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MAXIMUS

11419
Sunset Hills Road

Reston
VA 20190

United States Securities and
Exchange Commission

Division of Corporate
Finance — Mail Stop 3010

Washington DC 20549

Dear Ms. Monick,

In response to your letter
of April 5, 2010, our responses are below.

In addition, we acknowledge
that:

·                  The Company is responsible for the adequacy
and accuracy of the disclosure in the filing;

·                  Staff comments or changes to disclosure in
response to staff comments do not foreclose the Securities and Exchange
Commission from taking any action with respect to the filing;

·                  The Company may not assert staff comments as
a defense in any proceeding initiated by the Securities and Exchange Commission
or any person under the federal securities laws of the United States.

Item 7, Management’s
Discussion and Analysis of Financial Condition and Results of Operations:

We note your disclosure in
this section and earlier in the business section on page 11 regarding your
revenue backlog.  Please tell us how the
company’s significant amount of backlog impacts its results of operations and
liquidity.  Please also include this
disclosure in future filings.

At September 30, 2009,
we estimated that we had approximately $1.8 billion of revenue in backlog.  Backlog represents an estimate of the future
revenue from existing signed contracts and revenue from contracts that have
been awarded, but not yet signed.  Our
backlog estimate includes revenue expected under the current terms of executed
contracts and revenue from contracts in which the scope and duration of the
services required are not definite but estimable (such as performance-based
contracts), but does not assume any contract renewals, extensions or option
periods.

Increases in backlog result
from the awarding of new contracts or extension or renewal of existing contracts
and option periods.  Reductions come from
fulfilling contracts and early termination of contracts. Increases and
decreases can follow from changes in estimates.

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Our contracts typically
include provisions permitting government customers the right to terminate the
contract at short notice, with or without cause.

Of the balance at September 30,
2009, the Company anticipates recognizing 41% of this balance during fiscal
2010.

With the divestiture of the
Systems businesses, the greater part of the Company’s activities are now driven
by the Company’s Operations Segment.
Contracts within this segment are typically longer than those of the
Consulting Segment or the divested businesses as business process outsourcing
agreements typically cover a number of years.
At September 30, 2009, approximately 95% of the Company’s backlog
relates to the Operations Segment.  This
balance has increased to $1.7 billion from $1.2 billion at September 30,
2008, with the increase being principally due to significant new contracts in
Australia and the United Kingdom.  The
Company expects approximately 41% of the backlog balance to be recognized in
fiscal 2010 and expects backlog, in addition to anticipated option period
renewals, to represent 93% of estimated 2010 revenues.

Revenue, operating income
and cash flows have become more predictable as a result of the growth of the
Operations Segment.

We shall update this information
in future filings.

Note 9, Credit Facilities.

We note your disclosure of
performance bond commitments.  Please
describe the general nature and key terms of these commitments.

Certain contracts require us
to provide a surety bond as a guarantee of performance.

As of September 30,
2009, we had approximately $71.1 million of surety bonds outstanding.

These bonds are typically
renewed annually and remain in place until the contractual obligations have
been satisfied.

Although the triggering
events vary from contract to contract, in general, we would only be liable for
the amount of these guarantees in the event of default in our performance of
our obligations under each contract, the probability of which we believe is
remote.

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Note 13, Shareholders’
Equity

We note you corrected an
error related to stock-based compensation expense.  Please tell us how you have complied with ASC
250.

In correcting an error to
our 2006 and 2007 financial statements in 2008, management considered the
effect of the adjustment on the financial results for 2006, 2007 and 2008, as
well as the effect of the adjustment on the trend of earnings and other
factors.

In performing this
evaluation, management concluded that the identified error was not material to
any of the periods affected.

That evaluation included
consideration of the guidance related to materiality included in ASC 250-10-S99
(SAB Topic 1.M).  In conjunction with
that guidance, we considered both the quantitative and qualitative factors in
concluding that the amounts are not material.

Quantatively, we considered
the following:

·                  The adjustments for each
individual year and in total do not exceed 0.2% of revenues.

·                  During the years in which
the stock-based compensation adjustment occurred, management and industry analysts
adjusted income for certain unusual and infrequently occurring items.  Under the Texas HHSC contract, MAXIMUS served
as the subcontractor to Accenture.  This
contract generated large losses and a write-off of deferred contract
costs.  In addition, the Accenture
subcontract was a major driver to the legal and settlement expense, along with
two other non-recurring and unusual items.
Management considers this adjusted net income to be a more appropriate
basis for measuring materiality.  The
table below provides the adjusted net income for those years.  The stock based compensation was not material
relative to each of the years in question after adjusting for these unusual
items.

·                  Prior to 2006, the Company
had not recorded a loss as a public company and had recorded net income in
excess of $35 million in each of the five fiscal years prior to 2006.  Based upon this total, the effect of
correcting this error would not have materially affected the results of operations
in those years.  Similarly, the Company
has returned to its previous levels of profitability in fiscal 2009 and
beyond.  The stock expense error as a
percentage of historical results would also not be material.

