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    State contracts run amok


    By Nick, Section News
    Posted on Thu May 24, 2007 at 02:00:27 PM EST

    About a month ago I took issue with the administration mantra that we've "cut to the bone."  We hear it every day from government officials, lefty activists and every other stripe of tax-and-spender in the state.  But it always seemed that in a $43 billion state budget, a budget that's gone up billions of dollars every year since Jennifer Granholm took office, such a notion simply borders on the ridiculous.

    Sure, we've presented examples again and again of wasteful government spending.  There's MESSA, prison privatization, the office of the first gentleman and failed Democrat candidates being given cushy office jobs, but with a little attention being paid to ballooning state contracts on the Frank Beckmann show this morning I figured it might be worth looking at some of the actual numbers.

    There are about a bajillion and three state contracts out there so we'll focus on one particular area, information technology contracts through DMB and DIT.  State Rep. Jack Hoogendyk (who's blogging himself these days at http://www.coreprinciples.blogspot.com/) tracked down the information from the departments and presented it unaltered.

    Read on...

    Lets start with a contract to IBM for "Lawson Implementation" for the state's Human Resource Management Network.  What started in 1999 as a contract for $16 million expired at the end of last year.  Any guess on what it ballooned to by the time the state got if off the books?  Don't bother, I'll tell you.  Nearly $33 million.  That's more than a 100% increase.  

    In other words, IBM got the contract to do something for the state and for whatever reason the bureaucrats in Lansing let the dollars get away from them.  Outrageous, right?  Hardly.  That's a tame example.  Lets take a look at a few more...

    Company: Ameritech
    Purpose: Master contract for voice and data communications and network services
    Signed for: $17,198,640
    Ballooned to: $128,991,909
    Increase: 650%

    Company: Electronic Data Systems
    Purpose: End-user computing hardware, software and services for agencies statewide through DMB
    Signed for: $57,639,222
    Ballooned to: $555,089,402
    Increase: 863%

    Company: Unisys Corporation
    Purpose: Mainframe hardware and software for the MI Information Processing Center
    Signed for: $28,663,778
    Ballooned to: $92,169,104
    Increase: 222%

    Company: Motorola, Inc
    Purpose: 800 MHz radio system for Michigan State Police
    Signed for: $187,275,915
    Ballooned to: $228,442,720
    Increase: 22%

    Company: Oracle Corporation
    Purpose: Software and support for state agencies
    Signed for: $2,000,000
    Ballooned to: $144,055,000
    Increase: 7,103%

    Company: GC Services Limited Partnership
    Purpose: MARCS for the Department of Treasury
    Signed for: $63,927,140
    Ballooned to: $189,878,143
    Increase: 197%

    Company: Nextel West Corp.
    Purpose: Nextel Communication Units / Training / Service for all State agencies
    Signed for: $963,584
    Ballooned to: $3,963,584
    Increase: 311%

    Company: Policy Studies, Inc.
    Purpose: Project management services providing assistance in transition planning and program management for MiCSES
    Signed for: $5,548,205
    Ballooned to: $200,284,950
    Increase: 3,510%

    Company: Unisys Corporation
    Purpose: Computer consultants to provide maintenance, technical services and support for the ASSIST project for DHS
    Signed for: $13,123,792
    Ballooned to: $53,431,398
    Increase: 307%

    Company: Enfotech & Consulting Inc.
    Purpose: Consulting services for an electronic wastewater discharge reporting system for the DEQ.
    Signed for: $472,580
    Ballooned to: $4,411,773
    Increase: 834%

    Company: IBM Corporation
    Purpose: Michigan Administrative Information Network (MAIN) technology services for the Department of Management and Budget
    Signed for: $69,213,188
    Ballooned to: $230,453,294
    Increase: 233%

    (Contracts listed in bold font are still in effect.)

    All told information and technology contracts alone have ballooned by over $1.67 BILLION.  That's not responsible government and it clearly isn't "cutting to the bone."  Nevermind the discussion of whether or not we should be spending millions of dollars on things like cell phone training.  With numbers like that the administration's going to have a pretty tough time convincing many more people the state has a taxing problem, not a spending problem.

    House Democrats' demands for higher taxes are ridiculous.  Is it going to be tough to go through items like these and week out waste and inappropriate spending?  Sure.  Tougher than just writing one bill and raising taxes across the state.  Doesn't mean the tough choice isn't the right choice.

    < Tax burden at 1983 high. You RECALL 1983, don't you? | CALLING ALL DEMS!!! >
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    State contracts run amok | 13 comments (13 topical, 0 hidden)
    No way! (none / 0) (#1)
    by NoviDemocrat on Thu May 24, 2007 at 02:24:33 PM EST
    You mean we spend more on IT services now then we did in 1999? How can that be? Surely, we have fewer computers, less network infrastructure and less software now than we did in 1999. I'm sure if we can get the rotary phones back into state government, all of these costs would just go away.
    2 points (none / 0) (#2)
    by Nick on Thu May 24, 2007 at 02:34:58 PM EST
    1. That's funny coming from the same guy who touts the fact that there are less state employees than there were in the 1970s as some sort of evil mean spirited cost cutting maneuver foisted on innocent people by big bad Republicans while denying it has anything to do with the techonology revolution.

