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West Virginia auditor blasts Cisco, state for "oversized" router buy

West Virginia Legislative Auditor says vendor and state officials skirted legalities in $24 million router contract

By , Network World
February 25, 2013 03:21 PM ET

Network World - West Virginia wasted millions in federal grant money when it purchased 1,164 Cisco routers for $24 million in 2010, a state audit concluded.

A report issued this month by the West Virginia Legislative Auditor found the state used a "legally unauthorized purchasing process" when awarding the router contract, paid for with federal stimulus funds, to Cisco. The auditor also found Cisco "showed a wanton indifference to the interests of the public" in recommending the investment in its model 3945 branch routers, the majority of which were "oversized" for the requirements of the state agencies using them, the report stated.

[PRICEY STUFF: Country's largest 4-year university expels Cisco, saves $100 million]

"The Legislative Auditor believes that the Cisco sales representatives and engineers had a moral responsibility to propose a plan which reasonably complied with Cisco's own engineering standards," the report states. "(The auditor) concludes that the majority of Level 3 Cisco model 3945 routers which were purchased are unnecessary."

"Cisco remains committed to meeting the needs of West Virginia and we are actively working with our customer to do just that. We believe the criticism of the State is misplaced and fails to recognize the forward looking nature of their vision. The positive impact of broadband infrastructure on education, job creation and economic development is well established, and we are committed to working with the State to realize these benefits for the people of West Virginia now and into the future," says a Cisco spokesperson.

West Virginia could have saved almost $8 million had the scope of the purchase been scaled to the requirements of the state's libraries, schools and state police, the report states. Smaller, less expensive routers could have been used in the state's 172 libraries, resulting in a savings of $2.8 million; in state police facilities, for a savings of $1 million to $1.4 million; and in 368 schools with enrollments of less than 500, for a savings of $3.68 million.

The report recommends that West Virginia's State Office of Technology look into possibly redeploying any Cisco 3945 routers to more appropriate public facilities to maximize their usage; and/or trading out unnecessary features and modules on the 3945s which have yet to be deployed for the $80,000 of VoIP modules necessary to run the state police's VoIP system.

The report also recommends the state's purchasing division determine whether the Cisco representatives involved with the sale are liable for debarment under state code.

The findings come shortly after California State University concluded that Cisco bid $100 million more than the winning $22 million bid to refresh the university system's 23 campus network. Indeed, the West Virginia report cited the CSU findings in its own conclusions.

And in 2004, Cisco was found to have written portions of an $8 million bid to upgrade San Jose City Hall's network. The contract was withdrawn by city officials after the discovery.

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