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Expensive advice

Rather than punish a consultant for a costly and inefficient payroll system, the LAUSD wants to reward it.

June 12, 2007

AT MOST INSTITUTIONS, anyone responsible for installing a system that blew through its budget, caused employees to miss paychecks, demoralized and infuriated the workforce and delayed contributions to the pension fund would face grave repercussions indeed. At the Los Angeles Unified School District, a consulting firm whose payroll system has accomplished all that and more gets, if all goes as expected, a new contract.

Deloitte Consulting already has been paid about $55 million for its role in the creation and installation of a computerized accounting and payroll system known as Business Tools for Schools. That's a tidy chunk of the budget for hardware, software and training that, with overruns, may now cost the LAUSD roughly $132 million.

The system was supposed to bring efficiency and flexibility to district payroll systems. Instead, it has created the dispiriting spectacle of teachers and other district employees slogging downtown to register complaints and make sense of their paychecks. Back in April, the waits for help averaged nearly five hours; about the only good news the district has to offer lately is that the wait times have fallen to just over two hours. Still, problems persist. Not surprisingly, as employees have missed mortgage and rent payments, concern has mushroomed into outrage. The breakdown has, one board member told The Times, "contributed to the worst demoralization and cynicism I've ever seen in this district."

Given the district's manifold crises, that's saying something. But the district's response may manage to explore new territory in the LAUSD's landscape of cynicism. That's because although Supt. David L. Brewer has properly demanded quick results, he has turned to Deloitte for the fix. So for its part in this debacle, Deloitte stands to receive not opprobrium but rather $9.6 million.

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