DOIT warns against rushing a new AI/software engineering division; committee hears mixed testimony

Representative Erica Leon told the committee SB 640 would create a new division in the Department of Information Technology focused on artificial intelligence and software engineering to develop shared solutions, reduce vendor reliance where appropriate, and improve usability of state digital services.

"This is intended to make use of this great human resource pool," Leon said, adding that in‑house capacity could reduce some contract costs and improve negotiating leverage with vendors.

Dennis Goulet, commissioner of the Department of Information Technology, testified in opposition to the amendment as written. He cautioned that replacing enterprise or federally funded systems is typically the most expensive option and that the total cost of ownership includes licensing, implementation, personnel, and long‑term maintenance. "Replacing a system is the single most expensive thing you can do," Goulet said, and he warned that poorly timed transitions could jeopardize federal funding for health and human services applications.

Jamie Burnett, a consultant testifying for Google, urged caution and said the amendment risks growing government capacity in a way that duplicates private sector capabilities and could create implementation risks and cost overruns.

State agency witnesses including Melissa Nemeth of Fish & Game echoed concerns about the bill’s compressed timeline and potential impacts on federal grant compliance. Committee members asked detailed questions about recruiting, enterprise platforms, and whether AI tools already in agency use change the calculus.

The committee closed the SB 640 hearing after testimony and signaled further review; the commissioner recommended study and careful workforce and procurement analysis before any structural change.

Next steps: The chair closed the hearing; members asked for additional materials and suggested further review before any move to amend or report.