Senate Standing Committee on Labor and Technology

And happy Aloha Friday. This is the Committee on Labor and Technology calling our informational briefing to order. Today is Friday, February 27, 2026 and we are in Conference Room 225 at the Hawaii State Capitol. We'd also like to welcome welcome to Senator Moriwakee for joining us here today and all those in attendance and those watching on Zoom.

Just a few housekeeping announcements. There will be no public testimony at this time. The content, including the hearing notice can be found on the legislature's website. The live video stream and archive of this hearing can also be found on the Senate's YouTube channel. With that, I'm going to read our agenda for today.

The purpose of this informational briefing is to discuss updates to the state's mainframe services, cybersecurity and current status of technology upgrades and funding. We'll have a presentation by the Office of Enterprise Technology Services, which is housed under the Department of Accounting and General Services, also known as DAGs.

So they'll do a presentation with questions and discussions to follow. And before we proceed, I'd like to welcome Christine Sakuda and our Comptroller Keith Regan. Thank you for joining us here this afternoon.

If you would like to introduce your team and if they can just raise their hand or stand, that would be great and then we could recognize your hard working team. Thank you.

Thank you very much. Chair, Senator, I'd love to introduce members of the Office of Enterprise Technology Services Executive team.

And so please wave our Senior Communications Manager and PIO Glenn Delacruz, our IT Operations Officer, Tom Ku, our Chief Information Security Officer, Vince Wong, our IT Governance Officer, Todd Omura, our Administrative Services Officer Lenore Fisher, our Chief Data Officer Rebecca Cai and our Finance Analyst Kara Binger. And did I catch everyone? Yes, I did. I think so.

Thank you very much. And I just have a wonderful team and thank you for allowing me to introduce them.

And you may proceed if Comptroller, would you like to begin?

Certainly. Thank you, Chair. Vice Chair, I just wanted to start by saying we appreciate the opportunity to be before your Committee today to provide this info briefing as the Comptroller. ETS is one of the eight divisions that we have within DAGs. I think it's probably one of the most important divisions.

All of them are important, but ETS plays a very large role through throughout the state of Hawaii and we're very honored to have them here today to present before you. I would like to just recognize our Chief Information Officer Christine Sakuda, whom I've had the pleasure of working with.

Since June 2024, she has been an incredible asset to the state of Hawaii. I'm very fortunate to have her on our team.

And I would just like to recognize the team that's with her today as we just went through those introductions, because it is through that team that we're able to support the needs of the state of Hawaii in ways that you cannot even imagine.

These individuals are very experienced, they're professional, they're highly skilled, they're dedicated and committed public servants. And they work hard every single day. And I just want to thank them for all of the hard work that they do and for their commitment to the state of Hawaii.

So with that, I really appreciate this opportunity to be before you and I look forward to Christine's briefing and we look forward to answering any questions that you might have. Mahalo, Chair. Mahalo, Vice Chair.

Thank you, thank you. Thank you very much. Okay, so I'm going to start by giving a little bit of introduction of the Office of Enterprise Technology Services, just very briefly. And thank you, Kampfl, for that wonderful introduction. So we have an office of about 184 total positions within the office.

And we've, as you met, our Executive team cover a wide variety of areas, which I'll go into detail a little bit later. Our operating expenses is about $34 million.

So that with our personnel we kind of have about $45 million excluding our restrictions, so 45, $50 million to really cover all of our critical infrastructure that we provide to the state. Critical IT infrastructure. And so I wanted to just pause on that a little bit.

ETS has several enabling statutes and, and so the statutes really cover our, the CIO authority IT governance strategy.

And this is mainly through the HRS 2743 security audits and remediation, independent verification and validation, our data policy and our Chief Data Officer, our IT Consolidation plan and shared services plan, which we delivered to the Legislature at the end of last year. I can go over that in a little bit more detail.

Our Information Privacy and Security Council and our Access Hawaii Committee. So as you can see, a lot of the work that we do within ETS is really driven by these statues to really provide backbone IT infrastructure for the government enterprise focused on the Executive branch. And this is a little bit about our.

It's like one of the few technology slides that we have within our deck. It's like a technology stack. So it starts off with critical information at the bottom, almost like a mountain. And as you go further up from critical information, ultimately you get to constituent services, end user Services.

So ETS provides everything in the green, anything from critical infrastructure like networking, security, hosting, identity and access management, data management. And as you go up further, the Microsoft 365 Enterprise tenant is what we administer for the state, Adobe Esign.

And as you go further up, you know, we exist to really support and enable departments so that they may focus on their direct services. Within each Department, we provide enterprise core infrastructure that they can depend on so they can, they can do their job in providing their direct services to their community.

