DRA defends RIMS upgrade after reporting $14.4 million revenue uplift in FY24 and outlines operating costs

New Hampshire Department of Revenue Administration Commissioner Lindsey Step told the Finance – Division I committee that DRA——s new Revenue Information Management System (RIMS) replaced a 1990-era system and has improved collections and taxpayer service while producing measurable revenue gains.

"Our mission is to fairly and efficiently administer the tax laws of the state of New Hampshire," Step said in opening remarks. She described RIMS as a commercial, off-the-shelf tax administration platform (Fast Enterprises' GenTax) installed in partnership with the Department of Information Technology.

Revenue uplift and the debt service cap

DRA reported $14.4 million in RIMS-generated revenue uplift for fiscal year 2024. That uplift is the additional revenue the agency attributes to improved notices, reminder letters, automated payment plans and better use of federal tax data now possible with RIMS. Under the capital package that paid for RIMS, statute allows DRA to transfer up to $4 million a year into a dedicated revenue-uplift account to service bonds issued for the system; DRA has deposited the cap in recent years and has transferred $14.2 million to date toward a $40 million repayment total. Step told the committee that the principal and interest on roughly $24.16 million of bonds will remain to be paid and that transfers will continue until bond obligations are met.

Operating budget transition

Step said the capital appropriation that financed the RIMS replacement expires on Dec. 31, 2025 and DRA will need to move hardware and software maintenance costs into its operating budget afterward. The agency calculated ongoing costs at roughly $1.5 million per year for cloud-based operations, including about $800,000 for software maintenance and $750,000 for hardware support. DRA proposed funding RIMS operations within its FY26–27 operating request; Step said the department negotiated one-time ARPA funds for some RIMS components and managed vendor contracts to avoid support-cost increases where possible.

Service changes enabled by RIMS

Step and staff explained several RIMS-enabled operational changes that the agency calls revenue uplift: a new taxpayer portal (Granite Tax Connect), automated reminder notices that produce higher voluntary compliance, improved use of IRS data under strict controls and automatic payment-plan approvals for taxpayers meeting thresholds. Step said those features reduced manual workload for staff and improved customer service: Granite Tax Connect has more than 48,000 registered users and the department reported high call-center satisfaction scores after upgrades.

Staffing and efficiency

DRA told the committee it has reduced headcount in recent years and that about 80 percent of its operating budget is staff compensation. Step said the department had unfunded certain positions (18 positions fewer than earlier levels) after evaluating workloads and the expected administrative impact of the repeal of the interest-and-dividends tax. She emphasized that the department monitors operational metrics and believes it can meet statutory duties with the proposed headcount while acknowledging limited flexibility would help respond to changes.

Ending

Step said DRA is monitoring RIMS——s ongoing revenue performance and will continue transferring up to the $4 million statutory cap annually into the revenue-uplift fund until the statutory total payments are met. The committee asked about bond schedules and debt-service timing; Step said Treasury sets the official debt schedule and DRA will make transfers per the statute and schedule.