The House Appropriations Subcommittee on Infrastructure, Resiliency and Investment met to consider the following: Capital Needs for state agencies, Information Technology across all articles, and Texas Child Support Enforcement System 2.0 (T2 Project).
This report is intended to give you an overview and highlight of the discussions on the various topics the committee took up. It is not a verbatim transcript of the hearing but is based upon what was audible or understandable to the observer and the desire to get details out as quickly as possible with few errors or omissions.
Capital Needs for State Agencies
John Montgomery, LBB
- Sarah Keyton, LBB – Walked thought decision documents organized by decision point, a new document will be brought back to each meeting updated with any changes
- Summary by agency was provided
- Capriglione – asked confirmed court ruling was federal re pg 16 on HVAC installations
- Not sure what level it was at
- Toth – Is there any plan in place to bring parks to ADA compliance
- Montgomery – Do not have that information.
- Brown – To answer Toth’s question, there is no master plan for existing parks, for new parks they will be ADA complaint.
- Wu – Why is it $100m to dry berth the battleship Texas?
- Montgomery – There have been numerous leaks due to the hull thinning, there would be extensive structural shoring up that needs to be done.
- Thomas Brown, LBB – The $100m is a starting point, it could be higher. It is an estimate to do any lifting of the boat. At one point in time the lower areas were pumped with seawater for ballast, which degraded the structure. There has been talk of scrapping the vessel and keeping certain parts of value.
- Wu – An that $100m in from GR, no private funding?
- Brown – Yes that is correct.
- Schaefer – Could they come back to us with a gold silver and bronze plan we could consider with estimated costs for alternatives?
- Brown – They do not have currently a fully fleshed out plan for those alternative, we are working to get those.
- Capriglione – asked to go back to page 3 on the different definitions on the various categories
- Health and safety – critical need, impact health on anyone who interacts with agency
- Deferred maintenance – has built up over time until they can no longer put it off
- Wu – On deferred maintenance, is there a breakdown of which items are critical?
- Montgomery – These are multiple agencies and they all prioritize their projects differently. We have that breakdown for the facilities commission, but for other agencies I am not sure.
- Wu – And everyone’s definition of what is critical will be different?
- LBB – Yes.
Information Technology
Richard Corbell, LBB
- Summary by agency provided for IT requests
- Schaefer – On Article V we see $32m for legacy system modernization, but no FTE decrease. Shouldn’t we need fewer workers with this software?
- Corbell – Defer to agency, but often with these large projects the agency needs additional staff
- Schaefer – After 2-3 years wouldn’t those FTEs not be needed anymore?
- Corbell – They usually are able to stay under their current FTE cap.
- Toth – If we do this in-house there wouldn’t be any fewer boots on the ground to manage this?
- Corbell – That is correct
- Toth – Is there any kind of SOC rating for these agencies who are implementing this security?
- Corbell – Do not have that information.
- Capriglione – Did we do any of these projects for DPS last session? Page 11
- Corbell – There were some, these are new projects that are already built into their base request.
- Capriglione – Will HHSC legacy applications be migrated to DIR? Page 13
- Corbell – Yes
- Capriglione – Quesiton about contract workers, when is it an FTE? Is it when a new employee hired or does contracting and staff augmentation count?
- Corbell – Yes, with an FTE is hired it is an ongoing cost and requires retirement benefits, staff augmentation does not count for that.
- Capriglione – So an FTE is a new employee at the agency?
- Corbell – Yes.
- Capriglione – You said Dept. of Agriculture “may” lose federal funding if they do not get funding for a new licensing system, how much would that be? Page 16
- Corbell – Unclear how much it would be.
- Toth – What additional phases will be coming for licensing and reg? page 18
- Corbell – First phase would be infrastructure and getting systems together, there would be on additional phase
- Toth – How much would that phase 2 be?
- Corbell – That analysis has not been done.
- Toth – But this is a long term commitment and we don’t know what phase 2 would be? Is this just a study?
- Corbell – It is not just a study it is a new system.
- Capriglione – Shortfall for maintenance contract why?
- Corbell – Current vendor has increased fees.
- Capriglione – Do we owe them any money?
