The state of Louisiana has selected CGI Technologies and Solutions Inc. to help put in place a plan to improve the state's government debt collections.
Commissioner of Administration Kristy Nichols announced that CGI was chosen through a Request For Proposal (RFP) process.
"This is an important step for taking a data-driven approach toward implementing a comprehensive plan that protects taxpayers and aggressively and persistently pursues money owed to the state," she said.
Louisiana has no centralized collection agency to handle all state government debts. In the most recent tally, more than $1.4 billion was owed to the state in past due accounts. State lawmakers began pushing for changes with collection efforts after facing continued budget shortfalls in recent years.
The purpose of the RFP was to "engage expert analysis of the state’s inventory of accounts receivables and debt owed to it." An amendment to the RFP was also issued to make clear that, once the contract is finalized, there would be a more aggressive timeframe for pursuing the sale of long-term debts.
At a meeting of the state's Cash Management Review Board in September, Gov. Bobby Jindal's administration offered a strategy to improve state debt collection, including more aggressively pursuing delinquent debts. That strategy includes:
1. Streamline agency collection efforts for newly delinquent debts. Instead of having agency accountants operating by different rules, the plan is to standardize the policies and procedures.
2. Consolidate state level efforts and utilize third-party support. Once debts have reached adolescence, evaluate debts to be either tasked to a group of fulltime collection agents in a consolidated state entity, outsourced to third-party debt collection experts or addressed via public private debt collection partnership.
3. Trigger early action for delinquent payments. Put in place a standardized timeline for when outstanding accounts receivable follow different recoupment procedures. These deadlines will send a debt from agency accountants to state collection agents or third-party collection entities so that no debt falls through the cracks. For debts that may be the cause of disputed invoices, we will expedite the hearing and arbitration process and the negotiation of settlements.
4. Strengthen enforcement by establishing or enhancing penalties, fees, and fines, including offsets such as withholding tax refunds or unclaimed property, and a freeze on any further state work or payments for any entity with outstanding state debt.