A little bit about 2743 HRS 2743, which is one of our core enabling statutes. And that is that we provide IT strategic planning and we help departments provide their IT strategic planning and also help to leverage that to manage and oversee the IT spend requests that come into the state.

And so we provide a strong governance structure related to that. And I'm going to go over that in just two slides and if you would like any more information, we are happy to provide that to you. So for example, this is where the state's information systems are hosted.

So back in the day, state's information systems were hosted in a data center or in a surfer kind of below a desk or in a closet in an office. And we have been slowly migrating the state's critical applications off of physical servers that are distributed across the enterprise into a cloud and hosted environment.

And so in 2019, under 20% of the applications were actually hosted in a cloud environment. And today we have over 50% of the applications hosted in the cloud environment. So we're slowly migrating that where IT makes the most sense and that provides continuity of services.

It provides an opportunity to make sure that security and access management stay current as technology changes so frequently.

Where is the cloud? Where is it hosted? Do we have it locally or. We are still on the mainland.

We have been working very closely with Amazon Web Services so we're migrating things to our contracted government private cloud. But we, we support all of the other cloud providers as well as the departments have unique needs for that. So over time we would like to minimize the amount of cloud disparity.

But also we understand that programs have unique needs and we partner with them on that.

So our storage is all amendment or do we have storage here? I mean in case we need, we have need for it to be faster.

We do have the cloud storage here and backups on the mainland. Yeah, good question. Just wanted to know what I thought. Okay, so a little bit about our IT governance. And so this slide reflects that in the last five years we have administered over 1,000 spend requests. And these spend requests come to ETS if they're over $100,000.

So over five years we've had 1,000, and that total equals almost $2 billion. And so you can see on the left side the breakdown by Department of the IT spend requests that have come into the state. So Department of Human Services is very, very high.

And when you look on the right side, it's broken down by the amount of spend requests that we get every fiscal year. And so, for example, in 2024, it's high because DHS really invested very heavily in the MedQuest modernization effort. that time, the spend request was over $300 million for five years.

So these types of the IT governance that we put in place with the tools that we use to track IT spend requests like this really help us manage our IT spend requests, identify trends like migration to the cloud that's happening.

So we're able to respond as much as possible with the modern tools as they emerge and modern needs as they emerge. Okay, so now I'm going to pivot from just a General overview of what we do into the specific legislative budget requests that we have. And we're here today. So thank you. Thank you very much, Chair.

This is a high level overview of our budget priorities this year and I'll go into each of them in a little bit more detail, highlighting the major ones. And so the first one is our mainframe services. So ETS provides mainframe as a service.

We provide that service to departments that have had applications hosted on the mainframe and these applications, and you'll see this in subsequent slides, host the unemployment insurance benefits program, child support payments, the famous, the financial, the current financial management information system critical applications are actually on the mainframe today.

And the mainframe itself is a 40 year old system. So it used to be in our data center. And to the point that you had mentioned, center now is a mainframe as a service in the cloud with a backup. And so I believe it's in Omaha with the backup in. Where is the backup?

Illinois.

Yeah, Omaha and Illinois. And so we, you know, those are a phase of modernization as we try to get out of the data center, but it's still a 40 year old system.

And the reason why it's important is the good news is that all of the applications that are hosted on the mainframe is in the process of being modernized. That's good.

And this is an example of the impact that those systems have on our community, for example, and they're broken out into different chunks, I'm going to go over them quickly in the interest of time. They support the state's payroll, ability for the state to pay payroll to pay.

Vendors help us manage our operating funds on social, social services. The applications that are on the mainframe support disability payments, unemployment insurance benefits, for example. They really are there to support the vulnerable population. In addition to that, we support federal funding reimbursements and grants payments.

So as the system gets older and becomes more fragile, it runs the risk of negatively impacted our ability to deliver on these services, which is why we try to maintain this infrastructure as much as possible. So today, ETS spends about $12 million managing the mainframe. And that's broken out into personnel, hosting, consultants and software.

We track that very, very carefully. Most of those costs are fixed costs. This slide represents the applications that are on the mainframe and when they plan to migrate off the mainframe. So good news is that they're migrating. And so everything in green are the programs that are federally funded. And there's a charge back to those federal programs.

They get funding from federal funding that help to subsidize their portion of the mainframe. So in 2026, Child Support Enforcement Agency is scheduled to roll off. DOT Highways Accounting System is scheduled to do that. And later on in the year, Hawaii's automated Welfare Information system is scheduled to roll off.

When Child Support Enforcement Agency is going to roll off, we are going to have a federal funding shortfall of about $5.5 billion dollars. And that is what the spend request is for this year is to make up that shortfall for the, the 2026-2027 fiscal year.

