The Arkansas Blog wrote recently about legislation by Sen. Mathew Pitsch that would require state vendors to use a software application that tracks computer time by vendors who bill by the hour for computer work. Reporting here says it’s a national effort that once offered unusual fee deals for lobbyists.
The software company behind a nationwide push to get state governments to require IT contractors to use aggressive monitoring software recruited its first lobbyists with the potential for lucrative gains — like a 90,000 percent return on investment — in exchange for their advocacy work.
In a 10-page document obtained by StateScoop, the software firm, TransparentBusiness, lays out a program in which it offers government relations firms “an opportunity to earn exceptional financial compensation” in the form of cash and equity in the company. In the lobbying guide and other materials, TransparentBusiness bills itself as the next great tech startup, with a plan to eclipse the $60 billion market capitalization that the customer-service software company Salesforce reported in 2017, when the lobbying guide was written.
Lawmakers in at least 23 states have introduced legislation that would require any company doing at least $100,000 worth of government contract work to “use software to verify the legitimacy of the hours billed for work performed on a computer under a contract with a 10 state agency or a political subdivision,” as the version under consideration in Arkansas reads. All of the bills, none of which have passed, stipulate that the tracking software in question take a screenshot of contract workers’ computers at least once every three minutes, and in many instances also mandate the logging of keystrokes and mouse movements.
As it happens, TransparentBusiness’ flagship product is capable of that kind of monitoring. But the software isn’t just an aggressive tool, marketed aggressively. It’s the extension of the ambitions of a Russian expat who sees sales to state governments as part of a broader plan to become the next billionaire tech tycoon.
It’s also prompted fears among state chief information officers that the legislation would blow up their relationships with the IT contracting industry. The National Association of State Chief Information Officers, in a rare show of political activity, issued a forceful statement against what the bills would potentially do to states’ technology governance. The group’s executive director, Doug Robinson, also told StateScoop that forcing contractors to use software that takes frequent screenshots of their work would potentially capture citizens’ personal information, putting states in violation of federal privacy and cybersecurity rules.
Our earlier item cited just such concerns in a tough Department of Finance and Administration assessment of the legislation.
The Statescoop article goes on to describe a plan the company offered to lobbyists in 2017 for payment in cash and stock. The idea seems to be that lining up state business would encourage private business to buy the same software. Alex Konanykhin, the leader of TransparentBusiness, says the company is no longer offering lobbyists stock or asking them to encourage private businesses to buy.
In Arkansas, Bi-Partisan Strategies, whose lobbyists include former lobbyist Marvin Parks, have been working for TransparentBusiness.
The Pitsch bill remains on the agenda of a Senate committee, but has not been acted on.