Amendment #1 to H.3330

An Act financing information technology equipment and related projects

recommend that the bill be amended HOUSE . . . . . . . . . . . . . . . No. XXX

Message from His Excellency the Governor recommending legislation relative to financing information technology equipment and related projects. March 15, 2013.



The Commonwealth of Massachusetts



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DEVAL L. PATRICK

GOVERNOR



TIMOTHY P. MURRAY

LIEUTENANT GOVERNOR EXECUTIVE DEPARTMENT

STATE HOUSE • BOSTON 02133

(617) 725-4000



March 15, 2013.



To the Honorable Senate and House of Representatives:



I am filing for your consideration a bill entitled “An Act Financing Information Technology Equipment and Related Projects”.



Last October, my Administration published our sixth capital investment plan, which presented a responsible capital investment strategy for fiscal year 2013 through fiscal year 2017. In order to provide for continued investment in our Commonwealth’s infrastructure and innovation economy, I am filing a series of bond bills, in addition to this bill, to support this plan’s future funding needs through fiscal year 2017.



The citizens of the Commonwealth have asked for and deserve public infrastructure which will meet their needs, create jobs and stimulate economic growth in every corner of our state Targeted investments in our infrastructure solidifies the foundation of our Commonwealth for future generations. By investing in essential government functions, we create a more effective and efficient government. Investment in information technology will ensure our 21st Century citizens are served by a 21st Century government.



This bill includes funding for IT and innovation projects in my Administration’s five-year capital investment plan, including:



• $40 million for the Last Mile Broadband Project which will more adequately equip residents and businesses to compete in the 21st Century global economy by bringing broadband internet access to areas of the Commonwealth currently without high-speed internet access.



• $449 million for information technology projects including building on the Commonwealth's successful public safety information systems network modernization and Health Insurance Exchange to promote health care cost containment,



• $280 million for self-supporting information technology projects which will be funded through savings or revenue created by these projects, and



• $100 million for information technology projects for the Massachusetts Department of Transportation, including replacement of the Registry of Motor Vehicle’s Automatic License & Registration System (ALARS) which was initially deployed in 1986.



These investments will be made within my Administration’s debt affordability policy, which has allowed an unprecedented level of capital investment in the Commonwealth while maintaining the highest bond rating in the state’s history.



In light of the urgent need to continue funding these improvements, I urge prompt action to enact this bill.



Respectfully submitted,





DEVAL L. PATRICK,

Governor.





The Commonwealth of Massachusetts



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In the Year Two Thousand Thirteen.

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An Act financing information technology equipment and related projects.





Whereas, The deferred operation of this act would tend to defeat its purpose, which is forthwith to provide for the capital improvement needs of the commonwealth and deploy affordable and ubiquitous broadband access to the citizens of the commonwealth, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.



Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:





SECTION 1. To provide for a program of capital information technology improvements to various state institutions and properties and to fund the Massachusetts Broadband Institute, the sums set forth in this act, for the several purposes and subject to the conditions specified in this act, are hereby made available, subject to the laws regulating the disbursement of public funds, which sums shall be in addition to any other amounts previously appropriated for these purposes; provided, that the amounts specified in an item or for a particular project may be adjusted in order to facilitate projects authorized in this act.

SECTION 2.

EXECUTIVE OFFICE FOR ADMINISTRATION AND FINANCE

Information Technology Division

1790-2018 For the continued implementation of a second, active data center capable of maintaining mission critical applications and a supporting network infrastructure, including salaries and other personnel costs of staff assigned to that project; provided, that the center shall be connected to the Massachusetts information technology center and shall be used on a daily basis to support applications providing the commonwealth with the capacity for business continuity and quick recovery in the event of unplanned outages …………………………………………..........................................................$9,000,000

1790-3001 Subject to the conditions contained in Section 12, for costs associated with planning and studies, the preparation of plans and specifications, purchase, procurement and implementation of information technology-related equipment and related projects.........................................................$300,000,000

1790-3002 Subject to the conditions contained in Section 12, for costs associated with planning and studies, the preparation of plans and specifications, purchase, procurement and implementation of information technology-related equipment and related projects which are eligible for federal reimbursement, including but not limited to projects related to the provision of health care, unemployment insurance and human services; provided, that any federal reimbursement received by a state agency in connection with projects funded from this item may be retained by the state agency and expended for the purposes of the project, without further appropriation, in addition to the amounts appropriated in this item; and provided further, that any state agency receiving federal reimbursements for a project funded from this item shall file a quarterly report with the executive office for administration and finance, the house and senate committees on ways and means, and the house and senate committees on bonding, capital expenditures, and state assets that details, by project, an annual estimate of anticipated federal reimbursement to be received on behalf of and expended for the project, as well as year-to-date actual federal reimbursement received and year-to-date actual expenditures of the reimbursement, by project………………………………….......................................................$140,000,000

SECTION 2A.

