March 14, 2017 / 12:42 AM / in 8 months

Illinois comptroller stops payments for governor's computer modernization

CHICAGO (Reuters) - Illinois’ state comptroller has suspended $27 million in payments for a computer technology initiative launched by Republican Governor Bruce Rauner, according to a letter seen by Reuters, opening a new front in an ongoing feud over finances.

Republican Bruce Rauner smiles after winning the midterm elections in Chicago, Illinois, November 4, 2014. REUTERS/Jim Young

The move by Democratic Comptroller Susana Mendoza targets one of the governor’s priorities and comes as Illinois faces a record $12.3 billion backlog of unpaid bills that has more than tripled in the 21 months the state has gone without a full operating budget.

In a letter to the Rauner administration, Mendoza’s office said halting payments, including $21.6 million owed to consultants working on Rauner’s $250 million technology upgrade, is warranted because of uncertainty over how the program will produce long-term savings for the state.

The letter asked why those consulting firms should be paid before services like senior centers, hospice care and universities.

“The comptroller wants assurances that resources are being allocated toward our most critical needs and not toward discretionary initiatives,” Mendoza’s senior policy adviser, Patrick Corcoran, wrote.

Mendoza and Rauner clashed in state court this month over paying state employees without an appropriation from the legislature.

The state comptroller refused to process payments for nearly 600 state workers from Illinois’ cash-strapped general fund, as Rauner wanted. Instead, she wanted to tap other budgetary lines flush with more than $93 million.

The court ruled Mendoza could tap the funds but Rauner has appealed the decision.

Rauner’s office said Mendoza’s suspension of payments to information technology contractors would hobble the state’s computer modernization, known as the Enterprise Resource Program (ERP).

“If Comptroller Mendoza disrupts the ERP implementation process, she will put our state, residents and sensitive data at risk by forcing us to function under the current outdated systems,” Rauner’s spokeswoman Catherine Kelly said in a statement to Reuters.

McKinsey & Company is owed the most -- $12 million -- among firms caught in Mendoza’s move. The company did not respond to questions submitted after business hours on Monday about whether it would continue performing work for the state if it is not paid on a timely basis.

Kelly said the state continues to expect the upgrade to cost $250 million, and that vendors have billed $63 million over the past three fiscal years. Of that amount, the state has paid $12.6 million so far.

Reporting by Dave McKinney; Editing by Jo Winterbottom and Lisa Shumaker

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