Senate committee considers taming IT department as part of ongoing budget effort

Sen. Katie Fry Hester (D-Howard and Montgomery) is sponsoring a bill she said would bring accountability to the Department of Information Technology and help ensure major IT projects are delivered on time and on budget.. (File photo by Bryan P. Sears/Maryland Matters.)

The chair of the Senate Budget and Taxation Committee Wednesday said his committee will look to resolve how the state handles major information technology projects, saying the current process has resulted in money “going down a hole.”

Some lawmakers are dismayed by the Department of Information Technology, which has shied away from taking control of major projects since it was founded im 2002. Senate Budget and Taxation Committee Chair Sen. Guy Guzzone (D-Howard) characterized managing such projects as a money pit at a time when the state stares down a $3 billion budget gap.

“This is a mess. It was a mess even before 2002, quite frankly, and some of this — the DoIT solution — was supposed to help all of that,” Guzzone said during a committee hearing Wednesday. “We have not, in my opinion, in all the years I’ve been around, ever seen an actual solution to our problem. The money has been, unfortunately, going down a hole in many ways and in many projects. And it’s really a shame.”

Guzzone’s comments followed testimony on a proposal to impose stringent reporting requirements for the department. It also comes on the same day that the Board of Public Works approved a more than $400 million IT contract with dozens of contractors.

“It’s been a long time, and the lack of clarity, authority and management and oversight really has led to poor project management, cost overruns and failures,” said Sen. Katie Fry Hester (D-Howard and Montgomery) and sponsor of the Senate Bill 705.

Hester pointed to a scathing audit of the agency and its failures to properly manage the MDThink project. That mismanagement increased costs to $588 million — 80% more than the initial estimate, Hester said, calling it “pretty sad.”

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“In recent years, the state has also spent millions on the development of IT projects that produced inadequate computer systems. Some of the reasons for project failures point to poor project management, lack of initial planning, insufficiently trained personnel, and Maryland must take steps to safeguard its growing investment in valued resources,” she said.

Hester said the current system lacks accountability for delivering projects on time and on budget, describing it as “contractors overseeing contractors overseeing contractors.”

Officials from the department did not testify at the hearing Wednesday. In a “letter of concern,” Melissa Leaman, deputy secretary of the department, said the bill duplicates existing reports and “would impose a significant burden while providing minimal value.”

Leaman also cited security and procurement concerns.

“We strongly urge the committee to reconsider SB 705 and instead engage in a collaborative effort to refine our current reporting structure in a way that balances transparency, efficiency, and security. We remain committed to ensuring accountability and providing valuable information while protecting the integrity of state IT projects and operations,” her letter said.

Despite the concerns in Leaman’s letter, Guzzone signaled an interest in taming the problem. Guzzone said the committee could use Hester’s bill and may also look at language in the budget to bring the agency to heel.

“We’re going to work hard on this,” Guzzone said. “This is not something that we need … with all the challenges we have financially. This has got to get handled, and it’s going to get handled. It’s going to take a while, but it’s something that must be done.”

Earlier in the day, the Board of Public Works voted to approve a statewide IT contract involving 39 companies. The 10-year deal, valued at more than $400 million, was pulled from a board agenda two weeks ago after Hester and Sen. Stephen S. Hershey Jr. (R-Upper Shore) wrote a letter expressing concerns about the contract and numerous bidder protests and appeals filed with the Maryland Board of Contract Appeals.

State officials asked the board to approve the contract even though the appeals and protests had not yet been resolved.

Department of General Services Secretary Atif T. Chaudhry said the state “has a duty to protect essential services that directly impact public health and safety for over 2 million residents across the state, which is nearly one-third of the state’s population, particularly including programs such as the Supplemental Nutrition Assistance Program, also referred to as SNAP, supplemental Social Security Income, also referred to as SSI, child welfare support, foster care services and countless more.”

Chaudhry also cited concerns about federal funding which is now guaranteed through October.

During the board meeting, Leaman said the agency takes “seriously our role as stewards of taxpayers’ dollars.”

The changes being made to how the department oversees major IT projects reflect current best management practices, she said, “but we recognize that transitioning to new practices is hard and will take agencies time.”

The board approved the contract 2-0. Comptroller Brooke Lierman recused herself citing advice of ethics counsel. A spokesperson for Lierman declined to elaborate on the conflict, citing a policy of not commenting beyond the comptroller’s announcement

Following the board vote, Hershey criticized the approval for jumping ahead of the ongoing protests and appeals.

Hershey said it may not be incumbent on the legislature to dig in on what he said was “a budget issue.” He said lawmakers “can also do a lot with budget language and forcing an agency to comply with the will of the legislature. We have avenues that we believe are able to be used.”

“At the end of the day, these are taxpayer dollars, and the state has to find a better way to manage them and assure taxpayers that they’re being spent cost effectively and efficiently,” he said.

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