Rep. Shane Hernandez – chair of the Michigan House Appropriations Committee – today received a special legislative report that will help prevent cost overruns and inefficiencies plaguing state information technology projects.

The bipartisan Information Technology Task Force – appointed by Hernandez last summer – already has sparked an Auditor General review, and future legislation is anticipated. The goal is to implement best practices for managing IT projects across all state departments and improve accountability.

“We are asking the tough questions and doing the hard work necessary to improve services for Michigan residents and save money for taxpayers,” said Hernandez, of Port Huron. “This is an accountability problem that dates back several years, and I am disappointed Gov. Whitmer didn’t even bother to mention the need for improving these vital services during her State of the State address last week. Whether it’s waiting in line at the Secretary of State’s office, navigating the foster care system, or connecting with health care – Michigan residents and taxpayers deserve better.”

Hernandez has noted the list of the state’s IT failures is “long and inexcusable” with projects that cost millions more than they should while delivering poor service to customers. A Department of Health and Human Services system related to tracking child abuse and neglect cases, for example, has received $231 million in the past several years and still has persistent and significant defects. About 40,000 Michigan residents were victimized and wrongfully accused of fraud between 2013 and 2015 by a faulty computer system used by the Unemployment Insurance Agency. A failed Secretary of State computer system overhaul started in 2005 resulted in service issues, lawsuits and cost overruns.

While examining these cases and others, the task force – chaired by Rep. Mark Huizenga of Walker – found systemic problems and helped craft solutions.

Among the findings and recommendations:

• All state IT contracts should include “clawback” provisions to help hold contractors accountable. These provisions often call for money to be repaid or other penalties if a contractor fails to deliver on contractual obligations related to project completion and performance.
• State departments should provide updates to the Legislature on IT projects that exceed their budgets or aren’t completed on time. This will improve oversight and transparency on behalf of taxpayers.
• Accounting practices and terminology should be standardized across all state departments, and all of the state’s IT projects should by managed by the Enterprise Project Management Office within the Department of Technology, Management and Budget. The task force found some IT projects did not adequately define basic terms and couldn’t determine if a project was on time or within budget because of differing language and interpretations. As part of the process to improve overall management, the state Auditor General completed a report focused on helping ensure true costs for projects are identified from start to finish.

“This is a problem that wasn’t created overnight and won’t be fixed overnight – but this task force and its recommendations are an important step in the right direction,” Hernandez said. “The money wasted on IT cost overruns and inefficiencies could have been spent fixing our roads, improving our schools and protecting our Great Lakes. The state must do a better job, and task forces like this one will help hold departments accountable.”

Hernandez formed the task force in June 2019. In addition to Huizenga, members on the task force include Rep. Annette Glenn of Midland, Rep. Mary Whiteford of Casco Township, Rep. Terry Sabo of Muskegon and Rep. Abdullah Hammoud of Dearborn.

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