IT Project Sinks in Sea of Criticism
SAN FRANCISCO (CN) - With labor demonstrators chanting outside, the judges on California's governing council for the courts voted unanimously Tuesday afternoon to terminate a controversial IT project that has been in development 10 years, cost the state a half-billion dollars and rent the judiciary of California into opposing camps.
The mood was solemn around the council table as members deliberated over how to dispose of the costly computer software, after a consultant from Grant Thornton admitted it would cost another $700 million to install the system in 11 courts over the next 10 years.
Ultimately, the council found the courts could no longer afford to support the tech system and decided to allocate $8.6 million to shelve the Court Case Management System and salvage any useful technology, such as the ability to file documents through the web.
An option to deploy the final version of the system in San Luis Obispo's courts and then install it in 10 more courts was unanimously rejected by council judges.
"It's just not the right time to go forward on this project," said Judge James Herman from Santa Barbara, a supporter of CCMS.
"It's just too expensive," said Judge David Rosenberg of Yolo County, a non-voting council member who proposed scrapping the system.
"The Legislature and the governor are not going to give us a check or series of checks for $5 or $6 billion dollars for single case management system," he added. "So I'm a realist. I think the new vision is to allow the 58 trial courts to develop their own case management systems. Frankly, I believe the current on-the-shelf products are considerably cheaper than whatever we can produce through CCMS, but I'm willing to give the courts those options."
Labor unions have been a driving force against the massive project and their presence was felt on Tuesday. Union members demonstrated outside the courts' administrative building in downtown San Francisco, while court workers testified inside the council chambers.
"I am not only a court worker, I am a California taxpayer as well as a consumer of court services and believe me all three of us have been neglected," testified SEIU member Tim Lavorini who works in San Francisco Superior Court.
"Think about it," he said, "if this were your own PC and it still was not working as promised after so many years and each time you asked the manufacturer when it would be finally operable and he replied just give me a little more time and a lot more money, I think you would be outraged and insist on your money back."
After union members spoke against, lawyers spoke in favor.
"This is a system that is long overdue," said John Streeter, president of the State Bar. "Those of us who have practiced in other states know that we are falling behind. California will become, if this system is suspended or abandoned, one of the states that brings up the rear in terms of automation nationwide. We should not be in that position. We should be leading."
Shortly before the vote to pull the plug, council member David Rubin, a judge in San Diego and president of the California Judges Association, said his group supported termination of the project. Illustrating the view of many CJA members, trial judges at a conference a few months ago enthusiastically grabbed t-shirts imprinted with an image of a sinking Titanic and the letters CCMS emblazoned across the top.
"The budget forecast is bleak," Rubin told the council. "We're looking at cuts. Courts around the state have prepared for the worse and yet, it may not be good enough. Taking into account the front loading of costs to deployment to the first 11 courts, the cost to do so is staggering."
A short time later, the council voted unanimously to terminate the project.
"We think it is definitely a step in the right direction," said Michelle Castro, lobbyist for the Service Employees International Union. "But we wish the motion was a little tighter to eliminate wiggle room for future spending on CCMS and any of this kind of spending to occur without safeguards or oversight."
Any money saved, added Castro, should now go to the trial courts.
"We want all the available money to be distributed to the courts as soon as possible on a pro rata basis to help avoid further layoffs and potential court closures."
Judges in the Alliance of California Judges have attacked the project repeatedly in the last year. After Tuesday's vote, they said they were concerned that the project might not be dead.
Last summer, for example, the Judicial Council voted to halt spending on the project for one year, but that vote had no effect.
"Today's action is only the first step and we remain concerned that the Judicial Council has not truly and completely abandoned this failed project," said an Alliance statement. "An investigation needs to be launched to determine whether the public is entitled to any reimbursement for the over $500 million that has been wasted. Furthermore, those responsible for this debacle must be identified and appropriate action taken so that the judicial branch is protected in the future."
The huge technology project started in 2003 when the Administrative Office of the Courts signed a contract with Deloitte Consulting to develop a statewide civil case management system. Proponents, including the former chief justice, Ron George, argued that it made sense to create a single, uniform system for all the courts.
It all began to unravel when a legislative committee voted in 2010 to ask the state auditor to investigate. The auditor came back in 2011 with a damning report that blasted the project's management and said the Administrative Office of the Courts has understated costs by hundreds of millions of dollars.
The Alliance referred to those events in saying, "Members of the Judicial Council opposed a legislative audit of CCMS in 2010. Thankfully that audit occurred and we now know what a financial disaster this mismanaged project has cost the public: closed courtrooms, massive staff lay offs, and diminished service to those who seek redress through their courts."
The decision to terminate the project also affects legislative debate over a bill to reform the way the court's budget is distributed. AB 1208 would limit the power of administrators to embark on projects such as the IT system. The bill passed the Assembly last month, and currently lies in the California Senate, awaiting action.
The decision to pull the plug could take an argument away from those in favor of the bill, suggesting that the courts are able to fix their own problems. On the other hand, the decision could fuel the argument that legislation is needed to prevent similar follies in the future.
In the run-up to Tuesday's vote, a director from consulting firm Grant Thornton spent much of the morning calmly presenting numbers that soared into the hundreds of millions for software reviled by many in the very courts where early versions of CCMS are in place.
By way of contrast, Seattle's King County Superior Court spent $4.7 million to complete and install a new IT system a little over a year ago. That system lets lawyers file their papers over the internet, allowing them to bypass runners who charge to take paper documents to the court.
"You've got around $231 million in one-time costs that will be required to deploy CCMS V4," Grant Thornton consultant Graeme Finley told the council.
"You also have continuing costs. That's about $120 million," he continued as the numbers climbed. "You then have continuing statewide costs. When you add the $354 million, and the statewide continuing costs, about $475 million, about $231 million in one-time spending and there's about $475 million dollars in total continuing costs and current system operations costs. When you add all of that together. That's the total amount of $706 million money that's going to be spent on IT related costs between now and 2021."
Judges on the council then began asking questions.
"My court is about the same size as San Luis Obispo, Marin and Santa Cruz," said Rosenberg from Yolo County. "Your conclusion is that those courts are going to wind up spending something over $3 million over that 10-year period. I have checked with my staff at to the cost of alternative programs for my court, a full-on case management system that provides e-filing that exists right now. They've informed me that it will cost $500,000 to purchase it off the shelf, then about $80,000 a year."
"So, if I figure that out over a 10-year period, that's about $1.3 million," Rosenberg continued. "That's a big difference. Your number is two to one. So, if my number is correct, that changes the equation, does it not?"
Consultant Finley replied, "It would. I can't comment on your estimate, I don't know the facts behind it."
Rosenberg continued his questioning,
The 10-year cost for CCMS for 11 courts is $1.2 billion, if I got that correct. Would it be fair to say that the cost over 10 years for all 58 trial courts would be closer to $5 billion?"
The consultant also ducked that question.
"It's easy to construct different scenarios and it would change the numbers, but we weren't able to do that," said Finley.
Judge Rubin then took over.
"The base of the costs, you didn't look or talk to anybody about specific pieces of software that might be cheaper than what this report said was out there?
"Right," said Finley.
"OK," said Rubin.