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Tech Industry

Federal Y2K fixes grow costly

The cost of making the government's computer systems Year 2000 compliant is rising, but agencies don't agree on the exact price.

    By all accounts, the cost of fixing the federal government's computer systems so they recognize the year 2000 is rising considerably.

    But agencies disagree about the numbers on that price tag.

    Sen. Robert Bennett (R-Utah), in announcing the newly formed Special Committee on the Year 2000 Technology Problem yesterday, said the price for fixing government computers may be as much as $10 billion to $12 billion.

    That's more than twice the $4.7 billion that the Office of Management and Budget had quoted in its latest quarterly report in March.

    The OMB's March estimate was an $800 million increase over its own earlier quote of $3.9 billion, indicating what some economists and industry analysts see as a continuing trend of skyrocketing costs.

    "It's going to go higher," said Edward Yardeni, the chief economist at Deutsche Morgan Grenfell in New York. "There are still a lot of computer systems to be looked at. I'm not surprised at all by these numbers."

    The Year 2000 issue, also called the millennium bug, occurs because many computer programs record dates with only the last two digits of the year and may confuse 2000 with 1900 or generate other unexpected errors, causing system failures.

    According to the OMB's report last March, all federal agencies show progress but several remain behind. The report singled out six agencies as making poor efforts to handle the problem.

    Jack Gribon, a spokesman for the OMB and the President's Year 2000 Conversion Council, said he too expects the cost to fix the federal government's computer systems to rise. "We've said all along that the cost estimate will increase. Whether it will reach that level is to hard to say [at this point.] We'll see."

    The OMB's next report will be released mid-June. Gribon added his office won't change its estimates until the reports are completed.

    Bennett's committee will be made up of six senators, including Sen. Ted Stevens (R-Alaska), chairman of the Appropriations Committee, and Sen. Robert Byrd (D-West Virginia), ranking minority leader of the Appropriations Committee, as ex officio members.

    Sen. Chris Dodd (D-Connecticut), vice chairman of the new committee, said Stevens and Byrd were included so the committee could yield the political support required to get more money if needed. "This is one ball you can't afford to let drop," he added.