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CARES: A Massive Technology Failure Costing Taxpayers Tens of Millions

Bill Britt



By Bill Britt
Alabama Political Reporter

MONTGOMERY—Under the banner of “streamlining government,” Governor Robert Bentley issued Executive Order 44 on June 30, 2014. EO44 combined various agencies into one software system to administer and enroll individuals, in state and federal benefit programs such as, Medicaid, children’s services, public health and senior programs.

After two years, with between $20 to $40 million dollars in both federal and state taxpayer money being squandered, the program known as CARES does not work. Not only is the system not working, but the actual cost of the project is not known by the agencies footing the bills. Among the many troubling aspects of the project are budget overruns, software incompatibility, a poisonous work environment and extremely poor leadership, according to an internal review obtained by the Alabama Political Reporter.


CARES is an acronym for Centralized Alabama Recipient Eligibility System Project, once believed that after its implementation, it would allow state agencies to interact with individuals who qualify for state and federal benefits. CARES falls under Dr. Joanne Hale, Acting Secretary of Information Technology. Appointed by Governor Bentley on January 4, 2016, Hale is responsible for leading the State’s Information Technology policy, planning, and governance efforts.

A management assessment of the CARES project on July 16, 2016, found that various software purchased were incompatible, the project atmosphere was “toxic” and that only one manager acknowledged responsibility for “lack of acceptable results.”

According to a two-year-old web posting, “CARES is a Web-based Enterprise system designed to support multiple agencies and programs in a highly-automated enrollment and eligibility process.”

The project plan’s statement of work estimated a start date of November 3, 2014, with completion by September 30, 2016. However, according to the latest findings, the system is inoperable.


The agencies scheduled to implement the CARES system are:

Alabama Medicaid Agency

Alabama Department of Public Health (ADPH)

Alabama Department of Human Resources (DHR)

Alabama Department of Mental Health

Alabama Department of Senior Services.

Programs under these agencies include:

ADPH’s ALLKids (Alabama’s Subsidized Health Insurance Program)

Medicaid’s SOBRA, PlanFirst and Elderly and Disabled services

DHR’s SNAP (Food Assistance)

TANG Subsidized Child Care

Not only do these programs provide essential services to needy citizens, most operate using federal dollars, which require accurate accounting under penalty of law.

With only two months before scheduled implementation and with millions in taxpayer funds expended, the Office Information Technology (OIT) with approval from the CARES Executive Oversight Committee, appointed a “CIO Management Team” to assess the damage and offer recommendations for further action. The Management Team consists of Cheri Martin, Deputy Secretary of OIT; Regina Patterson, IT Director Alabama Department of Public Health; Marty Redden, Chief IT Officer Alabama Medicaid Agency; and Lisa Townsend, IT Director Alabama Department of Human Resources.

The CARES build-out employs over 100 individuals tasked with bringing the project online. According to the OIT website, “development effort consisting of state agencies, state universities and colleges and various vendors from the Alabama Professional Services contract.”

Shannon Crane began as project manager, assisted by deputy project manager Chris Sims. Sims is a contractor working for GDH Government. There are some five other companies supplying staff to the project, with GDH Government supplying 60 (out of 100) employees according to staffers who wish to remain anonymous for fear of losing their jobs.

GDH Government Service, according to its website, offers technology solutions for state, local and federal government.

Bloomberg lists it as a privately held company founded in 2010, to provide professional service solutions in Information Technology and Business Management specifically to government entities.

GDH Government Service Montgomery is located in the RSA building, on North Union Street.

Several employees have expressed concerns over offices (particularly management) of being extravagant and a borderline abuse of taxpayer dollars.

More disturbing are workers’ fears that management has instructed them to post “fake” documents submitted to the federal government as project documentation on its SharePoint site.

According to internal documents, the system components are a Citizen Portal for individual use by those using government services and a Worker Portal for those administering services. For example, an individual applying for Medicaid can sign-up by using the Citizen Portal. Using the Worker Portal the agency would verify the applicant’s eligibility and benefits.

