VITA contract is six months late, says official

By: JEFF E. SCHAPIRO AND OLYMPIA MEOLA TIMES-DISPATCH STAFF WRITERS | Times-Dispatch
Published: June 30, 2009

Virginia's computer agency is six months behind schedule in putting in place a $2.3 billion contract with Northrop Grumman for info-tech services.

Leonard M. "Len" Pomata, acting head of the Virginia Information Technologies Agency, disclosed the delay yesterday in the opening of House of Delegates and state Senate inquiries into the controversy engulfing the sprawling department.

Pomata, installed when the previous chief information officer, Lemuel C. "Lem" Stewart Jr., was fired as CIO for questioning a monthly, $14.3 million bill from Northrop Grumman, said it now will be Christmas before the state's new, privately run IT management plan is implemented fully.

The venture, complicated by continuing complaints from agencies about poor, expensive service, is emerging as an election-year challenge for departing Democratic Gov. Timothy M. Kaine and legislators in both parties.

Kaine, who has defended the VITA-Northrop Grumman alliance, said through spokesman Gordon Hickey that he is deferring to the board that oversees the agency to set right the contract. That board is made up of gubernatorial and legislative appointees.

Speaking before a House committee that questioned whether Northrop Grumman is failing to fulfill its obligations under the state's richest-ever privatization pact, Pomata said "service levels, in general, are below expectations."

But when asked why the state had not withheld payments to Northrop Grumman to force improvements, Pomata, who also is Kaine's secretary of technology, said he had not determined how using the power of the purse would affect service.

Senators expressed concern about the cost of the program to taxpayers and asked whether the 10-year contract could be junked. Short of that, they wanted to know what steps could be taken to save money.

Sen. Yvonne B. Miller, D-Norfolk, head of the Senate Finance subcommittee investigating the troubled VITA-Northrop Grumman alliance, said "some bumps in the road" were anticipated, but "problems are bigger than expected."

Northrop Grumman, stepping up its response to a growing business and public-relations challenge, acknowledged difficulties.

They include, the Chantilly-based defense company said, delays in completing an inventory of all state-owned computer equipment -- a first step toward determining what needs to be replaced as well as the cost of upkeep. Northrop Grumman promised to assign more employees to the project.

"Transformation does not take place on a straight line," said Jorman Granger, a Northrop Grumman vice president and lobbyist who has been amassing contacts in Virginia government since serving as a top aide to then-Gov. L. Douglas Wilder nearly 20 years ago.

The company had no immediate comment on whether the price of the contract should be adjusted because of delays -- an idea floated by senators and delegates.

The General Assembly's accountant, the auditor of public accounts, reported to the Senate subcommittee that the state has blocked $13.6 million in payments to Northrop Grumman since 2006 for inadequate service. The company since has been paid about $5 million, reducing the withheld amount to $8 million.

Meantime, additional details emerged surrounding Stewart's dismissal.

James W. McGuirk II, chairman of the VITA board, said in a letter Friday to Del. Samuel A. Nixon Jr., R-Chesterfield, an IT expert and head of the House Republican Caucus, that Stewart was removed "to avoid a major rift in the program with Northrop Grumman."

McGuirk also said Stewart had the authority to stop payments, "regardless of the desire of the board."

Stewart, who remains a consultant to VITA, did not return a phone call seeking comment.

Illustrative of discontent with the VITA-Northrop Grumman deal: continuing concern over the recent hacking of drug-prescription records in the Department of Health Professions.

The agency's director, Sandra Whitley Ryals, told the House Science and Technology Committee that some physicians are concerned about prescribing serious pain medications because they don't have access to the drug data base.

Del. Harry R. Purkey, R-Virginia Beach, questioned whether the security failure represented a breach of contract by Northrop Grumman and is grounds to renegotiate.

Contact Olympia Meola at (804) 649-6812 or omeola@timesdispatch.com.

Contact Jeff E. Schapiro at (804) 649-6814 or jschapiro@timesdispatch.com.