New Contractor Rules Aim to Prevent the Next CityTime Scandal

By Colby Hamilton on May 7, 2014 7:25am 

 Comptroller Scott Stringer released a citywide directive to improve oversight of the city's IT contractors.
Comptroller Scott Stringer released a citywide directive to improve oversight of the city's IT contractors.
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DNAinfo/Colby Hamilton

CIVIC CENTER — New regulations on how the city oversees technology contractors are aimed at avoiding another CityTime scandal, according to Comptroller Scott Stringer.

His office recently issued Directive 31, which lays out for all city agencies how to properly track and oversee Internet technology contractors billing by the hour. The purpose, according to the comptroller’s office, is to stop the unchecked inflation of tech contracts before they become a problem, Stringer said.

The lack of contract oversight contributed to the $652 million CityTime scandal and to as much as $160 million in overbilling as part of the city’s troubled 911 modernization, Stringer said.

“This is about an ounce of prevention being worth a pound of cure,” the comptroller said during a phone interview Tuesday. “When there’s no accountability and little oversight, you end up with taxpayers on the hook.”

The city currently has more than $1 billion in contracts related to IT investment and operations, according to the comptroller’s office. Agencies will now be required to have someone responsible for monitoring the timesheets, while contractors will be required to detail exactly what services were provided.

Additionally, contractors will be required to provide resumes for workers to show they have the necessary background for their jobs. Contractors will be limited in how much they can mark up products including outside hardware and software.

The comptroller’s office said it consulted with Mayor Bill de Blasio’s office, outside vendors and city agencies before finalizing the directive. The mayor's office praised the move and said it shared its goals.

"Together we will ensure the city is effectively managing our contract budgets and schedules," de Blasio spokesman Phil Walzak said in a statement. "This directive will create citywide standardization, while preserving the flexibility necessary for agencies to effectively procure IT services."

In the event contractors or agencies are found to be failing to follow the new rules, the comptroller’s office said it has the authority to deny payments.

“We aren’t going to wait for audits to verify failures,” Stringer said.

The comptroller’s office rarely uses the directive option it is afforded by the City Charter, Stringer said. This is the first time a new directive has been issued since 2005, according to his office.

“We take this extraordinary step because we cannot afford over-billing or worse,” Stringer said.

Pre-existing contracts will not be subjected to the new rules. The directive goes into effect July 1.

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