Perdido 03

Perdido 03

Tuesday, December 21, 2010

Juan Gonzalez: City Knew About CityTime Problems Eight Years Ago

Juan Gonzalez with another CityTime scoop:

Richard Valcich saw the warning signs of the CityTime fiasco long before anyone.

In February 2003, Valcich, then the city's director of the Office of Payroll Administration, wrote a scathing letter to the main contractor in charge of installing the CityTime payroll and timekeeping system.

That firm, defense giant Science Applications International Corp., had taken over the payroll project in 2000 but was far behind schedule.

"SAIC has repeatedly been late on virtually every deliverable," Valcich wrote. "The inability of SAIC to deliver on time has resulted in wasted city resources."

Valcich complained in the letter, which the Daily News obtained under a Freedom of Information request, that SAIC was constantly rewriting plans, requirements, and schedules without consulting the city.

Two firms whose owners were arrested last week on federal charges of bilking the city of millions of dollars, DA Solutions and PrimeView, were subcontractors doing some of SAIC's work.

Valcich's letter is clear proof that city officials had grave concerns about waste and bloat in the main contract nearly eight years ago.

"A certain level of professionalism and compliance with acceptable industry standard practices is expected of a contractor responsible for the execution of a $100m[illion]+ project," Valcich said. He further noted that SAIC had increased costs of some hardware by 400%.

SAIC's "commitment to quality is almost non-existent and is reflected from the top down," Valcich wrote. He added the city had spent "approximately $35 million on CityTime and does not have a tangible system to show for it."

A more damning assessment is hard to imagine - but in all the City Council oversight hearings about CityTime the past few years, no one at OPA or City Hall ever mentioned the Valcich letter.

Only when City Controller John Liu took office this year and immediately began an audit on CityTime, did these problems come to light.

SAIC spokeswoman Laura Luke acknowledged yesterday that the Valcich letter revealed "deficiencies" in the CityTime program.

She insisted that her firm "worked closely with the city on assessing and fixing the problems."

The company rolled out a new system in 2005 and the "city told us we were working well together," Luke said.

One of the main things that happened was that Valcich resigned as director of OPA in 2004 and was replaced by Joel Bondy.

Bondy was then a consultant on CityTime for Spherion Inc., the firm tasked to certify the quality of all CityTime contractors. Spherion paid Bondy $307,000 the year before he moved to OPA, payroll records show.

Soon after Bondy arrived, the cost overruns on CityTime spiraled even higher.

Valcich had complained about $35 million in 2003. The price tag under Bondy zoomed past $700 million.

A big part of the cost, The News reported in March, was the 230 SAIC consultants being paid an average of $400,000 annually as consultants on CityTime.

And that's on top of more than a dozen Spherion consultants who were raking in similar amounts.

Spherion consultant Mark Mazer, for example, who federal prosecutors charged last week as the mastermind of an $80 million CityTime fraud, was paid $449,000 in consulting fees by the city in 2009.

So when Bloomberg says that CityTime was just something that fell through the cracks, someone should tell him to read the Valcich letter.

It's interesting that in 2005 Bloomberg replaced the CityTime whistleblower at OPA with an actual CityTime contractor - Joel Bondy.

That's like hiring a lion to watch over the sheep.

Bondy allowed the cost of CityTime to skyrocket in five years by $665 million dollars.

Much of that money was paid to "consultants" working for the company that Bondy once worked for.

Again I say, Bloomberg needs to be brought to account for this.

This isn't some little scandal that "slipped through the cracks."

This was a huge financial mess that got much WORSE under Bloomberg.

And now, as Juan Gonzalez points out here, the city knew it was a mess seven yeara ago and did NOTHING about it.

Where's the accountability, Mr. Mayor?

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