So as we continue to move forward from 2026 to 2027, other federally subsidized programs are going to roll off. And in the next fiscal year, that shortfall is going to be $7 million. Over $7 million.

We are committed, Senators, to making sure that the fixed costs that support the mainframe that you just saw are as minimal as possible. But any changes or upgrades to the mainframe system actually delays these projects in modernizing. So we work very closely with the departments to identify what's the best path forward.

So if we don't get funding over the next year, we, we really, it really puts our ability to support the mainframe in jeopardy moving forward.

So the funding that you say, the shortfall, how is that estimated? Is that you get separate grants coming in, or is it a portion of. Oh, sorry, is it a portion of what like, say UI gets or, or you know, what DHS gets?

Is that a percentage that comes for it, that that's the shortfall, or you have separate grants?

Thank you for that question. We don't have separate grants. It's the latter. It's the federal funding that comes from the departments that help subsidize the mainframe costs.

So if so, like, for example, they're saying SNAP gets reduced. That's when you get reduced. Is it by the program areas or. And if they get increases, you can get more or how does that work?

No, it's really in the case of Child Safety Enforcement Agency, which is the application that's rolling off based on their utilization of the mainframe, their percentage of utilization of a mainframe. And there's a, there's a cost allocation model that calculates that cost.

They fund $5.5 million of the mainframe cost, but they're, they're getting off the mainframe this year. So that 5.5 million that covers part of the cost is going to go away.

So I guess what I'm asking is how do we make that shortfall up? Because if we put state monies into it, what is that covering? You don't do that program anymore. We don't do the program.

The early modernization applications are rolling off of the mainframe. There's still fixed costs to support the mainframe. Those fixed costs don't go away. So there are a little bit of variable costs and I can get that information for you, but the majority of the costs are fixed.

So if you go off and have it on the cloud, in the cloud, would that reduce your cost? I mean, I'm looking at what in the long term is it going to be, this cost going outward, or are you looking at how we might reduce the cost to begin with and how do we strategize going forward?

Well, the applications that you see here, they are all currently, all of these applications are on the mainframe as a service, which is currently in the cloud in Omaha, Nebraska and backed up.

And so we just moved the mainframe from our server environment in the data center into the cloud and a bunch of those costs, 12 million, are fixed costs. So as applications that you see here roll off the mainframe, it doesn't really impact the fixed costs that we have.

But since those federally funded applications subsidize the cost of the mainframe, we end up with having to make up for that cost through our General funds and chargeback model.

And maybe to help with context, if you could go back to slide 13.

So these original requests were Enterprise Technology Services requests to the governor's office, which was not included in the governor's package.

Yes.

And so, for example, what you're talking on, slide 21, where you have it prioritized as number one, that's to replenish what would be going off the cloud.

For that and that cost, to answer Senator Mori's question, that cost wouldn't change. That's still fixed cost, but now going into the cloud.

That's right.

Okay. Okay. And so these were. And then how many of this is related to mainframe on this particular slide? Is it just.

Yeah.

Just the first one. The first one. Just the first one. And that. That's priority for us because we don't want to jeopardize the services to our, our departments in supporting the mainframe.

Okay. And if we were to go back to 20, slide 21, the current slide that you're on. Thank you, Chair. Ms. Sakuda. So is the thought that as these agencies roll off the mainframe, that Enterprise Technology Services would come in for a similar funding request to what, make up the balance?

Yes, and we work with our departments on that because it's really supporting their applications that are on the mainframe.

But the request is coming from ETS, not so much the individual Department line item budgets.

Yes, because. And in this case, because we manage those costs on the mainframe on behalf of them and we provide the mainframe as a service. That's where the costs are incurred right now.

And then as a follow up to that, so for the mainframe, we're talking about the physical location. How many of you, how many employees do we have to manage that? And how much of that is being outsourced? How many of that is in house or how many is that through contract services?

That is a good question that I don't have. Okay, May I ask and answer that

question, if you could, if you don't mind. Coming up, speaking of mic. And then we'll go to Senator Moriwaki for additional questions. If you could just identify yourself, please.

Kara Binger, the budget analyst for ETS. So for the mainframe, the positions that we have dedicated to running the mainframe is about 49 personnel.

Yeah, and 49. Those are all civil service or is that.

Yes, all civil service. And it is included in the pie chart, that personnel section.

Okay, thank you, Senator Moriwaki.

So I guess just to get in my mind the fixed costs, if you have departments rolling off, the cost is still the same or are you reducing the service? So therefore the cost should be reduced. No, I don't quite understand how you calculate the costs.

