LouisianaVoice has obtained additional information on the proposed privatization of the Louisiana Office of Student Financial Assistance (LOSFA) in which 47 employees are scheduled to lose their jobs next June.
The State Civil Service Commission is scheduled to consider the layoff plan of LOSFA Executive Director Melanie Amrhein when it meets Tuesday and Wednesday of next week.
Certain administrative positions are scheduled to be retained but Amrhein said through LOSFA General Counsel George Eldredge that her agency does not yet have a complete list of certain administrative personnel who will be retained.
LouisianaVoice, however, has learned the identities of three unclassified employees “not targeted in the layoff plan,” according to a confidential source. They are Deputy Executive Director Sujuan Boutté, Assistant Executive Director for Marketing and Outreach David Roberts and Assistant Executive Director for Fiscal and Administrative Affairs Jack Hart.
“Each makes approximately $100,000 a year and most staff do not know what they do all day,” our inside source said by email. “The agency will be top-heavy with 74 staff total and three Assistant Executive Directors—all for two programs, TOPS and the Student Tuition Assistance and Revenue Trust saving program (START).
“The Public Information section will keep 12 staff and IT (information technology) 12…a lot of support staff for two programs.”
LOSFA actually supports far more programs than just TOPS and START. In addition, LOSFA supports the Early Start Program, the Rockefeller State Wildlife Scholarship, the State Matching Funds Grant, Go Grant, Chafee Educatonal Training Voucher Program, the Volunteer Firemen’s Tuition Reimbursement Program, John R. Justice Student Loan Repayment Program, Louisiana Guaranteed Student Loans, Financial Literacy for You (FLY) and College Knowledge.
“The Loan Division was an easy mark, therefore targeted in the layoff,” the email said. “The executive director is protecting the jobs of the unclassified staff at the expense of nearly 50 rank-and-file, hard-working state employees.”
Following the invitation to bid that went out in February, bid submissions for a new privatizing contract are scheduled to be reviewed in April and the contract awarded sometime after that with layoffs scheduled for June 30.
“We have a contract with Sallie Mae Guarantor Services for utilization of software to operate the loan program in compliance with federal laws,” Amrhein said. “This contract will be terminated once the transition to the successful bidding contract is complete.”
Our source, however, noted that response on the request for proposals (RFP) “has been so sparse that it is likely that the loan portfolio may have to be turned over to the U.S. Department of Education, resulting in the State of Louisiana losing the designation as the state guarantor of student loans. This all started at the governor’s office”
In attempting to justify the privatization contract, the proposal to be presented to Civil Service next week said that:
• a reduction of overhead was necessary to maintain support to state programs;
• an attrition of staff leads to ineffective administration and further strain on generating revenue;
• contracting services will potentially result in higher performance on portfolio while allowing the agency to retain a higher net income with reduced overhead;
• the timeline provides an orderly conversion from in-house functions to managed contractor operation;
• adversely affected employees will be given time to fine new employment.