State adds penalties to safety radio contract

Posted Sept. 30, 2010, at 8:25 p.m.

AUGUSTA, Maine — State officials have added penalty provisions to the state contract with Harris Corp. for the building of a $47 million statewide public safety radio network after concerns were raised whether the company could meet the October 2012 deadline to complete the system.

“There were problems and we felt it was best to set some benchmarks, and we did and Harris agreed to them,” Greg McNeal, the state’s chief information officer, said in an interview. A review of e-mails and other correspondence between the state and Harris obtained under the state Freedom of Access Act indicates Harris and its subcontractors made mistakes and were behind schedule in taking the steps needed to obtain the frequencies necessary to establish the network.

“To say we are disappointed would be an understatement,” McNeal wrote in an e-mail to Harris Vice President Michael Murray. McNeal said Sen. Bill Diamond, D-Windham, the co-chair of the Legislature’s Appropriations Committee, had expressed concerns whether the terms of the contract could ever be met within the next two years.

“I realize that we have some significant challenges in Maine, and desperately need to meet our commitments so we can regain your confidence,” Murray wrote to McNeal.

The contract modifications established benchmarks and the ability of the state to withhold payments to Harris until the benchmarks are met. McNeal said the most important benchmark is obtaining all needed licensed frequencies and his office is withholding 40 percent of contract payments until that is completed. That is in ad-dition to 10 percent already being withheld until the project is completed.

“We are not going to accept just throwing away $47 million to a company that is unable to meet its obligations and we are not going to wait until the last day to find that out,” Diamond said in an interview. He said he has serious concerns whether the company can obtain the necessary regulatory approvals for the large number of frequencies needed to implement the system that would provide statewide public safety communications for state agencies and the ability to communicate with local public safety agencies.

“Frankly, if we hadn’t been pursuing this, I think we would have found ourselves in a situation with no product, another fiasco on a state computer system that the taxpayers have to pay for,” he said.

Diamond was referring to the 2005 bill-paying computer system built for the Department of Health and Human Services that did not work properly when it was turned on. That system cost nearly $60 million and was replaced with a new system that just started operating Sept. 1.

“We can’t have that again,” he said.

In an interview this week, Harris officials acknowledged there had been problems with a subcontractor working to find some of the 302 new radio frequencies needed to build the system. But over the summer, additional Harris staff was assigned to the project and early this month the first batch of frequency requests were sub-mitted to the Federal Communications Commission.

“We have met and exceeded every milestone,” said Robert Isby, a senior engineer with Harris. “We are constantly reviewing our risk register as to where the next hurdle is that may come up that we will have to deal with, and we deal with it.”

He did acknowledge that the project needs to win regulatory approval from both the Federal Communications Commission and Canadian regulators. He said while it is hard to precisely estimate how long the process will take, he said the company’s experience with other projects indicates they can still meet contract obligations if there are delays.

Robert Kinney of the FCC’s Public Safety and Homeland Security Bureau said that the “first step” in the process of obtaining the needed licenses was done in early September when Harris staff met with Bureau staff. He said the Bureau is committed to handing the requests as quickly as possible because of the importance of state public safety radio networks.

“But no, I can’t give you an estimate of how long that will take,” he said.

Kinney said requests for new frequencies in northern Maine will need the agreement of Canadian regulators. He said it is also impossible to predict how long that will take. He said both regulatory agencies have to make sure that frequencies assigned for public safety uses do not technically conflict with other public safety uses or other licensed facilities.

“We can’t have signals where police are talking over other police, “he said.

Diamond said he is worried that since the contract was awarded in June 2009, work has not progressed as originally described to lawmakers. The $47 million project is funded through a combination of federal grants and state funds.

In a letter sent to Diamond this week, Murray wrote that Diamond may have received “inaccurate or misleading” information about the contract and its implementation and that he is ready to provide answers to any questions Diamond has about the project.

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