EXECUTIVE OFFICE FOR ADMINISTRATION AND FINANCE

Information Technology Division

1790-3003 Subject to the conditions contained in Section 8 and Section 12, for costs associated with planning and studies, the preparation of plans and specifications, purchase, procurement and implementation of information technology-related equipment and related projects; provided, that for projects the secretary of administration and finance certifies to the comptroller directly or indirectly generate new state revenue or budgetary savings, the comptroller shall transfer those budgetary savings or revenue to the state treasurer for payment of debt service related to those projects; provided further, that any federal reimbursement received by a state agency in connection with projects funded from this item may be retained by the state agency and expended for the purposes of the project, without further appropriation, in addition to the amounts appropriated in this item; and provided further, that any state agency receiving federal reimbursements for a project funded from this item shall file a quarterly report with the executive office for administration and finance, the house and senate committees on ways and means, and the house and senate committees on bonding, capital expenditures, and state assets that details, by project, an annual estimate of anticipated federal reimbursement to be received on behalf of and expended for the project, as well as year-to-date actual federal reimbursement received and year-to-date actual expenditures of the reimbursement, by project …………................................... $280,000,000

SECTION 2B.

EXECUTIVE OFFICE FOR ADMINISTRATION AND FINANCE

Office of the Secretary

1599-7061 For a reserve to provide funds to the Massachusetts Broadband Incentive Fund established by section 6C of chapter 40J of the General Laws.................................. $40,000,000

1599-7062 For a matching grant program, administered by the Department of Elementary and Secondary Education, to help those public school districts without the access through broadband, as defined in section 6B of chapter 40J of the general laws, needed to conduct Partnership for Assessment of Readiness for College and Careers testing obtain said access; provided that such installation, retrofit or other capital improvement shall also conform to the broadband standard of access established by the Department of Elementary and Secondary Education State Educational Technology Directors Association in the 2012 report titled The Broadband Imperative: Recommendations to Address K-12 Infrastructure Needs; provided further that the guidelines established by the Department of Elementary and Secondary Education for such testing are satisfied; provided further that grant amounts to districts shall vary according to the formula contained in section 10 of Chapter 70B of the General Laws; provided further that grants shall not be awarded for school buildings that are scheduled for decommissioning or razing within a period of ten years from the time of completion of the broadband installation, retrofit or upgrade; provided further that such installations, retrofits and upgrades occur only on and within publicly owned real property maintained for the benefit of the school district.................................. $38,000,000

1599-7063 For costs associated with the planning, preparation of plans and specifications, purchase, procurement and implementation of information technology related equipment and related projects for the Executive Office of Health and Human Services (EOHHS) to establish an integrated confidential data system among all state agencies that interact with individuals with autism to track diagnosis, treatment, services and outcome of individuals with autism.............................................. $12,000,000



SECTION 2C.

EXECUTIVE OFFICE FOR ADMINISTRATION AND FINANCE

Information Technology Division

1790-3004 Subject to the conditions contained in Section 12, for costs associated with planning and studies, the preparation of plans and specifications, purchase, procurement and implementation of information technology-related equipment and related projects for the Massachusetts department of transportation ………$100,000,000

SECTION 3. To meet the expenditures necessary in carrying out section 2, the state treasurer shall, upon request of the governor, issue and sell bonds of the commonwealth, in an amount to be specified by the governor from time to time, but not exceeding, in the aggregate, the sum of $449,000,000. All bonds issued by the commonwealth, under this section, shall be designated on their face, Information Technology and Innovation Act of 2013, and shall be issued for such maximum terms of years not exceeding 20 years, as the governor may recommend to the general court under Section 3 of Article LXII of the Amendments to the Constitution, but all such bonds shall be payable not later than June 30, 2038. All interest and payments on account of principal of these obligations shall be payable from the General Fund unless otherwise specified. Bonds and interest thereon issued under the authority of this section, notwithstanding any other provision of this act, shall be general obligations of the commonwealth.

