Jobs sent offshore worth millions - Democrats list state contracts in case against 'outsourcing'


BRAD SHANNON THE OLYMPIAN

2/17/04

Democrats identify overseas contracts Here is a sampling of state government contracts that House Democratic lawmakers say agencies are signing that, in effect, send taxpayer dollars abroad for work done overseas: -$15 million for two software-development contracts with the State Board for Community and Technical Colleges went to Hewlett Packard; about one-quarter of the work is done in India. -$27.6 million contract with the Department of Social and Health Services delivers cash and food assistance to public-assistance recipients. The contract with J.P. Morgan Chase uses an electronic benefits transfer system with three offshore customer centers in Mexico and India that handled about 1 percent of the 693,000 calls received in October. -$739,365 for 18 contracts with Washington State Patrol covering purchased services and employee development provided by companies in Canada and England. -$2.5 million contract between the Health Care Authority and Healthaxis in Texas was partially subcontracted to a company in India for programming work. -$18 million contract between the Department of Corrections and IBM Global Services for programming and application development included 20 percent of the work with people and companies outside the United States. DOC also had contracts over three years with Syscon Justice Systems in Canada for more than $262,000 for information-technology systems. -12 contracts ranging from $3,500 to $622,000 between the Department of Agriculture and companies in Japan, Taiwan, Switzerland, Malaysia, Hong Kong, Canada and Ecuador to expand export sales, provide software-programming services and do scientific work. -11 contracts ranging from $4,800 to $347,000 between the Community Trade and Economic Development agency and overseas companies to support the state's effort to expand its exports of Washington products. Contracts are with firms in China, Europe, Japan, Korea and Taiwan.

House Democrats, struggling to gain support to stop the

"outsourcing" of state-government jobs to foreign countries, offered new evidence Monday to bolster their case that Washington should limit its contracts for services to U.S.-based workers.
Rep. Sandra Romero and two other Democrats had a news conference to release new information collected by the office of Gov. Gary Locke. The information showed many state agencies -- and more than any of the lawmakers had suspected -- were contracting for computer services, payroll, accounting and other services that can be done for lower wages by foreign workers in such places as Mexico and India.

"We believe this is in the millions (of dollars) and could be approaching $1 billion in offshore contracting," said Rep. Steve Conway, D-Tacoma, who took testimony on the matter a few weeks ago in the House Commerce and Labor Committee, for which he serves as chairman.

"We saw a net growth of only 1,000 jobs in Washington last year," Conway added in a news conference that he called with Romero, D-Olympia, and Rep. Zack Hudgins, D-Tukwila.

Conway said the fact that 40,000 residents statewide remain jobless in the third year after the recession hit makes it worth putting limits on services contracts, even if it raises the cost for state government.

"We don't want the state shopping the world for cheap labor" that could be done by state employees, Romero added.

But neither Romero, the bill's prime sponsor, Conway nor Hudgins could say how much extra money taxpayers would have to fork over for the same services performed by Washington state workers.

So with questions hovering over their proposal, time is running out on House Bill 3187. The deadline falls today for bills to pass their house of origin in the Legislature.

House leaders were less than committal about bringing HB 3187 to a vote, too. Majority Leader Lynn Kessler, D-Hoquiam, said she didn't know whether they would have time to move the bill.

House Republicans dislike it -- even those like Rep. Jim Clements of Selah, who watched as several hundred jobs vanished from the Yakima area when a call-center firm, ClientLogic, relocated its operation from Central Washington to India and the Philippines.

"The question becomes in my mind, what does it cost? And can we use that money better for health-care and other programs?" Clements said Monday.

Clements noted that he has other concerns, such as interfering with international trade and triggering reactions by foreign governments or companies. He said Japanese companies such as Nintendo employ many Americans in Washington, and Japanese carmakers in California and German carmakers in Missouri have big manufacturing plans.

Gov. Locke hasn't taken a formal position on the bill, but he does believe the issue requires an in-depth study, said Chris Rose, who advises Locke on general government policy issues.

"Obviously, we care very much about people in Washington having jobs. There is a lot the governor is doing to promote that with the Legislature. This issue gets to be very complex -- do we know all the ramifications of a prohibition in terms of how it would work?" Rose said.

Rose added that staffers in Locke's office want to provide data and help along the discussions.

"We think this is an important issue that ought to be looked into in depth," Rose said.

Whether or not lawmakers move the bill today, House Democrats already have plans to explore "outsourcing" Thursday with a mega-meeting of four committees, including Conway's commerce panel, at 6 p.m.

The prohibitions under HB 3187 would keep contracts for state personal services, purchased services and civil service from going to businesses in foreign nations. But it would let the governor's Office of Financial Management review contracts to decide whether "the only realistic choice is a foreign company," according to materials released by the three Democrats.