy-day fund, according to the Bureau of Legislative Research.
Last week, Hutchinson told lawmakers that his proposed budget would increase the Children and Family Services Division's general-revenue budget by $26.7 million in fiscal 2018 because the number of children in foster care is increasing at nearly 20 percent a year and the state can't shortchange these children. He also proposed allocating $14 million of the $229.4 million projected budget surplus for foster care in a supplement to this year's budget.
J.R. Davis, a spokesman for the governor, said state officials are planning on releasing $10 million in rainy-day funds -- plus the $14 million in surplus funds for which the governor is seeking legislative approval -- in the current fiscal year ending June 30 to the division "to meet their updated projected needs based on a continued growth in the number of caseloads.
"Federal funding ... is capped and/or declining, meaning the state incurs most of the cost of any growth in cases," he said. "Part of the one-time funds will allow the department to take immediate action to begin hiring employees."
Metro on 11/19/2016