SECTION 4. To meet the expenditures necessary in carrying out section 2A, the state treasurer shall, upon request of the governor, issue and sell bonds of the commonwealth, in an amount to be specified by the governor from time to time, but not exceeding, in the aggregate, the sum of $280,000,000. All bonds issued by the commonwealth, under this section, shall be designated on their face, Information Technology and Innovation Act of 2013, and shall be issued for such maximum terms of years not exceeding 20 years, as the governor may recommend to the general court under Section 3 of Article LXII of the Amendments to the Constitution, but all such bonds shall be payable not later than June 30, 2038. All interest and payments on account of principal of these obligations shall be payable from the General Fund unless otherwise specified. Bonds and interest thereon issued under the authority of this section, notwithstanding any other provision of this act, shall be general obligations of the commonwealth.

SECTION 5. Notwithstanding any general or special law to the contrary, to meet the expenditures necessary to carry out section 2B, the state treasurer shall, upon request of the governor, issue and sell bonds of the commonwealth in an amount to be specified by the governor from time to time, but not exceeding, in the aggregate, $90,000,000. All bonds issued by the commonwealth under this section shall be designated on their face, Information Technology and Innovation Act of 2013, and shall be issued for a maximum term of years, not exceeding 30 years, as the governor may recommend to the general court under section 3 of Article LXII of the Amendments to the Constitution. All such bonds shall be payable not later than June 30, 2048. No authorization shall be expended unless expressly authorized by the secretary of administration and finance. All interest and payments on account of principal of these obligations shall be payable from the General Fund. Bonds issued under the authority of this section shall be general obligations of the commonwealth.

SECTION 6. Notwithstanding any general or special law to the contrary, to meet the expenditures necessary to carry out section 2C, the state treasurer shall, upon request of the governor, issue and sell bonds of the commonwealth in an amount to be specified by the governor from time to time, but not exceeding, in the aggregate, $100,000,000. All bonds issued by the commonwealth under this section shall be designated on their face, Information Technology and Innovation Act of 2013, and shall be issued for a maximum term of years, not exceeding 20 years, as the governor may recommend to the general court under section 3 of Article LXII of the Amendments to the Constitution. All such bonds shall be payable not later than June 30, 2038. No authorization shall be expended unless expressly authorized by the secretary of administration and finance. All interest and payments on account of principal of these obligations shall be payable from the Commonwealth Transportation Fund. Bonds issued under the authority of this section shall be general obligations of the commonwealth.

SECTION 7. The secretary of administration and finance shall submit a report on the progress of any projects funded through the authorizations in this act and included in the governor’s 5- year capital investment plan to the clerks of the senate and house of representatives, the chairs of the senate and house committees on ways and means, and the senate and house chairs of the committees on bonding, capital expenditures and state assets. The report shall include, but not be limited to, the previous year planned spending, previous year spending, current year planned spending, current year spending to date, original estimated total project cost, project description and purpose, location of the project, type of spending, type of asset and useful life of the project once completed. The report shall be submitted on June 30 and December 31 of each year for a period of 8 years after the effective date of this act.

SECTION 8. The authorization contained in Section 2A is made subject to the satisfaction of the following requirement: the secretary of administration and finance shall, at least sixty days prior to execution of any contract in furtherance of any project funded by Section 2A, submit to the clerks of the senate and house of representatives, the chairs of the senate and house committees on ways and means, and the chairs of the senate and house committees on bonding, capital expenditures and state assets a written finding, including the data and analysis on which such finding is based, that the cost of the project scheduled to receive funding from the authorization contained in Section 2A is projected to be less than the new savings or new revenues to the Commonwealth that will result upon completion of the project. Projects for which such findings are not submitted by the secretary of administration and finance may not be funded by the authorization contained in Section 2A.

