The Bee reported yesterday that the state has terminated its 2006 contract, with a going rate of $69 million, for the modernization of the state’s payroll and personnel computers. $25 million of the contract was already fulfilled at the time of termination.

It’s clearly a good thing to see the state hold a vendor accountable for not doing their job properly. The part that gets me is the company in question, BearingPoint, is based in Virginia. Don’t get me wrong, I’m all for interstate commerce and saving money by going to a low bid, but could we seriously not find one company in California, the technology capitol of the world, to handle modernizing our state’s aging computer systems?

The performance of the Virginia firm was clearly deficient given the recent ‘computer troubles‘ we’ve seen from payroll and personnel, but performance aside, the state should not be sending $69 million out of the California economy when that same investment can be made within our own state, particularly within these troubling economic times.