Sen. Jones renews call for performance bonds on state technology projects

Sen. Jones renews call for performance bonds on state technology projects

Lansing— In March, state Sen. Rick Jones introduced Senate Bill 1011, which calls for performance bonds on large technology projects proposed by the state of Michigan.

SB 1011 would call for all new contracts $2 million or greater to be subject to performance bonds.

“This measure is intended to restore efficiency and effectiveness to state sponsored computer projects,” said, R-Grand Ledge. “Performance bonds are already common practice for federal, state and local road and building projects. I am simply trying to make sure that results are being met. The bonds are unbiased and will increase accountability.”

An auditor’s report released on Thursday shows the Department of Technology, Management and Budget mismanaged a decade-old computer project for the secretary of state that has cost taxpayers $50 million and still isn’t finished.

“I introduced this legislation in order to prevent waste like this from happening,” Jones said. “A former unnamed official in the secretary of state’s office approved unauthorized payments to the contractor. In my opinion, these unauthorized payments may be criminal in nature, and I will ask the attorney general for an investigation.”

Examples of state of Michigan computer projects from the last eight years:

  • “Bridges”—Department of Human Services
    $58 million over budget and two years behind schedule
  • “Child support Enforcement System”—Department of Human Services
    $459 million dollar final cost (original contract cost 60 million) and $147 million in federal fines
  • “CHAMPS”—Department of Community Health
    $18 million lost during system cut-over
  • “E-Michigan”—The state’s primary web-portal
    $10 million over budget and two years behind schedule
  • “BAM—Department of State Business Applications Modernization $38 million dollars over budget and two years behind schedule, requiring the intervention of the Michigan Attorney General to get performance

 “Unfortunately the past administration’s accounting and contract controls were so out of control that we may never know how much money was wasted,” Jones said.

“Using the Department of Technology and Michigan Auditor General reports, I have found more than $400 million that could have been spent more effectively or was lost to federal fines. This legislation brings a common sense approach to major computer projects and will continue the Legislature’s commitment to accountability.