In a cool, hushed room on East Magnolia Street, Maricopa County officials threw away more than $12 million in taxpayer money last week.

The county's Health Care Agency--with the blessing of the Board of Supervisors--began to dismantle a brand-new, multimillion-dollar computer system that was mostly paid for but had scarcely been used.

Pleading poverty, health officials contended that the system, within months of kicking into full gear, was simply too expensive to finish. Rather than invest several million more dollars to complete the project, they decided to scrap it altogether.

What had begun several years ago as an effort to help one of the county's largest agencies emerge from the technological dark ages instead ended as one of the most expensive financial blunders in county history.

As explained by county officials, and briefly reported in the daily newspapers, the decision to scrap the system was unavoidable. Looking for ways to cut $30 million from his budget--and contemplating laying off as many as 200 employees--acting agency head Ted Williams says he cannot afford to sink any more money into a computer system.

"We're going through the most aggressive reengineering in the history of a county department," says Williams, who took over the agency earlier this year. "This is a good management decision to live within the budget we've been given."
But the issue is hardly that clear-cut, say critics and county insiders, and under scrutiny, it is hard to discern a compelling reason for flushing an investment of more than $12 million.

According to numerous reports prepared by various consultants and county employees but not widely publicized, Williams' decision qualifies for enshrinement in the penny-wise, pound-foolish hall of fame.

The expected costs of the computer system have been known for years, and the project was coming in on budget, according to an internal county audit. Its final cost should not have been a surprise to anyone.

Virtually everyone agrees that the computer itself was fully capable of meeting the agency's technological needs, and, in fact, would have saved the county money when it was operating by improving patient billing and recordkeeping.

By scrapping a system that is already almost paid off, critics point out, the agency will now have to buy another one, but nobody has a clue what it will be or how much it will cost. They wonder how another new system can possibly be cheaper than one that's already all but paid for.

"They've got this much invested, and they're snatching defeat from the jaws of victory," says Steve Wilson, one of the numerous system planners who worked on the project. "Did we know how much this was going to cost? Absolutely. Has that changed? Absolutely not. Everybody approved all of this. Everybody knew what the cost was going to be."
The decision has left many involved in the project dumfounded. They acknowledge that the county is in severe financial straits, but see the decision as a shortsighted and capricious overreaction to a budget crunch.

Startled by the seeming abandon with which county management is throwing away a $12 million investment, Supervisor Ed King has asked the county's internal auditor to reconstruct the chain of events that led to the computer debacle.

But board members and their staffs, King and others say, are not free to explain why they signed off on the plan to scrap the system, because the County Attorney's Office has told them to keep their mouths shut in case lawsuits spring from the decision.

"The County Attorney's Office has advised that everyone be very prudent about what is said about the situation," says Tom Simplot, aide to Supervisor Betsey Bayless.

Whatever the merits of the decision, King says, it raises unsettling questions about the competency of county management when it comes to computer and automation planning.

"When it comes to electronic data processing in the county, it appears we have a headless horseman," King says. "Nobody's in charge."
@body:Buying a multimillion-dollar computer system is hardly an impulse purchase, especially for a government agency. There are the predicate consulting reports, meetings, committees and forests of projections and plans. Phrases like "platform," "applications" and "gateways" are bandied about, presumably by people who know of what they speak.

In the case of the Health Care Agency, according to many who were involved in the process, about five years were spent figuring out what kind of computer was needed and whom to buy it from.

Employees from all parts of the agency--the people who would actually have to use the computer--were called in and asked what they wanted and needed to do their jobs.

There was little question about the need for a new system. The agency's last big computer acquisition was a Honeywell system bought in the late 1970s. The running joke around the agency was that, aside from keeping track of dog licenses, the computer couldn't do much.

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David Pasztor