Privatizing work program questioned

COLUMBIA - In 2012, when South Carolina privatized the core of a program designed to get people off welfare and into a job, officials hoped to streamline the process of getting people off state assistance and into paying work. So the state Department of Social Services turned to two large contractors, Kentucky-based ResCare Inc. and Virginia-based Maximus Inc. to help those on state or federal poverty assistance get a job. But critics question why spending the additional dollars for outside companies was necessary, and one state senator said that taxpayers are getting the wrong end of the privatization deal. As the Haley administration has touted its ability to get more than 20,000 people on welfare into jobs during its tenure, something highlighted in a recent campaign ad, concerns have been raised about the program.

Critics stated the department's efforts are more about numbers than results and cloud the real picture of poverty in the Palmetto State.

In this case, a move by DSS to contract with the private firms at a total cost of $13.7 million since 2012 is being questioned. By DSS's own standards, the program appeared to be doing well before the companies came aboard.

ResCare's advocacy fund donated $1,000 in 2010 and $500 in 2011 to Gov. Nikki Haley's campaign. Maximus donated $3,500 in 2010 to the Republican Governors Association South Carolina PAC and $1,000 to Haley's campaign in 2011 before the contracts were awarded, according to state ethics commission filings.

In 2012 and part of 2013, DSS referred 9,468 people on or applying to welfare-to-jobs, which is a nearly 10-year low, according to DSS data. It's also down from fiscal 2011, when the department helped almost 14,000 welfare recipients gain employment, a department best over the nearly 10-year span.

"If this is Gov. Haley's definition of success, she has very little to be proud of," said Sen. Joel Lourie, D-Columbia.

Lourie, who sits on a Senate panel primarily tasked with investigating DSS's alleged mismanagement of child protective services, said it's unclear why the Haley administration turned to private companies to find work for welfare recipients. He pointed to campaign contributions from both companies that benefited Haley.

"Is this just a way to help her campaign contributors?" Lourie asked of the privatization effort.

"Absolutely not," said Haley spokesman Doug Mayer. "Joel Lourie and his liberal allies prefer having people stay on welfare, but Gov. Haley knows that working is one of the keys to the American Dream, and she couldn't be more thrilled that this program has moved over 20,000 South Carolinians from welfare to work."

The department privatized, officials said, in order to meet quickly with welfare applicants rather than helping them get a job only after they had gone through the welfare application process. Those who the contractors did not place in a job, called Jobs Upfront Mean More Pay (JUMMP) are generally referred to DSS's own case workers for a more intensive job-finding effort. The numbers drop for last year isn't significant, officials said, because fewer people applied for government assistance overall so there was a smaller pool of people to find employment.

"Before JUMMP, work-ready South Carolinians had to wait to be approved for welfare before we could help them find a job - now we can get those eligible on the path to employment immediately," DSS spokeswoman Marilyn Matheus said in an email. "Not only is this common sense and good government in action, but it has allowed DSS caseworkers to focus on serving the people who need the most help entering the workforce, which is exactly what the agency should be doing."

ResCare has received $10.5 million in state contracts and Maximus $3.2 million, officials said. ResCare referred all questions to DSS and a Maximus spokesperson did not return a request for comment.

Tammy James, an 8-year veteran of the agency who helps clients find jobs in Lexington County, was referred by DSS officials to speak with The Post and Courier. She said that before contractors started taking the bulk of the work, case workers were inundated. Contractors freed up staffers - who often have a wider range of expertise - for only the toughest cases. "Locally our case managers were very swamped with their case loads and were not allowed to devote enough time," James said.

Linda Martin, who oversaw the program as a deputy director of the agency until late last year, said that the privatization effort rankled longtime case managers and had little rationale behind it. While former DSS director Lillian Koller set high numbers, the department had met them after a good deal of trial and error, she said. Martin was fired from the department last year and is suing the agency.

"Our workers, they were hounding people, they were calling (and) interviewing workers, putting them in a van to apply to places," Martin said. "They just didn't let up."

She said the JUMMP program has a good premise behind it. "I think that the best thing for anybody that's on welfare that's not disabled is to go to work," she said.

Base contracts for the contractors were $1.4 million per region with a possibility of a total of $2 million if they met performance metrics - numbers of people in a job for a longer period of time.

Martin said contractors took a more impersonal approach to the job than the case workers who worked under her. "You have to be realistic and practical about what you provide for people," Martin said. "But you have to give them all the support they need."

Reach Jeremy Borden at 708-5837.