JFO consultant tells House committee statewide IT projects mostly on track but flags ERP risks

Joint Fiscal Office consultant Lisa Gavan briefed the House Energy and Digital Infrastructure committee on Jan. 8 on a suite of large state IT initiatives, saying several projects are progressing while others — notably the statewide ERP implementation using Workday — contain notable gaps and risks.

"For the record, Lisa Gavan. I'm the contracted Joint Fiscal Office IT consultant," she told members, and then walked through a consolidated document of monitored projects, appropriations and planned reviews. Gavan said the Department of Labor’s unemployment insurance modernization — a multi-year replacement of legacy tax and benefits systems — began three years ago and is on track to finish in May 2026. She reported total appropriations of roughly $52.3 million and a known implementation cost of about $45.3 million, leaving a roughly $7.0 million balance intended for business-process redesign and staff augmentation.

Gavan framed those figures as provisional and based on current reporting. "They're actually, I think, going to come in under budget," she said of the unemployment project, noting the project team consolidated two bases and adjusted implementation sequencing to reduce costs.

By contrast, Gavan described the state’s ERP/Workday program as the most challenging undertaking. She said the state signed a Workday subscription arrangement that the contractor described as roughly $28 million over 10 years and that the Legislature has appropriated about $20.6 million so far. Implementation involves multiple vendor contracts: Guidehouse for Workday implementation and a separate contractor handling business-process transformation; Gavan said an earlier vendor left and was replaced.

Gavan told the committee the state’s independent assessment identified about 118 gaps between current systems and the new ERP, classifying 21 as high and 11 as critical. She also warned that agency-specific time-management systems (referred to as STARS/FARS) may not be fully replaceable by Workday without substantial additional work: "The cost to of other states to replace their STARS or their FARS range from 25 to 35,000,000," she said, describing that as a potential additional expense to watch.

The enterprise project office dashboard currently marks the ERP work as 'red' because of HR configuration delays. Gavan emphasized that the 'red' tag denotes the project's current state for management attention, not an irrevocable failure, but she urged committee oversight and careful questioning of change orders and integration needs.

Gavan also highlighted a successful recent implementation: the DMV system went live in November and, she said, came in a few hundred thousand dollars under budget — an example she called instructive for other agencies facing complex migrations. She discussed operations and hosting trade-offs, noting examples where leasing equipment creates higher annual costs (cited at about $9 million per year in one contract) but reduces large capital replacement spikes.

Looking ahead, Gavan previewed upcoming independent reviews. She said the Agency of Human Services' ACCESS portal work (a federal project) appears well-formed, with modular contracting and planned independent review before any state funds would be spent; AHS is reportedly seeking FY2027 funding. She also described the CCWIS child welfare system as having a compelling business case and said she would review it if it becomes a budget request.

Committee members asked whether the projects use off-the-shelf systems or custom builds; Gavan confirmed most are commercial platforms adapted to state business processes, stressing the importance of thorough gap analysis and business-owner involvement. The committee scheduled a joint hearing with Senate Institutions and JITOC next Tuesday at 2 p.m., at which ADS and Secretary Riley Hughes are expected to present the ADS annual report and dashboard.

The briefing closed with Gavan offering to post lessons-learned and links to her JFO reviews; the committee recessed for a short break and planned to resume later in the agenda.

Next steps: committee members will review the JFO links and the EPMO dashboard and question ADS and business-side managers about integration gaps, change orders and any potential additional funding requests.