Terri Bonoff

OET commissioner will oversee consolidation, millions in tech spending

Birds, lots of them, side by side along a long stretch of telephone wire — that’s the picture that state Chief Information Officer Carolyn Parnell sees when she visualizes the information technology (IT) universe where she works.

“I have many pictures like that, which may sound crazy,” she says. “But that image is sort of representative of IT to me.”

Swallows chirping at random along a common strand of cable may be how Parnell thinks of digital communications. But as CIO and commissioner of the newly empowered Office of Enterprise Technology (OET), her job is to get state agencies’ digital ducks in a row.

That is now possible because, in a fit of bipartisan consensus during July’s special session, the Legislature passed a bill that pulls all state agency IT operations into a single administrative tent. Gov. Mark Dayton signed the measure into law.

“What the authors of the legislation wanted was the ability to go to one place and find out what was happening in the information technology world in the state of Minnesota,” Parnell says. “Right now it is, for the most part, pretty scattered.”

If things work as they are supposed to, that will change. As of the next biennium, all agency IT budget appropriations are ordered to flow through Parnell’s office. Already the state’s 27 agency CIOs report to Parnell. On Oct. 1, nearly all government IT workers will become OET employees, while still housed in their various agencies.

When that happens, OET’s employment ranks will instantly swell from 350 to about 1,800 employees.

Parnell is working with agency CIOs and chief financial officers to inventory state IT assets and find out how much money the state is spending to purchase and maintain its digital communications. She does not know that answer, nor does she know how many various and possibly incompatible IT systems are operating in the state’s 70 or so agencies, bureaus and boards.

“We have no good handle on the statewide view of IT,” says Parnell, whom Dayton appointed to the post in February. “The legislation is intended to kind of correct that.”

Unique opportunity

The OET was formed in 2005 when the former Minnesota Office of Technology was combined with the InterTechnologies Group. Both were semi-competitive IT divisions of the state Department of Administration.

Up to now, the scope of OET’s mission was limited to some forms of oversight and project management. Under former state CIO Gopal Khanna, OET also developed funding and security strategies and established IT architectural standards for the state. But until now, it had no direct budget or policy oversight of Minnesota’s digital communications assets. Its original mandate was to strike a balance between central technology management and agencies’ control over their own IT departments.

With the new legislation, that balance is tipped solidly in favor of central management, at least as it concerns the purse strings. By July 2012, the law requires agencies to ink service level agreements with the OET governing how many IT systems, assets and people — and how much infotech spending — each will be allotted.

State House File 191, a bill authored in February, passed the House 116-16 in this year’s regular session. For various reasons, a companion version was never brought to the Senate floor until the summer special session, but once there, it also passed. The effort succeeded where a long line of previous legislative attempts to consolidate state IT functions had failed.

Rep. Keith Downey, R-Edina, a co-sponsor of HF 191, offered essentially the same bill in 2010, but it got nowhere. A former business executive, Sen. Terri Bonoff, DFL-Minnetonka — sponsor of the Senate version — says she has tried to consolidate state IT since taking office in 2005. Longtime Rep. Phyllis Kahn, DFL-Minneapolis, another HF 191 co-sponsor, tried to make it happen first in 1981, and then many times afterward, she says. Others have also tried.

Kahn says the stormy 2011 session — far from diminishing the OET legislation’s chances — probably provided the only window through which state government IT consolidation could finally pass.

Why? A whole lot of turf is involved in the state’s computer networks and applications, Kahn explains. Over the years, agency commissioners, legislative committee leaders, governors and agency CIOs have all claimed authority over pieces of that turf.

But with the shakeup in the last election, things lined up to the effort’s advantage this year, Kahn says. There was a new governor, a Legislature heavily stocked with freshmen and all-new caucus leadership, Kahn says. All their squabbling over other matters conveniently distracted them from the ramifications of HF 191.

