Negotiations Commence for County’s $200-Million Computer Contracts

The county government took another leap forward this week toward massive contracts to run its computer and phone systems with the approval of negotiations with four companies seeking a piece of a contract worth as much as $200 million.

Supervisors on Tuesday chose SAIC as the main bidder for computer services with Hewlett-Packard as the backup. Xerox was picked as the lead company for phone services with Verizon as backup.

“We will spend a lot of money, but we will spend a lot more if we do nothing,” said Supervisor Shawn Nelson. “We’ve got some great vendors.”

County staff will now negotiate final contract terms with company representatives and return to supervisors with the proposals.

The county intends to upgrade its computer and phone systems, including installing voice over IP communications that are now standard in many large businesses and having a company manage up to 5,000 county computers.

Beyond that, it wasn’t clear based on the supervisors' comments at Tuesday’s meeting what specifically the contractors would do.

A staff report states the work includes “data center operations, service desk, desktop support and applications services” as well as “countywide voice and data network,” but the report doesn’t elaborate.

The computer and phone contracts, which will be among the most expensive service contracts the county has ever awarded, has drawn intense industry interest, officials said.

Some of that interest has come in the form of campaign contributions. Since 2009, four of the five supervisors and supervisor-elect Todd Spitzer have received at least $23,000 from the top bidders, according to campaign finance records.

And questions were raised this week about secret meetings regarding the contract involving two supervisors and aides to the rest.

Supervisors last month allowed staff from all five supervisors' offices to attend the closed meetings, ask questions and report back to the elected officials. The public wasn’t allowed to know where and when the officials met, leading open-government expert Terry Francke to assert that the discussions were illegal.

County Counsel Nick Chrisos said the meetings are “perfectly acceptable” as long as board staff don’t “express an opinion during the meeting that would be perceived as trying to form a consensus.”

Tension has also developed between the central information technology office and the individual departments that would be served by the new contract.

Supervisor Janet Nguyen said the “trust factor is lacking” because the central computer office, CEO-IT, has protected itself from layoffs that are expected among computer staffers at other county agencies.

Nick Berardino, general manager of the Orange County Employees Association, said 20 to 40 employees were anticipated to be laid off because of the new contract.

“You have the managers protecting themselves,” said Berardino. “They’re going to protect themselves, and then they’re going to force layoffs on the other departments.”

Nelson said that the supervisors’ focus is on improving the county’s computer and phone services and that he’s not necessarily against making guarantees to existing staff.

“This isn’t a downsizing issue. This is a technology issue,” said Nelson.

Nguyen also asked for a future discussion on setting aside savings from the IT contract into a separate fund that would cover cost increases, which she said were inevitable.

“I’m sorry. Call me five years from now and tell me I’m wrong,” said Nguyen.

Turning to the bidders, she added: “If you’re low-balling us, we’re not going to take too kindly to it.”

Later in the meeting, a Xerox representative said the company “will guarantee” to provide services for the price in their proposal.

The last major county computer contract was with ACS State and Local Solutions and ran for a decade.

It was worth $250 million and was the subject of a series of critical audits, which led to the forced retirement of former IT director Satish Ajmani. ACS was later bought by Xerox.

Comments are closed.