In the OIT Management Team report, they expressed “very few concerns” regarding the products used to develop the Citizen Portal but many concerns regarding the Worker Portal.”

The assessment states, “The technology used for the two portals is different, and the restrictions of the CRM tool used for the Worker Portal make it more difficult to use and much more difficult to customize and maintain.”

Those building portions of the project say they use Microsoft’s Dynamics CRM for development. Reportedly, the project bought 5,000 licenses at a cost to the State of around $4 million. But insider’s claim they are only using around 300.

Those inside the project claim OIT’s Martin demanded and approved the purchase of a Microsoft CRM software, and that she authorized payment for $1 million in new licensing or maintenance fees for the project this year, despite knowing that the software is unusable for health care enrollment. They also claim after the disclosure of the software boondoggle, Martin is throwing “everyone else under the bus” to protect her job.

The assessment team’s technical review of the program’s software “deepened the initial concerns with the CRM tool and led to more extensive questions about the system architecture.” They discovered “several products that, taken as a whole, could adversely affect system stability, performance, sustainability, scalability, and maintainability.” The report concluded the overall database structure in their judgment was, “overly complicated and raised concerns with data reliability.”

The report paints a picture of a project management team who “did not seem to recognize the severity of the situation, with only one manager acknowledging, ‘responsibility for lack of acceptable results.” The review also revealed a lack of focus on what was needed by the agencies with “too much focus on project culture, methodology, and processes.”

The four-person panel recommended replacing the Program Director. It also called for the elimination of Deputy Program Director, PMO Program Manager, and Lead Business Analyst.

Keith Wright, with ADPH, is Interim Program Director for 90 days and Jim Richardson, a contractor with Medicaid, will be assigned full-time to provide general and technical support with Lisa Townsend, DHR, providing methodology support as needed.

When confronted with the facts on the failed STAARS system, Gov. Bentley doubled down on the program, refusing to hold those at the top accountable. Recently, a request for emergency funding to complete the STAARS program was issued, despite $47 million initial cost.

A joint legislative committee established during the Special Session will conduct inquiries into such spending. Bentley may again work to protect cabinet loyalists from being held responsible.

In light of this latest revelation of taxpayer funds being wasted by the administration, perhaps lawmakers will do what Bentley has proven he is unwilling to do.


In Case You Missed It

House passes General Fund Budget

Brandon Moseley



By Brandon Moseley
Alabama Political Reporter

The Alabama House of Representatives passed the state General Fund Budget on Tuesday.

The General Fund Budget for the 2019 fiscal year is Senate Bill 178. It is sponsored by Sen. Trip Pittman, R-Montrose. State Rep. Steve Clouse, R-Ozark, carried the budget on the House floor. Clouse chairs the House Ways and Means General Fund Committee.

Clouse said, “Last year we monetized the BP settlement money and held over $97 million to this year.”

Clouse said that the state is still trying to come up with a solution to the federal lawsuit over the state prisons. The Governor’s Office has made some progress after she took over from Gov. Robert Bentley. The supplemental we just passed added $30 million to prisons.

The budget adds $50 million to the Department of Corrections.

Clouse said that the budget increased the money for prisons by $55,680,000 and includes $4.8 million to buy the privately-owned prison facility in Perry County.

Clouse said that the budget raises funding for the judicial system and raises the appropriation for the Forensic Sciences to $11.7 million.


The House passed a committee substitute so the Senate is either going to have to concur with the changes made by the House or a conference committee will have to be appointed. Clouse told reporters that he hoped that it did not have to go to conference.

Clouse said that the budget had added $860,000 to hire more Juvenile Probation Officers. After talking to officials with the court system that was cut in half in the amendment. The amendment also includes some wording the arbiters in the court lawsuit think we need.

The state General Fund Budget, SB178, passed 98-1.

Both budgets have now passed the Alabama House of Representatives.

The 2019 fiscal year begins on Oct. 1, 2018.

In addition to the SGF, the House also passed a supplemental appropriation for the current 2018 budget year. SB175 is also sponsored by Pittman and was carried by Clouse on the floor of the House.