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Table of MAXIMUS selected
data 2004-2009

  amounts
  in 000s - tax effected

  2004

  2005

  2006

  2007

  2008

  2009

  Revenue

  603,774

  647,538

  700,894

  738,646

  745,133

  717,299

  Net income (loss)

  38,774

  36,069

  2,460

  (8,255

  )

  6,677

  46,540

  Losses recorded on Texas
  contract

  —

  —

  29,887

  15,246

  —

  —

  Legal and settlement
  expenses (recovery)

  —

  5,683

  26,885

  23,207

  (4,271

  )

  Deferred contract cost
  write-off

  —

  —

  10,351

  —

  —

  —

  Goodwill impairment

  —

  —

  —

  —

  4,598

  —

  Gain on sale of building

  —

  —

  —

  —

  (2,382

  )

  —

  Net income adjusted for
  unusual items

  38,774

  36,069

  48,381

  33,876

  32,100

  42,269

  Adjustment to stock based
  compensation

  (638

  )

  (679

  )

  1,317

  Adjustment as a percentage
  of revenue

  0.1

  %

  0.1

  %

  0.2

  %

  Adjustment as a percentage
  of net income adjusted for unusual items

  1.3

  %

  2.0

  %

  4.1

  %

As part of the qualitative
analysis, we considered the following:

·                  The misstatement does not
significantly change, or mask, changes in earnings or other trends.

·                  Analysts historically review
results adjusted for certain items discussed above and the misstatements would
not impact their assessments.  Also, the
amounts misstated are non-cash stock compensation.

·                  The misstatement would not
move the Company between income or loss in any periods affected.

·                  The misstatement does not
affect any compliance matters, including compliance with debt covenants.

·                  The misstatements do not
affect management compensation.

·                  The misstatements do not
represent any unlawful or fraudulent transactions.

Upon our conclusion that the
amounts were not material, we considered the guidance of ASC 250-10-S99-3
related to immaterial adjustments.  The
example in SAB Topic 5.F. states that, if an accounting change does not have a
material impact in the financial statements, the cumulative effect of the
change should be included in the income statement for the period in which the
change is made.  In accordance with that
guidance, the full amount of the change is reflected in the period in which it
was made.

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Finally, we note that the
errors and their correction were appropriately disclosed in the footnotes to
our financial statements allowing the user of the statements transparency into
our operating results.

Note 14, Commitments and
Contingencies

In connection with the Texas
Health and Human Services Commission (“HHSC”) settlement, you agreed to provide
future services to HHSC valued at $10 million.
Please tell us how you accounted for this portion of the
settlement.  Within your response,
reference the authoritative accounting literature management relied upon.

During 2006 and 2007, the
Company was a subcontractor to Accenture on a contract to provide certain
integrated eligibility and related support services to the State of Texas
Health and Human Services Commission (HHSC).
During the term of the contract, certain performance issues arose and
ultimately resulted in the termination of the contract between HHSC and
Accenture.  Subsequently, MAXIMUS filed
arbitration claims against Accenture, and Accenture filed counter-claims
against MAXIMUS related to the Company’s performance on the subcontract.

On December 12, 2008,
the Company entered into a three-way settlement agreement with Accenture and
HHSC to settle the arbitration and claims among the three parties.  The settlement agreement required MAXIMUS to
pay a total of $40 million in cash to Accenture and HHSC and to provide $10
million in “Future Services” to be provided to HHSC.

The settlement agreement
provided the following:

MAXIMUS shall pay HHSC with services or service credits in an amount
not to exceed Ten Million Dollars ($10,000,000) at rates which are approved by
HHSC and as agreed to by HHSC and MAXIMUS in writing to be signed within 180
calendar days of the Closing Date (the “Future Services”).  If MAXIMUS and HHSC fail to reach written
agreement regarding the Future Services, or if HHSC does not exhaust the
service credits comprising Future Services by August 31, 2014, MAXIMUS
will pay HHSC the remaining unused value of the Future Services in cash or
credit HHSC an equivalent sum against any contracts with HHSC then in effect.

In conjunction with this
settlement, the Company recorded a pre-tax charge of $37.5 million in legal and
settlement expense relating to the HHSC settlement, representing the $40
million of cash payments and the fair value of the $10 million of future services,
offset by the reimbursement of $12.5 million from our insurance carrier.

The portion of the
settlement related to the Future Services was recognized at its fair
value.  The Company considered the
guidance in ASC 845-10 Nonmonetary Transactions, in arriving at this
conclusion.  In particular, ASC 845-10
requires that “the accounting for nonmonetary transactions should be based on
the fair values of the assets (or services) involved.”  While management considered the exceptions to
the fair value requirements in ASC 845-10, we concluded that the $10 million

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represented the fair value
of the Future Services as the terms of the settlement agreement enforce this
concept.  By refusing to agree to the
terms of the Future Services, either party could enforce payment of the $10
million in cash.  HHSC would not accept
services with a value less than $10 million as they could enforce payment in
cash.  Further, MAXIMUS would not agree
to provide services with a value in excess of $10 million, as the Company has
no obligation to do so and could, if required, settle the balance in cash.

The balance was recorded as
a short-term liability.  MAXIMUS notes
that monthly billings to the State of Texas exceed the $10 million balance and,
accordingly, the balance could be utilized immediately if the state chose to
apply it against their current obligations.
The corresponding expense related to the $10 million of services was
recorded in legal and settlement expense, as were the cash payments made
relating to the settlement.

Proxy Statement of Form 14A

We note your references to
pre-codification GAAP in the footnotes.
In future filings, please reference the new Accounting Standards
Codification.

We acknowledge this omission and
will reflect this in future filings.

  Sincerely

  /s/ David N. Walker

  David N. Walker

  Chief Financial Officer

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