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Spending board rejects radio cost overrun, rakes university officials over coals

Spending board rejects radio cost overrun, rakes university officials over coals
Maryland's Board of Public Works, shown here at its first meeting of the year in January, rejected a $20 million increase in a contract for a state first-responder radio system. (Michael Dresser)

The state spending board continued its fiscal warpath Wednesday, raking university system officials over the coals for murky project explanations and refusing to cover a cost overrun in a statewide radio system.

Led by Gov. Larry Hogan, the Board of Public Works voted 2 to 1 to disapprove a $19 million increase in a $485 million contract to develop a communication system for first responders after learning that agency officials had failed to factor operating costs for the system into the deal with Motorola Inc.

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"I just don't think that's acceptable," Hogan said. "That's not the way we want our agencies to do business."

Comptroller Peter Franchot sided with Hogan in rejecting the contract increase, while Treasurer Nancy K. Kopp dissented.  Hogan ordered information-technology officials to find a way to cover operating and maintenance costs for the system in the existing contract.

All three board members joined in chastising University System of Maryland officials for not explaining to their satisfaction $35 million worth of increases in five construction projects on campuses around the state.

The board had refused to go along with the contract changes at its last meeting two weeks ago and demanded answers about apparent cost overruns in the projects. Top university system officials - one of whom was criticized for not being present then - appeared this time, but their explanations only confused and irked the board members.

Joseph F. Vivona, the university system's chief operating officer, apologized repeatedly, only to be interrupted by Hogan when he suggested that their confusion stemmed from "the transition."

"It's not about the transition," Hogan shot back, pointing out that Franchot and Kopp both are veterans of the board. The governor then suggested that "the state might have to get more involved" in university system procurement.

"A murky presentation two weeks ago has gotten even murker," agreed Franchot.

Kopp as well demanded that spending requests be provided "in English, so I can understand what's going on."

While acknowledging not communicating well, system officials maintained that the $35 million in contract modifications weren't for overruns, but installments in projects that were being built within their budgeted amounts. And Salisbury University President Janet Dudley-Eshbach told the board that without its approval Wednesday, she'd have to halt construction on a new "academic commons" being built on her campus.

Still dissatisfied, Hogan said, "we're going to change the system" of contracting and declared members of his administration would work with university system officials to figure out how to do it better.  But the governor concluded by saying he wanted to "move forward on clearly important projects," so he moved to approve the changes. They passed unanimously.

Hogan was more pleased with the results of a $500 million bond sale Wednesday, which Kopp informed the board had saved the state $19 million in interest costs.

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