San Diego Magazine / November 2003 / Bugs in the System

 Email  Print  Feed

Bugs in the System

(page 1 of 5)

San Diego Data Processing Corporation. Ask anyone on the street if they’ve heard of it and you might get a shrug of the shoulders.

But tell them this city-owned organization spends anywhere from $60 million to $80 million in taxpayer dollars each year, that the chief executive’s compensation package is well over $300,000 a year—highest of any city-paid executive—and their ears perk up.

Faced with a $30 million budget deficit, San Diego city officials are taking a harder look at this little-known agency, which provides most of the city’s information technology services, or IT for short. As a nonprofit agency, the DPC should be able to provide those services at or below market rates. Or so the theory goes. But city staffers have complained for years that the agency’s service is poor and its rates are too high.

Some critics—among them former members of the DPC’s board of directors—suggest the 24-year-old agency may have outlived its usefulness; that it’s a middleman that needlessly drives up the city’s IT costs. But last year, when board members began questioning the way DPC was spending the city’s money, they were removed in a shakeout.

A shakeout, they say, engineered by San Diego Councilmember Jim Madaffer at the behest of Data Processing Corporation’s president and CEO, Roger Talamantez.

DPC needs greater scrutiny from the city council, these critics say, because of the decade-old ties between Madaffer and Talamantez, who both served on the organization’s board in the early 1990s and are now connected politically.

DPC “may very well be an anachronism at this point,” says Phil Thalheimer, who served on the board in 2001 and 2002 and is a candidate in next year’s District 1 city council race. Thalheimer was also a vice president and general manager under Talamantez, after working as a senior staffer in the city’s financial management department, where he coordinated IT services with DPC.

“I can make a very good case for the whole thing being brought in-house,” Thalheimer says. “The issues that it was created under don’t exist anymore.”

Dianah Neff, formerly the city’s chief information officer, left San Diego two years ago after butting heads with Talamentez. She’s now chief information officer for the city of Philadelphia.

The DPC “was a model that had been studied to death but never replicated anyplace else,” Neff says. “When that happens, you have to ask why.”

Madaffer, the city council liaison to DPC, disagrees. The problem, he claims, is the city’s sprawling bureaucracy that refuses to give up control of its computers. “You’d be astounded at the millions of dollars that are being wasted [by the city],” he says. “I’m tired of paying for it twice.”

Because the city has its own information technology and communications department, and other departments have in-house technical staff, Madaffer argues, the city is either duplicating services already provided by DPC or magnifies overall costs through an inefficient use of resources. “[The critics] never really take the time to understand what it is DPC was tasked to do and how they save the taxpayers millions of dollars,” Madaffer says.