Assemblyman Jeff Klein


Update on Committee Investigations

From Assemblyman Jeff Klein
Chair, Committee on Oversight, Analysis and Investigation

Klein Budget Reforms Passed In The Assembly
Reforms Would Provide One-Stop Shopping for Information Technology Contracts and a Clearinghouse of Information for State Agencies and Authorities

Currently State budgeting for information technology projects is fragmented, uncoordinated and virtually impossible for the public to understand. State agencies make contract award decisions for millions of dollars with limited and incomplete information about the "responsibility" of bidders.

Jeff Klein, Oversight Committee Chair, sponsored a two-bill package that would enhance the information detailed in the State budget regarding information technology contracts (A 6977-A); and would help to ensure that all agencies benefit from shared information when making bidder responsibility decisions for State contracts (A 3730). The Assembly unanimously passed Klein’s budget reform proposals in June.

Budgeting for Information Technology (IT)

Information technology (IT) contracts represent a large and growing portion of the State Budget. In fiscal year 2001-02 alone, there were over 4,650 IT contracts between state agencies and private companies, valued at $9.6 billion dollars. The Office for Technology’s 2003 Baseline Statewide Information Technology Inventory reported 2,828 data processing consulting and contracting service contracts with FY 2003-04 expenditures alone totaling $623 Million.

Key provisions of A 6977-A, include:

  • requiring line item appropriations for IT projects valued at $5 million or more proposed for funding in the Governor’s budget;
  • requiring a detailed report from the Division of Budget about these proposed IT projects, including:
    • existing or anticipated contracts;
    • vendors;
    • project descriptions and purposes;
    • contract amendments or change orders;
    • estimated contract completion dates;
    • annual contract expenditures; and
    • information about any cost overruns and delays.

The Executive budget often requests significant funding for IT. However, the details supporting these requests are few and far between. The Executive’s failure to issue a timely report about the State’s computers (See Public Eye Issue 2) only exacerbates this problem. Without this information, Legislators are forced to make budgeting decisions in a vacuum.

Assembly Bill 6977-A responds to investigative findings by the Assembly Oversight, Analysis and Investigation Committee, which revealed numerous instances of:

  • contract cost overruns (CONNECTIONS and Women Infant Children State Information System {WICSIS} are but two examples);
  • lack of detail at budget time about long-term contractual obligations (CONNECTIONS and Statewide Wireless Network);
  • contract change orders and amendments (CONNECTIONS); and
  • failure to segregate particular project costs (WICSIS).

This legislation is modeled on existing state law requiring budgeting for environmental projects and was the result of a prior Oversight investigation into environmental law violations by state agencies. That earlier law has worked well, and should be applied to these other multi-billion dollar obligations of the State.

Bidder Responsibility – A Clearinghouse of Information for State Agencies and Authorities

Current law requires that agencies and authorities award contracts only to "responsible bidders." The Responsible Bidder Database that would be established by Assembly Bill 3730, would provide contracting agencies with relevant information about a bidder’s background, history of contract performance and compliance with laws. Modeled on NYC’s law which established the City’s successful "Vendex" database, it will assist state agencies and authorities in making their responsibility determinations.

Why is the Database needed?

Individual agencies and authorities each collect bidder background and history information. There is no functioning system for storing and exchanging the information among all of the agencies and authorities. They don’t benefit from the knowledge of another agency’s good or bad experience.

Sound management practice requires that agencies and authorities have a coherent system for regularly exchanging accurate information. The lack of information can have costly consequences. One example is the Dormitory Authority’s award to contractors for construction work at SUNY Old Westbury. The State faced four million dollars in cost overruns and two years of delay because the contractor was not responsible. This information should have been in the Authority’s hands when the award decision was being made.

How will the Database work?

Data will be fed into a centralized location from a number of sources: self-reported information from bidders; agencies’ investigations of bidders’ responsibility; and agencies’ reports of contractor performance on earlier contracts.

Maintained by the State Comptroller, who now maintains a database of all state contracts, agencies will be able to tap into the database and consider the information when making their responsibility determinations.

Important link to the NYC Vendex system

This new State database will be allowed to exchange information with the City’s Vendex system. The end result will be more information in the hands of the State and the City, helping both carry out their lawful responsibilities.

PUBLIC EYE #4 (September 2003) is the fourth in a series of updates from Chairman Jeff Klein detailing his work as Chair of NYS Assembly Oversight, Analysis and Investigation Committee. Other issues will follow. The Committee is charged with reviewing implementation and adequacy of laws and programs to ensure compliance by the public and government agencies. Through its monitoring and investigative activities, it seeks to determine whether programs are operating as required and whether funds allocated for programs are spent effectively, efficiently and in accordance with legislative intent.


District Office: 728 Lydig Avenue, Bronx, NY 10462, 718.409.0109
Albany Office: Room 637, Legislative Office Building, Albany, NY 12248, 518.455.5844
Committee Office: Agency Building 4, 12th Floor, Albany, NY 12248, 518.455.3039

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