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August 2017 Essential Politics archives

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California budget

UC's new payroll system will cost at least $200 million more than expected

University of California President Janet Napolitano (Marcio Jose Sanchez / Associated Press)
University of California President Janet Napolitano (Marcio Jose Sanchez / Associated Press)

The University of California president's office has failed to keep a proposed new payroll system on budget and on schedule, and original estimates of its cost savings are unlikely to be realized, a state audit concluded Thursday.

The Office of the President originally estimated in 2011 that the UCPath payroll system would be implemented by 2014, cost $306 million and save the university $753 million, mostly from staff reductions.

But current estimates put the cost at $504 million and it won't be done until 2019. University officials now estimate it will cost hundreds of millions of dollars more to operate, so the projected savings won't happen, California State Auditor Elaine Howle wrote to Gov. Jerry Brown on Thursday.

UC President Janet Napolitano said the complex project began before she became head of the system but has improved over time.

The audit made recommendations to improve the cost of the project, and Napolitano responded that "the recommendations are helpful and constructive, and align with our proactive efforts to continually improve UC’s operations, policies and transparency to the Legislature and the public at large." 

Thursday’s audit is the third this year that has been critical of Napolitano’s office. One audit accused the president's office of failing to properly report the existence of tens of millions of dollars in uncommitted funds and of approving excessive salaries and perks for university managers.

As she did in that stinging audit earlier this year, Howle on Thursday accused the president's office of leaving the UC Board of Regents in the dark on the problems.

In 2014, the payroll project's director told the regents that the estimate for the project was $220 million, but internal records from a month earlier showed the project would cost $345 million, the audit found.

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