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IBM Contract For Centralized N.C. Education System Terminated

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RALEIGH, N.C. — The State Board of Education terminated its agreement Wednesday with IBM to develop a centralized education system called N.C. WISE, citing that the company failed to deliver the technical support it promised, resulting in a "negative impact on the normal school business process."

N.C. WISE, which has faced problems since it was started several years ago, allows schools to create individual report cards or track groups of students. It also offers grade books for teachers, electronic transcripts for college and data for parents.

Educators had hoped that the project would be complete and running by now, but after seven years and millions of cost overruns, only one-third of the project is complete.

Both the state and IBM, which sent word several days ago that it wanted out of the agreement, have blamed each other for delays and problems with the program.

On the same day that the Board terminated its contract, it also explained the project's growing cost to the Government Oversight Committee.

Education leaders told lawmakers on the Government Oversight Committee Wednesday that they would not lose time in linking all of the schools to the system and hoped to finish the project for less than the $52 million remaining that IBM would have received for the rest of the work.

Philip Price, state associate superintendent for business and finance, said the state has no choice but to move forward with NC Wise because the old system is losing its effectiveness.

The total price tag for the project has been estimated at $250 million, including the costs to local school districts.

IBM spokeswoman Alise McNeill said the state has fulfilled its contractual obligations to the state for NC Wise.

"The state has continued to ask IBM to perform work outside the contract without payment," McNeill said, adding IBM is owed millions of dollars for work that has been completed.

Because several key issues have not been resolved, IBM asked to dissolve the contract, McNeill said.