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Justice, public safety and homeland security August review

Office work tends to slow to a crawl in August with employees taking advantage of school breaks and warm weather to get out of the office. Government is no different. August proved to be a slow month for the justice and public safety market. That said, several trends emerged throughout the month, including an increase in the number of local governments focusing on purchasing new or upgraded radio systems. Numerous counties in Pennsylvania, including Clinton, Montgomery and Schullykill, are moving closer to releasing solicitations while determining what sort of system to implement. Chester County, Pa. released a solicitation for a 700/800MHz public safety radio system. Two counties in Georgia also released solicitations for new radio systems. Gordon County is calling for an 800MHz, APCO P25 system. Rockdale County, on the other hand, has not specified what type of system it prefers; county officials have stated that either a 700 or 800 MHz system is acceptable so long as it meets the FCC narrowbanding requirements.

The second trend that emerged in August was the move toward kiosk-based services for motor vehicle departments and inmate registration. New Mexico released a request for information (RFI) for a motor vehicle division kiosk project similar to the RFI released in 2010 by the Connecticut Department of Transportation. Nevada awarded two kiosk projects in August – one for DMV registration, which was awarded to Intellectual Technology Inc. for $27,591,949. The second was for inmate kiosks and was awarded to Keefe Group and JPay Inc. for a total of $26.8 million. It is too early to tell whether kiosks will be an emerging trend; however, it is likely that they will become an attractive option as states and counties are forced to cut their budgets (including personnel). While the initial expenditure is often substantial, they could save millions in salary expenditures, not to mention time for those waiting at the DMV.

As mentioned in last month's recap, the Los Angeles Regional Interoperable Communications System (LA-RICS) project, which had originally been slated to be awarded to Raytheon, was waylaid due to a breach in the state's procurement laws. It was announced that the project should have been procured for using three separate solicitations rather than one overarching request for proposals (RFP). Just six short weeks after making the announcement, Los Angeles is expected to release the new solicitations sometime this week. As these solicitations will each cover a smaller scope than the original RFP, this will provide smaller and more specialized vendors the chance to get in the game either though responding to the solicitation on their own or through partnering with larger companies. For companies that responded to the original solicitation, this rerelease provides an opportunity to rethink pricing strategy and respond in a more competitive fashion.

Florida reached a milestone on September 1 that many thought would never come: the implementation of the state's prescription drug monitoring program (PDMD), the Electronic Florida Online Reporting Controlled Substance Evaluation (E-FORCSE). After many problems and several false starts, the contract was finally awarded to Health Information Designs last spring. The program ran into problems early in the process when a protest was lodged on the contracting process shortly after the release of an RFP. Next, Governor Scott threatened to stop the creation of the program, which Deltek Analyst Evan Halperin discussed in his February blog. After requests from the ONDCP and significant negotiation pleas from governors of states impacted by Florida's pill mills, the program was finally launched. Tennessee, which had a much smoother procurement of its own controlled substance monitoring database, awarded a contract in August to Optimum Technology, but has not yet set a date for the program's implementation.

Analyst's Take: As summer vacation draws to a close and people begin to refocus on work, there is likely to be an increase in the number of solicitations released this fall. This is particularly true for states whose fiscal year began on July 1. GovWin expects radio systems will be the focus of many smaller cities and counties over the next few months as they gear to meet the FCC's January 1, 2013 narrowbanding deadline. While many of the larger entities have already made the switch, smaller counties – particularly those experiencing funding difficulties – have yet to make a determination about which system to purchase or whether to release a solicitation for the project. It would behoove vendors to work with those counties still reviewing their system and implementation options, particularly given that the largest impediment to meeting the narrowbanding requirement is often the lack of funding. Vendors who are willing to work with these struggling localities could win big when they finally decide to go out to bid for the system. As covered in the state budget projections for justice, public safety and homeland security blog, radio communications is one area where both federal and state and local spending is expected to remain steady, if not increase in the next few years. Therefore, it is worth it for vendors to continue targeting these areas.

As far as PDMPs go, there are still more than 10 states that have not yet implemented a program. Given the pressure that the nation's drug czar and neighboring states put on Florida to enact a PDMP, it is likely that other states will face similar pressure to move forward with these types of programs. Vendors should therefore begin speaking with states that have not yet implemented the program, particularly those that have enacted legislation mandating it, but have not taken any further steps.

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