CPA firm echoes Haslam outsourcing savings estimate

An accounting firm, hired by Gov. Bill Haslam’s administration to review its estimate of savings through outsourcing some services on college campuses, has confirmed the estimates of $35 million in projected savings.

Further from The Tennessean:

After college leaders, including (UT President Joe) DiPietro and former Board of Regents Chancellor John Morgan, questioned the veracity of the state’s math, the Haslam administration agreed to hire Nashville-based KraftCPAs to vet those savings. The KraftCPAs review found the potential for $35.2 million in annual savings.

Terry Cowles, director of the state’s Office of Customer Focused Government, said the consistency between the two projections justified a continued push to pursue outsourcing.

“We appreciate the cooperation of all those who assisted this effort to improve services at state facilities while saving Tennesseans’ tax dollars,” Cowles said in the statement. “Now that we see a less than two percent impact to the overall potential savings from this objective report, we continue moving forward.”

But a spokesman for the United College Workers union called the KraftCPAs review “anything but independent” because of the company’s donations to Haslam’s 2010 and 2014 campaigns for governor. State records also show that a KraftCPAs manager donated to both of Haslam’s campaigns as well.

“KraftCPAs has multiple political and financial connections to the Haslam administration,” UCW spokesman Thomas Walker said. “It’s hard to imagine them conducting this work independent of those connections.”

Haslam refuted those claims during a conversation with reporters Monday.

“Kraft is one of the most respected CPA firms here in the state,” Haslam said. “They don’t need this work here to make their business.”

Critics have repeatedly blasted Haslam’s proposal to privatize facilities management for a wide range of state properties — including college campuses, parks and prisons — predicting it would translate to subpar services and slashed pay and benefits for employees. (Note: See,  for example, Tennessee State Employees Association Randy Stamps’ op-ed piece in the News Sentinel, HERE.)

Haslam has said the savings are possible without layoffs or cuts to pay or benefits, a sentiment he reiterated Monday. He also said the savings could keep tuition costs down in the future.

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