Senator Gaines slams IT company for California’s employment records | TheUnion.com
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Senator Gaines slams IT company for California’s employment records

Sen. Ted Gaines, R-Rocklin, demanded that California agencies adopt a performance-based contracting system after he expressed outrage and disappointment at the California Employment Development Department’s $110-million software upgrade with Deloitte Consulting.

“This kind of software debacle happens far too often here,” Gaines said in a Wednesday news release.

“We waste billions of dollars, and no one is held accountable. My office has been flooded with calls from panicked people who were left without their unemployment benefits. I refuse to believe that this is the best California can do.”



The EDD selected Deloitte Consulting to upgrade its antiquated software system. However, EDD and Deloitte grossly underestimated the number of existing claims that would be mistakenly hit with “stop payment flags” during the upgrade, resulting in the stoppage of payments to roughly 300,000 Californians.

In addition, the project cost nearly doubled from $58 million to $110 million, Gaines said.




The problems with Deloitte are not exclusive to California. Other states, including Massachusetts, New Mexico and Florida, have experienced similar troubles with upgrades to their unemployment software.

Gaines attended Wednesday’s Assembly Insurance Committee oversight hearing on the troubled software implementation and emerged with demands that officials improve California’s IT contracting system.

“It is critical that we put into place a better process, better oversight and more accountability,” Gaines said.

“That is why I plan to explore a legislative solution utilizing performance-based contracting, which includes better incentives and remedies to protect taxpayers and can factor in past vendor performance when awarding contracts. If the same company keeps failing, that should really tell us something.”


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