Commentary: FI$Cal ‘Celebrating’ Milestone for Project

This commentary first appeared on the website of the Financial Information System for California (FI$Cal).

On June 25, we successfully deployed the final functionality of the FI$Cal project known as the State Controller’s Office (SCO)/State Treasurer’s Office (STO) Integrated Solution. Implementation of this milestone allows the FI$Cal system to capture the information required to generate the state’s key financial reports, validate the balances and ensure that the data captured in FI$Cal aligns with SCO’s legacy systems. FI$Cal now has the necessary functionality to produce a parallel Budgetary/Legal Basis Annual Report (BLBAR) and a parallel Annual Comprehensive Financial Report (ACFR).

This is a huge moment in FI$Cal’s history, and one in which the state can take great pride. A look back serves as a reminder of all that we have accomplished.

We began this FI$Cal journey as a business transformation project in 2005 slated to replace the Department of Finance’s (Finance) budgeting system at a proposed cost of $140 million. The focus of the project soon shifted to address the need to modernize the state’s entire financial management processes into a single financial management system.

During the next year, the concept of the Financial Information System for California began to coalesce and, in December 2006, Special Project Report (SPR) 1 was approved by Finance’s Office of Technology Review, Oversight, and Security (OTROS). It proposed leveraging the state’s then-planned investment of nearly $140 million to establish an integrated financial and administrative system based on Enterprise Resource Planning (ERP) software rather than continuing to replace each of the state’s administrative systems separately.

The following year, 2007, we saw the project formalized with a Memorandum of Understanding signed by the state controller, the state treasurer, and the directors of the departments of Finance and General Services. In December of that year, OTROS approved SPR 2, which extended the implementation schedule by two years for additional planning, legislative reporting activities, and procurement and design phase activities, and increased estimated costs to $1.6 billion.

Two years later, in January 2009, in response to concerns expressed by the Legislature and other stakeholders, we contracted with an ERP expert to review best practices for planning and implementing such a large ERP project. SPR 3 resulted from the revised implementation strategy, based on this review and subsequent decisions of the FI$Cal Steering Committee. This SPR described activities and costs through the system’s procurement phase and awarding of the system integrator (SI) contract and was approved by the Office of the State Chief Information Officer within the California Department of Technology (CDT).

In March 2012, CDT approved SPR 4, which updated the schedule to consist of five waves: a Pre-Wave followed by four implementation waves, and it significantly reduced costs for system development and implementation. Total costs, including planning, procurement, design, development and implementation, and the first year of Operations and Maintenance (O&M), were estimated at $616.8 million. This represented a reduction of about $1 billion from total costs identified in SPR 2.

Three months later, in June 2012, the system integrator contract was awarded to Accenture. Pre-Wave activities commenced that month, and the onboarding and integration of Accenture began. In September, Wave 1 activities commenced and the FI$Cal Steering Committee chartered the FI$Cal Service Center (FSC) to provide ongoing O&M, customer service and support, and internal administrative services for the FI$Cal system.

In July 2013, we deployed Pre-Wave procurement functionality including requisitions, purchase orders and receipts to seven state entities. At the same time, we implemented the FSC to support the Pre-Wave users and we also implemented the single, statewide, Master Vendor File — a complete catalogue of vendor information across every department.

In January 2014, CDT approved SPR 5, which extended the system implementation schedule by one year and increased SPR 4’s estimated cost of $55.8 million to a total of $672.6 million. It also included a PeopleSoft upgrade for Wave 3 and moved a variety of state entities to different waves as we remained focused on improving implementation of the system.

We saw our second Go Live in July 2014, with the Wave 1 deployment of accounting, budgeting, and procurement functionality to nine state entities. Wave 1 provided centralized vendor data management and a standard chart of accounts and budget structure. At the same time, we made user support labs and job aids available to end users and Finance went live with control budget functions, making FI$Cal the budget system of record. SCO began transacting in the FI$Cal system in December 2014, and for the first time, Finance prepared the 2015-16 Governor’s Budget of $164.7 billion using the FI$Cal system.

STO began transacting in the FI$Cal system in August 2015, after which we deployed departmental accounting and procurement. Also that month, we transitioned 52 state entities to Wave 2 functionality. Next came the release of a new vendor portal (Cal eProcure) to production in December 2015. By January 2016 this modernized procurement system, operated by the DGS, provided access to bids/solicitations for approximately 50,000 suppliers/vendors.

2016 was the year we transitioned from a project under Finance to a new state department, the Department of FI$Cal. The department was charged with the responsibility of operating and maintaining California’s statewide financial system and facilitating transparency. In July 2016, we upgraded and redesigned the budget solution and deployed it statewide to all remaining budget users, plus six more state entities onboarded for accounting and procurement. That month we also launched our first business intelligence platform, allowing for financial analytics and visual representations of data.

July 2017 saw the release of STO’s initial control functionality and the onboarding of 30 departments into the FI$Cal system. In the same year, FI$Cal implemented a private cloud appliance (PCA), migrated the budget system to PCA, and upgraded network hardware. This provided the infrastructure that allowed enough processing capacity to support future releases.

In July 2018, we brought 64 departments into the system — easily our biggest onboarding as it included the largest and most complex departments in the state. 2018 also marked the start of the SCO/STO Integrated Solution that defined milestones to get us to project completion. Additionally, control and audit functional improvements were implemented as part of Milestone 1 and FI$Cal staff took over all operation of FSC from Accenture. In October, we released Milestone 2, the STO operations and bank integration that synchronizes more than $2.5 trillion annually in cash management, and we also began deployment of the SCO integration.

In September, we launched the pilot of our financial transparency website, Open FI$Cal. This website gives the public a window into how departments are spending taxpayer money.

Between November 2018 and July 2020, we deployed the Integrated Solution that built interfaces between the FI$Cal system and legacy systems. We deployed “FI$Bot,” an in-system virtual agent that answers questions while end users are logged into PeopleSoft. As part of Milestone 4, in July 2020, the SCO ledger conversion went live in the system and created temporary interfaces, allowing for replication of the ledger without duplicate work for department users.

FI$Cal staff assumed system operations and maintenance from Accenture in January 2019, marking another significant achievement for the department. Since then, we released or improved-upon 344 enhancements and tools to improve user experience and customer service, continually adding innovation to the system.

Our work is not done! With the final release of functionality for this project behind us, we are now shifting from project activities to operations and maintenance, which means improvements to the FI$Cal system will continue. There are many initiatives and enhancements to the system that we are focusing on that will help us keep the system modern, efficient, and able to continuously support the financial management of California’s state government.

We will be highlighting those improvements in the weeks and months to come, but today, we are celebrating the successful deployment of the last piece of the FI$Cal project.