Las Vegas Sun

December 15, 2018

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State seeks to replace contractor fired from $115 million DMV project

0404DMV2

Steve Marcus

People wait in line near unstaffed stations at the Department of Motor Vehicles office in Henderson in 2009.

Lessons learned from a botched contract are helping the Department of Motor Vehicles seek out a new company to lead its technology upgrade.

The state is requesting proposals from companies that want to replace Tech Mahindra, the state’s fired vendor in a project to modernize the DMV’s 20-year-old technology system.

Alex Smith, Department of Motor Vehicles spokeswoman, said a new price tag for the project will be up for discussion during the 2019 legislative session, as well as when a vendor is selected and contract negotiations begin. The request for proposals was posted Nov. 1, Smith said, and the state plans to start reviewing bids Jan. 2.

Smith said the department is looking to award the contract to a company that has proven experience building out DMV technology for other states. She said this has been a statewide shift in executing technology projects, from seeking to create systems from scratch to looking for proven solutions.

Smith said an off-the-shelf solution rather than building from the ground up should make up the time lost. This was a five-year project when the contract was first awarded in 2016.

“We lost some time in the transition,” Smith said. “We ... are on schedule to make that up.”

The state settled and terminated its contract with Tech Mahindra in August for zero dollars rather than the $7.5 million the company had argued it was due. A DMV-requested audit found the vendor did not provide sufficient staffing, among other issues causing delays and increasing costs. The audit found the DMV was partly responsible by not ensuring the project was in compliance with the contract.

The original contract for the work was for $75 million in 2016, increasing over the years to an estimated $115 million. The DMV had spent about $27 million on the project as of January, when the DMV announced it would terminate the contract.

Smith said the technology in use now is not as intuitive as it could be. If a resident changes a driver’s license address, for example, that change must be made to the vehicle registration separately.

The new technology will allow DMV workers to see if residents renewing vehicle registrations will need to renew their driver's licenses soon. This will allow residents to get it done all at once rather than returning in a few months, Smith said.

“This modernization will really change the way we provide customer service,” Smith said.

The Secretary of State’s Office has said that it remains to be seen how the state’s new automatic voter registration system will fit in with the technology upgrade. Smith said the technology project will not negatively impact the new automatic voter registration law, which says people who apply for driver’s licenses or state identification cards need to opt out if they do not want to be registered to vote. It’s unclear when automatic voter registration will go into effect.

Lt. Gov. Mark Hutchison said during a Jan. 16 audit committee meeting that the DMV should get out sooner rather than later and “cut” its losses. The DMV announced less than 10 days later that it would terminate the contract.

“I read this as a lawyer and say this is a bait and switch,” Hutchison said at the time. “You put everything in the RFP that you think the state wants. You make all the promises, and we accept all those promises, and then they just do not deliver.”