Call to Order and Roll Call
The second meeting of the Capital Planning Advisory Board was held on Tuesday, July 14, 2015, at 9:00 AM, in Room 171 of the Capitol Annex. Senator Stan Humphries, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Stan Humphries, Co-Chair; Representative Terry Mills, Co-Chair; Senator Whitney Westerfield, Representative Tom Riner, Jane Driskell, Carole Henderson, John Hicks, Sherron Jackson, James Link, and Mark Overstreet.
Guests: James Fowler, Chief Information Officer, Commonwealth Office of Technology; Tim Pollard, Executive Director of Finance, and Elaine Walker, Department of Parks Commissioner, Tourism, Arts and Heritage Cabinet; Dr. Len Peters, Cabinet Secretary, and Bruce Scott, Department of Environmental Protection Commissioner, Energy and Environment Cabinet; Beth Jurek, Executive Director, Office of Policy and Budget, Steve Veno, Commissioner, Department for Income Support, Christopher Clark, Executive Director, Office of Administrative and Technology Services, and Jennifer Harp, Deputy Executive Director, Office of Administrative and Technology Services, Cabinet for Health and Family Services; Troy Robinson, Executive Director, Office of Administrative Services, and Andy Casebier, Director, Division of Engineering and Contract Administration, Finance and Administration Cabinet; and J. Michael Brown, Cabinet Secretary, Justice and Public Safety Cabinet.
LRC Staff: Shawn Bowen, Katherine Halloran, and Jennifer Luttrell.
Approval of Minutes
A motion to approve the minutes of the June 12, 2015 meeting was made by Mr. Hicks, seconded by Senator Westerfield, and approved by voice vote.
Information Items
Two information items were included in members’ binders as follow-up from the board’s June 12 meeting. The Department of Education submitted information regarding the Kentucky Facilities Inventory and Classification System project, and the Education and Workforce Development Cabinet submitted information regarding the placement of Kentucky Educational Television’s microwave towers. No action was required.
Presentation – Commonwealth Office of Technology
As part of the capital planning process, the Commonwealth Office of Technology (COT) is responsible for the review and evaluation of information technology (IT) projects submitted in the agency capital plans. The evaluations were conducted over a one-week period by an eight-member review panel. Mr. James Fowler, Chief Information Officer, COT, discussed the results of the review and presented the project recommendations.
Forty-two qualifying IT projects were submitted for the 2016-2018 biennium. The review panel scored 20 of these projects (from all funding sources) as high in value, meaning they had the best return on investment for the Commonwealth. The projects total slightly over $140,000,000, and include $36,000,000 in federal funding. The panel recommended 12 General Fund projects totaling $62,000,000, and three additional projects totaling $32,030,000. The three additional projects did not mathematically make the cut as high in value, but were deemed important.
Four of the project recommendations, totaling $18.2 million, related to document management and the digitization of paper records. Mr. Fowler recommended that these projects be funded collectively, and that COT develop an enterprise-wide document management solution that would satisfy the needs of these projects and similar initiatives by other agencies. He further recommended that COT partner with the Kentucky Department of Libraries and Archives to develop an enterprise-wide high speed scanning and digitization system. The basic components of such a system are already available through the Kentucky Department of Libraries and Archives.
Mr. Fowler said the statutory definition of an IT system in KRS 45.750, while not prohibitive, is not clear that IT systems may include services or service subscriptions from third parties. He recommended that the statute be amended to specifically include these new forms of IT delivery.
Senator Humphries said he appreciated COT’s objective approach to scoring and reviewing IT projects for the board. In regard to amending KRS 45.750, Senator Humphries said he and the board’s staff will work with COT to accomplish this during the next legislative session. He then suggested that COT’S recommendation to amend KRS 45.750 be included as a policy recommendation in the capital plan.
Representative Mills said it is important to upgrade and fully integrate the state’s IT infrastructure to better serve the public. He said he supported the language change to KRS 45.750, as well as the COT enterprise-wide document management solution project. He recommended the enterprise-wide document management solution project be supported and endorsed in the capital plan.
In response to a question from Mr. Hicks regarding the status of the Kentucky Business One Stop (KyBOS) project, Mr. Fowler said substantial progress has been made on this project. KyBOS is an example of multiple cabinets and agencies working together and sharing data. Systems are linked together via Cloud and Internet-based computing. These options would not be available had COT not completed, or almost completed, the centralization of IT infrastructure resources for executive branch agencies (Executive Order 2012-880, October 2012). The consolidation will be complete no later than October of this year.
Mr. Hicks noted that the Enterprise Business Intelligence reporting tool, which allows for the integration of data from multiple platforms, has enabled the Commonwealth to implement enterprise-wide business solutions. Mr. Fowler said the state has an enterprise level license for this software which allows executive branch agencies to share and manage data.
