Governor Doug Ducey has approved a $9.8 billion budget package – an increase over the $9.6 billion budget last year. It includes a 1.9% increase in state spending, and predicts a 4.3% increase in state revenues in the coming year. If you tracked last year’s technology budget, you will see quite a few similarities. Here are a few of the big takeaways from the FY2018 budget, and what they mean.
Oversight Remains High
Consistent with the budget year, the Joint Legislative Budget Committee remains a key component in how the state manages its IT investments. From requiring the Department of Transportation to report on the state’s shares of fees retained by the Service Arizona vendor (IBM), to preventing DES from reallocating funding to conduct a feasibility study to replace a legacy IT system, agencies will be held accountable.
ASET Funding Suffers Some Losses
The Arizona Strategic Enterprise Technology (ASET) division within the Department of Administration (ADOA) provides the centralized IT infrastructure used by all agencies, such as the State Data Center, security of the state’s IT systems and training for state IT professionals. ASET also happens to be the “home” of the State CIO. ASET requested a number of appropriations to continue its cloud-first policy and infrastructure improvements. However, some projects were not completely funded, including statewide enterprise architecture adoption, the data management program and the HR system replacement, leaving ASET to reallocate funds or decrease its efforts.
Here are the some of the FY18 IT line items:
Phase Two of migration to the hosted data center ($3.4M)
Statewide network security enhancements ($7.3M)
Statewide e-Licensing System ($595K)
Enterprise architecture enhancements ($1.05M)
Legacy System Replacements Continue with Some Surprises
The FY2018 budget protects the majority of large-scale IT projects currently underway across state agencies. Most of these projects began several years ago when the state established a special fund – the Automation Projects Fund – dedicated to implementing, upgrading or maintaining automation and IT projects for any state agency. Two notable appropriations include $11.1M to the Department of Child Safety to continue the third year of the CHILDS system replacement and $11.0M to the Department of Revenue to advance its IT infrastructure upgrades.
However, the FY2018 budget cycle came with its share of surprises. Last year’s appropriation of $12M to replace the statewide e-procurement system was retroactively reduced from $12M to $9M. And, while the governor dismantled the Department of Education’s $17.6M appropriation to continue the implementation of the state’s student data system in his executive budget, the final budget restored the appropriation to $7.3M. Shortly after the governor signed the budget bills, the Department of Education CIO Mark Masterson decided to leave the department.
Public Safety Projects Make an Appearance
Among this year’s IT funding winners is the Department of Public Safety. The department received $2.5M to assist with upgrading the state’s microwave backbone system, and another $2.3M to begin replacement of the state’s 30-year-old criminal justice information system.
Arizona Management System Impacts IT
It’s been over four years since former Governor Brewer established the Government Transformation Office to help agencies conduct process improvement efforts. The deployment of the Arizona Management System which rests on the Lean methodology has resulted in millions of combined savings. With respect to ASET, the state is focusing on consolidating email systems, adopting a cloud-first policy (AWS and Azure), going paperless, migrating services online and cyber standardization.
Agencies Can Still Pursue Other IT Projects
Please remember, the Automation Projects Fund and projects listed above represent a slice of the IT investments occurring statewide. Provided that they have the funding, agencies are free to pursue other IT projects either by purchasing off an existing contract, or by procurement.
Stay tuned for more updates and tips on IT projects and procurement as the budget year continues.