BILL ANALYSIS Ó
AB 805
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Date of Hearing: April 7, 2015
ASSEMBLY COMMITTEE ON PRIVACY AND CONSUMER PROTECTION
Mike Gatto, Chair
AB 805
(Burke) - As Introduced February 26, 2015
SUBJECT: Director of Technology: Procurement: training
program
SUMMARY: Requires the Department of Technology (CalTech) and
the Department of General Services (DGS) to establish and
oversee a curriculum to provide procurement professionals with
the advanced skills and training needed to work on complex
information technology (IT) procurement projects. Specifically,
this bill:
1)Requires the Director of CalTech, in cooperation with the
Director of DGS, to establish and oversee the implementation
of a training program and curriculum for persons engaged in
the procurement of IT.
2)Requires the training program to be used to develop, sustain,
and advance the competency and skills of state employees
involved in complex IT acquisition.
3)Requires the Director of CalTech, in cooperation with the
Director of DGS, to prepare and submit to the Legislature, by
January 1, 2017, a report regarding the progress in
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establishing the training program.
EXISTING LAW:
1)Establishes CalTech within the Government Operations Agency,
supervised by the Director, who also serves as the state's
Chief Information Officer (CIO). (Government Code (Gov. Code)
Section 11545 and 12803.2)
2)Requires the Director, among other things, to produce an
annual IT strategic plan to guide the acquisition, management,
and use of IT. (Gov. Code 11545(c).)
3)Shifts, under 2012 Government Reorganization Plan, the
responsibility for IT project contract approval from DGS to
CalTech. (Public Contract Code Section 12100 et seq.)
4)Requires CalTech to monitor and oversee state agency IT
projects from start to finish. (Gov. Code Section 11546 et
seq.)
FISCAL EFFECT: Unknown
COMMENTS:
1)Purpose of this bill . This bill is intended to establish a
curriculum to better train state employees involved in IT
procurement in order to develop, sustain and advance their
competency and skills in undertaking complex IT projects, and
thereby decrease the risk of problems in the public
contracting and implementation process. This bill is sponsored
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by TechAmerica.
2)Author's statement . According to the author: "For several
years fiscal constraints have caused the state to lower
training budgets, eliminate training programs and restrict
travel to training events. This in combination with an aging
workforce has created an unprecedented event now termed the
'Silver Tsunami' where many of the senior managers and journey
level staff are retiring from the workforce, resulting in a
very large knowledge and competency drain. Due to the fiscal
constraints, there has not been the ability to adequately
train and replace the levels of experience that have and are
continuing to exit the workforce."
3)The State of California's IT project failures . Like many
other state and local governments, California has a number of
substantial IT project failures going back at least two
decades. According to the State Auditor, the state terminated
or suspended seven major IT projects between 1994 and 2013
after spending a total of $1 billion on the projects. For
example, the state paid out a combined $900 million before
canceling an overhaul of the state's payroll system, a major
IT upgrade to the driver's license and vehicle registration
system, and a new case management system for the state's
courts in recent years.
According to the State Auditor, CalTech is currently
overseeing 45 large IT projects in various stages of
development. Of those, seven are experiencing significant
cost overruns and delays. For example, the Department of
Consumer Affairs' BreEZe project was intended to streamline
licensure and improve data sharing and was initiated in 2009
at an estimated cost of $28 million, is now several years
behind schedule, and - as of January 2015 - the estimated
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project cost is $96 million.
4)Past efforts to restructure and improve state IT procurement .
The Legislative and Executive branches have been in the
process of restructuring the state's IT procurement and
oversight responsibilities for more than a decade. In 2002,
the Legislature disbanded the then-existing IT oversight
agency, called the Department of Information Technology
(DOIT), following multiple massive state IT procurement
failures. As a result, decisions about IT policy, project
oversight, and security fell to the Department of Finance, and
IT procurement devolved to DGS.
