Marin County ERP system: $14 million

The latest chapter in Marin County's computer system woes unfolds next week as officials consider a $14 million appropriation to acquire, install and initially staff a new system, including $8.2 million for a vendor.

In line to handle the program under a $8,171,357 contract is Tyler Technologies of Texas, the largest company in the nation focused solely on public sector software and services.

County supervisors will consider a $14,057,370 allocation Tuesday morning to cover Tyler's $8.2 million bill and a $5.9 million tab for county staffing for 36 months and related expenses including a $1 million contingency. Last June, cost estimates for the program ranged from $12 million to $16 million.

Mindful of the county's $30 million SAP computer troubles, a team of top officials negotiated a detailed, carefully-worded software systems contract as well as a related requirements document that runs more than 500 pages. The program is aimed at replacing core financial, budgeting, human resources and payroll components of the troubled SAP system that never worked as expected and cost too much to maintain.

"The software and services contract with Tyler Technologies applies multiple lessons learned from previous county experience and is designed to provide detailed level project control and shared incentives for project success," according to a memo signed by County Administrator Matthew Hymel and department heads in charge of finance, human resources, information technology and public works.

In that light, the contract involves a "not to exceed" price, guarantees to assure "consistent and quality" staff expertise from the vendor, a payment schedule tied to performance milestones and the sharing of any savings if the project comes in under budget.

"Annual ongoing maintenance and support fees will begin at $386,564 with contractually guaranteed incremental increases for a minimum of 10 years," Hymel's report added. Ongoing county staff costs will be roughly $750,000 less a year than the SAP system.

The county administrator noted a team of top managers and other staffers worked for four years on preparations to replace the system, selected Tyler as a finalist, then began talks with the firm last summer to draft a contract. "It is imperative to implement a fully functioning software program, which works effectively within our particular environment, and serves the administrative functions that are used by all county departments," Hymel's memo asserted.

Among those backing the new program is county finance chief Roy Given, who as assistant treasurer was among critics of proceeding with the SAP program in 2006. "We have done our very best up to this point, but we know that we have a lot of work ahead of us to be successful," Given said. "All the departments that should be involved ... are involved this time."

The grand jury last year lauded the county's cautious, studied approach to planning for a new system but said it found some of the same deficiencies in the process that plagued the SAP system. It questioned management, criticized a reliance on consultants and said county supervisors were not as involved as they should be.

"We do not believe there is a lack of best business practices expertise in-house," the jury asserted, urging a consultant crackdown including strict hiring guidelines. "The process of hiring outside consultants has become too convenient for the Board of Supervisors."

But the jury noted that unlike last time, the county's high-tech staffers were included in decision-making about the new high tech system, and better staff training was planned.

The county decided to junk the SAP system in 2010, just four years after installing it, after officials concluded it was more economical to start over with new gear than to fix and maintain a program that did not work as expected. The civil grand jury said after a probe that it cost the county $30 million.

The county, claiming fraud and racketeering among a host of felonies, filed dual lawsuits, but lost even more money when its legal battle went belly up at the courthouse. The county board, which spent $5 million on legal consultants, accepted a $3.9 million settlement with no public explanation.

A gag order approved behind closed doors by county supervisors gave political, legal and liability cover to all parties, preventing anyone from explaining who was accountable for what.

Dropped were all claims against Deloitte Consulting LLP, software giant SAP and former county auditor Ernest Culver, who managed the computer project before joining SAP.