A software project with 6,000 pages of specs ends badly

Orange County files lawsuit to recover damages from offshore firm in tax system rewrite

A modernization of Orange County, Calif.'s tax collection system that was supposed to take three years and cost less than $8 million was on track to cost twice that amount and take twice as long when officials pulled the plug.

Instead of seeing the project through to completion, Orange County abandoned the effort, declared the software "fatally flawed" and in April filed a lawsuit against the contractor.

The two sides -- the county and the contractors, Tata Consultancy Services and its U.S.-based subsidiary -- are now attempting reach a mediated agreement, according to the most recent federal court filing late last month.

In 2007, Orange County hired Tata America International, a subsidiary of the world's largest offshore provider of outsourced IT services -- Mumbai, India-based TCS -- to develop custom software to handle most of the county's tax functions. The county collects some $4.5 billion in taxes a year.

Before hiring Tata, the county had used another contractor to develop the business documentation for the projects. That documentation ran more than 6,000 pages and outlined every aspect of the project, from legal requirements to operating systems.

Tata was the winning bidder for the job, offering to do it for just over $8 million. As part of the contract, TCS proposed that all work on the tax project "be performed onsite at the county offices in Orange County." The county, in its legal filings, states that it believes that many of the people that TCS assigned to the project "worked and lived in India" -- a logistical complication that contributed to delays and communication problems.

The lawsuit outlines many complaints, and says that TCS had claimed a 96% success rate in completing projects on time and on budget. The tax system project's cost was rising above $16 million when the county pulled the plug.

The county, in its lawsuit, says it will have to start over from scratch.

In a statement, a TCS spokesman said it is company policy not to discuss pending legal matters, but added that TCS stands by the quality of its work. "Over 98% of our business comes from repeat clients," the spokesman said.

Patrick Thibodeau covers cloud computing and enterprise applications, outsourcing, government IT policies, data centers and IT workforce issues for Computerworld. Follow Patrick on Twitter at  @DCgov, or subscribe to Patrick's RSS feed . His email address is pthibodeau@computerworld.com.

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Copyright © 2013 IDG Communications, Inc.

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