Can You Top This? $68 Million New York City Project Is Now $722 Million and Counting

Mayor Compares Project To Air Traffic Control Modernization

3 min read

Can You Top This? $68 Million New York City Project Is Now $722 Million and Counting

Defense programs routinely overrun their original budgets, but I can't recall one reaching the level of "special achievement" that the CityTime project of New York City has been able to accomplish.

CityTime, according to New York City's Office of Payroll Administration (OPA): ..."is a secure, web-based time and attendance system for the 80 Mayoral and other Agencies of the City of New York that:

  •  Provides objective and consistent application of citywide compensation rules and policies as defined by collective bargaining agreements.
  • Automates the generation of pay and leave transactions.
  • Automatically sends leave, overtime, and timesheets to the appropriate supervisors for approval.
  • Interfaces with Payroll Management System (PMS) for pay and leave processing."

The CityTime system - assuming that it is finally completed - will cover 140,000 city workers who, instead of filling out paper timesheets, will need to scan their hands into a biometric reader to record their comings and goings. The system currently covers 45,000 employees, 19,000 of whom must use it to clock in and out each day and during their lunch hours.  City workers earning more than $68,000 don't have to use the palm scanners, which makes the New York City unions angry.

The project was initiated in 1998 at an estimated cost of $68 million, but I can't find an originally estimated time to complete anywhere. However, this 2008 CityLimits article says the project contract, which I assume includes system maintenance, could run to 2021.

The current estimated cost to complete is now placed at a whopping $722 million, with some $670 million of that going to the defense contractor SAIC for the system's development. According to this article in the New York Daily News, most of the remaining tens of millions have been spent on outside contract and project management to control the project's cost and quality: I guess that was money well spent, huh?

As a bit of background, in this January 2007 New York Times article, the project cost was given as "only" $181.1 million, and the estimated completion time was set for 2009. (Interestingly, in this 2 October 2006 SEC filing, SAIC placed their total CityTime contract value at $375 million - a discrepancy that I cannot find explained anywhere.) 

In this March 2008 CityLimits story, the project cost had risen to $348 million, while this May 2008 CityLimits story says that the contract had been amended some 8 times since its original signing.

In December 2009, this New York Daily News story said that the city government kept modifying the contract every six months to ensure no one could figure out the final project cost. In fact, the Daily News story reported that Mayor Michael Bloomberg in September of last year quietly added $140 million more in funding to the project's contract, even though the city was (and still is) facing massive financial (and apparently common sense) deficits.

Mayor Bloomberg earlier this month admitted that the CityTime project was a "disaster" but he didn't explain how he was going to fix it. He also compared it to developing the next generation air traffic control system - a bit of hyperbole, me thinks.

In February, City Controller John Liu decided to audit the contract - the first such audit (or any outside review) of theproject since it started nearly twelve years ago. Is there some rule that New York City IT projects don't trigger an audit until they have exceeded their original budgets by a factor of ten?

Friday's New York Daily News has an article claiming the top eleven CityTime project managers are being billed to the contract at more than $600,000 per year,  while some 230 project consultants are being billed at an average $400,000 per year. Nice work if you can get it, I suppose.

OPA claims that CityTime will eventually save the city $60 million per annum - unfortunately, that amount will likely never cover the cost overrun on the project.

By the way, if anyone knows of an IT project over $50 million that has exceeded its budget by more than 10 times and still hasn't been canceled, let me know. I can't find any in my archives.

The Conversation (0)