SB175 includes $30 million in additional 2018 money for the Department of Corrections. The Departmental Emergency Fund, the Examiners of Public Accounts, the Insurance Department and Forensic Sciences received additional money.

Clouse said, “We knew dealing with the federal lawsuit was going to be expensive. We are adding $80 million to the Department of Corrections.”

State Representative Johnny Mack Morrow, R-Red Bay, said that state Department of Forensics was cut from $14 million to $9 million. “Why are we adding money for DA and courts if we don’t have money for forensics to provide evidence? if there is any agency in law enforcement or the court system that should be funded it is Forensics.”

The supplemental 2018 appropriation passed 80 to 1.

The House also passed SB203. It was sponsored by Pittman and was carried in the House by State Rep. Ken Johnson, R-Moulton. It raises securities and registration fees for agents and investment advisors. It increases the filing fees for certain management investment companies. Johnson said that those fees had not been adjusted since 2009.

The House also passed SB176, which is an annual appropriation for the Coalition Against Domestic Violence. The bill requires that the agency have an operations plan, audited financial statement, and quarterly and end of year reports. SB176 is sponsored by Pittman and was carried on the House floor by State Rep. Elaine Beech, D-Chatham.

The House passed Senate Bill 185 which gives state employees a cost of living increase in the 2019 budget beginning on October 1. It was sponsored by Sen. Clyde Chambliss, R-Prattville and was being carried on the House floor by state Rep. Dimitri Polizos, R-Montgomery.

Polizos said that this was the first raise for non-education state employees in nine years. It is a 3 percent raise.

SB185 passed 101-0.

Senate Bill 215 gives retired state employees a one time bonus check. SB215 is sponsored by Senator Gerald Dial, R-Lineville, and was carried on the House floor by state Rep. Kerry Rich, R-Guntersville.

Rich said that retired employees will get a bonus $1  for every month that they worked for the state. For employees who retired with 25 years of service that will be a $300 one time bonus. A 20-year retiree would get $240 and a 35-year employee would get $420.

SB215 passed the House 87-0.

The House passed Senate Bill 231, which is the appropriation bill increase amount to the Emergency Forest Fire and Insect and Disease Fund. SB231 is sponsored by Sen. Steve Livingston, R-Scottsboro, and was carried on the House floor by state Rep. Kyle South, R-Fayette.

State Rep. Elaine Beech, D-Chathom, said, “Thank you for bringing this bill my district is full of trees and you never know when a forest fire will hit.

SB231 passed 87-2.

The state of Alabama is unique among the states in that most of the money is earmarked for specific purposes allowing the Legislature little year-to-year flexibility in moving funds around.

The SGF includes appropriations for the Alabama Medicaid Agency, the courts, the Alabama Law Enforcement Agency, the Alabama Department of Corrections, mental health, and most state agencies that are no education related. The Alabama Department of Transportation gets their funding mostly from state fuel taxes.

The Legislature also gives ALEA a portion of the gas taxes. K-12 education, the two year college system, and all the universities get their state support from the education trust fund (ETF) budget. There are also billions of dollars in revenue that are earmarked for a variety of purposes that does not show up in the SGF or ETF budgets.

Examples of that include the Public Service Commission, which collects utility taxes from the industries that it regulates. The PSC is supported entirely by its own revenue streams and contributes $13 million to the SGF. The Secretary of State’s Office is entirely funded by its corporate filing and other fees and gets no SGF appropriation.

Clouse warned reporters that part of the reason this budget had so much money was due to the BP oil spill settlement that provided money for the 2018 budget and $97 million for the 2019 budget. Clouse said they elected to make a $13 million repayment to the Alabama Trust fund that was not due until 2020 but that is all that was held over for 2020.

Clouse predicted that the Legislature will have to make some hard decisions about revenue in next year’s session.


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In Case You Missed It

Day Care bill delayed for second time on Senate floor, may be back Thursday

Sam Mattison



By Samuel Mattison
Alabama Political Reporter

The day care bill, which would license certain day care centers in Alabama, was once again delayed on the state Senate floor after one lawmaker requested more information.

