Kansas is ending its relationship with CGI after a review of no-bid contracts awarded during the Brownback administration.
“For many years, I have voiced concern about the frequent use of ‘no-bid’ contracts under the previous administration,” Governor Kelly said in a statement. “This practice bypasses the official state bidding process designed to ensure that contracts are transparent and in the best interests of Kansans.”
The State of Kansas had two contracts with CGI. One was to upgrade the state’s tax collection systems, a second contract tasked CGI with the maintenance of state IT systems previously managed internally. Both were 10-year contracts. The minimum value of the contracts was roughly $111 million plus expenses and cost escalations. The state has paid about $28 million to date.
Revenue Secretary Mark Burghart said that after a review, “CGI was not able to adequately perform its obligations under the contracts.”
The company had been the subject of investigations by two local papers the Wichita Eagle and the Kansas City Star. In those investigations, reporters showed that the company had worked very closely with the Brownback administration to secure the contracts in November 2016. The company missed a key deadline in its overhaul of the tax system, forcing the state to continue using the old system for the 2018 tax season.
In a statement, CGI defended its track record in the state and said that much of its work came in ahead of forecasts.
“These contracts were not in the best interests of our state,” Kelly said. “Not only that, the process for initiating these contracts was contrary to the guidelines for state procurement. My administration will continue to review contracts from the previous administration, limit the use of ‘no-bid’ contracts, and increase transparency.”