So the mainframe is a fixed cost. So the hosting, just looking at the pie chart, the hosting contract, we would still need to be paying that for the entirety of, of our mainframe or running the mainframe. Same with software. Software is installed at once, it's not by pieces.

So we will be continuing the mainframe until the last Department rolls off, which should be famous. Dag's famous. So we would need to keep these costs while the entirety of the mainframe is running.

So if you have only one Department on, the cost is still the same as having 20 departments on. Yes. So when the last DAGS famous goes off, then our contract ends or how does that work? Or do we get off of the mainframe? We will get off of the mainframe.

When the last application rolls off the mainframe, then we will get off the mainframe and we don't need those services anymore. And those as we continue to mature and modernize, you know, resource needs get diverted to other, you know, other other opportunities or supporting all of these systems and moving forward.

And so as a follow up to that as well, for the 49 civil service positions, does ETS have a future plan on how you would utilize those positions going forward? Once we're off the mainframe?

We are working, actively working on that plan. Okay. Workforce development is very important to us and we'd love to, you know, leverage the expertise that the staff have in other areas of demand that we currently have that we are, that are growing within ets.

Senator Milwaukee.

Yes.

So I guess looking at all the

departments that we've talked about consolidation forever and you folks have done a good job moving together when you're looking at shared services, when we get off the mainframe and everybody's kind of every department's, I guess, doing their own thing, how is that connected in terms of still having a central focus on the kinds of services we've once talked about that you can just come into, the consumer could just come in or client could come in and come into the system once and DHS and DoH and DLNR can all have.

DLIR can all have the data without having to input constantly. How does that relate. Do we need to have a mainframe or can each Department have their own program and somehow it's connected.

Yes, thank you. Thank you for that question. I'm going to move back to this. Sorry if I'm making folks dizzy. Let's see here. So part of the. Okay, if we look at part of the green slide is Slide 8. Slide 8, yes. Is that as applications move to the cloud. Thank you very much, Kara.

As applications move to the cloud, it's a good question of how do they stay connected.

And that is where the demands of IT governance, the Department within ets, that really helps ensure that standards across the applications, there's interoperability across the applications, are there security across the applications, and that all those applications are able to exchange data through a data interface, which is sort of the green bar where it says ipaas and IT management.

And so instead of sharing data physically, perhaps the opportunity moving forward is to build interfaces across the different cloud environments so that data can be shared. And so that's just new for us.

And while there are initiatives that do that today, at the scale that we're talking about, those are some of the tools that as an enterprise, it's on our IT consolidation roadmap and our enterprise roadmap to really build.

So that is something that going forward, everybody's, all the departments are on board with going forward in that direction of interfacing. As you go forward, even if they have separate, you're going someplace else in the cloud.

I think the departments definitely see the value in sharing data and exchanging data. And we still have a combination of applications that are hosted and not hosted. So we, it's important for us to continue to work with the departments very closely so that we're actually able to build that.

So I believe that they, they definitely see the value in doing that. It's just a matter of how do we set up the infrastructure, how do we support that effectively moving forward?

I hope so you can proceed on.

Okay, thank you.

Yeah, thank you. Thank you very much for those questions.

Thank you.

Okay. Okay, I'm going to skip to the second priority and moving very quickly now. So the second priority is supporting our government private cloud. And we had mentioned this earlier. So the GPC enables Hawaii's government agencies to leverage the cloud by providing that flexibility and reliability.

So we work with the departments very closely on their smaller applications to move them to cloud environments. We prefer our hosted cloud environment, but we don't require them to do that.

And it's very important that we do do that so that they are able to get the benefits of cloud services, continuity of service in case of an emergency response, for example.

And so if not funded, and you'll see a couple of examples of the applications that are in the process of being migrated or the departments that, that we are working with to migrate their smaller applications to the cloud, you know that's why support for this is very important. So that's the, the second request that we have now.

I'm going to keep on moving forward in the interest of time and please proceed. Okay, thank you very much Chair. The third and you had asked about this specifically is around cyber security and we can never invest enough in cybersecurity so it's always really related to managing risk.

And so the funds, this 1,000,000 dollar request for cybersecurity is broken up into a couple of chunks. One of them is to provide technical tools to expand our zero trust network architecture so that we may strengthen the security network itself.

And the second is to support security education and coordination across with our partner states as well as with the counties moving forward. And that's through Ms. ISAC as I mentioned here and we can provide a little bit more detail into that later.

So it's really important for our security network led by our Chief Information Security officer to coordinate very closely with all of the departments in the Executive branch but also the additional departments like the University of Hawaii Department of Education as well as our counties to make sure we're very well coordinated as well as getting the tools that we need, the technical tools that we need to support the infrastructure so we can monitor the system and prevent bad actors from coming in.

