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Chapter 14 Managing Projects 587

current workers are not included in the system. the mayor, but those concerns too were ignored or
Even worse, NYCAPS was built to run on the same dismissed by Page.
old legacy systems that used the previous patchwork The lack of adequate government oversight of the
system, despite the fact that upgrading legacy CityTime project may have been the biggest reason
technology was a major reason for the project’s for the hundreds of millions of dollars in cost over-
development in the first place. runs incurred since the project’s conception in 1998,
As bad as the NYCAPS project has become, an but the main beneficiary of those overruns has been
earlier, even more ambitious New York City project SAIC. In 2000, work on the project was transferred to
makes it look tame by comparison. The CityTime SAIC from the first contractor, a subsidiary of MCI.
payroll system project, first conceived in 1998, has Instead of the usual competitive bidding process
seen its budget grow from approximately $65 million for contracts, the city opted simply to pass it off to
to well over $700 million as of 2012. CityTime was SAIC, a transfer which is still being reviewed by city
created to automate payroll timekeeping once investigators. Shortly after SAIC took control of the
dependent on pen and paper, and in the process to contract, work on CityTime was switched from fixed-
curb undeserved overtime payments to city workers price to hourly billing. This, in turn, inflated costs
and improve accountability throughout the govern- from $224 million in 2006 to a total of $628 million
ment. In an ironic twist, the project has instead been by 2009. Thanks to the hourly contracts, the city was
permeated with fraud at every level, and engineers on the hook for all of the waste incurred by SAIC.
from the main consulting organization, Science The terms of contracts were also constantly chang-
Applications International Corporation (SAIC) were ing: another consulting company hired to provide
charged with fraud. quality assurance for CityTime had its contract
A June 2011 press release from Manhattan U.S. amended 11 times, increasing its value to almost $50
Attorney Preet Bharara states that “the alleged million from its original $3.4 million figure.
criminal scheme extended across virtually every SAIC delegated most of the work on CityTime
level of (CityTime); contractors and subcontractors to subcontractors, further complicating the
systematically inflated costs, overbilled for consul- chain of command involved in the project. The
tants’ time, and artificially extended the completion most prominent of these, Technodyne, received
date.” Again, the biggest reason for the project’s $450 million in funds from the city. When the
unheard-of budget increases is lack of qualified over- U.S. Attorney’s office released its indictments,
sight. The few government employees constantly Technodyne’s owners, Reedy and Padma Allen, fled
monitoring the project turned a seemingly blind eye the country and are believed to be at large in India.
on the ballooning costs incurred by SAIC and the Today, over 150,000 city workers use CityTime
lack of progress in the project. Belief that the soft- to keep track of attendance and leave of absence
ware developed for the system could be sold to other requests, but the cost per user for the project is
governments was perhaps another reason why the estimated to be approximately $4,000. The industry
city let costs balloon. standard for projects of this size is between $200 and
Bloomberg’s budget director, Mark Page, was $1,000 dollars. New York State has developed a much
reportedly the strongest voice in favor of CityTime. more complicated system to perform similar tasks
He had hoped to stop the trend of police officers, for only $217 million, which makes CityTime’s $720
firefighters, and other aging city workers receiving million price tag look even worse by comparison.
unnecessary overtime at the end of their careers, In March 2012, the city received some good news:
presumably to increase their pensions. Page also SAIC agreed to repay $500 million in restitution and
wanted to limit lawsuits against the city from work- penalties back to the city to avoid federal prosecution
ers claiming their pay was too low for the hours they for various instances of fraud involving the CityTime
had worked. But Page’s background was in law, not project. Although the result will lessen the burden
information systems, making him a poor choice to of the project on taxpayers, the scandal neverthe-
oversee CityTime. Other government branches, like less is a black mark for Bloomberg and his goals to
the city comptroller, left the project mostly to Page. modernize city information systems, and there is
William C. Thompson, the city comptroller from some doubt about how much of the sum that SAIC
2002 to 2009, never audited CityTime despite numer- will actually be able to pay.
ous warnings about the project from staffers. Still, The New York City Council also called a hearing
an aide for the mayor did suggest that the comptrol- to respond to the budget-crippling cost overruns of
ler’s office had raised concerns about the project to both projects. The Bloomberg administration vowed

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