Family Services fighting own computer problems

Friday, March 20, 1998 | 11:19 a.m.

The state Division of Child and Family Services wants a contract with a Virginia firm for a $14.2-million computer system - the same system that four years ago was estimated at $6 million.

The division joins the growing list of state agencies that have experienced delays, higher-than-expected costs and glitches in new computer systems and programs.

The $54 million system for the state Division of Welfare that was installed in 1989 still isn't on line. The state Taxation Department went to court to force a Reno contractor to pay more than $500,000 to fix a computer program it installed. And the Legislature's $1.7 million system was never fully operational during the 1997 session.

The family services division signed a contract in February with BDM International Inc., of McLean, Va., to install an integrated information system for its child welfare cases, corrections programs and mental health projects.

When the contract was presented to the state Board of Examiners this week, Budget Director Perry Comeaux told members the system was over budget. The board approved the request without members Gov. Bob Miller, Attorney General Frankie Sue Del Papa or Secretary of State Dean Heller, asking a question or making a comment.

The family services division's next hurdle is the Legislative Interim Finance Committee, which meets here Wednesday. Assemblyman Morse Arberry, D-Las Vegas, chairman of the Assembly Ways and Means Committee, says he wants a full explanation of what happened.

The division has been through three directors in the past four years. Its present administrator, Stephen Shaw, says "we did everything the right way." He adds the agency learned from the past mistakes of other departments.

The contract agreement includes liquidated damages and performance bonds to ensure that the contractors deliver, increasing the price of the contact.

Shaw said consultant KPMG Peat Marwick made the latest estimate in 1996 of the cost of writing and installing the new system. There wasn't another similar state system running in the United States at that time.

Since then, 17 other states have gone to bid for these systems, increasing the price. Also, there's a huge demand for computer programmers to work on the year 2000 problem, resulting in a higher pay scale.

"The market place is so volatile in this area. It has changed dramatically," Shaw said in explaining the cost overrun.