The Franchise Tax Board will start the planning process for the Enterprise Data to Revenue 2 project this year.
In one of the first steps, the tax board plans in April to release a bid proposal related to identifying and documenting business processes for the "EDR2" project, CIO Cathy Cleek said Wednesday.
EDR2 is scoped to expand case management, modeling and the board's MyFTB customer application. The project also would phase out and replace legacy systems for audit, filing enforcement and collections, according to an analysis of the EDR2 system presented last month to FTB. The average age of FTB's accounting systems is 18 years old, the FTB says.
The original EDR project, which has been held up as an example of a state government IT project done well, went live in mid-2011. It was launched to modernize the tax collection system to improve compliance, enhance tax return automation and go after billions of dollars in otherwise uncollected money.
EDR1 to date has resulted in the collection of $2.1 billion in additional revenue for the state of California, Cleek said. That's $300 million more than the project's projections. Cleek said 2016 will be the first time EDR generates $1 billion in a single year. EDR1 has moved into the maintenance and operations phase.
"Although EDR did a great job of addressing the tax gap, there are still considerable areas for improvement. We continue to see this tax gap grow, between what people pay in taxes versus what they legally owe," said Kem Musgrove, EDR's technical director, during a March 10 presentation to the tax board.
EDR is a performance-based project that pays prime contractor CGI from a percentage of the increased state revenue. The Franchise Tax Board would like to use the same compensation model for EDR2, Musgrove said. The project can pay for itself by the revenue it generates, he said.
Cleek said for for EDR2 the Franchise Tax Board is planning for a four-year procurement phase, followed by at least a four-year development and implementation phase. That would mean EDR2 would be finished in 2026.
