GRAND RAPIDS, Mich.(WOOD) — A question over who controls a computer source code could derail the state’s new road funding law.
Though the Kent County courthouse was closed for Veterans Day, one courtroom held a trial for the State of Michigan v. Hewlett Packard.
Ten years ago, Michigan hired a company called EDS — later acquired by HP — to construct the Business Application Modernization or BAM project. Michigan fired HP earlier this year, citing missed deadlines and problems with the $40 million project.
The BAM system handles the Secretary of State’s online portal, along with things like voter registration and vehicle licensing.
The roads deal changes the way the state charges for vehicle registrations and therefore requires changes to the BAM source code, which HP is holding on to. For example, changes need to be made for hybrid and electric vehicles, which the state said it currently cannot do.
“The entire road funding package is essentially in peril, never mind the reputation of the Secretary of State and everything that goes with it,” Kent County Judge Christopher Yates summarized an argument of the state.
Attorneys for the state also said that without the source code, no other vendors would want to work with the state, and Michigan does not want to work with HP anymore.
Attorneys for HP said Wednesday that there’s no rush to hand anything over to the state, especially since the company says the state hasn’t paid for all the code it wants.
“Nobody can stand here in court and claim that this has all been paid for,” HP attorney Robert De Jong said.
De Jong acknowledged the state has paid millions over several years, but his clients’ position is that the state terminated HP’s contract before paying for the code. De Jong said it would likely be up to a court to determine how much the code is worth.
The state of Michigan contends that HP has not only been paid, the company has been “overpaid.”
De Jong said HP is also concerned that state employees don’t know what to do with the computer program and any problems state workers create will then be blamed on HP.
“In essence, if you give them the source code and they crash the system because they don’t know what they’re doing, HP is going to get blamed for it,” Yates again summarized.
The state is also concerned about security. It says it needs the source code to make sure the system is up to date and safe — though it’s worth noting there have not been any security problems so far.
A state audit in 2012 found a series of missed deadlines and problems on the part of HP, and mismanagement at the state level. That mismanagement included millions of dollars in payments to HP for systems that were either not finished or not working. Other payments were made without appropriate approval.
The audit also found the state was lax in enforcing the requirements under the contract. HP argues the state was also responsible for delays in the project and failed to timely identify issues and give HP time to fix them.
Yates is expected to make a decision Monday. Whatever the ruling, it will likely mean millions of more taxpayer dollars to get the computer program up and running with a new company.