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Bankrupt Contractor Will Get $5.5 Million For Not Printing 2020 Census Forms

Jul 31, 2018
Originally published on August 5, 2018 2:29 am

With less than two years before the start of the 2020 census, the U.S. government is back on the market for a new contractor to print forms and letters for the upcoming national head count.

Last week Justice Department attorneys ended a $61 million contract the U.S. Government Publishing Office had awarded to the now-bankrupt printing company Cenveo, as part of a settlement agreement approved by a federal bankruptcy judge in New York. Citing the constitutional requirement to count every person living in the U.S. once a decade, DOJ attorneys concluded that "it is in the public interest" to terminate the contract.

The Census Bureau is paying Cenveo $5.5 million "to resolve all disputes" related to the ending of the contract, according to an order by Judge Robert Drain of the U.S. Bankruptcy Court for the Southern District of New York.

"That's a very unusual situation," says William Turri, who once headed what was previously known as the Government Printing Office and left the agency shortly before the 2010 census printing contract was awarded.

Based in Stamford, Conn., Cenveo filed for Chapter 11 bankruptcy in February. The company is known for printing specialized envelopes for credit card statements, as well as graphic novels and prescription labels. The shift toward electronic billing and advertising has cut down on business and forced the company to reorganize, Cenveo Chief Restructuring Officer Ayman Zameli wrote in a court filing.

For months Census Bureau officials have been tracking the company's financial status, which was deemed a "hot topic" to watch in the agency's memos about 2020 census preparations. Cenveo printed materials for the bureau's only test run of the 2020 census, which began in May in Rhode Island's Providence County, according the bureau's status report from May.

The Census Bureau has not responded to NPR's inquiry about how the termination of Cenveo's contract impacts preparations for the 2020 head count. Cenveo has also not responded to NPR's request for comment.

A spokesperson for the Government Publishing Office, Gary Somerset, said in a written statement that the agency "will work on a new procurement in the coming months that will cover the remaining printing and distribution requirements" for the 2020 census.

"They're going to be under a lot of pressure to come up with someone that can handle something of this nature," Turri says of the GPO.

One of the federal government's largest printing projects, the 2020 census contract involves printing "questionnaires in English and Spanish, letters, inserts, postcards, and envelopes," according to the GPO's November 2017 press release announcing the awarding of the contract to Cenveo.

While the 2020 census is planned to be the first U.S. census to accept responses online and by phone, paper questionnaires and mailings are expected to continue to play a key role in collecting demographic information from every U.S. household.

Uncertainty with the printing contract is just one of several challenges facing the upcoming national head count, which the Government Accountability Office has added to its list of "high-risk" government projects.

The process for collecting 2020 census responses through the Internet has already raised questions about cybersecurity. The late addition of a controversial citizenship question by Commerce Secretary Wilbur Ross, who oversees the census, has sparked multiple lawsuits from dozens of states, cities and other groups. Critics of the question worry that its inclusion will reduce participation among noncitizens, which could harm the accuracy of population numbers that are used to reapportion congressional seats and Electoral College votes among states.

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From paperless voting machines to a printer-less census, this week, NPR learned how a government contract worth tens of millions of dollars resulted in a company headed towards bankruptcy. That contract was for printing forms for the upcoming 2020 census. NPR's Hansi Lo Wang reports on what this means for the national headcount.

HANSI LO WANG, BYLINE: Right now, I'm just a few blocks away from NPR's headquarters in Washington D.C., outside a red brick and terra-cotta building. This is the home of the U.S. Government Publishing Office. For decades, this is where government documents were printed. Nowadays, a lot of that work is contracted out to private companies. And the single largest contract the GPO has awarded was for the 2020 census forms.

BILL TURRI: Oh, it's a huge contract - huge.

WANG: Bill Turri would know. He used to lead what used to be called the Government Printing Office before the 2010 census. For the 2020 headcount, the GPO selected Cenveo for a $61 million contract. The company was supposed to print the forms, letters and postcards the government will send to try to get every person living in the U.S. counted, just as the Constitution requires every 10 years.

But less than four months after Cenveo won that contract, the company filed for bankruptcy. Then, last week...

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AL FONTENOT: The United States concluded that because of the constitutional mandate to conduct the 2020 census, it was in the public interest to terminate Cenveo's contract.

WANG: Now as the director of the 2020 headcount, Al Fontenot speaking at the Census Bureau, which has agreed to pay Cenveo more than $5 million as part of the bankruptcy settlement.

As NPR has reported, GPO officials didn't check if Cenveo had enough money to complete the job. They also allowed the company to lower its bid by almost $9 million after other bids had been unsealed. Cenveo has not responded to NPR's request for comment. In a written statement, a GPO spokesperson says the agency is working on an expedited timeline to find a new printer. The head of the 2020 census, Al Fontenot, says they hope to do so...

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FONTENOT: By November, which will ensure there is no negative impact on the 2020 printing - mailing operation or the overall 2020 census schedule.

WANG: But former GPO head Bill Turri isn't so optimistic.

TURRI: That's cutting it very close. They would, obviously, normally have somebody lined up to do this kind of work long before now, so they're going to be under a lot of pressure.

WANG: Pressure on the 2020 census is already coming from lawsuits against the new citizenship question and cybersecurity concerns over the first online U.S. census. The Census Bureau, though, is still planning to rely on paper to complete the headcount. It just needs to find a new printer first. Hansi Lo Wang, NPR News, Washington.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.