If I just may pause you for a second here, it's my understanding that is there also like notice that goes out from federal, state and county agencies on new emerging threats or cybersecurity threats that are aware like a sort of like a bulletin. Is that, is that pretty an accurate, fair statement?

Please come up and answer that, introduce yourself and answer that question. Thank you.

Vince Huang, State System and then also regarding the information notices, there's layers of information that's available.

Some of them are from the vendors, some are from our public sector partners and some of the information is free and others are facilitated through services and with the federal level Right now a large majority of the cybersecurity information we get through the Department of Human Services cisa.

Yeah and so that information is at the free level including some bulletins that are joint operated that include the FBI as well through the system with the Ms. ISAC that we're proposing getting funding to continue that effort. It'll combine a lot of information that's referred to as sltt, state, local, tribal and territorial.

So it pools information at that level below the federal level so that we can have all information. So if there is particular vulnerability or sensitivity that's being targeted at the state and local area, then all of us participating in that group will be able to participate and share the information. Okay, thank you so much, Vince.

Thank you. Thank you, Vince. Our fourth request is around improving constituent access and security of the state websites. And so my Hawaii is a tool that we implemented last year that provides secure and seamless access to digital government services, enhancing both constituent experience and security.

So when you log on to state websites now, you use one username and password that is authenticated. And not all applications use this. Many do. And so we're really looking to expand that for a couple of reasons. One, for the constituent benefit, since they don't have to manage many usernames and passwords.

And we focus on the security, multi factor authentication and security, which is good. So one is ease of access and two is security. And so we hope to expand those services moving forward. Number five, expand radio sites for first responders.

So the image is very small, but across the islands, the Hawaiian Islands, there are towers, those towers provide. There are radio towers, bless you, that provide access, especially for first responders that use walkie talkie.

So when the Internet's down, when there's an emergency, when we have park rangers that are in the forest and there's not great cellular access, they depend on this network to connect, and that's very critical.

So this funding is specifically to expand two, put two sites in, on Hawaii Island, in Puna, in Kona, to kind of build out that capability. And currently that axis is weak. And so we want to strengthen that.

Question. Yes, Senator Morawaki, so how does it relate to E911? Because E911 is for the first responders and this helps them when they get calls and so forth. Right, but do we. Because I know they have big budget and I don't know how they're using that.

But would that be something that there's more of a connection between the interoperability? Because I would think that this helps them do their jobs.

We do coordinate with E911 and the CIO sits on the board, and Todd Omor, our IT Governance Officer, represents me sitting on the board of E911. So we work very closely to coordinate services. And so the radio network is actually supported with a lot of partnerships across the state, federal, state and city and county.

And so we always are really depending on those partnerships to make sure that the infrastructure is stable and working so that it's dependent upon during times of emergency.

What about in terms of sharing their resources, like their budget, which is pretty large. Right. Be great if we can get Some of those resources I know that get. What is it, a dollar per cell phone or something like that. Right. It's big.

So I'm just wondering how they, they can help in building the infrastructure and maybe that's a conversation that maybe with them. Yes.

Do you have any, anything to add to that Mr. It come up here and.

Okay. If I want. Okay. I talked to more IT governance officer and actually sit the delegate for CAO. I sit on the E911 board. So the funds for the E911 but I guess the basis, you know, to answer your question, the technology.

So we're Talking about the 911 system where citizens call in, connects to police departments, first responders, we call them the PSAPs for the counties. What this is. So this is under Vince's area networking and radio. This is land mobile radio communications. These are all the towers where the first responders. I call them, I'm kind of a layperson.

I call them walkie talkies. These are ones where you know, in times of emergencies that they go, you know, the direct connections with each other. So there are actually two different types of communication technologies.

And then as you know Senator, the board is with the surcharge that we get from the cell phone companies which is different to able to administer that help the PSAPs and provide governance over the infrastructure and the building out that next generation 911 system.

There is a lot of crossover obviously because of the function and what they do.

I know from participating on the Board Meetings that when you know, when items for consideration for build out and reimbursement comes up, these things get discussed and on occasion, you know, the crossover with the radio, the network and to see you know, what's appropriate to be reimbursed or what's not.

So I can tell you that it's closely monitored on the 911 board side. And I don't know if Vince wants to add any from that.

Yeah, because I mean I think we, we're all in this together. And so I'm just looking at, you know, when funds are down. Yes. Then how can we use what funds are available for the same purpose, which is really for first responders. No, I appreciate that.