- Montgomery, LBB – We are good for the current biennium, if we were to continue to fund this program we would have to bring funding up to the new vendor fees.
- Toth – Is the ethics commission system currently cloud based? Page 20
- Corbell – No.
- Bell – Does DIR do an assessment to determine whether the bandwidth is competitive with the agency?
- Corbell – They make sure that the bandwidth is adequate for the requirements of the agency.
- Toth – Expand on the performance management analytics system for HHSC? page 25
- Rustin Dudley, LBB – Agency is looking to create a centralized system across programs so they would have day-to-day information about how programs are performing.
- Toth – What would you be measuring?
- Dudley – Client outcomes, I would have to get specifics from the agency on what they specifically will be measuring. Will provide data across several programs.
- Capriglione – Are the WIC programs on in HHSC being done with federal funds? page 28
- Corbell – Yes they are all done with federal funds, HB 1 includes federal funds for all 4 projects.
- Capriglione – TxDot programs on page 32 will be funded through fund 6?
- Sarah Keyton, LBB – It is an allowable use of fund 6. It would have to be reduced form somewhere else within TxDOT since fund 6 is full appropriated to TxDOT.
- Bell – Does TxDOT already has the authority to use fund 6 wherever they want, or do we need to give them that authority?
- Keyton – You have to give them capital budge authority.
Lena Conklin, LBB
- Gave overview of Centralized Accounting and Payroll/Personnel System (CAPPS)
- Capriglione – The AG’s request on page 2 is just for preparation for the deployment of CAPPS?
- Conklin – It also includes cost to modernize their systems and legacy data
- Capriglione – If they did not get their funding could they deploy CAPPS?
- Conklin – They will have to deploy eventually, possible it could be delayed by the Comptroller if they do not get this funding.
- Toth – on page 5, $8.5m for HHSC, what does the current system not give them that PeopleSoft will give them?
- Conklin – They need app support.
- Toth – Is there a way to migrate their system?
- Conklin -They are trying to migrate to PeopleSoft.
- Toth – IS there a more affordable way to do this?
- Conklin – Will have to check on that.
- Corbell, LBB – Their current system is not compatible with Peoplesoft and it needs to be updated.
Child Support Enforcement System (T2)
Ben Foster and Steve Grotto, Accenture
- Capriglione – Gives overview about costs of Child Support Enforcement System, costs have been rising
- Foster – Large scale projects of this nature often go over budget and over schedule.
- Accenture struggled early in the project.
- Accenture made mistakes and is responsible for these mistakes.
- Did not deliver the value expected by the legislature or that Accenture expected of themselves.
- Amendment 1 changed contact and established milestones. Accenture has hit all 12 milestones since 2016 on time and on budget.
- Believe that the Committee should see a side-by-side comparison of T2 system and current system, believe the Committee will be impressed by the T2 system.
- Will continue to work with AG office, do necessary tests up to go-live date.
- System is worth the investment, Committee will agree when they see the demo.
- Accenture has a larger presence in Texas than in any other state.
- Capriglione – I will be blunt, I do not think we will ever get value for this system. For amount of money we have put in ($417 million) I don’t think it will ever be impressive enough to be worth it.
- When you bid on it 11 years ago, and it now was not the project you thought it would be. At some point you have to figure it out.
- I talk to a lot of people who say Accenture is not a software company, they are a contracting company. Massachusetts is having similar issues with Accenture.
- What did you get done and what will this product end up being?
- Foster – We are prepared to deliver the T2 system we were contracted for.
- Capriglione – When is that done? When is it delivered?
- Foster – When we meet all requirements set forth in the functional design.
- Capriglione – Have you done those?
- Foster – There are still a few that need to be done
- Capriglione – If there is a problem what happens?
- Foster – If there is a deviation that is our responsibility.
- Capriglione – Who defines a deviation?
- Foster – It is defined by our contract.
- Capriglione – How many times has this project changed from what the expectations were in the being.
- Foster – Before amendment 1 the project was free form
- Foster – there were 2 amendments, there has been a night and day change since amendment 1 and the 2nd addresses federal changes
- Capriglione – This project was in “free form” before amendment 1?
- Foster – Yes.
