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Revenue administration warns of RIMS operating costs and lists vacated positions in governor's budget
Summary
The Department of Revenue Administration told the committee it must operationalize recurring costs of the RIMS tax information system, is facing vacancy-driven budget variability and the governor's proposal unfunds multiple currently vacant positions while moving some vendor and debt-service costs into central operating lines.
Commissioner Lindsey Step and business administrator Shelly Gurlano briefed the committee on the Department of Revenue Administration (DRA) budget and the transition of RIMS (Revenue Information Management System) from capital to operating costs.
Step said RIMS was a multiyear, roughly $30.16 million capital project and that the department has anticipated moving ongoing cloud, support, monitoring and time-and-materials vendor expenses from the capital account to the operating budget. The presentation identified hardware end-of-life, baseline software support, 24/7 monitoring and ongoing vendor time-and-materials support as operating costs to be covered in fiscal years 2026 and 2027.
DRA said its overall headcount is proposed to be reduced in the governor's budget by funding fewer positions: the governor's proposal would fund 29 positions (a 15.7% reduction from prior authorized counts), with about two dozen vacant positions becoming unfunded across divisions. The department highlighted that some vacancies were converted into proposed unfunded cuts and that vacant positions that remain funded could be reconsidered for recruitment depending on budget flexibility and operational priorities.
DRA also described a transfer of debt-service obligations tied to bonds issued to fund RIMS; principal and interest schedules for those bonds produce class-43 debt-service charges in the administration accounting unit. The department said $4 million of revenue uplift from RIMS would be transferred annually into a dedicated fund to pay the remaining bond service, and that Treasury supplies the debt-service schedule used for budgeting.
Other points raised included: reduction of training/equipment/travel lines tied to lower funded headcount and a discussion of audit and collections staffing trade-offs. Step noted auditors and collections staff generate revenue; she emphasized the department's need to balance vacancies and programmatic capacity.
Members asked about the accuracy of workers' comp and retiree benefit lines; DRA said some lines are fixed charges billed by DAS and that certain increases reflect statewide costs outside the department's direct control. Step offered to correct an indexing error on a mislabelled vacancy in the governor's budget with the LBA.
