$17 Million Later, Tuttle Scraps Computer Overhaul

After spending more than $17 million on a long-anticipated overhaul of Los Angeles’ computerized payroll system, the city controller has decided to scrap it.

In a letter sent to Mayor Richard Riordan on Friday, Controller Rick Tuttle essentially recommends that the current, nearly 30-year-old computer system continue to handle the job of issuing paychecks to the city’s 32,000 workers.

With the project a year behind schedule and millions over budget, Tuttle said the city should cut its losses.

“The cost of the project has gone up, the benefits have gone down, and we have lost confidence in the process and the contractor,” he said.

Deputy Mayor Noelia Rodriguez said Tuttle’s decision infuriated the mayor.

“Millions have already been invested in a new system. This raises questions about the management of the controller’s office,” she said.

The project began in 1997 and was expected to cost $13 million. Work was to have been completed by September 1998.

Tuttle said his office continued with the project because “we kept being told there was a light at the end of the tunnel.”

Earlier this year, when a city study estimated that the project’s cost would balloon to $23.9 million, Tuttle faced a barrage of criticism from City Council members.

Tuttle said he will not seek additional funds for the project. This fiscal year, $6.3 million has been set aside for the computer change, much of which has yet to be spent, he said.

“By stopping now, we can probably recover a substantial part of that,” Deputy Controller Tim Lynch said. He added that $5-million worth of computer hardware purchased for the system can be used for other purposes.

Lynch also said the city has spent about $5 million on licensing, consultant’s fees and staff salaries. The contractor has been paid about $5 million as well.

Meanwhile, the computer system that was recently seen as antiquated is now said to be good for at least a few more years. Tuttle said that during the overhaul process the old system was made Y2K compliant, and more recent studies by the city’s Information Technology Agency have concluded that it is more reliable than they had believed.

Rodriguez criticized that assessment as well.

“Three years ago, they said the old system was not adequate. Now they’re saying it is,” she said.