Anchorage computer system cracks cost millions


The City of Anchorage’s enterprise software system, SAP, has now cost taxpayers in Alaska’s largest city more than $ 90 million, most under the leadership of Mayor Ethan Berkowitz. He has promised to fix it if he becomes mayor, but the problems are getting worse, according to a secret report to city hall.

SAP has been in the throes of trouble for years, but now there’s rumor going around about another issue.

Cliff Notes Explanation: The SAP computer system does not understand all the different union contracts and how they relate to workers overtime.

Over the years, the various union contracts have become so complex that it is practically impossible to calculate the compensation correctly. Even the old software, PeopleSoft, had problems with it.

Civil servant unions have no incentive to simplify the negotiated rules, and programming in the new SAP software did not come with these complicated contracts preloaded.

Since SAP is run by out-of-state contractors, they also have no incentive to fix it. They are banking.

Normally, an employee would be paid a certain amount based on regular time and another rate based on overtime. But unions have their own rules of “if-then” logic based on seniority and the days overtime has been accrued, as well as the time it is accrued.

Union contracts provide for heavy penalties against the employer for any payroll calculation error. Union contracts state that if the payroll is miscalculated, huge rewards go to the workers involved. These are not small bonuses, but extremely generous bonuses.

It appears that a significant portion of the municipal employee sector has seen their wages and benefits miscalculated by the SAP system, and they owe thousands of dollars per employee in penalties, with some employees expecting as many as 40,000. $ roughly in rewards – not for the work done, but simply because a minor miscalculation in the SAP system resulted in penalties that accumulate day by day.

The firefighters union contract charges $ 50 per day for each day an error has not been corrected. AMEA employees are assessed a daily penalty of $ 60, and there are over 500 of those employees. Several of the municipal employee unions have filed grievances over more than 1,000 adjustment requests.

Note: We hope that an enterprising news organization will have the staff resources to get their hands on the report, which is of concern to property taxpayers. Must read Alaska will eventually submit a public records request.

Gordon K. Morehouse