Let’s Make a Deal

Here’s a deal for Maine legislators: We won’t object to your breaking the state’s contract with Apple for laptop computers if you promise to never again say anything a – not even a peep – about the state’s business climate.

In dollars and cents, it will cost Maine $645,000 to break the $37.2-million contract, according to an assessment done by the attorney general’s office at the request of Reps. Brian Duprey of Hampden and Phil Cressey of Baldwin. This, says Rep. Duprey, refutes Gov. King’s recent statement that it would cost nearly as much to break the contract than to keep it.

In strictly contractual terms, it may be somewhat more complicated. As Attorney General Steven Rowe notes, the 2,868 demonstration laptops already received would have to be returned, of course. Then there’s the matter of the 16,780 laptops already ordered for next school year, the wiring of 239 middle schools for the networks, the training for teachers, the curriculum development, the warranty services and all the other elements of this turnkey contract.

In terms of the real world, as Mr. Rowe and the governor observe, the damage reneging on this deal would do to Maine’s business you-know-what could be devastating. It’s one thing for the state to break its contract with CarTest, as it did in 1994, and to fight that little-known company in court for a couple of years before leaving it on the hook for a series of bad decisions Maine made about automobile emissions testing. It’s quite another to stiff one of the most high-profile companies in the technology sector -you know, the sector everyone says is the future, the one every state wants to have move in.

Mr. Rowe puts it this way: “(F)ailure to fund a program after a contractor has expended considerable resources in fulfilling its obligations under a contract may adversely affect the state’s creditworthiness as well as its ability to contract in the future, undermine its credibility at the bargaining table and-or increase the costs of its agreements.”

Put another way: Maine – including the Legislature, which had many opportunities to kill the laptop program in the past three years but did not – got a lot out of Apple in this first-in-the-nation project to make hands-on, daily access to technology a statewide project. Apple gave the state a great deal on this – the discounts and freebies amount to as much as $15 million. Nobody likes being played for a chump.

Nearly every state is dealing with revenue shortfalls. Some will work their way through these difficult times by making tough, well-researched and reasoned decisions, the kind of decisions that leave a state better off when better times return. Some states will panic and make reckless decisions it will spend the next better time undoing. Some may even buy quick fixes by wriggling out of contracts – a small downpayment now, followed by years of additional costs to things like in honor and reputation. It would almost be worth it to never again have to hear legislators gush about the importance of Maine’s business climate, but the price is simply too high. And that deal offered in the first paragraph – it’s off.