Update: ResCare was awarded the federal funding Thursday. See related story.
Nevada Partners, the Culinary union’s non-profit workforce training organization, is filing a federal lawsuit as part of an effort to stave off a national, for-profit competitor in the workforce development arena. And the conflict has attracted the attention of Gov. Steve Sisolak.
ResCare, which has 350 workforce development centers throughout America, according to its website, is poised to win $10 million of $14.9 million slated to be awarded Thursday by Nevada Workforce Connections, the local workforce development board charged with allocating federal funds distributed to the state.
ResCare is the applicant recommended by Workforce Connections’ Programs Committee, comprised of 17 representatives from a variety of industries.
ResCare’s corporate office in Louisville did not respond to the Current’s request for comment.
Last month, ResCare’s parent company, BrightSpring Health Services, was sold by its private equity owner, Onex, to KKR, another private equity firm, for $1.32 billion.
The same day, the company merged with PharMedica, “a leading provider of health and pharmacy services,” according to a news release. “Upon close, the combined company will serve over 300,000 clients daily in 47 states, Puerto Rico and Canada with combined revenue of approximately $4.5 billion.”
Nevada Partners, a non-profit that has provided training, placement, and support services for 27 years, and has received the federal funding for 17 years, is asking a federal judge to halt the process and start anew. It’s also filed a complaint with the Nevada Attorney General alleging violations of the open meeting law and conflicts of interest on the part of the committee members who choose the successful applicants.
In an apparent response to client concerns, Workforce Connections wrote on its website that there are “distinct advantages to funding primarily one organization within the Las Vegas valley which positively affect customer service levels and the amount of resources available to do work in the community.”
Last month, Gov. Steve Sisolak asked Workforce Connections not to take action on the pending contract applications at a scheduled meeting, which was subsequently cancelled.
In a letter to Workforce Connections, Sisolak wrote that he’d been “contacted by multiple parties expressing concerns about the requests for proposal evaluation and selection process” for the 13 contracts up for grabs.
“We are concerned that, at best, the decision to recommend totally defunding Nevada Partners after a successful 17-year history was arbitrary and capricious; and at worst, it was predetermined before the RFP responses were evaluated,” Uri Clinton, chair of Nevada Partners’ Board of Directors and Vice President and Deputy General Counsel of MGM Resorts International, wrote to Workforce Connections on April 9.
In his letter, Clinton alleges violation of Nevada’s Open Meeting Law; possible conflict of interest on the part of Workforce Connection Programs Committee members, who recommend winning candidates for contracts; and possible failure to adhere to the “Request for Proposal” process dictated by state law.
Workforce Connections’ executive director Jaime Cruz told the Current via email that an attorney would provide “direction for addressing” our request for comment, but we received no statement.
Nevada Partners alleges in its complaint that Workforce Connections failed to adhere to the RFP process by removing “past performance” as a criteria for evaluation.
“They changed the criteria after the submission date,” says Nevada Partners’ Executive Director Monica Ford. “The recommended candidate may not have performance history here, but that doesn’t mean they don’t elsewhere.”
In fact, several states have prematurely cancelled workforce development contracts with ResCare.
ResCare was hired in 2016 to provide workforce services in Bowling Green and Glasgow, Kentucky. The contract was terminated in 2018 because of file management issues, according to the Bowling Green Daily News.
Denver Human Services took over case management of Temportary Assistance for Needy Families (TANF) recipients who received job placement at ResCare’s centers, the Denver Post reported in 2017.
In Missouri, ResCare underbid two applicants to win a contract in the Springfield area.
“A city attorney wrote to the state with several complaints that the bidding process was ‘fatally flawed’ and requested the award to ResCare be nullified,” according to a 2018 story in the Springfield News Leader. The contract was rescinded and new proposals for bids were issued.
Now, Nevada Partners is requesting the same remedy.
Evaluation documents posted on Workforce Connections website indicate ResCare services applicants at a significantly lower cost ($3,637 per enrollee) than Nevada Partners ($4,608 per enrollee).
“The successful candidate is a multi-billion dollar company. They are probably leveraging,” says Ford of Nevada Partners. “I will tell you, if you look at our expenditures, we’ve been able to out serve them because we do a per person, individualized program, customized to the needs of the community.”
“‘One size fits all’ costs less. Our populations are historically marginalized. They face barriers,” says Ford.
“Based on the recommendations in the agenda, Workforce Connections is recommending $10 million of almost $15 million go to one for-profit company that’s not even invested in Nevada,” says Ford. “That particular entity works out of the Workforce Connections building.”
Evaluation documents from Workforce Connections’ Programs Committee praise ResCare’s proposal and excoriate Nevada Partners for grammar and spelling errors.
“We had a federal reviewer look over our proposal,” says Ford. “That’s disturbing because they put that on public record but they don’t have to justify it.”
The Current was unable to view the proposals, which are not made public until the selection process is completed.
The evaluation documents also indicate ResCare has several “pink slips” open for “corrective action,” which did not seem to be of concern to those recommending the successful applicant. By contrast, Nevada Partners has no corrective actions.