TITLE: CONCERNING THE CREATION OF THE OFFICE OF INNOVATION AND TECHNOLOGY IN THE GOVERNOR’S OFFICE.

Fiscal Impact Summary	FY 1999/2000	FY 2000/2001
State Revenues General Fund
State Expenditures General Fund (Interagency GF Transfer)	$3,472 $1,565,728	$3,472 $714,777
FTE Position Change (Interagency GF Transfer)	9.0 FTE	8.0 FTE
Other State Impact: None
Effective Date: July 1, 1999
Appropriation Summary for FY 1999-2000: Department of Personnel reduction ($1,562,256) GF and (9.0) FTE (Interagency Transfer) Governor’s Office increase $1,565,728 GF and 9.0 FTE
Local Government Impact: None

The reengrossed bill, as amended by the Senate Business Affairs and Labor Committee, April 26, 1999, would create the Office of Innovation and Technology (ITO) in the Governor’s Office and transfer the authority, duties, and employees of the Commission on Information Management (IMC) to the new office. The new IMC would also have some additional responsibilities. A Chief Technology Officer (CTO) would head the ITO and be the chairman of the IMC. The IMC membership would be increased by two additional legislative members and the existing membership would change from eight private sector members to six. Total legislative membership on the commission would increase from four to six. All state agencies, except institutions of higher education, would report to the ITO and be regulated by the ITO’s policies and procedures.

• to develop a comprehensive statewide 4-year planning process and plan for acquiring technology;

• promulgate policies, standards, and guidelines for communications and technology;

• integrate policies and procedures into budget requests submitted to the Office of State Planning and Budgeting;

• promulgate policies, standards, and guidelines for procurement of communications and technology in excess of $25,000;

• develop policies and procedures for the effective management of technology investments throughout its life-cycle;

• establish statewide standards for efficient exchange of electronic information within state government and with the private sector;

• evaluate outsourcing technology and utilize outsourcing that is beneficial to the state; and

• recommend disapproval of state agency purchases that do not conform with the recommended policies and standards.

The bill transfers the functions, duties, and employees of the existing IMC to the Governor’s Office. This transfer would reduce the Department of Personnel’s budget by $1,562,256 and 9.0 FTE and increase the Governor’s Office budget by the same amount. The table below lists the line item transfers that would be made as a result of this bill. It is assumed that the Year 2000 Project would also be transferred with the IMC.

Line Item	Dollars (GF)
Personal Services 9.0 FTE	$526,520
Operating Expenses	39,989
Contractual Services	77,258
Year 2000 Projects	847,479

Health, Life, Dental	16,224
Short-term Disability	$998
Salary Survey, Anniversary Increases, and Shift Differential	25,986
Worker’s Compensation	7,907
Payment to Risk Management and Property Funds	1,280
Capitol Complex Leased Space	14,115
Information Technology Asset Maintenance	4,500
Total	$1,562,256

For FY 2000-01, it is assumed that the Year 2000 Project would be concluded. This would reduce expenditures in the ITO to $714,777 GF and 8.0 FTE.

The reengrossed bill would also change two IMC members from private sector members to legislative members and add two additional members to the commission, thereby increasing the Governor’s Office GF expenditures to pay members to attend commission meetings. Under current practice, IMC legislative members are paid per diem and expenses from the Department of Personnel and private sector members are reimbursed actual and necessary expenses. The Legislative Branch does not provide funding for the members expenses for attending IMC meetings. It is assumed that the four new legislative members would attend seven commission meetings during the interim. This increase would be reduced by the amount of expenses currently allotted to the two private sector members actual and necessary expenses (2 X 7 X $50 = $700). The increase is estimated to be $3,472 (7 meetings X 4 new members X ($99 per diem + $50 expenses) - $700). The total increase to the Governor’s Office would be $1,565,728 GF ($3,472 + $1,562,256).

The fiscal note implies that for FY 1999-00 the Department of Personnel should receive an appropriation reduction of $1,562,256 General Fund and 9.0 FTE. The Governor’s Office should receive a General Fund appropriation of $1,565,728 and 9.0 FTE.