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Cover Story In addition, Northrop Grumman


and VITA disagree on a number of important issues related to the transition to a new system. Disputes include how much information Northrop Grumman must share with Virginia during the new procurement process. The company also has balked at providing infrastructure for messaging services supplied by another company. Those services originally were scheduled to transfer to another provider in September. VITA and Northrop Grumman also


disagree about unexpected increases in service charges from Northrop Grum- man. Northrop Grumman has charged the state an additional $5.5 million for Unisys mainframe services. In addition, the company says Virginia owes $4.2 million more in Microsoft licensing and fees than VITA believes it owes. In response to these disagreements,


Northrop Grumman, VITA and the Virginia Attorney General’s Office have agreed to work together in a nonbinding mediation process. Those discussions were scheduled to start in January. Still, Moe says, such disputes are


not unusual. “It is normal for a contract of this size and complexity to have these types of issues, especially toward the end,” he says. Resolutions to these disagreements


are vital to a smooth transition process. Unless resolved, these disagreements “could harm the state’s effort to transition duties and ongoing service obligations,” the Joint Legislative Audit and Review Commission (JLARC), the Virginia legislature’s watchdog, concluded in a September memorandum. JLARC also warns the disputes “could negatively impact the much larger and more com- plicated transitions that are planned in the years to come.” Northrop Grumman, in response to


questions for this story, said it plans to work with the commonwealth to ensure a smooth transition. “For more than a decade, Northrop


Grumman and the Commonwealth of Virginia have been partners in providing award-winning improvements to the state’s IT infrastructure,” said Brandon R. “Randy” Belote III, vice president of strategic communications for Northrop


Grumman, in an emailed statement. “The commonwealth has announced it is going in a different direction and will work to disentangle the VITA program. “As the commonwealth goes through


this process, Northrop Grumman will continue its efforts to protect the citizens of the commonwealth and enable the services that are used every day. We are committed to adhering to the terms of the Comprehensive Infrastructure Agreement with VITA to facilitate an effective transition of IT services.”


Warner administration idea In 2005, Virginia signed a 10-year,


$2.4 billion contract with Northrop Grumman to revamp and modernize the commonwealth’s antiquated IT infrastructure. The deal was the largest contract the state had ever awarded to a private contractor. The idea was the brainchild of then-


Gov. Mark Warner, who had made it a priority to consolidate and modernize the state’s aging, outdated IT infrastruc- ture. George Newstrom, Warner’s secre-


would like to thank our sponsors


Washington Gas and Virginia Credit Union League for a successful 2016 Political Roundtable.


22


JANUARY 2017


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