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Agency of Digital Services Secretary Denise Reilly-Hughes speaks before the House Appropriations Committee at the Statehouse in Montpelier on Wednesday, February 12, 2025. Photo by Glenn Russell/VTDigger
The state is shifting gears on rolling out a $70 million information technology overhaul — and top state officials say the change in plans could continue to raise project costs and delay implementation.
The technology project touches every branch of state government and attempts to modernize state human resources and finance systems, making them work in harmony with each other through one new software platform called Workday. The project is high stakes, affecting how and when state employees get paid and how the state balances its books.
“It’s what kind of allows state government to function — so it’s a big deal,” said Administration Secretary Sarah Clark, in an interview.
The state originally planned to roll out changes to the state’s human resources and finance systems in phases. But last month state officials told project leaders that the two parts of the system “are more interconnected than originally anticipated,” according to an email obtained by VTDigger. As a result, the email said, the state plans to roll out the system all at once.
The email, signed by Clark and Denise Reilly-Hughes, secretary of the Agency of Digital Services, says that changing course will “support a better, more cohesive product in the long run.” The decision came after getting feedback from employees working on the system, the email said.
Deciding to roll out the system all at once could change the overall cost of the project and when it will be implemented, Clark said, though specifics are still up in the air.
The prospect of a higher price tag and delayed implementation isn’t out of left field. It follows concerns raised by analysts last year.
An expert hired by the state Legislature’s nonpartisan fiscal analysts told lawmakers last session that she was unsure the Workday platform had the capability to meet the state’s needs. Her report for legislators said that the state never properly assessed its needs — making it unclear if Workday has the required specs.
Other states have been plagued by fallout after failing to transition to Workday. The platform is one of few cloud-based business and finance management softwares, which operate through the internet rather than local servers or computers. The platform is owned by its publicly traded parent company Workday Incorporated.
In Rhode Island, the governor fired a top official last month after a chaotic transition to Workday resulted in state employees being under or over paid. In Oregon, thousands of state employees received incorrect paychecks in 2023 after the state fumbled its transition to Workday.
Steve Howard, executive director of the Vermont State Employees’ Association, said in an interview that it’s incumbent on the governor and his administration to make sure the project is rolled out smoothly so that state employees are properly paid.
“Not getting that paycheck would be devastating. I mean they have to feed their families, they have to heat their homes,” Howard said.
Despite other states’ failures, administration officials in Vermont insist that the state can roll out the platform correctly.
Reilly-Hughes said in an interview that she has faith in the Workday platform to meet the state’s needs. Although her predecessor decided on the state’s contract with Workday, Reilly-Hughes said that she approved of the agency’s charted path forward when she stepped into her role in 2023.
Reilly-Hughes said the state’s willingness to adapt to its new course of action demonstrated strength, not weakness.
“The strongest (IT projects of this type) all share one behavior. They’re willing to change the plan to protect the outcome,” she said.
Vermont is learning from other states’ challenges, which is why it’s “pushing the reset button” and deciding how to move forward, Clark said in an interview.
Rep. Monique Priestley, D-Bradford, vice chair of the Legislature’s Joint Information Technology Oversight Committee, said in an interview that she continues to be concerned about the program given the problematic outcomes in other states.
“I personally am very skeptical about whether or not this Workday solution will end up working for the state of Vermont.” Priestley said.
Priestley said her concerns also stem from the state’s process of selecting its Workday contract. The state assessed its needs very late in the contract process, Priestley said, and that’s what appears to be causing the delays in rolling out the project.
The 2024 expert report to legislators outlined similar concerns with the contract process, saying the project would have “challenges driven by an unconventional (contract) procurement approach.”
Reilly-Hughes said that she disagreed with the idea that the state’s contracting process was flawed.
“I think that’s an opinion,” she said.
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