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Auditor Rakes California’s IT Department

SACRAMENTO (CN) - California's state auditor says the state's technology department ineffectively oversees its troubled IT projects, and needs to do a better job retaining good employees and suspending projects when necessary.

"Despite clear statutory authority to curtail troubled state IT projects, CalTech faces challenges in pursuing effective project oversight," State Auditor Elaine Howle wrote in a report released Thursday.

"One challenge is that CalTech's independent project oversight (IPO) analysts lack clear guidance for when to escalate problems to their managers. CalTech also lacks criteria for the conditions that will trigger it to consider suspending or terminating a project. This lack of guidance is compounded by CalTech's failure to formally set expectations of its oversight authority to sponsoring agencies - state agencies implementing IT projects," according to the 56-page report.

The full title of the report to the governor and Legislature is: "High Risk Update - California Department of Technology[:] Lack of Guidance, Potentially Conflicting Roles, and Staffing Issues Continue to Make Oversight of State Information Technology Projects High Risk."

Another problem is the conflict between the bureaucracy's ability to maintain an independent watchdog role and getting too closely invested in the success of the projects they oversee.

The bureaucracy has also been crippled by an inability to retain qualified staff. "High turnover, an insufficient state job classification, potentially inadequate personnel resources, and inconsistent training impact CalTech's staffing practices and present risks to the oversight of state IT projects," Howle wrote.

Howle's investigation of the bureaucracy responsible for managing many of the state's IT ventures revealed that six of 45 IT projects in development could run into delays and cost overruns. Their costs are currently more than $575 million, she said.

Howle's IT expert looked at 12 oversight reports for four state IT projects, including a project to modernize the DMV and the State Controller's "MyCalPays" payroll system.

The expert found that CalTech was very much aware of significant problems, but did not intervene to correct them.

"Our IT expert believes earlier intervention might have improved the outcomes of the projects," Howle wrote. "However, CalTech ultimately terminated the IT Modernization Project and suspended the MyCalPays Project."

Howle's audit noted the state's longstanding history of IT failures.

"Like many other states, local governments, and private entities, California has a history of costly failed IT projects and is at risk for more failures with some of its current IT projects," she said.

The $371 million MyCalPays system was started in 2004 by BearingPoint and continued by SAP in 2010. Its failure echoes that of the Court Case Management System, a $500 million case-tracking system for California courts, which Howle excoriated in a 2011 audit for mismanagement and cost overruns.

Howle recommended that CalTech step up its authority, ensure that it remains independent, hire employees with appropriate experience and qualifications to oversee IT projects and make sure that agencies meet its expectations.

CalTech Director Carlos Ramos said he agrees with those recommendations, and that some are already under way. He said the bureaucracy already has criteria for suspending or terminating a project, which Howle had recommended.

Howle responded that its efforts haven't been good enough.

"We note that the criteria provided in its response are a good start; however, they only speak to circumstances where the need to intervene is apparent," Howle wrote.

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