Its brief appearance Tuesday ended with state Sen. Gerald Dial, R-Lineville, saying a compromise had not yet been worked out with the bill’s detractors.

Alabama’s Senate has been hesitant to act on the legislation because of complaints of state Sen. Shay Shelnutt, R-Trussville, who has been an opponent of the bill since its introduction last year. The bill’s delay on Tuesday marks the second time its been taken off the Senate’s agenda.

The bill has had a rocky time in this year’s session, but the bill’s sponsor state Rep. Pebblin Warren, D-Tuskegee, said she is still confident about its passage out of the Legislature.

Warren, D-Tuskegee, filed the bill this session with the support of influential lawmakers including Gov. Kay Ivey, who told reporters last year that she though all day cares should be licensed.

Mainly sparked by the death of 5-year-old boy in the care of a unlicensed day care worker, the bill had great momentum coming into this year’ session.

Despite the growing support from lawmakers, Religious groups had concerns that the bill would increase state-sponsored reach into religious day cares in churches and non-profit groups.


Spearheading the dissenters was Alabama Citizens Action Program, a conservative religious-based PAC.

Warren, proponents, and ALCAP announced a compromise to the bill while it was still in the Alabama House.

Announced by ALCAP originally, the new bill was a weaker version in that it did not require that all day cares in the state be regulated. Instead, religious-based day cares would only need to be registered if they received federal funds. At a Senate committee meeting in February, Warren said a similar requirement was about to come from federal law in Congress.

The bill moved through the House in a overwhelming vote in favor of the proposal and passed unanimously out of a Senate committee a few weeks ago.

Warren, speaking to reporters after its passage from the House, said she was unsure if the bill would encounter resistance in the upper chamber.

It was the Senate that killed the daycare bill last year amid a cramped last day where senators took the bill off the floor. The bill may face similar complications this year, as lawmakers seem to be preparing to adjourn within a few weeks.

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In Case You Missed It

Fantasy sports bill fails on Senate floor

Sam Mattison



By Samuel Mattison
Alabama Political Reporter

Would-be Fantasy Sports players in Alabama will have to wait to legally play in the state following a Senate vote on Tuesday.

The Alabama Senate decisively killed a bill to exempt fantasy sports from the state’s prohibition on gambling.

Not even entertaining a debate on the Senate floor, the proposal was killed during a vote for the Budget Isolation Resolution, which is usually a formality vote preluding a debate.

Fantasy sports are contests where participants select players from real teams to compete on fantasy teams using the real-world players’ stats.

Since 2016, the practice has been illegal in Alabama following a legal decision by the Attorney General’s Office that categorized it as gambling.

The bill’s sponsor, state Sen. Paul Sanford, R-Huntsville, predicted the bill’s failure during a committee meeting two weeks ago, where the bill passed unanimously.

Sen. Paul Sanford speaks to reporters after a Senate Committee meeting on Feb. 28, 2018. (Samuel Mattison/APR)

Speaking to reporter’s after the committee meeting, Sanford said the decision to file the bill was mainly a philosophical belief that the practice shouldn’t be illegal.


Sanford, a fantasy sports player before its ban, said that fantasy sports are a way to bring people closer together and not a means to win money. The Huntsville senator is not seeking re-election.

The bill’s failure in the Senate follows its trajectory last year too. A similar version of the bill, also sponsored by Sanford, failed in the Senate during the final days of the 2017 Legislative Session.

Since Sanford is retiring, it is unclear if the bill will even come back next session, or if it will even have a Senate sponsor.

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In Case You Missed It

House OKs bill to clarify consulting contracts by state legislators

Brandon Moseley



By Brandon Moseley
Alabama Political Reporter

Tuesday, the Alabama House of Representatives passed a bill to try to clarify how legislators accept consulting contracts under Alabama’s 2010 ethics law. Some pundits have suggested that House Bill 387 is actually designed to weaken the existing ethics law.

Sponsor state Rep. Rich Wingo, R-Tuscaloosa, argues that the legislation is merely a clarification and is intended to prevent legislators from inadvertently crossing the line into illegality.

