April 17, 2007
The Honorable, The Legislature:
We have completed a review of information technology (IT) projects that describes and provides cost and funding information for 184 projects in 28 executive branch agencies. We identified 103 projects that were completed in the past two fiscal years at an estimated cost of $90.6 million, and 81 projects that were ongoing at the start of fiscal year 2006-07 and are expected to cost $201.1 million upon completion.
Individual projects with costs of $1.0 million or more represent 92.7 percent of the expected costs of ongoing projects. These large projects are typically complex and entail a significant risk of exceeding estimated costs and time lines. We note particular concerns with six ongoing projects that are expected to cost a total of $122.7 million upon completion and have already experienced difficulties.
In a detailed review of selected large, high-risk projects, we found evidence of inadequate planning that increased costs and compromised timeliness. Estimated costs for one project to
customize software for administering the Unemployment Insurance program increased by $18.7 million, and another project was suspended after $23.6 million had been spent. In addition, sales and use tax software with a cost of at least $24.9 million is being replaced only five years after implementation. Two statewide IT consolidation projects have experienced significant delays and cost overruns. A third, intended to replace approximately 100 types of administrative software and projected to cost at least $66.6 million upon completion, requires close monitoring.
The Department of Administration (DOA) has broad statutory authority to oversee and coordinate state IT projects. However, its oversight has been inadequate. We include recommendations to improve DOA's collaboration with other agencies in identifying high-risk projects and establishing planning standards, including quantifiable performance measures. We also include recommendations to enhance legislative oversight of high-risk IT projects.
We appreciate the courtesy and cooperation extended to us by officials and staff of DOA and other agencies. DOA's response follows the appendices.
Respectfully submitted,
Janice Mueller
State Auditor
State of Wisconsin
Legislative Audit Bureau
April 17, 2007
The Honorable, The Legislature:
We have followed up on the Department of Revenue's (DOR's) efforts to address concerns related to the processing and distribution of sales and use taxes through its Integrated Tax System (ITS), which was implemented in December 2002. In a letter report issued in December 2005, we summarized challenges DOR faced during implementation of the sales and use tax component of ITS, including an initial backlog in processing sales and use tax returns, various computer programming problems, and errors in distributions from the State to counties and professional sports districts that assess their own sales and use taxes. Difficulties in planning ITS are described in a review of state information technology projects (report 07-5) that we are issuing today.
Our current analyses, together with work performed by the system's developer, indicate the errors we reported in December 2005 have been addressed effectively in ITS. This work provides reasonable assurance that ITS is accurately calculating counties' and two professional sports districts' shares of reported sales and use taxes.
To better understand sales and use tax trends, we analyzed and identified reasons for a decline in 2006 sales and use tax distributions to the Green Bay/Brown County Professional Football Stadium District. We found the decline was largely the result of lower sales and use taxes reported for the football stadium district; certain changes in sales and use tax law; and a reporting error by a single, large business entity.
In February 2007, DOR announced that ITS will be replaced with new software from a different vendor, at an estimated cost of $3.3 million. Given the challenges faced in implementing ITS, we believe continued oversight will be important to ensure accuracy in the processing and distribution of local governments' sales and use taxes. Our report includes a recommendation for reporting by DOR to the Joint Legislative Audit Committee.
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We appreciate the courtesy and cooperation extended to us by DOR staff during our review.
Sincerely,
Janice Mueller
State Auditor
__________________
State of Wisconsin
Office of the Governor
April 17, 2007
The Honorable, The Senate:
I am pleased to nominate and with the advice and consent of the Senate, do appoint Kachelski, Joseph,
of Verona, as a member of the Health Insurance Risk-Sharing Plan Authority, to serve for the term ending May 1, 2010.
Respectfully submitted,
JIM DOYLE
Governor
Read and referred to committee on Transportation, Tourism and Insurance.
State of Wisconsin
Office of the Governor
April 17, 2007
The Honorable, The Senate:
I am pleased to nominate and with the advice and consent of the Senate, do appoint MacArdy, Wayne,
of New Lisbon, as a member of the Health Insurance Risk-Sharing Plan Authority, to serve for the term ending May 1, 2010.
Respectfully submitted,
JIM DOYLE
Governor
Read and referred to committee on Transportation, Tourism and Insurance.
__________________
Relating to energy efficiency and renewable resource programs.
Submitted by Public Service Commission.
Report received from Agency, April 11, 2007.
Withdrawn from committee on
Environment and Natural Resources and rereferred to committee on
Commerce, Utilities and Rail, pursuant to Senate Rule
46 (2)(b),
April 18, 2007.
__________________
By Patrick E. Fuller, chief clerk.
Mr. President:
I am directed to inform you that the Assembly has concurred in:
Senate Joint Resolution
22
Senate Joint Resolution
36
