A restart for the project has been years in the making, and accelerated after the state reached a financial settlement in June 2016 with the system integrator on the MyCalPays project — the failed payroll system modernization that the controller's office canceled four years ago.
The price tag and approach for a new replacement is an open question at this point. A 2015 study concluded that it might cost anywhere from $107 million to nearly $200 million to pay a system integrator to complete California’s statewide payroll system. And last year, the state controller said her office had discussed using agile principles to develop a new system.
Upfront planning through the Department of Technology's (CDT) project approval process will cement those unknowns. In the meantime, the state controller appears to be moving ahead to secure a contractor that will help it document business processes, which is one of the first steps to get CDT approval. On Dec. 27 the controller issued an RFO inviting vendors qualified under the California Multiple Award Schedule (CMAS) to respond to the solicitation, with responses due by Jan. 26. (Dates subject to change.) The contract will run for as many as three years, capped at $500,000.
Instant Analysis
Don't expect the procurement of a solution to begin in the near term, although this project is worth watching because it's a high-value opportunity. (The original contract with the former system integrator of MyCalPays was worth about $90 million.) And if the state controller chooses an agile, modular procurement, that money could be split up among several vendors, a la the state's child welfare modernization project that's currently underway. The state controller likely will continue to seek contract resources in the next year or so as the planning process moves forward.Interestingly, within the RFO, the State Controller's Office listed the direct stakeholders of what's now being called the California State Payroll System (CSPS) project:
• California Department of Human Resources (CalHR)
• Department of Finance (DOF)
• State Personnel Board (SPB)
• Department of Technology (CDT)
• Legislative Analyst’s Office (LAO)
• Department of General Services (DGS)
• California Public Employee Retirement System (CalPERS)
• California State Teachers Retirement System (CalSTRS)
• Financial Information System for California (FI$CAL)
• State Compensation Insurance Fund (SCIF)
• Franchise Tax Board (FTB)
• Employment Development Department (EDD)
Other stakeholders:
• End Users — All HR offices and IT support within state departments
• State Employees
• Collective Bargaining Unit Representatives
• Excluded Representatives
• Deduction Companies