Wingo said that his bill would require legislators to notify the Alabama Ethics Commission that they have entered into a consulting agreement in an area outside of their normal scope of work.

State Rep. Paul Beckman, R-Prattville, said, “I have never understood why members of this body were allowed to take contracts as consultants or counselors.”

Wingo said, “Never do I use the word counselor in my bill; it is consulting.”

Beckman asked, “Are we going to be getting into an area where  every time we turn around we create a bureaucratic nightmare where we have to go get an opinion. These opinions whether it is orally or written don’t hold up in a court of law.” Beckman said, “We are serving the people here but we get this admonition that we can still be a consultant if we get an opinion.”

Wingo said, “This does not apply to professions where a member is currently licensed.”


Beckman said, “I would like to see more opinions coming out of the Ethics Commission. Right now we have the Ethics Commission competing with the Attorney General’s office over who has more authority.”

State Rep. John Rogers, D-Birmingham, said,”This happened to a friend of mine. He just got out of prison. He was a state senator and had a written letter from the Ethics Commission which his lawyer read at trial and the jury convicted him anyway.”

Rogers never named his friend, but reporters think he was talking about former state Sen. Edward Browning ‘E. B.’ McClain who spent over 22 years in the legislature until he was convicted on 47 counts of conspiracy, mail fraud, bribery, and money laundry in 2009.

A federal jury found that McClain and the Rev. Samuel Pettagrue were guilty in a scheme where McClain would secure public funds for Pettagrue’s community programs and then receive a kickback once the funds were in hand. McClain was sentenced to five years and ten months in prison. McClain was not prosecuted under the Alabama ethics law as the state has a much weaker ethics statute then. The current ethics law was passed in 2010.

Rogers said, “If they offer me a consulting contract for a field like aerospace engineering that I know nothing about they are trying to pay me off. If you can already be a consultant for something you know about why would you seek a consulting contract for something you don’t know about.

Rogers this is how they can pay you off for your vote.”

State Rep. Artis “A.J.” McCampbell said, “I don’t like making changes to things like this because we get into things called unintended consequences.”

McCampbell was reading from the bill and Wingo said, “You are reading from the original version it has completely changed.” “We worked tirelessly on this bill with the Ethics Commission this is not a fly by night bill.”

“If a member of the legislature enters into a contract to do a consulting contract outside of their normal field of work this bill requires that they consult with the Ethics Commission first,” Wingo said. “It is up to the member to notify the Ethics Commission not to the company or person offering them the money.”

State Representative Pebblin Warren, D-Tuskegee, said, “Everybody but legislators are allowed to do contract work up to $30,000.”

Rep. Wingo said, “This is not intended to be a roadblock.”

State Representative Arnold Mooney, R-Indian Springs, said, “The whole purpose of this is not to prevent members from doing work in your field.” “What you are doing is offering to protect me.”

State Representative John Knight, D-Montgomery, asked Wingo what the Alabama Attorney General said about this legislation.

Wingo replied, “I have not contacted the Attorney General.”

Knight responded, “Something from the Ethics Commission does not carry a lot of protection from the Attorney General. We have seen that in the past. I think the Attorney General and the Ethics Commission should be in agreement in the working on this.”

Wingo answered, “Maybe this is a first step.”

Rep. Laura Hall, D-Huntsville, asked, “Do we have anybody doing work outside of their regular scope of work?”

Wingo answered, “Yes I think so.”

Wingo said, “If we had had this bill four or five years ago maybe we could have been spared the embarrassment that this body experienced with the former Speaker.”

Wingo was referring to former Speaker of the House Mike Hubbard who was convicted of 12 counts of felony ethics violations in June 2016. Ironically, Hubbard is largely responsible for creating the ethics law that he was found guilty of violating 11 times in his relentless pursuit of outside contracts and personal wealth.

Unlike McClain, however, Hubbard has not yet served any of this sentence.

House Bill 387 passed 67-0 with 26 legislators abstaining.

The bill now moves to the Senate for its consideration.

(Original reporting by the Alabama Media Group’s Lisa Osborn in 2009 was consulted in this report.)

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