“Because of all the other things that they were trying to do, they didn’t realize what a huge turf issue this was,” Kahn says. “All of the legislative committees were all new, too, and so they also didn’t realize it was also a turf issue for them.”

She says she saw an opening and took it. “You had to do it really fast before people understood what kind of a takeover this was,” she says.

Kahn admits that’s a fairly cynical take on how things unfolded, and Bonoff doesn’t agree with her characterization. The senator does not, however, deny the role all those fresh faces played in the legislation’s success after decades of failed attempts.

“You had a new administration and a new legislative body who were not attached to [the status quo], or who really felt great ownership over the way things were done in the past,” Bonoff says. “So you had a chance to make your case for why drawing it up in this fashion was not only the right thing to do, but really will leave us in a much better place.”

For Bonoff, the real significance of the legislation is twofold. First, it institutes a “shared services model” for state IT. Bonoff says that will help the state get a handle on its computer communications costs, which Parnell says are, minimally, in the hundreds of millions of dollars. It likely will eliminate needless duplication of services that could otherwise be shared, Bonoff says.

Secondly, Bonoff says, the bill was a successful piece of bipartisan legislation. That, she says, offers hope that despite the rancor and divisions of the last legislative session, there are shared interests that the two political parties can work on together, particularly when it comes to government reform. Consolidating IT, she says, is the fundamental first step to reforming government.

“The only hope we have for having a government that lives up to the demands of the 21st century is our ability to work in a bipartisan fashion,” Bonoff says. “Every chance I get to speak to citizens, to the press, to the governor, to anybody — that is my message. Nothing should happen unless it has bipartisan support. Because if it doesn’t, half of the citizens’ voices are not heard.”

Getting efficient

As with all instances of IT consolidation, a lot of talk about “efficiencies” is embedded in conversations about the OET’s new mandate.

No immediate layoffs are required by the legislation, however, nor was IT outsourcing mandated. That’s partly as a result of a compromise agreement between Downey, the Republican bill co-sponsor, and the Minnesota Association of Professional Employees union as the bill was taking shape.

However, in one late iteration of HF 191, Downey inserted a line mandating that state agency CIO numbers be pared to 15. That line was extracted from the final bill.

However, Downey doesn’t mind mentioning that layoffs and outsourcing remain his goal. “Let’s get the organizational redesign done first,” he says. “Let’s get all those moving parts under one person. And then the natural evolution of further consolidation and evaluating outsourcing opportunities can happen from there.”

Downey is confident those opportunities will surface. “Clearly,” he says, “when you see that there are 27 agency CIOs and one state CIO for a total of 28, you say, ‘Gee, there is an opportunity to get a little leaner there.’”

Kahn agrees that, as the state IT consolidation tactical plan is rolled out over the next several years, some jobs will be lost. But she thinks employment levels can be pared through attrition as IT professionals retire, rather than through layoffs.

For her part, Parnell questions whether state IT staffing levels really are too high, whether at the CIO level or below. Staffing levels now are already lower than in the early 2000s, she says.

The bigger challenge, by Parnell’s lights, is a coming “brain drain” as IT professionals hired decades ago begin to retire.

“I think it is always good to be able to refresh your workforce skill set, but there is also some very important functions that are walking out the door,” Parnell says. “I am more worried about handling that retirement factor and that brain drain, and attracting new talent to the state.”

IT consolidation checklist

The following milestones are specified in the new Office of Enterprise Technology (OET) legislation, passed during the summer special session.

• Aug. 20, 2011: Agency CIOs begin reporting to OET Commissioner Carolyn Parnell.

• Oct. 1, 2011: State IT employees, powers and duties transfer to OET.

• Jan. 15, 2012: Report to Legislature. The state CIO must report any statutory changes she believes are needed to implement IT consolidation.

• July 1, 2012: Service level agreements (SLAs) must be in place between agencies and OET. These must include services to be provided, and charges or cost allocations for them.

