This county computer upgrade was supposed to cost $7.5 million.
And be finished in August 2019.
Yet nearly three years later, it’s still not done.
And the pricetag for taxpayers keeps skyrocketing – now to more than $14 million.
And still growing.
Orange County officials often pay millions for companies to make new computer systems, many of which have ended up glitchy and far behind schedule.
And oftentimes, they also fundraise from those very same vendors.
Back in 2014, then-supervisors Todd Spitzer and Shawn Nelson raised serious concerns about the prices for jail phone calls.
But after getting maxed-out contributions from the company, they dropped it completely and approved the contract with the same prices.
Last week, the cost overruns spilled out into public view again.
County supervisors acknowledged wasting millions in tax dollars on their new computer system to calculate over $7 billion per year in property taxes in Orange County that fund everything from schools to law enforcement.
Upgrading Orange County’s antiquated property tax computer system has been in the works for decades.
This past week, county supervisors were asked yet again to renew a $650,000 per year contract for an old mainframe computer to keep the existing tax software running on ancient code from the 1980s – something they have to do until the new system is up and running.
“We are wasting $650,000 a year renewing this contract on this anchor – which is a mainframe computer,” Supervisor Lisa Bartlett said at the Board of Supervisors’ meeting Tuesday.
Bartlett then referred to “the millions of dollars we’re wasted over the years” on the upgrade project, known as the Property Tax System.
“Quite frankly I’m tired of it,” added Supervisor Andrew Do, saying the county is being “held hostage year after year.”
Yet none of them previously raised any public questions or concerns when the project last came up for a multi-million dollar increase – nor when its latest cost overruns have been highlighted in quarterly IT updates.
Instead, the supervisors unanimously approved a $2 million increase for the vendor in November 2020 – more than a year after the project was supposed to be completed – without any objections or discussion.
When asked about the issue point blank last week in public, county CEO Frank Kim said the vendor didn’t do their job as promised.
“The vendor originally believed that they could do a lot of [this work] in an automated fashion. The automated fashion did convert a significant amount of the code. But as it did, it created errors. And so they need to fix those errors,” Kim said.
The errors have to be fixed so that property taxes are calculated correctly once the county eventually switches over to the new system, he added.
And taxpayers will foot the extra bills.
The project is being managed by the county Auditor-Controller’s Office, whose current leader Frank Davies was appointed by the supervisors after the elected Auditor-Controller Eric Woolery died.
County supervisors also have final say over whether to approve contract increases.
Taxpayers should expect better of their government leaders, said Carolyn Cavecche, former CEO of the Orange County Taxpayers Association.
“If [the vendor] bid for the project at a certain price, then the taxpayers of Orange County should be paying for it at a set price,” Cavecche said.
“[At] the Board of Supes, I don’t know who is minding the store there on this,” she added.
“We have a history of problems with IT [at the county]. To have a project explode this high, there are so many questions that need to be answered for why this got so out of control and to double the original cost.”
Davies, who opted not to run for election as auditor controller and is set to leave office near the end of the year, didn’t return a phone message for comment.
Asked previously by Voice of OC why taxpayers are footing the bill if a vendor doesn’t deliver as promised, Davies said that gets into “the legal aspects with regard to contracts, that I really can’t get into.”
A spokesman for the vendor – Perspecta, which was acquired last year by the government IT giant Peraton – didn’t return a phone call for comment, nor did Peter Whittingham, who represents the company as their lobbyist to county supervisors, according to the county’s lobbyist registry.
It’s crucial that the new software calculate taxes correctly, Cavecche noted.
“We have a very complicated property tax system. You could literally live on one side of the street and have one list of agencies that you’re paying into for your property taxes. The person across the street can literally have a different group,” she said.
“So when you look at our system, it is going to be very difficult because it has to go property by property. So yes, this is going to be a difficult system,” she added.
“That being said, there are a lot of questions about why this has gone as long as it’s gone, and why it’s so out of control at this point.”
Nick Gerda covers county government for Voice of OC. You can contact him at firstname.lastname@example.org.
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