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Michigan House Republicans
COLUMN: Reforms needed to rein in state’s IT costs
RELEASE|September 26, 2019

The amount of money Michigan spends on information technology projects has spiraled out of control. Far too often, state departments start IT projects that cost more and perform worse than expected, with lax oversight.

The list of state government’s IT failures is long and inexcusable.

For example, a Department of Health and Human Services system related to tracking child abuse and neglect cases 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 – and it’s still not finished.

All of these examples prove that throwing money at a problem doesn’t fix it. The cost overruns have wasted taxpayer money – and we still have ineffective systems that compromise public services.

It all adds up to hundreds of millions of dollars wasted on failed systems that could have been invested in roads, schools and other critical services.

Quite frankly, taxpayers deserve better. That’s why the House set up a special bipartisan task force to work closely with state departments to find solutions that result in better, more cost-effective and efficient systems in the future.

It’s also why I introduced legislation to prevent state departments from extending IT contracts that should be renegotiated or rebid to save taxpayer dollars.

Last year, one state department was nearing the end of a five-year contract for the lease of electronic equipment. The department was presented with five options to extend the contract by one year, or it could have chosen to end the contract and open it up for bids from all vendors. Instead, the department decided to exercise three of the options at once with an entirely renegotiated contract, which is not how these options are designed to work. This was all done with no documented input from the Department of Technology, Management and Budget (DTMB) – the state department tasked with overseeing procurement.

In the technology world, eight years is a long time to go without reassessing costs or looking into what new services or technologies might be available. By my estimates, the state would have saved millions if the contact in question had gone back up for bid. And who knows how many times similar decisions have been made in the past by state departments, thus costing taxpayers possibly millions and millions of dollars.

My plan, House Bill 4831, will require state departments to receive sign-off from the DTMB before exercising future contract options or renegotiating new contracts. It will also protect public tax dollars by ensuring the contracts that are extended are done so by the shortest available term.

The IT spending waste in Michigan’s state budget would never be tolerated in a family budget or in the business world. It’s time to start making state departments come to the table prepared to truly document and justify their IT needs with real numbers and evidence.

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State Rep. Sarah Lightner is serving her first term in the Michigan House representing residents in portions of Jackson, Lenawee and Eaton counties.

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