• July 1, 2013. The Minnesota Geospatial Information Service’s functions transfer to OET. The state CIO will appoint a chief geospatial information officer.

• Now through July 1, 2013: Governor-appointed IT Advisory Committee meets.

• 2013 (not retroactive): IT appropriation requests. Agencies will make IT project appropriations requests to the state CIO, who will manage and disburse money on behalf of the sponsoring agency.

• 2014: State CIO reports to Legislature.

• Jan. 15, 2015: SLA extension report. Parnell must report to the Legislature on the feasibility of entering into SLAs with the State Lottery, the Statewide Radio Board, pension funds and the Campaign Finance and Public Disclosure Board. Each office requested and received a waiver to the law that rolls state IT functions into OET.

By Senator Terri Bonoff  07/10/2011

It’s hard to believe 11 days have passed since the fiscal biennium ended in gridlock. It is unacceptable that there’s no agreement in sight. While I have recriminations for each of us who serve, I write today not to assign blame, but to provide a way forward.

We will reach consensus by coming together and harnessing the power of our collective spirit. I have served in the Minnesota Senate for six years and remain convinced we have not yet come to the table serious about transforming government into something that can propel us into the future with the strength required to meet the demands of our increasingly competitive global economy.

Shortly after I was elected, I began a quest to redesign and reform government—partnering with a broad coalition of Democrats, Republicans, business and labor leaders, educators and independent experts. At every turn, I have been blocked by members of both parties who fear shaking up the status quo.

The current impasse—and the last decade of fiscal crisis—has made it increasingly clear that redesign and reform are the only viable options for Minnesota’s future. It’s high time both sides stop the partisan angling and recognize the true urgency of the situation. We must be driven not by ideology, but instead by our shared passion to leave Minnesota a better place for generations to come.

It’s clear to Minnesotans that holding to entrenched positions hinders our ability to leave our state better than we found it. Allowing our government to shut down was a lowly proposition at best and an exceedingly selfish one at worst—with long-term consequences, as evidenced by the recent downgrading in our bond rating.

Both sides must change their strategy and change it quickly.

The DFL can begin by offering a compromise that has a chance of passing the Republican-controlled Senate and House. For example, why not put forward a common sense expansion of the sales tax to include clothing; levy an additional tax on cigarettes and alcohol; and consider allowing the Racino? The modernization of the sales tax—among other things—is long overdue. It will strengthen our fiscal position by freeing us from some of the volatility that comes from reliance on the personal income tax.

Any offer must also include guarantees that we will immediately begin to reform and redesign state government—including strong policy changes in the areas of education and healthcare—so we never find ourselves in this situation again and position ourselves to lead in human capital. 

This compromise isn’t a “surrender” by the DFL or a “victory” for the Republicans. It’s the right thing—a “win”—for all.

The GOP must realize that this crisis hurts Minnesotans each day. It’s time for the Republican leadership to address the critically important issues facing our state and leave the divisive social issues at the door. Any focus on banning stem cell research, banning gay marriage, and overturning women’s rights is an impediment to emerging strong and united from this economic downturn.

The Republicans must also get serious about a solution that is fiscally responsible. The GOP leadership offered a budget proposal on June 29 that included $700 million of increased debt—borrowing money from both schools and future tobacco settlements. We understand this was an important acknowledgement that our current crisis demands more revenue, but let us not continue the irresponsible practices of the past by offering temporary solutions that add to our financial insecurity. Letting people go without healthcare, or dis-investing in our revered University system, is not any more of a solution than offering a band-aid that results in more pain later.

Serving in a legislative body is like being part of a family. It is time to stop the bickering, set aside egos and ideology, and embrace a solution that provides the strongest path for Minnesota’s future.

I trust the people of Minnesota. They knew who they were voting for last November and those elected should know what their responsibility is. Time has run out for us to live up to those expectations. If we don’t reach a solution quickly, I have no doubt Minnesotans will reach a workable solution of their own in November 2012.

Senator Terri Bonoff