Anchorage Assembly reluctantly gives more money to $81 million software project

The Anchorage Assembly voted in favor Tuesday night of spending several million more dollars to finish the beleaguered city software upgrade project known as SAP.

But several Assembly members pointedly warned it was the last time. The project has cost more than $81 million to date.

"I will not vote for one more penny after this," said Assemblywoman Amy Demboski of Chugiak-Eagle River, a longtime critic of SAP.

SAP, named after the German company that built the software, replaces the city's aging business software system. The new software will handle critical municipal functions such as payroll, timekeeping and payments to companies that do business with the city.

The project started in 2011 with a $9 million budget. By the time Mayor Ethan Berkowitz inherited the project in the middle of 2015, the amount of money spent so far was nearing $50 million. In October 2015, after a "pause," an external committee concluded that the project was salvageable, and too much had been invested to turn back. A pair of reviews earlier that year blamed the failures on a crisis in leadership, organization and project management, not technological failures or the software itself. The Assembly on Tuesday night voted to spend another $5.8 million on the project.

This March, Berkowitz told Assembly members that nearly all of the money spent on the project up to the point when he took office had "no measurable benefit."

Assembly members Felix Rivera and Christopher Constant said they'd both heard a tidal wave of complaints from constituents in recent days about the expense of SAP. Assemblywoman Suzanne LaFrance of South Anchorage said she understood this to be the last large appropriation, and that she'd have trouble supporting another one in the short term.


But Zig Berzins, who has served as the Assembly's independent consultant for the SAP project, pointed out to Assembly members Tuesday night that if the city didn't finish the project, it would have to be paid back through the operating budget — an immediate cost to taxpayers.

"And that could be a real problem," Berzins said.

The system is slated to start operating in early October.

Turf approved for Sullivan Arena; health clinic delayed

The Assembly also on Tuesday night supported using about $421,000 in state grant money to pay for a new turf field at Sullivan Arena.

The turf, officials told Assembly members, can be set up when the ice at the arena isn't in use. It could support a range of field sports that face limited winter field space, like rugby or box lacrosse, said John Rodda, director of the city parks and recreation department.

Rodda said the new field was not meant to directly replace or compete with The Dome, the giant inflatable sports complex that collapsed earlier this year. He said the revenue could help meet broad demand for indoor field space and help balance Sullivan Arena's budget in the future, though he didn't have exact projections for how much the field could generate.

The Assembly postponed to its next meeting a decision to contract with a Seattle-based company to provide a health clinic for city employees. Assembly members said they wanted to see a more specific breakdown of the savings associated with the contract.

In other business, the Assembly processed marijuana licenses, cleared up confusion over a land title in the Point Woronzof area and put money toward an update to an areawide transportation plan.

The future Muldoon Town Square Park in East Anchorage formally got a new name: Chanshtnu Muldoon Park.

Chanshtnu (pronounced CHANSH-nu), meaning "grass creek," is the Dena'ina word for the Chester Creek, which winds through the park; "Muldoon" memorializes an early homesteader.

Correction: A previous version of this story was unclear on the time frame Mayor Ethan Berkowitz was referring to when he said nearly all of the money spent on the SAP project had "no measurable benefit." Berkowitz was referring to money spent up until the point when he took office in July 2015.

Devin Kelly

Devin Kelly was an ADN staff reporter.