Yeah, yeah, no, thank you. Okay, thank you, thank you, thank you very much for that question. We'll definitely make some inquiries. Okay. The sixth request is for indigov constituent relationship management platform. And so this is the constituent management platform that the governor's office and Lieutenant Governor's office uses to get public input into the system.

And so we are very happy to stand this up. We partly stood this up around the Maui wildfires. We didn't get any additional funding to do that. And so that's what we're requesting to do. So we're doing this out of our current operating budget. Thank you. Okay. The request number seven is Adobe Acrobat Services.

And so there is a deadline this year for all state websites to be accessibility compliant. And ETS works very closely with DCAB, very closely with our partners, to make sure that the information that is put on the state's websites, including PDF documents, are accessibility compliant to the new rules and that they are accessible.

It's a big effort, It's a heavy lift. And so this funding actually helps to provide the tools that enable us to be able to do that in a less labor intensive way and enables us to put the documents on as fast as possible.

Okay.

All right, so that's, that's the list for our general request. And we do have one CIP request. We mentioned this in, in our meeting earlier. And this is to decommission the Kalanimoku data center and convert it to new state office space.

So right now we'd love to get out of the basement, to be honest with you, of the Kalanimoku building.

And it may have been, you know, a great idea way back when, but, you know, we really believe that the staff, you know, would benefit and ETS would benefit as an organization to kind of get out of the basement. But we stay very close to the infrastructure.

So in the basement of the Kalanimoku building there is the big data center. We have moved, made a concerted effort that you're very familiar with, to move this equipment out of the data center and prepare it for office space.

So this CIP request is really to start to do that because there are so many wires, there's such a long history of hardware and wires in the data center. We want to make sure that we decommission it appropriately. And Importantly, there's a 40 year old halon system in there as well.

And halon is, it's getting to the point where it's hard to sustain, which creates risk to the people that are in the data center. And so we want to very move out of the data center as effectively as possible.

So my understanding was we moved everything out so we could make office space so people can move in. So you're saying we shouldn't be in.

It is to move. Well, we want to move out. The Helon system was to support the, the data center and the servers. And so we don't need that system anymore. So part of the decommissioning is the removal of all of the infrastructure, including the Helon system that we don't need.

But today we still have people that are working there.

Okay, so you're moving all of the equipment out, though, so you can make space for people to move back in?

Yes, and I think part of the vision is that the comptroller has swing space in the building. And so when departments are renovating their. Their office buildings, there's, I think, on the third floor or fourth floor, some swing space. So the idea is to renovate the.

The Kalanimoku basement into swing space and then move ETS up to the. The third and fourth floor of the building. And so it's still being envisioned to. We want to use that space space. So what is the. What is the plan for use of the space once everything is moved out?

It would be swing space, you know, office space for departments that are renovating their spaces that, while their space is being renovated, such as the Department of Health. But I think they're going elsewhere. They would come into that, into the basement, into that swing space temporarily, so it's temporary space, and then move back again.

So we prefer, you know, prime real estate on the third or fourth floor, not to be the swing space, but for that to be in the. In the basement.

So at some point, then there's no more need for swing space. Is that made. Is that going to be built as office space? Because I think that's what the comptroller said, or at least you said. Yes.

The idea was that we could bring people out of private spaces that we lease into buildings where we can renovate and have space for our. Our own employees.

Right. And I'm sorry if I'm not being clear that the swing space is for state workers that are renovating their offices. Yeah, I'm just saying once that, Once that's done. Yeah, that's. Yeah. I mean, I think that. I think that I'll leave that plan to others, but. Okay.

And I know you have a few more slides, and then we. Yes, we can ask questions. Sure.

Okay. So that's our request. So, you know, we gave you an overview of ETS and the expanse of the enterprise. IT shared services that we host, that the critical backbone infrastructure that ETS provides to the state. And we're really excited about the IT consolidation plan, and we got approval, worked very closely with the department's leadership.

And thank you, Senator Moriwaki, in particular, for your support on that to really build out our shared services so that we actively manage our IT investments. This is what ETS does as providing shared services so that departments are able to do what they do best and provide their programmatic support.

And so moving forward, our goal is to continue to strengthen the core infrastructure because we still have to invest in that and then scale that out and support, support the departments. And so with that, I'll thank you for the opportunity to provide our.

What we do to in ETS and also to share our major budget priorities for this year.

No, thank you so much. So I'll start off and then if Senator Moriwaki has questions, feel free to jump in. Senator. So the first one is, so. So we talked a lot about the mainframe and going to the private cloud is sort of that.

Is that the trend across the nation and going to a secured private cloud server?

It is. Okay, it is.

