Sacramento Computer Woes Belie California’s High Tech Image

SACRAMENTO – In California, where the modern electronics industry was born six decades ago, state government has stumbled from one expensive computer purchasing disaster to the next. The Department of Motor Vehicles is the latest agency to fall into a quagmire of expense, delay and legislative criticism. Between 1988-94, the department spent more than $50 million on a new system for driver’s license and registration information, only to see the effort fail. The new system simply did not work. In 1995, a new effort was launched, but the state’s legislative analyst, Elizabeth Hill, reports that the department does not know when the systems will be installed or how much they will eventually cost.

“The department cannot project a completion date at this time,” Hill wrote in her annual analysis of the state budget for the fiscal year that begins July 1. “Neither can DMV provide cost estimates for the entire redevelopment effort.”

The experience of DMV is not new for California. Other departments have been saddled with huge and costly failures.

One of the worst was a $111 million effort to build a system to track child support payments as required by the federal government. The state canceled its contract with Lockheed Martin Information Systems to build the statewide system and now faces $37 million in federal penalties.

Also in trouble is the State Automated Welfare System, whose cost is approaching $1 billion, which is supposed to track all California welfare recipients. So far, it can handle only 14 percent of the caseload.

The Department of Corrections in 1997 terminated a contract for a system to track inmates after spending nearly $100 million. It is now almost a year late in re-bidding the contract.

Among legislators who face critical votes on appropriating money for large computer projects, there is plenty of criticism for the way the state tries to buy enormous data-crunching systems.

“We are so big that we can’t just run down to CompUSA or Staples,” said Senator Debra Bowen, D-Marina del Rey, who closely follows the issue. “We have a procurement system still geared toward buying pea gravel and pencils.”

Bowen said state agencies should be encouraged to purchase computer systems in phases, to insure that all the fancy gear works before it is installed statewide.

“The natural reaction of the agencies is to buy everything at once,” she said.

State Senator John Vasconcellos, D-Santa Clara, who represents much of Silicon Valley, said top state administrators should meet regularly with computer industry leaders to learn about innovations that may affect state systems.

“There’s a lack of political will,” Vasconcellos said. “Businesses are doing it. Everyone else is doing it. We’re not doing it.”

Repeated expensive and embarrassing failures led to creation in 1995 of a state Department of Information Technology under former Governor Pete Wilson. The department is charged with overseeing large computer projects, and has the power to suspend or terminate contracts.

But as Legislative Analyst Hill noted, “We believe that it has not met all of the Legislature’s expectations, as evidenced by the fact that the state continues to have difficulty implementing major IT (information technology) projects.” She suggested giving the department cabinet-level status to elevate its importance, and adding employees because it has not been adequately staffed.

The history of the DMV project typifies the kinds of problems faced by California government agencies. In the 1960s, DMV built its own information databases, but with huge population increases and rapid changes in computers, the system became obsolete. And most of the staff that developed the original in-house system had retired.

In 1988, the department hired outside consultants to upgrade its registration and licensing of computers. After spending more than $50 million, DMV killed the project in 1994.

The next year, it hired another consultant to plan a replacement. Analyst Hill said the approach is “generally sound,” but the department has set schedules that “are unrealistic… more out of concern for funding and budgeting deadlines than on a basis of a realistic assessment of the tasks to be performed.”

The department’s redesign and implementation for registration is now set for operation in June 2000 — 18 months beyond estimates of a year ago.

For driver’s license information, the startup date is August 2001, eight months longer than last year’s projection.

Meanwhile, the department wants to spend $6.7 million in the coming fiscal year on the new system. “Considering the amount of resources and time wasted in the first failed effort,” Hill wrote, “we believe the current incremental approach is appropriate.”