Some workers didn't like being replaced by Avizion.

Miller and other city officials believe his private-sector approach has started the department down the path to improvement. But along the way, his actions have outraged some now-former employees.

Former employees and other sources close to the situation charge that the city's information technology (IT) office has become too chummy with Avizion Technologies Group, a Dallas-based private contracting firm. The sources claim Avizion is profiting from public contracts it never bid on while botching the city's IT operations.

Shortly after Miller arrived, in a move he says began before he arrived, the city hired Avizion. And last fall, Miller began cleaning house. Three administrators in the department resigned in October, citing philosophical differences with him. Then Carl McGee, the head of the networking division, left in December. He was replaced by Avizion's managing partner, Terry Bey, brought in for $16,000 a month to run the section on a contract basis for four to six months. Critics were outraged that Bey was suddenly in a management position in the same city government with which her company has a lucrative contract.

Then on Feb. 7, the IT department laid off 10 employees, some of whom had worked in the department for more than 15 years, and replaced them in part with Avizion contract workers. Two of those contractors were installed under Bey in the networking division. "This is an Enron-type thing," said one source, observing that Avizion now serves as the IT department's consultant, contractor, and employment agency.

"It seems like Terry is in there being able to hire her own people," said another source, who asked to remain anonymous. "There ought to be more checks and balances. It's kind of fishy-smelling the way things are going."

In addition, since the 10 employees were fired, some sources said, the IT department's mainframe, which supports the city's 911 and police dispatch systems, has gone down more often, though Miller and Bragg deny that.

"Dave Miller doesn't know the technical stuff that well," a third source said. "Terry Bey and [assistant director] Randy Hunt are running the department."

City administrators and others respond that the department is finally cleaning up its act after years of neglecting technology systems and customer service, and that Avizion is one of several private firms helping streamline and improve the department. The IT department, city officials add, is a microcosm for new City Manager Gary Jackson's efforts to make all of Fort Worth city government more customer-friendly. As city manager in Carrollton, Jackson outsourced the entire IT department.

Miller, who joined the city from a Louisiana energy company, is a private- sector guy; of his 37 years in the industry, his only experience in government was a brief stint in the Navy. As Miller noted, he was the only candidate from the private sector among the five people the city interviewed for the position. His hiring was no accident. "They wanted someone with a private-sector background to take their IT department to the next level," Miller said. That goal was reinforced when Jackson became city manager in March and began emphasizing improved customer service in all city departments.

The first order of business for Miller was to evaluate the department. He said he had his own impressions of what was wrong with the department when he was hired, but wanted a consultant to confirm his observations. A contracting deal with Avizion was in the plans when Miller arrived, and he turned to Avizion and Bey for more work, hiring the company to assess the IT operation's needs. Bey had worked with Miller as a consultant several years and "two jobs ago," Miller said. Once Bey and Avizion completed the assessment, Miller began hiring Avizion contractors to help fix the problems, including the flimsy mainframe supporting the 911 and police dispatch systems.

Miller defended Bey's placement, saying that, in the private sector, it's not unusual for a contractor like Bey to consult from a management position. He added that Bey doesn't have authority over spending or contractors, which are approved by the city manager's office, so there is no conflict of interest. He said Bey is simply overseeing the department's transition to Microsoft's Windows 2000. When that's done, she'll hand over the position to an already-hired successor.

The city council approved Avizion's one-year contract in April, with options to renew it every year for four years. But the contract wasn't put out for bid, critics charge. Rather, it was just given to Avizion, while the IT department scaled back its business with two other contractors, TMP and TEKsystems. The relationship between the city and Avizion is unethically close, some sources said, adding that Miller has shown favoritism toward Bey.

"It absolutely should have been put out for bid," said one source involved in the IT industry.

That's not necessarily true, according to city policy and state law. Under a state program that certifies technology vendors, certain firms are authorized to contract with local and state governments without going through the bidding process. The reasoning is that, by putting a company through the certification process, the state has satisfied the fair-competition requirements, allowing governments to move faster in hiring high-tech contractors to solve critical technology problems. A city department can spend as much money as it wants with a state-approved technology vendor and never put the contract out for bid. "It's a real good tool for public entities," said Robert Combs, Fort Worth's city purchasing manager.

Each quarter, the city council approves funds for the IT department to spend with 40 state-approved technology vendors, said David Bragg, chief financial officer for the IT department. TEKsystems is also a state-approved vendor. But Miller said he chose Avizion to help fix problems in the department because he'd worked with Bey before and knew she would deliver, especially since he thought several systems, including those supporting public-safety networks, needed immediate work. "If you needed brain surgery, you'd want someone who does it all the time," Miller said. "What I didn't want to do was go out and get someone I didn't trust." The IT department brought in four Avizion contract workers, including Bey, at a cost of more than $238,000 in the first quarter of the fiscal year, according to Bragg. The city spent $144,00 with TEKsystems during that same span.

Miller and Bragg said Avizion's large presence in the department is temporary. Once the department's systems are performing better, Miller said, the city may outsource them permanently. As for the loss of several longtime employees, he said that's all part of a painful transition. "Yeah, we had people with a lot of institutional knowledge, but the job wasn't getting completed," Miller said. "There are significant changes going on in the city, and those changes are reflected in our organization."

In a larger sense, this dispute seems a clash of cultures -- the fervid, outcome-oriented mentality of the private sector colliding with the more plodding, loyal ways of bureaucracy. If the IT department is a microcosm of Jackson's approach, city government may be in for more turmoil.