Friday, March 4, 2011
Auditor: CCMS Cost-Benefit Analysis ‘Unrealistic’
By SHERRI M. OKAMOTO, Staff Writer
State Auditor Elaine M. Howle yesterday questioned the likelihood that the beleaguered California Case Management System will yield the $300 million return on investment claimed by the Administrative Office of the Courts.
Howle said the cost-benefit analysis completed last week by Grant Thornton LLP at the AOC’s behest “excludes and understates certain costs, assumes certain benefits of CCMS that are questionable, and uses a deployment model that includes some unrealistic assumptions.”
First District Court of Appeal Justice Terence L. Bruiniers, who chairs the Judicial Council’s CCMS Executive Committee, said he was “surprised [Howle] chose to respond in this way,” and that he found it “a bit ironic that the auditor is critiquing a report that they asked us to get.”
Howle’s scathing review of CCMS last month found the project had “lacked sufficient planning and analysis” and faulted the agency, among other things, for having failed to analyze whether the $1.9 billion project “would be a cost-beneficial solution to the superior courts’ technology needs.”
According to the 129-page Grant Thornton report, full or partial deployment CCMS would eventually yield savings to the state, but canceling the project would produce a negative return on investment of $270.5 million.
Bruiniers said the report was “quite thorough and well-researched, and clearly stated what its assumptions and limitations were,” noting it “was prepared by one of the best qualified companies, and recognized companies, in the field.”
Howle, however, said Grant Thornton’s analysis failed to show how the return on investment savings were calculated and was based on assumptions that the program works, deployment will occur as scheduled, and funding will be made available.
She also emphasized that the report’s findings relied on data provided by the AOC, which “has a history of understating costs and being overly optimistic about when CCMS will be completed.”
Even if CCMS is deployed on schedule, Howle cautioned, its “useful life…may be very short after it begins to achieve a positive return on investment in fiscal year 2019-20,” noting that the program—which started development in 2007—“could be outdated” by then.
Bruiniers declined to “speak to details” in Howle’s report “without a chance to look at it a bit further.”
Los Angeles Superior Court Judge Charles Horan, a director of the dissident Alliance of California Judges, said that he was “just sick to death of the misinformation and slanted reports coming out of the Administrative Office of the Courts.”
“Thank goodness for the auditor!”
Horan also called on the Legislature to “step in and help the judges of this state reign in” the AOC, which he called an “out-of-control bureaucracy.”
California Assembly members Ricardo Lara and Bonnie Lowenthal last week called on Chief Justice Tani Cantil-Sakauye to replace William C. Vickey, head of the AOC, due to his “staggering mismanagement” of the CCMS project.
The chief justice issued a statement in response defending Vickrey as “an invaluable resource to the judicial branch” and criticized the lawmakers for “attempt[ing] to interfere with judicial branch governance.”
Copyright 2011, Metropolitan News Company