Privatization in Practice: Case Studies of Contracting for TANF Case Management. Addressing Deficiencies


When monitors in the study sites identify problems, the public agency generally convenes meetings with service providers to address them. Delaware has formalized this process by conducting quarterly "results and learning" sessions with each contractor. At these meetings, representatives from the contractor and the four state agencies that run Delawares TANF program review the contractors performance during the previous three months and discuss difficulties or potential problems. Public agency administrators felt that this approach encouraged an open exchange of ideas and helped keep contractors accountable for their performance. While contractors agreed that the sessions could be useful, they also noted that because they felt some pressure to portray their performance in a positive way, frank discussions rarely occurred.

Public agencies might also take the opportunity to provide informal technical assistance after case reviews. In Hennepin County, contractors reported that some public agency monitors would not only point out errors in documentation or procedures but also spend time discussing how contractor staff could prevent future mistakes.

When very serious problems arise, or when previously noted deficiencies persist, public agencies may require contractors to submit a formal plan for resolving them, impose a provisional contract extension or, in extreme cases, terminate a contract entirely.

  • In Delaware, contractors whose actual performance misses targets by more than 20 percent must prepare a written narrative explaining why this is the case, proposing actions to address the situation, and, if appropriate, requesting a modification of the target.
  • During Hennepin Countys most recent round of contract renewals, public agency administrators created special provisions for four providers that had not met half or more of their performance targets. The county required these contractors to prepare corrective action plans, indicating how they intended to change their services and management. It also issued three- to six-month (rather than full-year) contracts to these providers, with the possibility of renewal if performance improved.
  • In Wisconsin, the state notifies contractors of the results of each monitoring session and lists changes that require corrective action. If the contractor does not implement the changes listed in the corrective action plan, its right of first selection may be revoked, it may be assessed a penalty, and/or its contract may be terminated.
  • Persistent and serious problems with a former contractor in Lower Rio Grande Valley, including financial mismanagement, contributed to workforce board administrators decision to terminate the contract early.

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