1 expect the best Lemuel C. Stewart, Jr. CIO of the Commonwealth Information Technology Investment Board February 9, 2006 CIO Status Report

2 expect the best Highlights Since Last Meeting Submitted VITA’s Quarterly Report to the Governor and the General Assembly on December 28 Held VITA Dialogue meeting on January 10 in conjunction with Northrop Grumman and the Service Management Organization (SMO) Held VITA Statewide IT Strategic Planning Retreat on January 11 and 12 VITA and the Department of Minority Business Enterprise (DMBE) held a joint SWAM Workshop on January 25 which was attended by more than 40 vendors from around the state 42 new customer accounts were established for the 2 nd quarter of FY06 VITA and Northrop Grumman employees moved into space on the 5 th floor to begin transition planning Scheduled a statewide Agency Head/AITR meeting to be held February 16 to disseminate information on the Infrastructure PPEA University of Virginia customer survey draft and action plan

3 expect the best Audit Update 2005 APA “Review of Controls Over Information Security” Audit Action Plan (4 audit findings/recommendations w/16 corrective actions). The 4 Findings will be in the Statewide Single Audit Report issued around March –Of the 16 actions, 5 are reported as completed, 3 have revised due dates and 8 are reported on schedule 2005 APA “Performance” Audit Action Plan (15 corrective actions) –Of the 15 actions, 10 are reported as completed, 1 has a revised due date and 4 are reported on schedule 2006 APA Audit is in progress; should conclude around March

4 expect the best Customer Agency Audits 3 Customer Agencies (VDH, VDOT & VEC) have received APA management comments concerning “Obtain Assurance over Security and IT Infrastructure” We are working with our customer agencies to resolve this issue by having each Agency explain in detail, the security needs for each of it systems and databases along with what access controls it currently provides. VITA then shall provide the Agency assurance that the infrastructure provides the level and depth of security necessary to meet state policy and other applicable requirements.

5 expect the best Security Statistics Report *The statistics do not reflect VITA’s remote locations. A centralized security incident monitoring capability does not exist today. One of the objectives of transformation is to provide centralized monitoring and reporting of security incidents.

6 expect the best VITA Transformation Update VITA is an evolving, maturing organization that will continue to roll out over the next few years Functions have been realigned to gain synergy and eliminate unnecessary redundancy A change management capability is being implemented to assist in additional evolution

7 expect the best VITA Transformation Update Examples of Key Challenges: Organizational Transition Project Management Security Lessons learned from integration and assumed new responsibilities Agency support, business process change, culture and financial Timing and expectations

8 expect the best FY 2006 Financial Results Budget Second Quarter Actual Second Quarter Operating Revenues$147,844,835$141,853,428 Expenses, including transfers$146,720,641$139,486,424 Net change$1,124,194$2,367,004 Ending, retained earnings$56,477,509 Second Quarter FY 2006

9 expect the best PPEA Capital Lease Update VITA’s agreement with Northrop Grumman includes imbedded capital leases for equipment and facilities Exact assessment of debt impact cannot be made until agreement finalized and significant capital activity starts HB/SB 29 contains language approving the agreement and any capital leases related to the agreement

10 expect the best Infrastructure PPEA Lease Obligation Balances Under worst case scenario $101 million is the largest one-year General Fund capital lease obligation Presently, only the Desktop tower is determined to create a capital lease obligation – maximum $31 million

11 expect the best For More Information on VITA Lemuel C. Stewart, Jr. CIO of the Commonwealth