Philadelphia amends contract for troubled water-billing system

Philadelphia officials announced today an agreement in principle with Oracle Corp. to restart a suspended water-billing system initiative called Project Ocean at no extra cost to the city (see "Philly CIO: Troubled water billing system can still work").

An amended contract between the city and Oracle calls for additional off-the-shelf utility billing software, said City Solicitor Romulo Diaz Jr.

"We'll have the functionality that the city requires and be able to meet budget requirements and have the billing system up and running sometime in the fall of 2007," Diaz said in an interview. That means the system should be working before the end of Mayor John Street's administration at the end of 2007.

The project is still expected to cost about $18 million, even with the addition of billing software, said outgoing Philadelphia CIO Dianah Neff in a separate interview. She leaves Friday to become a municipal wireless consultant, and the city has named Terry Phillis as acting CIO.

Neff and other officials would not name the new billing software vendor until the amended contract is finalized. But Neff said it is a well-known package that the city has already evaluated and found to be workable. The vendor is one of Oracle's many recognized business partners, she said.

Neff defended the $18 million cost, which is about double the anticipated price tag when the project was conceived in 2003. She said the industry average cost for a modern sophisticated utility billing system serving Philadelphia's 600,000 water customers could be expected to exceed $32 million.

"We certainly hope the [agreement in principle] ends the political turmoil," Neff said. She added that the mayor's office of information systems took over the project when problems developed and "got the full blame for problems, which was a little irritating. It has taken longer than hoped, but we've come up with a very good solution that allows us to move forward."

Neff stopped work on Project Ocean, which is designed to replace an inefficient 30-year-old custom-built system, last October. That suspension remains in place until the contract amendment is finalized in two to three weeks, Phillis said. The city also plans to hire an outside party to oversee future work, which Neff said could push costs above $18 million.

Oracle officials could not be reached for comment. But last month a spokeswoman said that Project Ocean was still in progress and that Oracle would deliver on its obligations.

Neff said last month that problems with the implementation stemmed from technical complexities, Oracle's inexperience with building such a system and the departures of several project managers and executives sponsors.