- Capriglione – You work with other states, is this a common problem?
- Foster – At the macro level this is a one off.
- Capriglione – How is the process done for smaller tweaks, not the amendments?
- Foster – The AG office has the ability to change trade items within scope, for expanding the scope that is a different
- Capriglione – Is there a formal process by which functionality is decided or not decided?
- Foster – Once functionality is decided that is what we build to.
- Toth – You alluded to certain ambiguities, how long did those exist before you got clarification?
- Grotto – The delineation was 2015, the program had been started with another vendor. There was an approach taken up from that vendor, when we took up the project in 2010 we struggled and failed to incorporate that approach. We then met with AG in 2015 to redesign the project.
- Toth – We did it take 5 years to figure out you were on an unsustainable path?
- Grotto – For a few years we struggled, “embarrassed” is not the word, but we struggled.
- Toth – It seems like we keep doling out more and more money, I have a difficult time seeing how the Texas taxpayers are receiving value for this.
- Grotto – What we have been able to accomplish since 2016 is good, it is night and day from prior systems.
- Toth – I understand that, but the letter you sent the other day says you will not agree to any of the penalties you accepted in the initial contract?
- Grotto – We do not have a choice about whether or not we accept the penalties. One of the things we had to do in amendment 1 was recognize there was a need for infrastructure upgrade, which was not something that was our fault and is not in our scope.
- Toth – What is not in you scope?
- Foster – The work involved in infrastructure upgrades.
- Capriglione – We heard in the last Committee meeting there were security issues, are there security defects in the system right now?
- Foster – Not in the system we designed but does believe there is a need for infrastructure upgrades.
- Capriglione – Are you saying your stuff is fine, but other parts of the infrastructure is not fine?
- Foster – There is a known issue associated with SSL which was recently fixed. That is the kind of thing where security is important and we need to get it right, but our product is fine.
- Capriglione – So there are no severity 1 or 2 defects in the product?
- Foster – Not that we are aware of.
- Capriglione – How far are we through the federal certification?
- Grotto – There are 388 federal requirements out of around 9000 total requirements built into the solution, our federal partners are working with AG to ensure we are federal certified.
- Capriglione – And those 388 are the ones you still need?
- Grotto – We are working to ensure those are still current.
- Capriglione – How much testing is needed
- Grotto – We have done extensive testing and have converted over 3 Terabytes of legacy data into T2 with 99.9% accuracy.
- Capriglione – So you are sure the converted data is accurate?
- Grotto – Yes the converted data is correct
- Capriglione – I have seen in Massachusetts and other states there are problems, could the perceptions of problems affect the child support payments that are made?
- Foster – We will not go live with a system that would cast doubt on the ability to collect child support payments.
- Capriglione – When will you be ready?
- Foster – depending on infrastructure decisions – that will have a big impact on timing
- Capriglione – How much is the state on the hook for paying Accenture if things go wrong with the system, and for maintenance?
- Foster – There is a warranty for a year after the final go-live date.
- Capriglione – So there are no additional per day costs after that go-live date?
- Foster – For that year under warranty.
- Toth – Question about legislature’s responsibility with SSL
- Grotto – There are certain parts of the system that still need to be tested.
- Toth – If those things were taken care of today when could you go live?
- Grotto – We would still have to do extensive user acceptance testing.
- Bell – There was a conversation about compatibility when we first had these conversations. Is there a concern that the system breaks when you upgrade, and what is the game plan if that happens?
- Grotto – We determine what changes we would need to make.
- Bell – My understanding is that the platform is not supported “if” it moves forward, could you elaborate on what you meant by “if”?
- Foster – It is the legislature and the AG’s call if we move forward with the upgrades.
- Bell – Are there any improvements or changes on the security programs slowing down processing?
- Foster – That was resolved recently, the ability to turn on the SSL will not have an affect on processing.
- Bell – What was life expectancy of this program?
- Foster – We would expect it to serve the state for decades.
- Bell – I would encourage you to incorporate that life expectancy into your plans.
- Bell – Has the ROI of this project been reduced based on the shortened timeframe?
- Foster – We believe it will last for 20-25 years.
- Toth – What kind of support plan would Accenture recommend to AG after we are through the warranty period?
