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Bogh Sacramento Notes | 05/11/02 | Russ Bogh

Posted on 05/11/2002 11:42:43 AM PDT by dewaste

You may have been reading about the Oracle Corporation, which recently received a lucrative state contract without a competitive bidding process. State analysts dissected the contracts and reported that the contract overpays Oracle $41 million for software state employees contend is not needed or wanted. Ever emerging details of the 6-year deal, valued between $95 million and $123 million, shows the contract was rushed through to benefit the vendor without any regard for the taxpayer. The claims made by Oracle and the Department of Information Technology of remarkable cost savings to taxpayers were never independently verified. Subsequent campaign donations by Oracle raise the specter of an illegal quid pro quo.

This week, the bipartisan Joint Legislative Audit Committee, began looking at this fiasco, to see who and how this serious breakdown occurred. Here is what we know:

June 2000: The Department of Information Technology (DOIT) contracts with Logicon to review the state’s software licenses. The state department is led by Elias Cortez, who previously worked for Oracle but failed to disclose that fact when confirmed by the Legislature.

February 2001: Logicon makes presentation to DOIT on “enterprise licensing.”

March 2001: Survey of state agencies finds little interest in Oracle software.

April 2001: Logicon begins promoting Oracle agreement, claiming it will save California $110 million.

May 10, 2001: Members of the technology review unit of the state Department of Finance warn cost-savings alleged by Logicon cannot be substantiated.

May 22, 2001: Kari Dohn, a member of the governor’s staff, e-mails Department of Finance Chief Deputy Director Betty Yee inquiring as to the hold up of the Oracle contract. Yee then e-mails three others in the department, including director Tim Gage, about the contract status, “so I can brief Kari before she has to talk with the governor about this…” The e-mail, obtained by the Sacramento Bee, also reveals: “per Kari, (the Department of Information Technology) and Arun are hot to trot on nailing this agreement down with Oracle, but they have advised Kari that Finance is not on board.”

May 23, 2001: Logicon presents proposed contract to Arun Baheti, Gov. Davis’ director of e-government.

May 26, 2001: Department of General Services, under Director Barry Keene, finalizes no-bid, 6-year contract with Oracle for 270,000 for database software licenses, and another 100,000 Internet-related software licenses. Logicon’s share of the deal is $28 million.

May 31, 2001: The state signs the contract with Oracle. Gov. Davis’ top policy advisor, Susan Kennedy, also “signs off” on a four-page summary of the contract. Another administration official, Steve Nissen, also signs the summary. Nissen later resigns his post and joins a law firm that has Oracle as one of its clients.

An Oracle lobbyist gives Arun Baheti a $25,000 contribution for Gov. Davis’ re-election. One week after the contract is signed.

Aug. 16, 2001: Responding to media investigations of the Oracle contract, Cortez defends the firm, saying, it is “the only company that can provide the products the state needs. The real story here is that the state is moving forward, preparing to better manage its technology contracts.”

September 2001: Reacting to growing criticism, General Services Director Barry Keene defends the contract, saying, “(The contract) itself is indisputably of public benefit.”

October 2001: Investigation of the Oracle deal intensifies; Cortez declines media requests to be interviewed.

Feb. 25, 2002: Criticism of the Oracle fiasco grows. Stockton Democrat Senator Mike Machado calls for the closure of the Department of Information Technology. “This department has simply not shown it can do the job it was created to do,” he charged.

April 16, 2002: State Bureau of Audits criticizes the Oracle contract, reporting it will cost taxpayers $41 million had no deal been signed. The audit also questions whether Logicon, as a former advisor to the state, was in conflict when it received $28 million as part of the Oracle contract.

April 17, 2002: Another ranking Democrat criticizes the Oracle fiasco. Assemblyman Dean Florez charges, “Something is amiss here … It’s got to be criminal or criminally stupid.”

April 18, 2002: Finance Director Tim Gage informs the joint legislative committee he signed off on the contract with the “assumption” that the Department of General Services verified Oracle’s claims of cost savings. However, we know this not to be true, as the technology review unit of the state Department of Finance reported on May 10, 2001 that cost savings could not be substantiated

April 26, 2002: General Services Director Barry Keene resigns, saying he made an “error in judgment.” Keene earlier told an Assembly subcommittee the Oracle contract “will save taxpayer dollars. It will have a positive impact on the General Fund.”

