House committee begins FY26 IT budget review; flags $15M state IT transfer and tax-system modernization funds

Representative Kathleen James, chair of the House Energy and Digital Infrastructure Committee, opened a session on budget items assigned to the committee and directed staff to identify and flag sections that need follow-up. "Jack, let's stay alive. Do folks have a little bit of time here to can we just have a little session on the budget? Okay. Great," she said as the committee shifted to FY26 budget review.

The committee focused on a series of one-time appropriations (Section 1,100 et seq.) affecting IT modernization across state agencies. Members highlighted several items for additional documentation and testimony: a $1,557,500 one-time general-fund appropriation to the Department of Human Resources for a "classification modernization" project; a $4,300,000 transfer to a Tax Computer System Modernization Fund; a $1,500,000 transfer from the education fund to the same tax modernization fund; and a $15,000,000 one-time transfer to the state's information technology fund (described in the materials as an IT/information-technology fund transfer).

Nut graf: Committee members said they needed clarification on the purpose, recurring nature (statutory vs. one-time), and governance of the funds, and asked that Secretary Riley Hughes of the state IT operation and JFO staff appear to explain the transfers, billing practices, and whether a central fund or custodian for statewide IT projects exists.

Members discussed the history of a proposed statewide IT modernization fund and asked staff to find earlier working-group work that outlined a central fund to oversee IT modernization projects. Several members flagged the $15 million transfer as a large, one-time move that merited a high-level presentation on how agencies are billed for EDS/IT services and whether the proposed transfer addresses recurring billing and billbacks. "She's gonna come in and make a presentation to us, But it's related to that whole build back thing about how agencies are some agencies really aren't that great, you know, at estimating their EDS time and charges," the chair said.

The committee assigned follow-up tasks: request written explanations and documentation from Secretary Riley Hughes and the relevant agency budget leads; invite JFO and Secretary Riley Hughes to brief the committee on Wednesday (per the transcript); and alert appropriations staff if any bills under the committee's consideration are likely to carry fiscal implications. Committee staff also agreed to prepare a memo summarizing the items and the committee's questions for the agencies.

Ending: The committee closed the session with a plan to request testimony from agency officials (including the secretary overseeing IT services), ask for the historical working-group materials on a statewide IT modernization fund, and circulate a memo identifying items that need more explanation before appropriation decisions.