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Del. Robert "Bob" Purkey, R-Virginia Beach, said the recent database breach that compromised hundreds of thousands of Social Security numbers could give state officials an avenue to revisit the 10-year $2.3 billion contract with the defense contracting behemoth.
Purkey asked the attorney general's office to review the fine print to see if the state can renegotiate the record-breaking deal.
"Very frankly, this is a security failure," Purkey said. "Does it create a breach of contract?"
House and Senate committees asked probing questions of Len Pomata, Virginia's secretary of technology and interim chief of the Virginia Information Technology Agency. Pomata acknowledged the company "missed key deadlines" and said there have been "notable delays and downtime," but he defended the overall implementation of the new technology.
The confrontation underscored the mounting problems between the state and Northrop Grumman over Virginia's largest privatization contract.
Northrop Grumman won the contract in 2005, charged with upgrading the state's computer mainframe and streamlining services available on the Internet. But the company has faced a barrage of criticism in recent months for blown deadlines and patchwork service.
In late May, Virginia's chief information officer, Lemuel Stewart, suggested that the state consider withholding a $14 million payment to Northrop as punishment for poor performance.
Hours later, Stewart was removed from his job.
Ashley Colvin, who works for the General Assembly's investigative arm, the Joint Legislative Audit and Review Commission, called the outsourcing deal an "extremely complex and path-breaking endeavor," but he detailed significant delays.
"Many of these tasks are more than a year overdue," Colvin said. "Since last July, VITA may have been overpaying or underpaying Northrop Grumman. We don't know."
The company was originally supposed to take complete control of the state's computer infrastructure this week, but that step might not take place by the end of the year.
Northrop Grumman issued a statement calling the state contract a "visionary partnership," acknowledging "challenges" and noting increased manpower and resources dedicated to the contract.
"This is a complex and unprecedented undertaking and we are making significant progress," the statement said.
The hearing comes at a somewhat difficult time in Virginia for Northrop Grumman.
This spring, an inspector charged with checking welds on ships built at the company's Newport News shipyard admitted to falsifying records. Northrop Grumman and Navy inspectors are now reviewing welds on as many as nine submarines and four aircraft carriers.
Northrop Grumman enjoys a unique status in Virginia because of the company's links to the military and because the Newport News shipyard is the state's largest private employer. State lawmakers recently approved $50 million in incentives for Northrop Grumman to expand work force training facilities in Hampton Roads.
The start of the hearing focused on a prescription drug database at the Department of Health Professions that was attacked by hackers. State officials warned more than half a million Virginians that their Social Security numbers might have been accessed during the breach.
The State Police and Federal Bureau of Investigation are still searching for the hacker.
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