May 2, 2002: CHP officers are dispatched to Department of Information Technology to prevent any shredding of documents or purging of computers. Gov. Davis suspends agency chief Elias Cortez but continues paying his $123,000 salary; e-government director Arun Baheti resigns. Joint Legislative Audit Committee chair Assemblyman Dean Florez, D-Shaffer, reacts: “If people were shredding, we ought to treat them the same way we did Arthur Andersen and Enron folks. We ought to treat them very seriously.”

Assembly Republican Leader Dave Cox formally requests the U.S. Attorney General’s Office to investigate the Oracle contract. Cox commented, “Given the scope and enormous cost of the Oracle contract, as well as the documented attempts to suppress information, I believe the citizens of California deserve a thorough, nonpartisan and timely investigation into this matter.”

May 3, 2002: Attorney General Bill Lockyer alleges Logicon violated state law. Oracle contends it negotiated the contract in good faith but reveals it offered to rescind the deal several months earlier when the issue was first learned. It is also found that Lockyer accepted a $50,000 contribution from Oracle.

May 6, 2002: Senior attorney Cynthia Curry of the General Services Department tells the Joint Legislative Audit Committee, “I haven’t seen a contract that had so many people pushing for it in higher government.”

Suspended DOIT Director Elias Cortez told a skeptical panel, “This is the first time I’ve ever seen this contract.”

The initial hearing was recessed at 1:30 in the morning after 10 hours of testimony.

May 7, 2002: Speaker Herb Wesson appoints Assemblyman Fred Keeley, D-Boulder Creek, the No. 2 member of the Assembly and political ally to the governor, to replace Assemblywoman Christine Kehoe, D-San Diego, on the Joint Legislative Audit Committee. The sudden change draws criticism from both parties that the governor is trying to stack the committee in his favor.

May 9, 2002: Governor Gray Davis follows in the footsteps of the Attorney General and returns $25,000 in campaign contributions that he had received from the Oracle Corporation in June of last year. The governor has repeatedly denied there was any link between the contribution and the signing of the contract, and he said Wednesday he would wait for the results of the investigations before deciding whether to return the Oracle money…..

TOPICS: Crime/Corruption; Government; Politics/Elections; US: California
KEYWORDS: calgov2002; contributions; politics; spending
Something is fishy in Denmark (I mean in Sacramento). What is gray-out davis waiting for?
1 posted on 05/11/2002 11:42:43 AM PDT by dewaste
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To: dewaste
2 posted on 05/11/2002 12:10:57 PM PDT by tomakaze
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Comment #3 Removed by Moderator

To: *CalGov2002;Ernest_at-the_Beach
Check the Bump List folders for articles related to and descriptions of the above topic(s) or for other topics of interest.
4 posted on 05/11/2002 12:13:02 PM PDT by Free the USA
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To: Free the USA;dewaste;Carry_Okie; SierraWasp; Gophack; eureka!; ElkGroveDan...
Thanks for the ping!

dewaste thanks for posting this. It could be very useful!


calgov2002: for old calgov2002 articles. 

calgov2002: for new calgov2002 articles. 

Other Bump Lists at: Free Republic Bump List Register

5 posted on 05/11/2002 1:14:10 PM PDT by Ernest_at_the_Beach
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To: dewaste
Here's another date for the chronology:
August 17, 2001: The scandal makes news, but soon fizzles into hibernation for eight months.

Grampa Dave posted the following linked FR article last August. It valued the contract at $126 Million whereas current articles usually say $95 Million, but otherwise it contains much of the same information that more recent articles repeat.
The article no longer allows new comments, and the original source is not available.

California let rules slide in Oracle contract!
Miscellaneous Breaking News News Keywords: CALIFORNIA LET RULES SLIDE IN ORACLE CONTRACT!
Source: San Jose Mercury News
Published: 17 August 2001 Author: NOAM LEVEY
Posted on 08/17/2001 08:37:02 PDT by Grampa Dave

6 posted on 05/11/2002 5:13:26 PM PDT by heleny
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To: dewaste;ElkGroveDan
Nah, nah, nah-nah, nah! Can't catch me-e.

The 'ORACLE' Gov. DOOFUS to the taxpayers of California.
7 posted on 05/12/2002 8:23:38 PM PDT by d14truth
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