    2. Spending more on technology isn't just understandable, it's probably prudent.  But these are not exmaples of simply purchasing new technologies.  These are examples of contracts running amok AFTER that technology was purchased.  Examples of bureacrats losing control of their departments and their spending.  Examples of legislators and governors asking too few questions and letting things get out of control.

    New technology will be represented by new contracts, but signing a contract for cell phone training at $1 million and then paying $4 million for that same service is beyond ridiculous.

    Well Golly, Gee, Gomer! (none / 0) (#3)
    by sandmman on Thu May 24, 2007 at 02:36:30 PM EST
    Imagine that!

    And granholm doesn't want to trim state government. Shazaam, Gomer.

    New contracts? (1.00 / 1) (#6)
    by NoviDemocrat on Thu May 24, 2007 at 05:39:08 PM EST
    Changes in the scope of service are often done through the existing contract. So if you add 20 new computers, the existing contract may be amended to purchase those computers, etc. Even if prices go down, the amount of computers, phone lines, data networks, etc. may have increased beyond the original scope of the contract. Or the services provided may have been amended to provide a better quality service. Government contracting isn't like private sector contracting. It takes forever to complete and often what was originally bid, especially in technology, isn't what you would want when it comes time to actually purchase the equipment or service.

    I'm not going to defend waste. But you all are busy leaping to conclusions with nothing besides the numbers to justify claims of "waste" and "abuse". You have no idea what the scope of those contracts included, whether they included provisions to allow the contracts to be extended, amended, etc. to allow for additional services, etc. I know that actually doing the legwork to search out those details is beyond what you want to do. But until you can show that that taxpayers actually paid for services they didn't get or didn't need, you're just spinning numbers for the sake of scoring political points, the facts being irrelevent to that purpose.

    Where are your numbers? (5.00 / 1) (#7)
    by Dutchsma on Thu May 24, 2007 at 07:09:02 PM EST
    I will agree with you that changes are often made to contracts and ultimately effect the amount of the original number but it seems to me that you are talking out of both sides of your mouth on this one.  You argue that people can't complain about the final cost of a contract without knowing the reasons behind it but instead of providing hard facts to make your point, you provide only conjecture.

    Do you know for a fact that there were additional computers purchased?  Or if additional services were added to the contract later on? Or if there were other mitigating circumstances to justify the cost of the contracts?  If you do, you should provide them when trying to make your case.

    Without the facts, you have no case.

     

    How DARE you mock John Engler!!! (none / 0) (#8)
    by recallbishop on Fri May 25, 2007 at 08:35:34 AM EST
    Our Great former Governor (and still Governor in my mind), John Engler was responsible for the IBM contract in the first place!  In a sly, great move Engler gave them a HUGE contract in his last year in office, THEN went to work for them as thier government relations director.

    I'm sorry, I can't let this blog tarnish the name of our Michigan's Greatest Governor.  Shame on you.

    I see (5.00 / 1) (#9)
    by Nick on Fri May 25, 2007 at 08:50:12 AM EST
    the trolls are out to play today :)

    Um, yeah, not making any arguments about the contracts being granted, only the way they're ballooning out of control.  And notice, please, that there was no blame assigned.  Never said it was Engler's fault, Granholm's fault, Republicans, Democrats, Bill Gates, LeBron James or the boogyman's.

    It is an example of the state letting things get out of control and of how much work there is still to do before raising taxes.

    But welcome to the site!

    Wow, we must be gaining popularity... (5.00 / 1) (#10)
    by John Galt on Fri May 25, 2007 at 09:34:39 AM EST
    Just look at the trolls sticking their heads up.

    It's funny, the IBM contract was awarded under Engler, and ran amok under Two Penny Jenny.

    Go figure.  

    But I'm sure you agree with "the woman who might be Governor".  She's OBVIOUSLY cut to the bone.  That 800% increase, despite the deplorable tax cuts from 1993, were absolutely necessary.

    probably no more of them here (5.00 / 1) (#11)
    by Nick on Fri May 25, 2007 at 09:45:15 AM EST
    then there are of us on their sites... the only difference is I don't delete comments with differing viewpoints.

    Long live free speech and open debate.

    this is what they're reduced to (5.00 / 1) (#13)
    by Nick on Fri May 25, 2007 at 10:05:49 AM EST
    In their zeal to blindly support Democrat leadership they're defending 3,000% increases in spending and refusing to even consider that that might be a problem.  MIGHT be a problem.  Nope, that's too much.

    Critical thinking?  Bah.  Having an open mind?  Over-rated.  Demanding accountability of your own party?  That's for losers.

    State contracts run amok | 13 comments (13 topical, 0 hidden)
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