State Will Recover $8.3M In IT Losses From HP

12/05/12 5:50PM By Jane Lindholm
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Vermont has had some pretty high profile IT disasters in the last few years. The court system spent at least $1.7 million on a new computer system that doesn't work. The state spent $8 million on a tax system that is not fully functional. And the Department of Motor Vehicles spent roughly $18 million on a new computer system that also doesn't work.

But on Wednesday, Commissioner of the Department of Information and Innovation Commissioner Richard Boes announced the state is getting some of that money back.

"Hewlett-Packard is refunding about $8.3 million of the roughly $8.6 million that was invested in the system," Boes said.

In 2006, the DMV contracted with Hewlett-Packard to overhaul the department's old computer system. They paid HP nearly $9 million, and spent an additional $9 million on associated equipment and staff time.  Most of the remaining money is a total loss for the state. But Boes says, not all.

"$2.7 million, or roughly that order of magnitude, is value that we got out of that system," he says. We have a new point of sales system that is in place and has been in place for 4 or 5 years that came from that 18 million dollar project. We've got various different components that help for enhanced drivers' licenses that came through that program."

The DMV may be getting some money back. But it's still left with an outdated IT system. Robert Ide is the Vermont's DMV Commissioner. He says the system is old but it has been upgraded over time and will continue to function for the foreseeable future.   

"We have a system in place that's a legacy system that is working very well for us today," Ide says. But he's not sure what the next step for Vermont will be.

"I probably will not have the courage to bring forward a proposal until I see a successful implementation in another state," Ide says. "I think to jump into the pond quickly again because we think we have to get something done is probably a strategy that would only bring more frustration." Ide points out that several other states also contracted with Hewlett-Packard to get new IT systems and those partnerships didn't go well either.

Last term, the Vermont legislature gave the Department of Information and Innovation more authority to oversee the implementation of IT projects throughout state government. Officials hope to learn from these mistakes as they move forward with at least $300 million worth of IT upgrades, including a major online registry for health insurance.

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