A new city audit released this morning rips Portland government a new one over its botched roll-out of a payroll software system that was supposed to cost $14.2 million but wound up socking the city for some $47.4 million—and counting!—instead.
Check out a link to the report, prepared by the office of City Auditor LaVonne Griffin-Valade, right here. It’s another black eye over a project that has long been a source of grief for Portland leaders.
The audit blames the overrun on flawed estimates and weak leadership (the project was tinkered with mid-stream, and warnings and lessons from previous software rollouts were ignored). It also notes that the system—meant to process, among other things, payroll for the city—was put in place months later than expected and has failed to handle all the jobs it was supposed to handle.
“They underestimated from the beginning in the complexity and the cost,” Griffin-Valade told the Oregonian (in a story that compares the system to the city’s “budget-busting” aerial tram).
The project was conceived in 2004, under then-Mayor Vera Katz, and approved after managers provided too-good-to-be-true estimates about how much the system would cost ($14.2 million), and how long it would take to put in place (14 months, with work starting in 2006). But by mid-2008, under Mayor Tom Potter, the software still wasn’t fully in use, and it’s projected budget climbed as high as $49 million. (The system, which remains flawed, finally went live last summer.)
According to the audit, the project’s initial budget was based on an outside estimate, touted by managers, that didn’t account for higher consultant costs as well as other expenses, like buying new hardware. The city didn’t confront those omissions until after work had begun—despite the estimate “clearly” stating that “it did not include these items,” the report says.
Oh, and that $47.4 million figure? Even that’s not the final reckoning. The city has yet to compute how much it has paid, over the years, to employees whose time has been spent troubleshooting and setting up the computer system. Whoops.
Sounds like the average outsourced project to me. A nice low bid, an overrun budget, and no choice but to pay the talented people you were trying to avoid paying as high-priced consultants to come fix the mess built by the contractors…
Can the City – and the Oregonian – give it a rest with the tram analogy? OMG TEH TRAM! The two are not the same. The Tram experienced cost overruns, but at the end of the day the City paid $8.5M of the $55M budget. The tram works better than intended, and met the City’s design intent. In fact, if the City had not insisted on maintaining the design vision for the project, it would have cost much less. And, the operating budget for the tram is far less than what was originally estimated.
The computer system, on the other hand, is triple the cost, behind schedule, and not delivering the original features promised. Plus, it appears that the City will be spending more time and money than anticipated just working with their software. If the tram were really like the software, it would have one car, with doors that don’t close, running on one cable, and getting close to, but not really all the way to, OHSU.
I might use this report as a case study! Study project management, kids, or this could happen to you…
Sounds like the lack of leadership should be placed squarely on Sam Adams shoulders. After all he *is* the mayor and *was* the chief of staff for the prior mayor while this project spiraled out of control.
Fiscal mismanagement? I am so shocked. Yet another reason why I will never vote for any measure that raises my property taxes.
Was the payroll software developed internally or contracted outside? I think a lot of contractors see ‘government contract’ as ‘feed at trough indefinitely’. Of course I’ve worked on more than one project were the clients JUST WON’T STOP CHANGING THEIR GODDAMN MIND ALL THE TIME.
shit..there’s 350 of us out of work (used to work at BDS, and yes….I DID work, and plenty busy), we are all on unemployment now….the 33 million could’ve kept us at jobs…i wouldn’t be losing my house….etc…there’s a bunch of “untouchables” in upper management despite the ineptitude displayed not only here but other projects….
And Sam Adams says, “It’s frustrating.”
No, it’s not frustrating, Sam. Frustrated is what I feel when the bus doesn’t come on schedule. This is outrageous, ridiculous, disgusting, and stupid. 70 percent of this project was funded by debt that we’ll be paying off for decades. Thanks, city government! Watch people take this out on the school district next year when pissed off voters vote down the bond measure PPS will try to wrangle out of us. Way to think long term.