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Not a dead issue

'Clear-the-air' remarks on computer snafu leave many questions

Mettle detector _City Council puts Hornbeck on defensive over school-safety plan HORNBECK WATCH An unwitting ally for Hornbeck Councilman: School payroll snafu's a 'total disgrace'

by Yvette Ousley Daily News Staff Writer

Superintendent David Hornbeck says not to worry.

The School District has paid only 14 dead employees - only eight of whom were paid by mistake. The six others were owed pay, which went to their estates.

"This kind of thing happens every year," he said. "This is not unusual in any large payroll system. Social Security pays thousands of dead people every month until the Social Security system is updated.

"I believe that the district and our employees have been wrongly ridiculed for sending checks to deceased employees," he said. "This is reporting the exception rather than the norm."

Hornbeck's statements came yesterday during a press conference at School District headquarters to answer questions about the district's problem-plagued computerized payroll and purchasing system.

At that time, Hornbeck:

Expressed deep concern about what he termed "the small percentage" of employees who may have been affected by problems associated with the start-up of the new payroll system.

Announced that any impressions left by the administration that principals and secretaries were to blame for payroll problems is wrong. And defended Herb Kaufman, director of employment operations, who earlier this week blamed secretaries and principals for problems, saying, "I know he never intended to hurt anyone with his remarks."

Minimized payroll problems, saying that about "200 employees out of 30,000" did not receive a computer-generated regular paycheck. And offered as proof the fact that School District employees didn't take advantage of $70,000 in an emergency fund set aside by the Mary Mason Foundation to assist employees who hadn't been paid.

The press conference followed Daily News reports this week that the $26 million computer system is riddled with major glitches that have resulted in underpayments, overpayments and no payments at all to employees - both dead and alive, past and present. The News also reported that more than a year ago managers warned of flaws with the system.

Yesterday's news conference was supposed to "clear the air" about payment issues. But instead left more questions than answers and led at least one school board member to accuse Hornbeck of misrepresenting the truth.

Hornbeck said 15 managers - some in attendance at the news conference - had written a letter citing flaws with the $26 million computer system because they had been asked for their input on concerns about the software system.

But, he said, most of their concerns were later addressed.

This comment quickly drew the ire of school board member Jacques Lurie, who wanted to go on record as saying that Hornbeck's statement was essentially a lie.

"That is absolutely not my understanding from anyone who wrote that letter at the time that it was written," Lurie said.

"And, in fact, the board put a screeching halt to the whole process of awarding that contract when it heard about that letter."

Hornbeck also cited a Sept. 17 letter from Ted Kirsch, president of the Philadelphia Federation of Teachers, as proof that the employee-payroll problem is limited. The letter from Kirsch to Hornbeck thanked the district staff for the hard work that made the first payroll for 10-month employees go smoothly.

But union officials were quick to respond to Hornbeck's assessment of the letter, saying Kirsch did not know the extent of the problems when the letter was written.

"It was the first payroll of the school year, but the extent of the problem did not become clear until the following week," Kirsch said, "and it was not immediately clear that the procedure they put in to pay employees who had not received paychecks had completely broken down."

Hornbeck said that only $335,000 was incorrectly paid to employees who had separated from the district due to retirements, changes in jobs and death, and that half the amount paid to them had already been recovered.

But last week the district reported that it mistakenly paid out $542,000 to people who shouldn't have received the money.

They said officials had recovered $207,000 and were trying to get back $335,000.

Problems experienced with the computer system weren't unusual, given the size and scope of the project, Hornbeck said.

He also noted that, "At the beginning of every school year, there are always payroll adjustments and emergency checks issued to employees for a variety of reasons."

He said the district had issued fewer correction checks this fall than last year.

Hornbeck also said that about 200 employees out of 30,000 did not receive a computer-generated regular paycheck.

But he modified the statement after being asked whether the numbers of unpaid college interns, summer student workers, noontime-aides, bus drivers, substitute teachers, regular teachers, coaches, principals and night-school employees only added up to 200 people.

And he defended Kaufman, who had earlier stated that principals and secretaries were to blame if people were not being paid because those groups had not entered data properly.

Hornbeck noted that there were many external circumstances that "conspired to increase the demands on the employees, who were also learning the new system this fall."

"Any impression that has been left in any way that specific blame belongs in any one or two places - secretaries or principals or others - is wrong. I regret any such impression.

"We are beyond trying to pass the blame or assign blame. We are only concerned about fixing the problem as quickly as possible."

Send e-mail to ousleyy@phillynews.com

-- Homer Beanfang (Bats@inbellfry.com), October 22, 1999

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Hornbeck defending new computer system

Some union members and district vendors have not been paid. City Council has asked that checks be issued now.

