A new payroll system to modernize the current city-county system, eliminating cumbersome and time-consuming paperwork, was expected to roll out early this year.
But the start date has been delayed for a year because the company hired to implement the system was not able to handle the work.
A new contract, with Everge, will cost the city and county around $3 million, more than quadruple the price tag for the original contract with Denovo.
Lincoln and Lancaster County will use Oracle software for the payroll system, under a $236,000 annual contract. But a separate company is hired to implement that software, said Brandon Kauffman, city finance director.
The original contractor, Denovo, "strugged to meet deadlines. They took on way too much,” Kauffman said.
The city and county had paid about $115,000 to Denovo before the contract was canceled, Kauffman said.
The city and county looked at two new companies for implementation services: KPMG, with a potential implementation cost of about $5 million, and Everge, for a cost of around $3 million.
Oracle is also making some concessions on cost, reducing the first-year cost by half because the system won't be in use for the full year, according to Kauffman.
The payroll system for more than 4,300 city, county and public building commission employees is funded 70 percent by the city and 30 percent by the county through tax revenues.
Lincoln property owners pay both city and county property taxes.
Everge will set up the system so that it includes all the employment and pay rules related to 13 city and county union contracts, explained Dennis Meyer, budget officer for the county. The city and county are hoping the new system will be up and running by April 2020.
The state of Nebraska last year ended a contract with Oracle and KPMG, a company that was to implement the Oracle software.
Lincoln’s issues are different from the state’s problems, Kauffman said. The state canceled both contracts, but the city plans to continue with the Oracle contract for the software.
The new payroll system will allow employees to process forms online for issues like benefits, address changes and renewals.
The city and county needed to change not just to modernize the payroll system. The current system is a mainframe human resources payroll system, begun in 1992. Lincoln and Lancaster County are one of the remaining few customers on the system, and it's likely the system will not be supported in the future, according to Kauffman.