Looks like we are about to pay EDS $33.2 million over the next five years to set up an automated income tax payment system. If the state government chooses not to pick up the last two option years of the contract, the cost would be $23.4 million over three years.
The primary benefit of this deal seems to be that taxpayers could file state taxes online.
11:38 UPDATE: The Finance and Administration Cabinet is now disputing the amount of the five year contract EDS is giving out. According to spokesperson Jill Midkiff, it is $27 million instead of $33.2 million.
11:53 UPDATE: EDS spokesman Brad Bass said the Commonwealth of Kentucky approved the press release with the $33.2 million figure, but that he will double-check it.
5:24 UPDATE: Mr. Bass from EDS says it appears the company may have erred in its press release, but that he would call back when he had details.
The Finance and Administration Cabinet released the following statement: "The Comprehensive Tax System (CTS) will provide much more than electronic filing for taxpayers. The long-term goal of CTS is to replace all of our existing systems with a system that uses new technology that is easier to maintain, more cost effective, user and taxpayer friendly, and will better prepare the Department of Revenue for technological advances in the future. The purpose of CTS is to provide the Finance and Administration Cabinet the means to enhance the administration and collection of revenues using optimal processes and technology to benefit the citizens of the Commonwealth."
5:38 UPDATE: Mr. Bass from EDS called back to confirm the company was indeed wrong to claim the contract was worth $33.2 million over five years and would actually only be worth that much if the service agreement were to run for nine years. Otherwise, the state was right to claim that the five year contract is for $27 million. Which gets me back to my original question: "Is it worth the money?" For that, they will get back to me on Monday. Stay tuned.