And then I want to talk about specifically. There was a bill this session with the city and county to request. It got deferred, but it was to request about $10 million for driver's licensing, which would sort of be on the county of Honolulu. City and county Honolulu. And I believe they're on the old Cobalt system.

And is there a way that ETS can work with DOT in the city and county to see what can be done to address some of those needs and concerns? Absolutely. I don't know if you're aware of that.

Yeah, absolutely. We do have, we work closely with the new Circle CIO in city and county of Honolulu. And they have mainframe. They've had mainframe services. We have mainframe. So I think, my understanding historically is that we've leveraged each other's infrastructure. And so moving forward as we continue to modernize, those present great opportunities for us.

Okay. Yeah. I want to kind of go on your website in a. In terms of your portfolio management. This is on ETS's website. It mentions about 462 active projects and 453 that is roadmapped. And I know, I think this kind of dovetails with what's on the mainframe and what's coming off.

But could you tell the Committee and the public what are some critical modernization programs that ETS is tracking with the different agencies that comes to top of mind.

Well, we track all of the major projects. And so one of the, one of our enabling statutes is.

If you could speak a little into the mic. Sorry. Thank you.

One of our key roles that we provide is independent verification and validation oversight over the large modernization projects. And I maybe that's what you might be referring to, Chair. And So that's in HRS 2743.6, which is that it enables the CIO and ETS to decide which of the large projects have an Independent Verification and Validation process.

And IVV for short, is really is a an oversight that is applied to major modernization projects to help ensure that the projects stay on time and on budget. And we actually thank the Legislature for helping to get that passed several years ago.

And so on our website, we post the reports that come out of the major modernization projects. So all of the major modernization projects that we feel are important to have IV and V have that. And we work with the projects to develop those reports, post them on the ETS website, but also share them with the Legislature.

And that creates great visibility on what the status and the progress is of those projects.

So in line with the IVV reports, I noticed on the website that there hasn't been a report for December or January. Is are you folks in the process of perhaps updating that? Yes. Posting that. Yes. Okay.

Yes, we do. For each of the each of the different projects, they kind of work independently on their own schedule. And the goal is for them to produce monthly reports. Is it are they all required to produce monthly reports? Yes.

So all they're all required to produce monthly and some are a little delayed, but we try to make sure that they get posted. Yes.

Senator Malwaaki, you have any questions?

So in light of what the chair is saying, you have five or six or something major projects like the unemployment insurance, disability comp, some of these. So how and so other than the IV and V, how do you support the departments or are they on their own?

I know that for the UI folks gave a lot of support, but even in terms of getting the vendors right, you went to visit all over. How does that process work? Is that your business modernization or is that your service service?

We help in a couple of ways. So as a part of our IT governance process, when spend requests come in, we have a team that works very close with all of the departments and talks with them on a regular basis about the different IT projects they want to do. And so we work with them on that.

Ultimately they come into ETS for us to approve and track in our system, as you've seen, and it depends on the project. We are always there to provide support and advice. And so the larger the projects that require more resources, we may be more active in that.

And it's one of my priorities moving forward to strengthen the relationship that ETS has with the departments and provide technical advice and resources to them to help them be successful.

We wish that all of the, we had enough resources within the state for all the departments to have all robust technical expertise, but that's just not, not the case. And so we really try to build that internally within ETS and then work closely with the departments.

As the, as the size of the projects get larger and maybe the stakes get a little higher, there's a more formal, rigorous process like IV and V that kicks in. Sometimes we're invited to participate in their RFP process.

Sometimes when the IVV reports are showing that there may be some concern, I reach out to them directly, ask them what kind of support can we provide, share with them best practices, bring our team in to see how we can advise them and be really their best advocate with their vendors.

So I think, well, because we've had problems in the past of vendors not really performing and then we kept them on too long. Is there anything now that you have in your system or your process where you actually can look at?

I guess it's the IV and V, but beyond that, how you can from the start, before you get your vendor, work with departments in large projects because they cost millions and we've lost millions. And so what have you done to improve the process? Because I think you need attorneys too, right?

When you're looking at the scope of work and you're looking at being able to cut a contract when they're not performing.

Yes, when it's a new project, for example, that's coming up. And one of the best examples is the enterprise financial system, the EFS project that is being led by the comptroller. You know, we, we have had lessons learned, you know, about what, what makes a, a project successful.

And start very early on in outlining governance, bringing in resources, front loading the project with the right skill sets to help plan for resources appropriately moving forward. And I think that project is well on its way because of that process.

When the project is midstream, as in some of the projects that are, that are in the process of IV and V and they have been going on for a while. It's a good question that you're asking, Senator. IVV allows us to play the role as the administrator.

