A contractor hired to replace New Jersey's antiquated computer network used for welfare programs has agreed to reimburse the state $7.5 million as part of a termination agreement.

The state hired Hewlett-Packard in 2009 to build a new computer system that would assist eligibility and enrollment functions for Medicaid and other benefit programs such as the Supplemental Nutrition Assistance Program, commonly known as food stamps.

But the project, originally set to be completed in July 2014, has been dogged by delays and defects, according to a state audit released last month.

New Jersey's old technology and low staffing at county welfare agencies have contributed to a backlog of an estimated 11,000 people who have applied for Medicaid, the health-care program for the poor, but not received a response.

Nicole Brossoie, a spokeswoman for the state Department of Human Services, said the state had paid HP $17 million. The department is in the process of hiring a consultant to move the project forward, she said.

Neither side admitted liability in the agreement, she said.

"HP understands that client needs sometime change over time and appreciates the opportunity to have served the residents of New Jersey," an HP spokesman said in an e-mail.

- Andrew Seidman