Thursday, March 20, 1997 | 11:59 a.m.
Welfare Director Myla Florence and Director of Information Services Marlene Lockard presented the IBM letter to a Senate Finance-Ways and Means subcommittee Wednesday, making it clear they weren't recommending the added contract.
"This endless hole we're throwing money into has got to stop," said Sen. Bill O'Donnell, R-Las Vegas, the subcommittee chairman.
The so-called NOMADS system has been a source of numerous state and legislative protests as problems caused delays and added to costs, and contractors missed deadlines and failed to produce the system on time.
The original contract was for $11.2 million in state funding and more in federal money. That was renegotiated to $19.2 million to deliver an operating, unified computer system that would handle all of welfare's different programs before a federal deadline of October 1997.
Florence said that contract is still in effect and IBM is working to meet that deadline.
But that contract doesn't include management procedures for operating the system or training for state staff to operate and maintain the NOMADS system. It also won't provide for changes in welfare law the federal government is planning for this coming year.
IBM officials say in their March 18 letter they will provide all those things for $16 million over the next two years - or a total of $22 million if it takes three years.
Florence said she hopes the federal government can pick up much of the cost - if the state decides to go with the contract.
With all state and federal costs added together, the system has already cost a total of $56 million, more than two-thirds of it federal. Florence said the IBM contract would bring the total cost to either $72 million or $78 million.
"It sounds like we're being held hostage by IBM," said Assemblywoman Sandi Krenzer, D-Las Vegas.
"We are not saying we recommend this," said Lockard. "The state believes we can support and maintain NOMADS. This is IBM's proposal, so it's not in the budget."
She and Florence said if lawmakers agree to add 30 contract positions to the information services staff, they should be able to manage the system.
Florence also rejected suggestions the state might be better off if the whole thing was dumped.
"We're assessing what options are available to us," she said. "But I don't think scrapping the system is one of those options."
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