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The Journal Gazette

Tuesday, October 03, 2017 1:00 am

Editorial

For appearances: Prior affiliations taint state job development deal

In mid-August, as commissioner for the Department of Workforce Development, Steve Braun helped roll out Gov. Eric Holcomb's ambitious Next Level Jobs Initiative. Days later, Braun left his job and announced a run for the 4th District congressional seat being vacated by Rep. Todd Rokita.  

Appointed by Gov. Mike Pence in 2014, Braun worked with a private contractor to develop a numbers-based approach to job development. The $3.6 million system gathers information from Indiana employers to predict job openings and training needs for the coming decade.    

But questions have been raised about the department's choice of Chicago-based Inquidia Consulting to help develop the new system. Inquidia, the Indianapolis Business Journal reported Friday, was started by several of Braun's former employees at an IT firm he founded and served as chairman and CEO before selling in 2004.

Inquidia's three co-founders and a consultant previously worked for Braun Consulting, according to the story by IBJ's Hayleigh Colombo. In addition, Braun's son, Jonathon, was employed as a senior data architect and consultant when Inquidia began the work that would earn the company $981,000 from state coffers, Colombo reported.

Braun, who said he once owned 27 percent of Inquidia's stock, told IBJ he favored the company's involvement. “As we looked around in terms of people that could do it for us, we weren't comfortable that there were vendors in the current system really that ... were capable,” he said. “I knew my guys could because this is what we did.”

Braun said he sold his stock two weeks before the department requested bidders for the contract, and wasn't involved in the selection process in which Inquidia was chosen over five others.   

Workforce Development asked the Indiana Ethics Commission to review the contract two months after it was signed, Colombo reported. The Office of the Inspector General, which brings matters to the commission, concluded “it does not appear that a potential conflict of interest exists” under state law but advised the department that “you may consider, out of an abundance of caution, to continue screening the commissioner from any involvement with Inquidia.” 

Officials ignore those appearances at their peril. In 2006, when he was secretary of  the Indiana Family and Social Services Administration, Mitch Roob awarded a billion-dollar contract to IBM and several other companies for what would prove a disastrous privatization of welfare operations. The fact that one of the companies was a Texas firm where Roob had been a former executive only added to the criticism.   

The Roob plan, which caused serious problems for thousands of needy Hoosiers before it was modified in 2009, was a classic illustration of why officials should steer clear of situations that offer even the appearance of conflict of interest.  

The Demand Driven Workforce System seems to be a much worthier effort than the welfare privatization fiasco, and Braun seems to have violated no rules. But he could have been more sensitive to his, his colleagues' and his son's involvement with the firm.