City to Recoup $50 Million and Achieve $10 Million in Additional Savings
Following Delays on Component of Emergency 911 Call-Taking System
Following Delays on Component of Emergency 911 Call-Taking System
Mayor
Michael R. Bloomberg and City Comptroller John C. Liu today announced
that Verizon (NYSE: VZ) will repay the City $50 million to settle cost
overruns caused by the company’s
delays on the Emergency Communications Transformation Program project
and work with the City to provide up to an additional $10 million of
cost savings achieved through a knowledge transfer program over the term
of Verizon’s renewal agreement with the City.
In 2006, the City hired Verizon to develop and maintain software that
handles call transferring for the new 911 calling system. When Verizon
fell behind on delivering the software, known as VESTA, because it did
not meet the City’s rigorous testing standards,
the City ceased payments for the delivery until a settlement was
reached to compensate for the delay.
“With
this settlement, Verizon is compensating the City for the considerable
costs associated with the delay of a key component of the new
911 system,” said Mayor Bloomberg. “Since that component was finally
delivered in December 2011, the City’s state-of-the-art 911 system has
successfully handled more than 21 million calls, and we look forward to
continuing to work with Verizon as we complete
the first comprehensive overhaul of the system in more than forty
years.”
“Taxpayers
should be confident that when companies do not live up to their
commitments we hold them financially accountable and this agreement
delivers what taxpayers deserve,” said Comptroller Liu. “Transferring a
significant portion of E911 operations to our talented City workforce
will not only save $10 million in taxpayer money but also ensure that we
are no longer reliant on high-priced outside
consultants for public safety. An added benefit of this cash settlement
is that it will provide a much-needed and immediate $50 million cash
infusion to our Fiscal Year 2014 budget.”
As part of the approved agreement announced today:
·
Verizon will pay $50 million to compensate the City for the delay it cost taxpayers.
·
Verizon
will work with the City to provide up to an additional $10 million of
cost savings over the next four years as part of a “knowledge transfer”
program. This innovative
collaboration, between Verizon and the Mayor’s Office of Citywide
Emergency Communications, will provide City employees with the requisite
skills and training to assume significant responsibilities associated
with the operations and maintenance of the VESTA
system.
·
The
City will issue a Request for Information to understand the latest
public safety technology offerings from a broad base of suppliers to
ensure that E911 continues
to use state-of-the-art hardware and software that requires as little
customization as possible to serve the needs of the largest 911 system
in the United States.
As
part of its planned scope of work that began earlier this year, the
City is also expanding on-site locker rooms and eating space, to enhance
working conditions for personnel at the Public Safety Answering Center
in Brooklyn.