Joint Budget Committee approves IT capital funding mechanism, trims OIT requests and OKs transfers

The Joint Budget Committee voted to adopt a mechanism for funding IT capital projects and approved staff recommendations that reduce several Office of Information Technology (OIT) funding requests while authorizing transfers from the IT revolving fund to the general fund.

Andrew Maclear, JBC staff, told the committee the Joint Technology Committee recommended funding 11 IT capital projects (six state agency and five higher‑education projects) plus four cash‑funded projects, totaling $9.8 million in general fund and $17.1 million in cash funds. He noted the JTC list is about $2 million higher in general fund than the governor’s prioritized request and roughly $300,000 lower in cash funds.

Maclear highlighted two budgetary items of note: the school finance modernization project is now estimated at about $3.4 million for two phases, down from an initial $9.3 million request after lower procurement bids, and a proposed statewide human resources information system (priority 6) could cost nearly $64 million over four years if fully implemented; the initial figure‑setting request included $1 million for a study.

Committee members questioned why some projects use cash funds while others rely on general fund. Maclear said in several cases related cash funds lacked sufficient revenue to support the projects and staff will follow up with details on specific cash funds and fee sources.

On the committee’s single required action for IT capital today, members agreed to the mechanism proposed by staff to incorporate the committee’s final IT project selections into a general fund transfer to the capital construction IT subaccount. The motion to authorize staff on IT Capital General Fund Transfers passed 4–0 with Bridges and Taggart excused.

Separately, staff recommended denying OIT’s $5.2 million centralized statewide AI compliance implementation request (about $3.4 million general fund) tied to SB 24‑205, on the basis that the FY25‑26 long bill already assumed assessment work and early implementation costs. A committee member asked for a footnote to allow departments to return with demonstrated costs; other members noted agencies may request supplemental funding if costs materialize. The committee approved the staff recommendation on the AI compliance request (staff rec motion passed 3–1, with one objection).

Staff also recommended a net reduction of $32.1 million in OIT payments common policy requests (including $17.4 million in general fund) after reviewing reversions and over‑collections to the IT revolving fund and contending departments had not appeared to raise fees to cover indirect costs. The committee approved the reductions and allowed staff to work with departments on technical corrections.

Finally, the committee approved staff‑initiated transfers involving the IT revolving fund: members had previously approved an $11 million transfer from the IT revolving fund to the general fund; on the recommendation of staff the committee also approved an additional staff‑initiated transfer of $10 million for FY26‑27 (vote 4–0, Bridges and Taggart excused).

The committee asked staff to follow up with detailed cash‑fund balances and revenue sources for projects discussed, including the stationary sources modernization project and the funds supporting it. Maclear offered to provide the requested cash‑fund details to clarify whether projects can be shifted from general fund to available cash funds.