By Anita Kumar
Washington Post Staff Writer
Thursday, July 9, 2009; LZ06
The largest contract in Virginia history was born in 2003, after a legislative review showed that the state's computer system was out of date and increasingly expensive to maintain.
Six years later, the troubled, 10-year, $2.2 billion contract with Northrop Grumman could cause headaches for those running for office.
Lawmakers have begun to blame each other for the problems, which include missed deadlines, cost overruns and poor service.
Some lawmakers are trying to use the issue to their advantage, although both gubernatorial candidates -- state Sen. R. Creigh Deeds (D-Bath) and Republican Robert F. McDonnell -- have stayed uncharacteristically silent on the matter.
Deeds, running as the heir apparent to the past two Democratic governors, has to be careful not to criticize a plan that was the brainchild of Sen. Mark R. Warner (D) and has largely been implemented under Gov. Timothy M. Kaine (D). In a statement this week, Deeds expressed support for the legislative inquiries. "These implementation problems need to be fixed," he said.
McDonnell, who has unveiled proposals supporting additional public-private ventures, doesn't want to hurt Republican efforts to implement partnerships with companies, particularly on transportation projects. But when asked about the contract this week, McDonnell had some strong words.
"Virginia's outsourcing contract with Northrop Grumman, championed by Governor Tim Kaine, has not been properly managed,'' McDonnell said. "Reports of security breaches . . . missed deadlines, delays and costs overruns are very troubling and must be promptly corrected. There needs to be more effective management, openness and increased accountability within [the agency], and this needs to happen now."
McDonnell had pledged to run similar programs like businesses, add transparency to contracts, request regular audits and seek more input from state employees.
Virginia, which is accustomed to accolades for being the best-managed state, isn't used to such problems. But the governor's office and the General Assembly -- Democrats and Republicans -- all had a hand in creating the Virginia Information Technologies Agency.
Warner proposed, and received legislative approval for, consolidating the state's computer operations into one agency and overhauling the system to make it more efficient and less expensive. As legislators, Deeds and McDonnell voted for the bill.
The state accepted bids and selected Northrop Grumman for the contract. With thousands of workers here, the company is one of the state's largest employers.
Warner spokesman Kevin Hall said this week that the senator still supports the program even though he is no longer involved in its implementation.
"No one disputes the business argument for leveraging the efficiencies and savings through IT consolidation,'' Hall said. "It's also clear that a project this ambitious has run into some implementation problems. Senator Warner supports bipartisan efforts to get VITA back on track so taxpayers can benefit from the ultimate savings this should produce."
Since the program began, Northrop Grumman has replaced more than 35,000 computers, created a centralized service desk to respond to state agencies and opened two secure data facilities in Chesterfield and Russell counties that have created 370 jobs in the financially distressed southwestern part of the state.
But in recent months, state officials say Northrop Grumman has missed key deadlines, has not adequately maintained inventory and has provided poor service to state agencies. The state is withholding more than $6 million from the company because of problems.
The original timetable called for the company to assume full control of the state's computer infrastructure by July 1, a deadline that has not been met.
Part of the problem is that the Information Technology Investment Board, which oversees the agency, does not report to the governor or the legislature.
In 2003, the General Assembly, controlled by Republicans, suggested separating the state's chief information officer and his agency from the governor to insulate them from the political process and allow them to make decisions based on business and technological needs. As a result, they report to a nine-member board, its members appointed by the legislature and the governor.
Kaine, who has spoken to Northrop Grumman's chief executive officer and division chief, said the problems have more to do with the way the agency managed the contact than with the work the company has done.
"It was an organizational model that was screwed up from the beginning,'' he said. "I have made plain to the legislature that I think that the model was wrong, but we tried to deal the best we could with it."
But House Majority Caucus Chairman Samuel A. "Sam" Nixon Jr. (R-Chesterfield), who sponsored the bill in 2003, said Kaine has only recently become involved and has never tried to significantly change the governance structure.
"Obviously the governor has every right to question the governance structure, but it's just silliness to make that comment at this point in time,'' Nixon said.
Look for the escalating controversy to gain traction in the months leading to Election Day, as the General Assembly continues with several investigations that might not wrap up until the end of the year.