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Budget Subcommittee Approves $237M Budget Increase to FI$Cal

FI$Cal's executive partner says California's financial management and accounting system is "incredibly large and complex system and there's not another one like it anywhere in the public sector or the private sector."

The state of California is moving closer to approving changes to the IT project modernizing the state's financial management and accounting system.

On April 19 an Assembly budget subcommittee voted to approve a $237 million budget increase to FI$Cal, which would enable the project to add 46 staff positions and tack on an extra two years to the project timeline — one additional year of design and development, and a full year of knowledge transfer. With the changes, the total budget of FI$Cal would increase to $910 million.

"This is an incredibly large and complex system and there's not another one like it anywhere in the public sector or the private sector, and so we want to make sure we have our system integrator stay with us long enough that we can have sufficient knowledge transfer and that we're really in the driver's seat with that safety net behind us for that last year," FI$Cal executive partner Miriam Barcellona Ingenito told the subcommittee on Tuesday. The prime contractor for the project is Accenture.

In her testimony, Ingenito stopped short of saying there wouldn't be additional delays, noting there have been six "Special Project Reports (SPRs) prepared since the project began more than a decade ago." She said they're focused on getting it right and pushing hard, but said she would ask for more time or funding if necessary.

In January, Techwire first reported that SPR No. 6 would add significant cost to the project, and the Brown administration is proposing to create the "Department of FI$Cal" going forward. The Legislative Analyst's Office said whether or not the new department is formed, the state should address how accountability issues within FI$Cal are handled.

FI$Cal is attempting to create a central financial platform for the state, streamlining 2,500 legacy financial systems used across more than 120 departments. Approved in 2005, the system was initially projected to cost $1.6 billion but was revised down to a total cost of $672 million.

Some parts of FI$Cal already have been rolled out. FI$Cal is now the "system of record" for the state's budget, and Ingenito said Tuesday that the project has implemented accounting, budgeting and procurement functionality for Wave 1 and Wave 2 state agencies and departments. The State Controller’s Office and State Treasurer’s Office are both accounting in FI$Cal. The Governor’s Office processed the 2015-16 budget in FI$Cal using the Hyperion solution, and the Department of General Services and FI$Cal launched an online portal for statewide procurement, called Cal eProcure.

On Tuesday the Assembly budget subcommittee voted to 4 to 1 approve FI$Cal as budgeted and adopt placeholder trailer bill language proposed by the governor's administration.

Matt Williams was Managing Editor of Techwire from June 2014 through May 2017.