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The federal government is launching an investigation into a troubled state computer system used to track child-abuse cases that local officials across New York say has been a failure from the start, The Buffalo News has learned.

The probe, by the U.S. Department of Health and Human Services inspector general's office, will examine why state officials have let the computer system, known as Connections, balloon to more than $200 million in costs -- at least $50 million beyond the original contract.

In the meantime, the federal government has halted payments to the state on more than $60 million already spent by Albany on the project because the Pataki administration failed to get the required authorization for the expenses, officials in Washington said.

The state Department of Children and Family Services declined to comment on the matter, according to agency spokesman Terry McGrath.

Word of the investigation comes nine months after The News first reported widespread foul-ups in the system designed to serve as a statewide central tracking device for the more than 1,000 reports of child abuse that the state receives daily.

Eventually, the system was to handle the entire range of child welfare services, including storing information on prospective adoption families and keeping better track of children in foster care.

But after complaints by local officials who said the flawed system was putting some children at risk, the state has slowed down plans to expand the project.

In Erie County, officials reported incidents in which files from a central child-abuse complaint registry in Albany switched the names of alleged abusers and their victims.

Front-line investigators, as a result, mistakenly ended up tipping off alleged abusers when they thought that they were secretly calling the child or other family members. In other cases, entire files were missing, and child welfare workers found that the system was often unable to locate cases of children with common last names.

As a result, in places such as Erie County, officials sometimes simply stopped using Connections or used paper files as backup to double-check the data from the giant computer.

Federal officials said the probe could end up forcing the state to reimburse Washington millions in cost overruns.

"Our concerns fall into two categories," said Michael Kharfen, a spokesman for the Department of Health and Human Services. "One is that the system doesn't seem to be working, . . . and the other is that the costs associated with this have appeared to skyrocket, as well as the state failed to obtain approval for costs associated with the project -- costs that we will not reimburse."

As the state raced to beat a late 1997 deadline to get Washington to pay for most of the system's costs, Kharfen said, the Pataki administration failed to get approval for two contracts for the system totaling more than $60 million; the contracts went to the system's two main suppliers, Andersen Consulting and Integrated Systems Solutions Corp., an IBM subsidiary.

Ben St. John, a spokesman for the Department of Health and Human Services inspector general's office, said the probe would commence in the first week in October.

Local officials were not surprised that the controversial computer system was now coming under federal scrutiny. In a stinging audit earlier this year, State Comptroller H. Carl McCall said the system, deemed unreliable by 70 percent of local social services offices, was so bad that, he said, "children are at risk."

"It's understandable that the federal government would be reviewing the New York State computer system that is to manage very critical data for our most vulnerable population," said Erie County Social Services Commission Deborah A. Merrifield.

Since reports about the system surfaced, Ms. Merrifield said, the state has finally begun to move more seriously to fix the problems. Nonetheless, she said, the county still uses its old database as backup to Connections.

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