Four years after DOIT closed its doors, the state was still
struggling with continued IT procurement failures, so the
Legislature created a new Office of the State Chief
Information Officer (OCIO), a cabinet-level officer to advise
the Governor on IT. Then in 2007, the Legislature
appropriated funds to establish the OCIO as an agency with
authority over IT strategic planning, policy, and IT project
oversight. In 2009, under then Governor Schwarzenegger's IT
Reorganization Plan, the Legislature expanded the OCIO by
integrating four agencies: the OCIO, Office of Information
Security and Privacy Protection (now Office of Information
Security), the Department of Technology Services (now Office
of Technology Services, or "OTech"), and DGS's
Telecommunications Division.
In 2013, as part of Governor Brown's Government Reorganization
Plan, the California Technology Agency became what is now the
Department of Technology or CalTech, which is situated within
a newly established Government Operations Agency. Governor
Brown's Reorganization Plan also gave CalTech procurement
authority over the state's IT projects. CalTech is now the
state's central IT agency responsible for the approval and
oversight of all state IT projects.
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5)CalTech's new role as IT procurement lead . As discussed
above, CalTech is now responsible for both approval and
oversight of the state's large IT procurement projects. In
theory, by centralizing IT procurement and oversight under
CalTech, the State of California can more readily apply
lessons learned from prior IT procurements, create better IT
project bid requirements and contracts, and shorten the
overall IT procurement process, which should ultimately
improve the chances of success for the state's major IT
projects (i.e., on time, at budget, and as promised).
In 2014, to further augment CalTech's ability to help state
agencies succeed with IT procurement, the Legislature and
Governor allocated funding for CalTech to create a new
California Project Management Office (California PMO). The
California PMO is intended to make project management staff
and IT project expertise available to other state agencies.
Historically, one of the biggest risks to the success of a
public agency IT project has been the lack of adequately
trained and experienced project management staff, often as a
result of employee turnover. With California PMO, a state
agency that does not have qualified in-house staff, or that
loses a project manager midway through an IT project, will be
able to borrow a highly skilled project manager so that the
project can continue on schedule.
CalTech is also currently building out its Consulting and
Planning Division (CPD), which will offer expert staffing to
state agencies in specific IT project risk areas. Unlike
California PMO, CPD will provide advice and staffing resources
to state agencies that have IT projects underway and need help
in a specific area of IT expertise that is distinct from the
overall management of the project.
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6)DGS's California Procurement & Contracting Academy (Cal-PCA) .
CalTech also shares responsibility with DGS for providing
training services to the ranks of IT professionals who work
in-house at state agencies and departments. According to DGS,
Cal-PCA was established to provide professional development
courses and workshops for state employee procurement
specialists for general goods and services, as well as IT
procurement projects. The Cal-PCA academy offers beginning
and intermediate courses that are designed to provide a
foundation for IT procurement specialists. However, the
Academy does not offer advanced coursework for IT procurement
specialists who handle the state's most complex IT
acquisitions.
7)The relationship between staff training and IT procurement
failures . According to the State Auditor, undertrained and
inexperienced staff is a key factor in California's history of
IT procurement failures. In the most recent assessment of
CalTech's oversight of IT projects, the State Auditor
emphasizes that high staff turnover combined with inconsistent
training has compromised CalTech's ability to successfully
oversee large IT projects. The State Auditor specifically
recommends that CalTech develop and implement a "consistent
and repeatable training program" by June 2015 in order to
mitigate the risk of failure on current IT projects. ("High
Risk Update - California Department of Technology. Lack of
Guidance, Potentially Conflicting Roles, and Staffing Issues
Continue to Make Oversight of State Information Technology
Projects High Risk," California State Auditor, March 2015).
8)This bill in practice . AB 805 would require CalTech and DGS
to work together to create an advanced IT procurement training
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curriculum and then oversee the related training program in
order to ensure that public agency procurement professionals
have the highest possible level of competency, with the
ultimate goal of improving the state's performance in
implementing large IT contracts. This bill provides
substantial latitude to both departments in forming the
curriculum and the training program, with the sole requirement
being that CalTech and DGS must report back to the Legislature
on their progress by January 1, 2017.
