The New York Times reported Thursday, Aug. 23, that Mayor Michael Bloomberg’s administration is turning over the management of expensive IT projects to a quasi-government entity similar to the city’s Economic Development Corp.
The move comes as an apparent reaction to several project management problems that are troubling City Hall. Bloomberg’s creation, reportedly called the “NYC Technology Development Corp.,” will manage all IT projects that cost more than $25 million, as well as multi-agency projects costing more than $5 million. The Technology Development Corp. is designed to bypass common political stumbling blocks such as prolonged vendor bidding, political turf wars, salary limits, and procurement rules.
The New York Times said the information was obtained from confidential documents and from interviews with high-ranking city officials.
The Department of Information Technology and Telecommunications (DoITT), the agency that currently manages the city’s IT portfolio will not be eliminated in the new plan, according to the newspaper. But DoITT seemingly would have some project management duties taken away. Government Technology’s request for comment from DoITT was not immediately returned Friday.
In April, Bloomberg named Rahul N. Merchant to lead the city’s technology efforts. Merchant, a veteran of the private sector, reportedly told The New York Times he hopes to deliver at least six projects before Bloomberg leaves office after 2013. The new organization was conceived by Merchant and Deputy Mayor Caswell F. Holloway, according The Times.
The NYC Technology Development Corp. reportedly will be patterned after the NYC Economic Development Corp. Found in many big cities and counties and several states, an economic development corporation, according to one scholar, is “simply a legal entity/organization directed by a board of directors and/or members, for the purpose of creating new jobs and income growth.” But some of these not-for-profit organizations work on matters that extend beyond recruitment and retention of new business. Depending on bylaws, they may pursue public funding or work on efficiency measures, among many other functions.
Creation of the new organization follows high-profile difficulties for several city technology deployments. In one case, overbilling and fraud incurred during development of CityTime, the city government’s electronic timekeeping system, resulted in a $500 million settlement from the vendor involved. In a separate project, the city comptroller released an audit critical of the city’s modernized 911 system.