Smokers to Fund Year 2000 Fix

Nebraska mulls tax to solve computer millennium crisis

P> Nebraska Gov. Benjamin Nelson knows people in his state smoke too much. He knows computers will need a quick and expensive fix to handle the year 2000 crisis. Eureka! Make smokers pay for the fix.

That's the plan in the Nebraska state legislature, where state officials are eyeing a cigarette tax to partially fund a multimillion dollar software project to avert crisis 2000. Experts predict a pandemic computer snafu at the turn of the millennium. Because most computer programs allow only a two-digit date field, the new millennium, which would be designated as 00, could cause applications or systems errors. For example, if a program using the two-digit date field is calculating the age of a person born in 1930, it would subtract 30 from 00 and conclude that the person is -30 years old, not 70 years old.

The change seems minor, so when Nebraska's data processing office estimated a preliminary cost of $31 million, it made Democratic Gov. Nelson take notice, said Rod Armstrong, Nebraska's information technology coordinator. Unwilling to propose new taxes, Nelson turned to the cigarette tax.

Currently, the 32-cent tax funds infrastructure projects, such as the construction of roads, buildings or bridges. But Nelson wants to broaden the meaning of infrastructure to include information infrastructure. He introduced a bill in the state legislature to expand the definition, and chances look good that it will pass, said Armstrong.

The proposed bill would allow Nebraska to use 2 cents of the tax, starting in July 1997, to help fund the year 2000 changes. The tax is expected to raise $11.4 million, with the rest of the required funds coming from other sources, such as the state's general fund or federal money. Other IT projects also would be eligible for money generated by the tax.

Funding the changes with an existing cigarette tax is a "truly creative approach" that no other state is using, said Kevin Schick, research director with the Chicago office of the market research firm Gartner Group. And it's a good thing the state is moving now. If Nebraska waited until 1998 to act, which is when Schick projects most states will start to fix the problem, the cost would have doubled to $62 million. Now, $31 million would be an average cost for most states to fix all their programs, Schick said. However, a coordinated statewide effort, rather than individual agency efforts, could be the exception, not the rule.

Agencies at the state or county levels may be responsible for contracting for their own needs, said Brett Barton, advanced systems engineer with the state and local government division of Plano, Texas-based Electronic Data Systems Corp. The cost of changing all those systems could be in the billions of dollars, but it's impossible to estimate because of the variety of systems in use, he said. EDS manages a welfare system for 19 California counties and is helping them make changes required by the year 2000. The company also is chasing other century-change contract opportunities, but Barton declined to disclose how many or who issued them.

The century date change isn't something that can be put off. Ideally, changes should be made by 1999 so there is time to test the solution, said Joyce Wrenn, chief information officer and vice president of Information Technologies for Union Pacific Railroad in Omaha, Neb. Wrenn is a member of the Information Resources Cabinet, a group set up by Nebraska's governor to advise the state on its options.

Everything a government does deals with dates, whether it is payroll, benefits disbursements or taxes. Because these systems use the two-digit date fields, they will all be affected by the new millennium. Most states are only becoming aware of the problem now. About 25 percent of the states are requesting proposals on correcting the problem, and another 25 percent are in denial, Schick said. This last group is the most frustrating, he said. Political leaders rarely see beyond the next election, and they are loathe to raise thorny issues requiring public funds as they approach elections in 1996 and 1998. They will blame the problem on their predecessors or wait until they're out of office.

In the meantime, states will have little choice but to find money somewhere. "In the very near future, taxpayers will have to just get angry and make a statement to their governor's office that they are not a naive public [who will sit by while nothing is done]," said Schick.

Unfortunately, the longer states wait, the more expensive the projects will be because of the shorter time to complete the job. Additionally, the most experienced people will be snapped up quickly, so latecomers may have a hard time finding the necessary expertise.

Still, the date change is presenting a huge opportunity for businesses. Software tools, such as those by Viasoft, Adpac and Compuware can be used to identify the extent of the problem and make simple fixes. And consultants, such as Gartner Group, are often called in to help develop an initial plan of attack. But integrators, such as EDS, Computers Sciences Corp., El Segundo, Calif., and Andersen Consulting, Chicago, are needed for the actual technical work, said Barton.

Companies With Date Change Software

Adpac - System Vision 2000

Cap Gemini - tool and services

Compuware -Xpediter Xchange

Computer Horizons Corp. - Signature 2000

Coopers & Lybrand

Data Dimensions

IBM Integrated Systems Solutions Corp.

Isagon -TicToc

James Martin & Co. - TSRM and services

Micro Focus - Revolve

KPMG Peat Marwick


Viasoft - Enterprise 2000

Source: Gartner Group

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