Question-and-Answer Session
Operator
(Operator Instructions). Your first question comes from Charles Strauzer with CJS Securities.
Charles Strauzer - CJS Securities
Hi, good morning.
Bob Holster
Good morning, Charles.
Charles Strauzer - CJS Securities
Just following on that last part about Florida and ACS and they were awarded and you protested. Can you give me a little bit more color on that, is it more of a protest based on what factors? And then also in '09, when that contract extension expires, is it going to be another rebate or what is the process going to look like then?
Bob Holster
Here is what I can tell you and you can go to Florida procurement and (inaudible) websites and you can see pretty much what we know. Last month it was announced that there had been three bidders, HMS, ACS, and Maximus. Maximus was disqualified. HMS was ranked number one going into negotiations and then the agency announced that they had had a negotiation with ACS and there was an intent to award. We didn't have negotiation with the agency. We protested the next day, signed the emergency extension of our contract. Protest in Florida and this is still an ongoing protest now, proceed pretty expeditiously, taking anywhere from several weeks to several months and what the agency and state do at the conclusion of that process is up to them.
Charles Strauzer - CJS Securities
Got it. And any sense of why they were ranked highest?
Bob Holster
We were ranked highest. The state indicated that its intent to award to ACS was based on a negotiation.
Charles Strauzer - CJS Securities
Got it. Okay, great. And then just looking at the compensation expense line again, Walter, seasonally that usually dips a little bit with the drop in seasonal revenue, but you had a little bit of a pickup sequentially from Q4. I know although you had temporary help expenses, what were some of the components for the higher comp expense there?
Walter Hosp
Well, the comp is mainly driven just by higher headcount, which I quoted earlier that keeps driving up. We are now at a more stabilized base going forward. We may still see some other incremental increases to it, but the other non-permanent, the temporary help expense I was alluding to before in the other operating costs.
Charles Strauzer - CJS Securities
So it would be safe to assume that we can build from this compensation number or may be take other down a little bit as a temporary help winds down, correct?
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