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Tue July 24, 2012
Privatization of state agency yields early savings
Legislative auditors say a contract with a private company based in Mandeville to privatize and run much of the claims processing and management handled by the state's Office of Risk Management has been producing results ahead of schedules.
Emily Wilson, a performance audit manager for the state's legislative auditor's office, said Monday that F.A. Richard and Associates Inc. saved Louisiana a net amount of $1.4 million in the 2011 fiscal year.
FARA's contract guarantees $50 million in claims and litigation payment savings to Louisiana during its five-year contract and the risk management office estimates the company has achieved about $6 million, or 12 percent, of those savings so far.
ORM projects the net savings over the course of the contract will be $22 million.