- Grotto – We would have to sit down with AG employees and figure out what kid of support model would be needed.
- Toth – What did you do for Massachusetts?
- Grotto – We had the state’s IT support team and we augment that with our employees, which are contracted to fix any defects.
- Toth – So you must have an idea on what you can expect from a budget standpoint on a year-to-year basis?
- Grotto – I will get back to you on what that would be.
- Capriglione – The idea of the program is to have a program the feds will certify and pay for part of it, what are some requirements of the feds for certifying the system is done?
- Grotto – I do not know the specifics.
- Foster – There are requirements associated with accuracy, security, etc. We can bring a list of those requirements to you.
- Capriglione – Would part of those requirements be that the system is efficient, reliable, delivers results in reasonable time.
- Foster – The federal requirements constitute only 388 of the 9,000 requirements we put in for the T2 project.
- Capriglione – We are trying to figure out how this project is not going to cost us more money and it will work. While we have been working on it for 11 years and the original system has been fine. We have spent $400m which is a huge amount of money and could have been put to better purposes. How are we going to ensure that the project works when it is finished?
- Foster – We are not proud of how this process started but we are proud of the turnaround. The mechanisms the AG put into amendment 1 worked. We are at the cusp of go-live.
- Capriglione – Amendment 1 was a mutual contract, it is difficult for me to believe that you are still expecting to receive a bonus when the project is finished.
- Foster – Those are fees that we were due in the original contract and we agreed to backload them. We were at risk of losing those if we did not complete the project, but if we earned that we would receive that money.
- Capriglione – Do you believe you have earned those?
- Foster – Yes.
- Capriglione – I guess you have to say that, if I was a contractor building a house and came this much over budget I would not say I earned that.
- Capriglione – What happens if the system fails, how responsive will you be?
- Foster – The amendment goes to great lengths to talk about catastrophic failure and we care about that as much as you do.
- Capriglione – You should care about everything as much as we do. But what would happen on Saturday at 7:00 if there was catastrophic failure?
- Foster – If there is catastrophic failure we will work 24/7
- Grotto – You will get the best of Accenture if there is catastrophic failure.
- Toth – That really concerns me, it seems like we are being left to do the quality assurance on this project. The calendar sequencing is not even working properly.
- Foster – There are certain things that we will have to fix, the calendar was one of those.
- Toth – But why did we have to find it? It seems like this is not your priority.
- Foster – When you see some of the problems you will wonder why they are there, but that is why we test and fix those before the go-live date. We had a 3rd party come in and review, they said the code was cleaner than most projects of this size and scope.
- Capriglione – When is the expected new go live date?
- Foster – It is not determined yet.
- Capriglione – You don’t know ballpark, will it be this quarter, next year?
- Foster – there are to many variables in play.
- Capriglione – What are the estimated costs of upgrading infrastructure?
- Foster – It would depend on what is decided is wanted.
- C – What is needed?
- Grotto – We are not in a position to say.
- Capriglione – How severe are some of the defects and how fast are you going through them?
- Grotto – The number of open defects is very small. We are continuing to test, depending on use case and script we are continuing to find them. The process we are using has yielded great results. The number of defects we have captured is better than industry standard. Turnaround time to fix the defects is within 48 hours.
- Capriglione – In amendment 1 there was a requirement that 2/3 of people working on the project have to be in the US, did you keep those ratios?
- Grotto – Yes.
- Capriglione – I have heard this might be used in other states, what does Texas get out of putting all this money into it? If I pay for something I would expect to own it. And what will Accenture get for giving this to other states?
- Foster – Because there was federal participation we do not own it and cannot own it. The use of federal funds also means that sister states are entitled to it.
- Capriglione – Could another state contract you for the system?
- Foster – We would like that, since we put some of our own investment into this we would like to work with other states to give them this system.
- Capriglione – You said your investment, so you put money into this on top of the $400m?
- Foster – The additional resources that were brought to bear since 2015 was an investment by us from our perspective.
- Capriglione – So all the additional resources since 2015 you are saying were from you?
- Foster – No, but the problems that were on our side we paid to fix ourselves.
- Capriglione – Well you should pay for your own problems.