Controller assails city on water billing

Millions have been spent for a new system, he says, without success.

Posted: August 20, 2007

The city has already spent $30 million to $40 million on unsuccessful efforts to replace its water billing system, and now City Controller Alan Butkovitz doubts the massive job will be done by the time Mayor Street leaves office, despite the administration's promises that it would be.

In a report scheduled to be released today, Butkovitz chastised the city for learning little after two decades of fruitless attempts - and millions of wasted taxpayer dollars - to build the new computerized system. The report echoed a series of Inquirer stories last year that exposed the latest, but still troubled, computerized effort, named Project Ocean.

It is necessary to replace the system, city officials maintain, because they fear a breakdown. Bills to the city's 500,000 water customers are currently generated via near-obsolete, 30-year-old software.

But after four attempts, beginning in 1987, the city has yet to produce a billing system that works.

"It looks like the city was committed to spending a ton of money on a big technology project no matter what - and it has been trying to salvage it ever since," Butkovitz said in an interview.

Project Ocean, which tried to build the computer system from scratch, cost taxpayers $18 million alone. Officials finally stopped working on it in 2005, after three years of efforts that involved the Mayor's Office of Information Services, the Water Revenue Bureau, and the Philadelphia Water Department.

But after reaching a settlement agreement last year with Oracle Consulting, the company in charge of Project Ocean, the city is now engaged in a $6.7 million attempt to finish it. This time, the city is using existing software from Prophecy International in Australia.

City Solicitor Romulo Diaz has vowed to have the new billing system up and running before Street leaves office after eight years in January.

If that happens, the effort to produce the new billing system will have cost taxpayers at least $6 million more than such municipal projects typically cost, and possibly as much as $20 million more.

That finding is based on a report completed last year by a company the city hired, TMG Consulting, to assess whether Project Ocean could be saved. It stated that a new water billing system should have cost between $20 million and $30 million.

Actual and estimated costs aside, Butkovitz said that after a thorough review of past attempts to change the system, he was "skeptical about it being able to be accomplished by Dec. 31."

Among other issues, the controller's report determined that the project's goals were not clearly defined; different city departments involved with the effort and "a history of strained relations" had separate visions of what it would do.

Those city departments are now more aligned, the city said in its response to the report. "The level of team integration and user 'buy-in' is high and accounts for the considerable success achieved to date."

The city also told the controller that morale in the Water Revenue Bureau had improved. That had hampered previous efforts.

The controller's office spent more than a year working on the report. Butkovitz said its completion was delayed by the loss of his main investigator, Ellen Green-Ceisler, who resigned to run for judge.

Also, he said he did not want to disrupt the settlement agreement with Oracle, which was not completed until the fall.

For now, the controller's office said it would keep tabs on the effort over the next several months. Though Butkovitz said there was no indication the effort had so far stagnated, the last line of the report said: "Any indication of failure will trigger an immediate hold on future payments to any vendors associated with the project."


To see the city controller's report on Project Ocean, go to


Contact staff writer Marcia Gelbart at 215-854-2338 or mgelbart@phillynews.com.

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