Hornbeck grilled by City Council on safety in city's public schools

..By Susan Snyder INQUIRER STAFF WRITER

Philadelphia School District Superintendent David Hornbeck yesterday defended the district's new $26 million computer system, despite payroll problems that have caused some employees and vendors to go without being paid.

"It is superior. It pays more people on time and more accurately than the other system," Hornbeck said at a news conference.

He added that the payroll, purchasing and human resources system produced by American Management Systems Inc. (AMS) will allow the district to track expenses in a more detailed way and better administer budgets at a school level. But he also acknowledged that the system includes a deep learning curve that administrators and employees first will have to hurdle.

The system has come under fire in recent days from employee unions, which say that hundreds of their members have not received pay, or have received wrong amounts. Two unions already have complained in court, and the Philadelphia Federation of Teachers blasted the district at a news conference on Monday.

The school board's technology committee has scheduled a meeting for 10 this morning to explore the problems.

School Board President Floyd Alston said he was not ready to abandon the computer system, or to support it.

"We obviously have to back up and take a hard look at this whole thing," he said. "It warrants a lot of investigating."

Board member Jacques Lurie said the board needed to find out whether the problems were the result of the software, poor employee training or something else.

Philadelphia City Council yesterday unanimously passed a resolution, sponsored by Councilman Frank DiCicco and Councilman James F. Kenney, calling the school district "cruel and irresponsible" and asking that emergency checks be issued immediately to employees who have not been paid.

"I really wonder if . . . Hornbeck and his top management team had not received a check, if this would have been allowed to go on for such a long time," DiCicco said after introducing the measure.

He added: "It is a total disgrace. It should not have happened."

Hornbeck maintained that only 200 of 30,000 "regular check" employees have been affected, and that 90 percent of the problems have been fixed and the rest will be remedied by next week at the latest. He acknowledged, however, that others who receive extracurricular or intern pay also have been affected. He emphasized that there were fewer correction checks issued this year than last.

Mistakes also caused former employees to be paid, including eight who are deceased, he said. But he emphasized that similar mistakes occurred in previous years and happened because records hadn't been updated quickly enough.

"This is not unusual in any large payroll system. Social Security pays thousands of dead people every month until the Social Security system is updated," Hornbeck said.

The mistakes also have caused 49 vendors to cut off supplies to the district, said Thomas McGlinchy, executive director of facilities management and services. Eight of those restored service after being paid. The district works with about 15,000 vendors. But some of those affected are larger suppliers, of books and education supports.

"We've got to get this corrected and fast," McGlinchy said. "We're really concerned about this because we worked for years to get the district's reputation [for paying on time] corrected, and we did. So we're really agonizing over this."

He estimated that it would take no longer than two weeks to work out the problems. District officials are looking at paying vendors lump sums even if exact amounts can't be determined as a way to restore services more quickly, he said.

Schools have their basic supplies for the start of the school year, he said, but they may be forced to go without supplemental supplies until the matter is resolved.

Randy Roth, vice president of American Management Systems Inc., said his company was providing "full-time" support to the district to help resolve the issues. Such problems are not uncommon when installing such a large Y2K-ready financial, purchasing and human-resource system to update a 30-year-old infrastructure, he said.

Philadelphia's problems are "less intense and less in number than expected," he said.

Although the company has experienced some problems elsewhere, it has a "stellar" reputation in the field, said Robert St. Jean, an analyst for J.P. Morgan Securities. "Overall, the company has a very strong track record in developing large systems and is one of the stronger vendors in the state- and local-government market, which is a complicated market to work in," he said.

The school district has expanded the hours of its emergency-response service to deal with payroll problems. It is open daily from 9 a.m. to 4:30 p.m., Hornbeck said. The district also has established a help line for payroll workers.

Officials are training back-up employees, he said, and the district will offer more training to any payroll employee who wants it.

Hornbeck also acknowledged that in 1997, the district's technology team recommended a different computer company for the system - Oracle Inc. But Hornbeck said Oracle was unable to provide a fixed price or a promise that it could deliver what was offered.

He acknowledged that some district managers opposed American Management's system in a September 1998 letter, citing concerns about "increased workloads, the cumbersome nature of the system that might slow down the payment process, and the fact that the study phase of the project resulted in over 300 modifications to the AMS system that would be extremely costly."

But 24 of the 29 concerns listed were satisfactorily addressed by the company and other issues were not considered "insurmountable," he said.

Inquirer staff writer Clea Benson contributed to this article.

-- Homer Beanfang (Bats@inbellfry.com), October 22, 1999.