SECTION 9. The information technology division, in consultation with the operational services division, shall require that the procurement of services and equipment funded under items 1790-2018, 1790-3001, 1790-3002, 1790-3003 of section 2A and 1790-3004 of section 2C shall comply with the procurement policies filed by the state comptroller under section 13 of chapter 27 of the acts of 2007 to ensure an open and fair competitive process. Executive agencies that have or seek funding under said items 1790-2018, 1790-3001, 1790-3002 1790-3003 and 1790-3004 shall submit to the information technology division, at intervals to be determined by the division, documentation and deliverables necessary to enable it to oversee, ascertain and evaluate financial and non-financial benefits to be realized by performing the project, impacts to current and future operating budgets, and project management, status, progress, performance and expenditures. The information technology division shall specify this documentation and deliverables, which may include, without limitation, project management plans and methodology, technology designs and specifications, accountings of amounts expended or to be expended for all goods and services including, without limitation, hardware, software, consultant services and personnel, ongoing operating cost impacts, an assessment of whether the project is within budget and on schedule for completion, an explanation of any deviations in completion schedules and funding needs from those that were originally established for the projects, project plans and other document deliverables. The information technology division may make funding or continued funding for executive department agency projects contingent upon its approval of these documentation and deliverables.

SECTION 10. Chapter 7 of the General Laws is hereby amended by inserting after section 4F 1/2 the following section:-

Section 4F ¾. There shall be established and set up a separate account, to be known as the Commonwealth Federal Grants Management Trust, in this section called the trust. The secretary of administration and finance shall expend funds in the trust without further appropriation to support the purposes of the federal grants management unit within the office of commonwealth performance, accountability and transparency, established by subsection (e) of section 4A. The secretary shall charge all federal grants, an amount determined by the secretary for these purposes, not exceeding 1 per cent per grant and not exceeding an annual total amount of $500,000, plus the one-time costs of any technology as determined by the secretary.

SECTION 11. To provide for the continued availability of certain bond-funded spending authorizations which otherwise would expire, the balances of the following appropriation items and any allocations thereof are hereby extended through June 30, 2017, for the purposes of and subject to the conditions stated for these items in the original authorizations and any amendments to such authorizations: 1599-7060, 1790-2013, 1790-2016, 1790-2017, and 1790-2500

SECTION 12. There shall be a special commission for the purpose of making an investigation and study relative to information technology procurement and to make recommendations regarding responsible and fiscally prudent standards for state information technology procurements, known as the information technology procurement commission. The commission shall be chaired by the secretary of administration and finance or his designee. The governor shall appoint two members to the commission. The treasurer, the attorney general, the speaker of the house and the senate president shall each appoint one member to the commission. Each member of the commission shall have experience in at least one of the following areas: software and technology development, operations management, government procurement, public finance and government contract negation and dispute resolution. Said appointments shall be made no later than December 15, 2013.



The commission shall report its findings and any legislation necessary to implement said findings to the governor, the clerks of the senate and house of representatives, the senate and house of representatives committees on ways and means, the senate and house of representatives committees on bonding, capital expenditures and state assets by May 1, 2014. The authorizations contained in Section 2, line items 1790-3001 and 1790-3002, Section 2A and Section 2C may not be utilized to fund any capital project for any purpose until the commission files such report. The commission report shall include but not be limited to: an analysis of best practices for information technology procurement, including the scoping of projects, hiring outside vendors, oversight of outside vendors, review and assessment of projects and successful initiation of operations. In making its recommendations the commission shall consider among other issues:

a) best practices for information technology procurement among state and federal governments;

b) the number of state personnel needed to initiate information technology procurements and oversee outside vendors, as well as the required salary to attract individuals with information technology expertise;

c) appropriate benchmarks for periodic review throughout the completion of information technology project;

d) incentives for the on time and on budget completion of projects, as well as penalties for delays and overages;

e) benefit-funded procurements, in which an outside vendor is paid from the proceeds of a given information technology project;

f) performance based pay, in which an outside vendor is scored on the satisfactory completion of a project and pay is correlated to the vendor’s score;

g) fixed price technical competition, in which the budget for a given project is determined during scoping and vendors compete over the level of service provided at the specified budget;

h) the structure and dynamics of the software and technology industry focused on government contracts; and

i) specific reporting requirements necessary to inform executive branch agencies, the general court and the public of information technology projects, including reports deemed necessary prior to soliciting bids, during the life of the project and upon the project’s completion, including any changes to the project made prior to project completion.