Delays are expected to drive up the cost of an upgrade of state government’s computer systems by $25 million.

The issue came up Tuesday during a meeting of the Senate Committee on Finance.

The panel is reviewing the $25 billion proposed state operating budget for the fiscal year that starts July 1. Money to continue with what was once a $100 million computer system upgrade is limited in the state spending plan.

The Legislative Fiscal Office flagged the project as a major budget issue in its review of House Bill 1, the spending plan legislation.

Commissioner of Administration Paul Rainwater, the governor’s chief budget aide, said in a statement that the new system still is being tested at the state Department of Transportation and Development.

“The prudent thing to do, as it is with any pilot program, is to wait and see what lessons have been learned from that implementation before pushing forward,” he said.

Also delaying the upgrade is the $1.6 billion budget shortfall facing the state in the upcoming fiscal year.

During the committee meeting, legislators expressed concerns about the delay.

State Sen. Mike Michot, R-Lafayette and the committee’s chairman, wanted to know how much the delay is likely to affect the cost of the project.

“We believe in the merits of the system ... All the agencies can benefit. We want to make government more efficient,” he said.

Ed Driesse, chief information officer for the division’s Office of Information Technology, said an additional $29 million will be needed over the next three years.

Roughly $93 million already has been spent on the project.

“We do have antiquated systems that can crash at any time,” Driesse said.

He said the $29 million is “today’s number,” which would have to be recalculated if the state goes even longer without implementing the upgrade across state government.

Driesse said the pilot program at DOTD is, by and large, a big success.

State Treasurer John Kennedy disagreed, telling the committee that he is not convinced the pilot program is going that well. Kennedy is not allowing his office to participate in the upgrade.

The Jindal administration scaled back the project in October 2009 to a pilot program with plans to eventually move forward with the rest of the upgrade. Proponents claim the project is necessary to avoid a collapse of the state’s computer systems. Critics, like Kennedy, question whether it will work.

Kennedy said Tuesday that the state went with the Mercedes of systems rather than a more practical Buick.

“I’m not convinced that the pilot program at DOTD has worked as well as has been represented to you today,” he said.