1. - 0 - DRAFT FOR DISCUSSION PURPOSES ONLY Commonwealth of Massachusetts IT Consolidation Program IT Finance and Budgeting Sub-committee Discussion Document June 23, 2010 DRAFT FOR DISCUSSION PURPOSES ONLY

2. - 1 - DRAFT FOR DISCUSSION PURPOSES ONLY Agenda 1.Update on Fringe Revenue (K.Luddy) 2.Transferring and Funding IT staff using the chargeback model (K.Luddy) 3.Day 1 Readiness – All Set?? (K.Luddy)

3. - 2 - DRAFT FOR DISCUSSION PURPOSES ONLY Update on Fringe Revenue  Background -The general fund was previously collecting between $4.5 - $5 million in fringe revenue from federal, trust, and capital accounts that were funding IT staff. -IT staff are being transferred from these accounts and into either the -1700 or -1701 accounts. -It is important to continue to collect most/all of this fringe revenue in order to avoid a $4.5 - $5 million “hole” in the general fund after transferring these staff. -The chargeback rate used for the -1701 includes an amount for fringe.  Options -Include language in -1701 accounts that allows assessment of fringe/indirect on payroll costs. -Require agencies to revert from -1701 accounts an amount equal to the fringe assessment on payroll costs.  Stay tuned!

4. - 3 - DRAFT FOR DISCUSSION PURPOSES ONLY Transferring IT staff  In order for consolidation to be “substantially complete” by December 31, 2010 (per E.O. 510), staff should be transferred to either the -1700 or -1701 accounts.  SCFOs should work with SCIOs to determine the appropriate account from which IT staff should be paid. Account splits do not necessarily need to correspond to the accounts from which the staff were paid prior to consolidation. In determining the account from which to pay a staff member, you may consider: -Funding levels in the -1700 -Ease of implementation (e.g., application staff from chargeback account, etc.) -Whether you will directly charge salary costs to federal grants, capital accounts, or trust accounts  The IT Finance Subcommittee has previously provided guidance on the process by which staff can be transferred in HR/CMS from one account to another.

5. - 4 - DRAFT FOR DISCUSSION PURPOSES ONLY Funding Staff Using the Chargeback Rates

6. - 5 - DRAFT FOR DISCUSSION PURPOSES ONLY Day 1 Readiness  Staff -Transferred to correct accounts, both in budget and in HR/CMS?  Contracts -Approved by SCIO -Encumbered, where possible  Bills -MMARS security established -Workflow for bills that will continue to be sent to agencies created -Final plan in place for bills that may remain with agency for the first part of fiscal year 2011  Chargeback -Secretariat established as a vendor in MMARS -Chargeback levels communicated to agencies -Fiscal staff has knowledge of chargeback process (ITI/ITA)

7. - 6 - DRAFT FOR DISCUSSION PURPOSES ONLY Critical Dependencies Still Under Development # Pending Guidance Item DescriptionLead Response Deadline Start DateStatus 1 Asset Management What is the process for transferring Assets from agency to the secretariat? How soon does this need to be completed? Linda HamelTBD In Progress 2Chargebacks Guidance related to chargebacks, other than billing rates (e.g., process of reconciliation, etc.). Kathy Sheppard6/1/20107/1/2010Complete 3 Fringe / Indirect / Payroll Taxes How do we use the chargeback account xxxx-1701 to charge off-budget accounts without losing revenue to the general fund from fringe or indirect rates? ANF, Eric Berman, and Kathy Sheppard 6/1/20107/1/2010In Progress 4 IT Bond Authorization Should bond authorization remain at the agency level or at the secretariat level? ITD, Lou AngeloniTBD Complete 5 Open / Close Issues What needs to occur in order to Close FY10 and Open FY11 (mainly for lead agency model)? Kathy Sheppard6/1/20107/1/2010In Progress 6 Service Level Agreements (SLA) Develop sample documents for at least 2 SLAs for IT services and administrative services HHS/HED6/1/20107/1/2010Complete 7 “Shared IT Services” Legislative Authorization What are the alternative implementation steps for Lead Agency Models if Shared Service Language is not enacted OSC/ANF6/1/20107/1/2010In Progress 8 FTE Position Transfers What is the process for making sure that FTEs are transferred to the correct IT account ANF6/1/20107/1/2010Complete