State education officials are threatening to cancel a multimillion-dollar contract with IBM because of problems involving a sophisticated computer network.

The program, NC WISE, has been dogged by glitches since it began six years ago. It's supposed to give schools a single place where a wide range of information can be entered and analyzed.

Through the system, schools can create individual report cards or track entire groups of students. It offers grade books for teachers, electronic transcripts for colleges and data for parents, from test scores to attendance records.

But teachers say it has a tendency to crash and freeze to the point where some have dubbed it "NC STUPID."

Although all schools were scheduled to have the program by now, delays have made it available to less than a third of the state's districts.

Program changes requested by the schools also have played a large part in driving up its price. Although the original contract totaled $54 million, the terms of the control and scope of the project have been renegotiated, and the final costs now could be three times that.

If additional costs covered by local schools were included, the full price probably would top $250 million, said Philip Price, associate state superintendent for financial and business services.

Price said the state will finish the project itself if the contract with IBM is canceled, but both sides are expected to work through the weekend to meet a Jan. 1 deadline that would keep the partnership intact for now.

Under the contract, the state is supposed to make its next $3.25 million payment by Sunday. At issue is whether IBM has completed all the work it had agreed to do by that deadline.

"There are many, many details that need to be addressed, but one of the pressing issues involves payments, and we hope to resolve that in some fashion by Jan. 1 so we can continue to move forward," Price said.

NC WISE replaces an antiquated and much simpler computer program that schools have used since the 1980s. That program mainly records attendance and keeps track of who takes what courses.

NC WISE not only collects more information but also analyzes it within and across categories for more than 1.3 million students in 115 school districts. The task has been far more complex than state officials first imagined.

IBM was not involved when the project began, and it did not create some of its current problems. But it inherited the program's troubles when it bought the consulting arm of the accounting company PricewaterhouseCoopers in 2002 and got the NC WISE contract as part of the deal.

Since then, and especially in the past year, officials from IBM and the state Department of Public Instruction have argued about the quality of IBM's work and conflicting requests from the state.

The debate appeared to reach a breaking point over the holidays in letters between State Board of Education Chairman Howard Lee and the IBM executive who leads the project.

In a letter dated Dec. 20, William C. Brown of IBM called it "an intolerable situation" and said the state owed the company more than $3 million. He complained that IBM also had to sort through "multiple, conflicting requirements" because no one person seemed to be in charge.

Lee wrote back the next day, telling Brown the board of education thought IBM had breached its contract by missing deadlines and producing faulty software. Lee said the contract would be canceled unless the two sides reach an agreement by Feb. 8.

Brown fired back the next day in disagreement, but state education officials also upped the ante by sending a mass e-mail message to local school districts telling them of the problems with IBM.

The exchange ended Dec. 25 when Brown told Lee that further discussions with state officials "helped me better understand some of the concerns."

Brown left the country for the rest of the holiday break and could not be reached for comment Friday.

Company spokeswoman Alise McNeill said others at IBM are working to resolve the issues and the company remains committed to the project.

Price made it clear, however, that resolving the question of whether IBM is owed more than $3 million does not mean the state is backing away from its claim that the company breached its contract. That issue, he said, will be discussed separately.

"This is a huge project, and some problems were inevitable even if everything had gone well," Price said. "But one way or another, we will finish the project."

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