California official denies Oracle warnings

A top technology official for the state of California breaks down in tears as he testifies that he was not warned of any problems with a controversial $95 million software contract.

Dawn Kawamoto Former Staff writer, CNET News
Dawn Kawamoto covered enterprise security and financial news relating to technology for CNET News.
Dawn Kawamoto
3 min read
SACRAMENTO, Calif.--A top technology official for the state of California broke down in tears during testimony Thursday, saying he was not warned of any problems with a controversial $95 million software contract with Oracle.

Elias Cortez, the state's chief information officer, was testifying before a committee investigating an ever-widening scandal, seeking to find out why the state moved so quickly last year to approve such a large no-bid contract.

"I'm being held accountable for other people's mistakes," Cortez said when asked if he was being made a scapegoat.

In his testimony, Cortez acknowledged that he was an advocate of the contract in that he supports any deal that would help the procurement process for the state and save taxpayers money. But he also contended that his deputies did not express to him any doubts they had regarding the contract prior to its signing.

His testimony contradicts that of Kim Heartley-Humphrey, the deputy director of acquisitions at the California Department of Information Technology, who is one of Cortez's subordinates, and who testified last week that she warned her superiors--including Cortez--of concerns about the merits of the contract.

Cortez was also asked about his knowledge of Arun Baheti, the state's eGoverment director who resigned shortly after it was revealed that he accepted a $25,000 campaign contribution from Oracle.

Cortez said that Baheti had bragged about speeding the governmental approval process through for other vendors. "I believe that he leveraged the governor's name in bad light," Cortez said.

Cortez was one of six top state officials to sign off on the contract and was put on paid leave shortly after the state auditor released a scathing report last month that challenged the merits of the deal and purported $110 million cost savings.

Also scheduled to testify Thursday is Cynthia Curry, senior attorney for the department of general services, who has already appeared before the committee. In previous testimony, Curry said she had warned about possible problems with the contract.

Since then, others have testified that they were not notified about the concerns.

A public outcry came after an auditors report issued in April that said public officials failed to exercise due diligence in signing the six-year contract last May. The state paid at least $6 million more than it needed to for the database software, according to the auditor's report. Oracle maintains that the contract could save California as much as $163 million.

Three state officials have resigned or have been suspended, and some lawmakers are calling for the state to dissolve the Department of Information Technology, which was created in 1995 to guide the state's technology purchases.

Logicon, along with Oracle, has been accused by lawmakers of defrauding California by purposely withholding information from a state official who was involved in reviewing the contract.

In June, testimony is expected from five Oracle salespeople: Oracle lobbyist Ravi Mehta; Debbie Leibrock, technology investment review unit chief for the Department of Finance; Finance Director Tim Gage; and representatives from Logicon, the Oracle reseller that brokered the deal.

Mehta delivered the $25,000 campaign contribution to Arun Baheti, who served as the state's eGovernment director and played a role in the Oracle contract. Baheti resigned shortly after it was revealed that he accepted the contribution.