North Carolina auditor Beth Wood’s findings that state government IT projects end up costing twice the original estimates and aren’t coming in on time may be the first hard look at a procurement system now costing taxpayers $1.4 billion a year.
But in reaching those conclusions, Wood admits she was able to examine only a small sample drawn from the state’s IT past.
About 1,034 legacy projects are on the books. Wood and her staff examined only 84, or 8 percent.
For those 84, the initial cost estimates were $320 million. The final price tag was $676 million. Implementation schedules were busted by 65 percent, or 389 days.
The other 950 projects Woods’ auditors turned up couldn’t be included because the state’s IT database obliterates the initial estimates when newer data is entered.
Woods office doesn’t even hazzard a guess about how their findings might have changed had those hundreds of other projects been included.
“This has been an eye opener,” says Wood spokesman Bill Holmes.
Apparently for the McCrory administration too, which has scheduled a Thursday statement by the new governor dealing with IT procurement issues.
Along with its audit, Wood’s office published the list of the 84 projects.
Officials in the state’s ITS office believed some of them shouldn’t have been included in Wood’s audit because they were projects with “agreed upon business scope changes” that skewed the results.
An example of a contested project is the Department of Revenue’s new tax management system with an initial estimate of $525,000 and the final price tag of $97 million.
Wood, at the end of the day, chose to include it because, as she explains, it helps to demonstrate “the large monetary impact that inaccurate estimates … can have on state spending.”
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