Governor reluctantly approves Xerox contracts
August 13, 2014
Making clear he wasn't happy with the situation, Gov. Brian Sandoval on Tuesday reluctantly voted to approve two contracts with Xerox, the company the state fired from the Silver State Health Insurance Exchange.
The contracts were both with the Treasurer's Office — a $7 million contract to perform audits that identify and collect unclaimed property and an $800,000 contract to handle securities.
"It's no secret I'm not happy with this," Sandoval told those attending the Board of Examiners meeting. "But I don't want to crease additional exposure."
Xerox was the contractor providing Internet and call center services to the exchange.
The company was fired by the exchange board after months of problems getting the call center up and running and because the website providing access to health insurance plans was dysfunctional despite repeated claims the company was making improvements.
Sandoval was told by Kimberly Tarter of the Purchasing Division because these two contracts are being handled by a completely different part of Xerox, re-scoring the applicants would probably bring the same result.
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She said she didn't know what legal implications backing away from the contracts could bring — especially since the firms have been providing those services to the state for years — even before Xerox bought them — without problems.
Attorney General Catherine Cortez Masto pointed out these Xerox divisions provide the services to 48 of the 50 states and do so without problems.
Sandoval agreed "this is completely unrelated to what's going on with the exchange."
He said it would feel "retaliatory" for him to oppose the contracts so he voted for approval.
The discussion came after a report from Steve Fisher, outgoing interim director of the exchange, who told the board the process of transferring the state-based exchange to the federal exchange is "a little behind" but proceeding.
He said Nevada has to close the Xerox contract and ramp up the connections to the federal exchange by Nov. 15.
Then, he said, the state has to look at other possible state-based exchange operations around the country that might be a good fit by the 2016 fiscal year.