Lawmakers press Vermont Department of Labor on replacing decades-old FARS accounting system

Representative Kathleen James opened the Environment & Energy committee hearing on May 7 to continue oversight of the statewide ERP modernization effort and to press the Vermont Department of Labor on whether the agency's long-running accounting system, FARS (Financial Accounting and Reporting System), can be replaced by Workday.

"FARS is really good at applying indirect overhead and allocated costs across all the different projects that we have," said Chris Winters, deputy commissioner of the Department of Labor, describing why the department has used FARS since it was brought online in 1987. Winters told the panel the department reconciles a monthly lumped total into the state's Vision system but keeps detailed project-level records in FARS because of complex federal award and reporting requirements.

Chad Worsnach, the department's chief financial officer, provided a technical illustration of the problem: FARS maintains project codes and cost centers that track indirect costs (examples include office space and executive salary) and applies multiple denominators (floor space, time charged, number of phones) to allocate overhead across funding streams. "Anytime we file a report with whomever, federal government, state agency, whatever, FARS is our backup information to gather the numbers," Worsnach said.

Lawmakers pressed whether Workday's financial product can reproduce those functions. Winters said the ERP project has proceeded in phases (human capital first, financials second), that DOL has requirements gathered, and that the next workstream will run a focused, in-depth gap analysis. "We don't know specifically if Workday is gonna work yet," Winters said. He said the project team had restarted work and expected a concentrated "base camp" period where stakeholders would test whether Workday can run the specific reports and cost-allocation processes the department needs.

Committee members repeatedly asked for proofs and demonstrations. Several members, citing lessons from the Agency of Transportation's experience, urged the administration to require Workday and implementation partners such as Guidehouse to show they can run required reports before the legislature approves additional funding. "Hope is not a plan," one lawmaker said, pressing the administration to convert assurances into documented tests.

Agency officials described how the statewide project will be implemented as a single go-live rather than a phased handoff, and they gave the committee the project's public target: a July 9, 2028 go-live for the ERP rollout. Officials said they expect a period of parallel operation and extended testing (including multiple payroll cycles) immediately ahead of cutover to minimize errors.

Lawmakers also pressed the department about contingency planning if FARS fails before replacement. Winters and administration officials said the state maintains contractor relationships and emergency sourcing plans to respond to a catastrophic failure, and that they would notify legislative leadership if a critical outage occurred. On federal reporting deadlines, the CFO said she communicates closely with U.S. Department of Labor project officers and that the federal offices have in the past granted limited extensions depending on circumstances.

Officials gave a schedule expectation for the detailed gap analysis: they said contract negotiations and a Guidehouse contract amendment were expected to take a matter of weeks, with a goal of completing the deeper base-camp analysis by late summer to determine whether Workday requires additional configuration, third-party add-ons, or process changes to meet DOL's federal reporting needs.

The hearing closed when Representative James called a short break before moving to the next agenda item on community-scale geothermal. The committee signaled continued oversight attention, and staff said they would return with further updates as the base-camp analysis and vendor demonstrations proceed.