So we help track and make sure there's visibility over the health of the projects. We provide counsel to the departments. Ultimately, it's up to the departments on how they lead the projects for success and we raise awareness and try to support them as much as possible.

To kind of add to Senator Moriwaki's question, could you explain what IV and V is?

Yes.

For those that may not be familiar with it.

Yeah, I'd be happy to. So IV and V is independent verification, validation. It's. The Federal Government uses that. It's a, you contract a company that is dedicated to a modernization project to make sure that the project stays on time and on budget according to the scope of work.

So the IV&V reports really reflect how well is the project doing? Are they within scope, are they on time, or are they within budget? And what ETS is doing moving forward is we want to make sure that the IVV process is as meaningful as possible.

So the dashboards that you see across the different projects, there's a standardization to them and that they're meaningful to the, you know, to the programs, especially some of the, some of the reports really reflect, okay, here's some of the challenges that you're having, and here are some of the recommendations that we have to help you improve your, your, your project.

And then we are happy to work very closely with the departments to help them do that. And so, you know, that's how the process has been working so far.

So for IV&V, it's a third party that's contracted out by ETS and is it one particular vendor that oversees it? And does ETS have a team or a person that manages the IV and V contracts in working with the agencies?

Thank you for that question. The IV and V contracts are managed by the departments. Okay. So when the, when a big monetization project comes in, you know, part of that project is, is investing in the IV and V. If the CIO believes that it's important to have that.

We work very closely with the departments on creating that IV and V RFP, making sure that they're standardized across the, the different projects and making sure that the oversight is really set up for success. So we really are in the role of the administrator. We don't manage the project ourselves.

The departments do that, but we really help advise the departments on putting the proposal together.

It shows when the project is okay or yellow or red. When you really problematic and got to do something. Are you advising the Department? Sometimes the Department say, oh, okay, we have problems, but you know, to actually work on the reds and yellows or, you know, because it's like a rating of what is problematic.

How do you manage with the Department or administer with the departments?

It is, and it's inconsistent. So we are trying to strengthen our governance around The IV and V process. When projects reflect that there are challenges, then my team, I schedule a meeting to meet with the project to try to understand what the challenges are.

We try to make sure that we meet with both the business leaders, the directors, deputies, or their program leaders, as well as the IT leaders to try and understand where are the resource constraints and really be their best advocates to right. Set the project. That's what we try to do. We.

And again, I, I do want to emphasize that we're, we're in today, we're in the role of the administrator, that the departments really do own their projects, but we want to help them as much as possible.

And I think to that point, is there anything that ETS has flagged as being not performing well in terms of. At a critical point with some of these modernizations that you. That you could share at this point in time, or have they been just. There's been various issues and it's just working through those issues.

Each of the projects, I mean, if you look at the IV&V reports that are posted, then the projects are in various degrees of, I'll say health, and we take a good gauge on that. Some of the projects are on time and on, on budget. Other projects have more challenges.

And, you know, I have found in my short time working with the state that when I, when I reach out to the Department and say, hey, you know, I. We want to make sure that you're aware of the status of the IV&V report. Are you aware of them? How can we help you?

You know, can we bring your stakeholders together and try and understand what's happening? You know, that alone, I think, helps to ensure that the project kind of stays on the right track. Yeah, sounds good. Yeah.

Senator Moriwaki. Nope. Fine. And I think the last question I have is, I know we're, you know, approaching the halfway mark of our session, and from your slide, 11, I think, was 11 or the funding 13. Are you working through the legislative process to see what can be accomplished with some of these proposed items for funding?

This is where I leave. Oh, please stay.

I know the state budget, the supplemental starts in the House. So I guess what I'm getting at is have there been conversations with the House? Yes. Regarding this? Okay.

Yes, there have been. I mean, we went and talked to your counterpart Committee with Chair Iligan, and we continue to advocate for, you know, these, these are our priorities. We really believe that we're at a critical place right now within ETS where we have done some major strategic planning, the IT consolidation planning.

We want to really reinvest in and strengthen our services and so we continue to work with the subject matter chairs and the finance chairs and I'd appreciate any advice on on how we can continue to advocate for the resources that

we need and is there anything else that you would like to share in addition to the presentations that you made today or I would just like to

thank you once again for giving us the opportunity to share what we do and to share why what we do is so important to the state and I just am so appreciative of our team, the team behind this Executive team and all of your support and happy to answer any more questions.

Okay no thank you so much for the time and for your team as well for coming down to present to us and for this information and thank you. If there are follow up questions you know we'll be sure to reach out but there being no further questions we will adjourn.

Thank you very much. Thank you.