9)Technical Amendment . On Page 2, Line 4, strike "Establish"
and insert:
establish
10)Arguments in support . TechAmerica states in support of the
bill, "[D]ue to fiscal constraints and an aging workforce, the
Executive Branch has not had the ability to adequately train
and replace the levels of experience that have an are
continuing to exit the State's workforce. This was
highlighted recently in a Bureau of State Audits Report which
identified training as a critical weakness in the success of
Information Technology projects. We believe that AB 805
will?provide critical advanced procurement training to state
personnel conducting integrated systems procurements thereby
providing a cornerstone for eliminating future failed state IT
projects."
Natoma Technologies adds in support of AB 805 that the bill will
"help alleviate the drain of knowledge leaving the
departments" due to the retirement of senior managers and
staff.
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11)Related Legislation . AB 522 (Burke) would require the
Director of General Services and the Director of Technology by
January 1, 2017, to develop a standardized contractor
performance assessment report system to evaluate the
performance of a contractor on any IT contract or project.
The bill would require the evaluation system to be used for
all subsequent IT contracts and projects, in addition to using
existing procurement procedures when evaluating or awarding
contracts or projects. AB 522 is currently pending in the
Assembly Accountability and Administrative Review Committee
and is set for hearing on April 15, 2015.
12)Prior legislation . AB 2523 (Cooley), Chapter 391, Statutes
of 2014, required CalTech to report to the Legislature by July
1, 2016, with recommendations on developing a team of senior
consulting IT experts to help state agencies and senior
project team members working on IT projects in state
government. The bill also required CalTech to establish a
unit at CalTech to house IT experts who could serve as support
for state agencies.
SB 71 (Committee on Budget and Fiscal Review), Chapter 28,
Statutes of 2013, transferred the responsibility for IT
procurement from DGS to CalTech.
AB 1498 (Buchanan), Chapter 139, Statutes of 2012, modified
the Governor's Reorganization Plan No. 2 of 2012 (GRP 2) so
that the Director of Technology reported directly to the
Governor on issues relating to IT and declared the intent of
the Legislature that a plan for transitioning IT procurement
authority from DGS to CalTech be developed by the
administration.
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AB 2408 (Smyth) Chapter 404, Statutes of 2010, codified the
Governor's Reorganization Plan No. 1 (GRP 1) of 2009 which
consolidated state IT functions under the Office of the State
Chief Information Officer and changed the name of the Office
to the "California Technology Agency."
AB 12 X4 (Evans), Chapter 12, Statutes of 2009-10 Fourth
Extraordinary Session, enacted changes consistent with the
approved GRP 1 and also included additional reporting language
to track the success of the expanded OCIO in efforts to reduce
costs and increase efficiency surrounding statewide IT.
AB 618 (Blumenfield) 2009-10 Session, would have required the
OCIO to submit a strategic plan by January 1, 2011, and every
three years thereafter that included information on the key
performance measures identified by the OCIO for the Governor's
GRP 1 of 2009.
SB 90 (Committee on Budget and Fiscal Review), Chapter 183,
Statutes of 2007, authorized the OCIO to establish and enforce
IT strategic plans, policies, standards, and enterprise
architecture; and approve, suspend, terminate, and reinstate
IT projects for all state departments (with certain
exceptions). This measure also transferred the majority of
the Office of Technology Review, Oversight, and Security from
the Department of Finance to the OCIO and to the Office of
Information Security and Privacy Protection.
SB 834 (Figueroa) Chapter 533, Statutes of 2006, made the
statutory changes necessary to reflect GRP 2 of 2005, which
established the Department of Technology Services in state
government under the Director of Technology Services within
the Consumer Services Agency.
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SB 954 (Figueroa) Chapter 556, Statutes of 2005, required DGS
to conform to the Information Technology Procurement
Guidelines for Best Practices when purchasing new IT.
AB 1559 (Diaz) Chapter 45, Statutes of 2002, allowed DOIT to
expire by not extending its sunset date.
SB 1 (Alquist) Chapter 508, Statutes of 1995, eliminated the
Office of Information Technology and created DOIT with
expanded duties and authority.
REGISTERED SUPPORT / OPPOSITION:
Support
TechAmerica (Sponsor)
Natoma Technologies
Opposition
None received.
AB 805
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Analysis Prepared by:Jennie Bretschneider / P. & C.P. / (916)
319-2200