In response to a question from Senator Humphries, Mr. Fowler said if COT were to become a broker of information services, COT would partner with businesses to buy infrastructure as a service, or to purchase fundamental components of IT infrastructure as needed. Brokering these different services allows the state to get the maximum value from the industry at the best cost and purchase exactly what is needed. Additionally, it stimulates competition among the vendors to provide that service. Mr. Fowler added that brokering IT services is the future of industry.
Consideration of Agency Plans
The Capital Planning Advisory Board received testimony regarding five state agency capital plans: Tourism, Arts, and Heritage Cabinet; Energy and Environment Cabinet; Cabinet for Health and Family Services; Finance and Administration Cabinet; and Justice and Public Safety Cabinet. The testimony included discussion of capital construction, information technology, grant/loan programs, and equipment needs for the period 2016-2022.
Tourism, Arts, and Heritage Cabinet
Tim Pollard, Executive Director of Finance, and Elaine Walker, Department of Parks Commissioner, presented the cabinet’s capital plan. The following agencies within the cabinet submitted capital plans: Department of Fish and Wildlife Resources, Department of Parks, Kentucky Center for the Arts, Kentucky Heritage Council/State Historic Preservation Office, Kentucky Historical Society, Kentucky Horse Park, Northern Kentucky Convention Center, Secretary's Office, and the State Fair Board.
Mr. Hicks asked how the Department of Parks prioritizes maintenance projects given the limited availability of funds. Ms. Walker said the department has reached a critical stage in regard to funding its maintenance needs. Projects are prioritized in the order of health and safety and return on investment.
In response to a question from Senator Humphries, Mr. Pollard said the total dollar value of maintenance projects in the Department of Parks’ capital plan is $190,000,000. Ms. Walker added that an additional $51,000,000 is included in the department’s plan for expansion or improvement projects.
In response to a question from Senator Westerfield, Ms. Walker said the department’s capital plan includes an IT project that would address the lack of cell phone coverage at Lake Barkley, as well as other state parks and resorts (Cable Infrastructure Planning and Implementation project, $6,000,000). The department has been working with AT&T to provide coverage, and estimated timeframe for construction of a cell tower in the Lake Barkley area is three years. The department is also considering other options such as building a cell tower.
Energy and Environment Cabinet
Dr. Len Peters, Cabinet Secretary and Bruce Scott, Department of Environmental Protection Commissioner, presented the cabinet’s capital plan. The following agencies within the cabinet submitted plans: Department for Environmental Protection, Department for Natural Resources, Secretary's Office, and the Public Service Commission.
In response to a question from Representative Riner regarding the increased threat of pharmaceuticals in water supply, Mr. Peters said pharmaceuticals are sometimes flushed down the commode and enter the water system. Many of these drugs are steroids or steroid-type compounds, and tend to be replete with endocrine disruptors, causing a variety of problems and issues. There is now an increased emphasis, not just in Kentucky, but nationwide, to ensure that the water supply is safe.
In response to a question from Senator Humphries regarding the level of interaction between the Corps of Engineers and the cabinet as it relates to state-owned dams, Mr. Scott said cabinet staff meet with the Corps of Engineers periodically regarding matters of interstate commerce. Mr. Peters added that the cabinet works well with the three Corps of Engineers offices, which are located in Louisville, Nashville, and Huntington.
In response to another question from Senator Humphries, Mr. Scott said Bullock Pen Lake Dam is owned by the Kentucky Department of Fish and Wildlife Services and is the focus of an existing project to repair and upgrade this “high hazard” dam. There are eight homes below the dam and it is in threat of eminent failure. This dam requires structural repairs, including grouting of the foundation and dam, and upgrading and reconstruction of the spillway. Additional funding in the amount of $4,000,000 is necessary to complete the repairs and upgrades.
In response to a request from Representative Mills, Mr. Scott said he would be glad to provide a list of the state-owned dams and their location.
Cabinet for Health and Family Services
Beth Jurek, Executive Director, Office of Policy and Budget, Steve Veno, Commissioner, Department for Income Support, Christopher Clark, Executive Director, Office of Administrative and Technology Services, and Jennifer Harp, Deputy Executive Director, Office of Administrative and Technology Services, presented the cabinet’s capital plan. Three agencies within the cabinet submitted capital plans: Department for Behavioral Health, Developmental, and Intellectual Disabilities; Department for Public Health; and Office of the Secretary.
In response to a question from Mr. Hicks, Ms. Harp updated members on the status of the Kentucky Child Support Enforcement System (KASES) project. Several modules within the project have been completed, including the customer support web portal, the information exchange and search portal, business tools intelligence for reporting, online policy and procedure manuals, and the electronic case file. Additionally, the document management solution component has been completed. Mr. Veno added that funding was not available in 2012 to replace the entire system, therefore, federal funding was used to replace several components of the system. The mainframe core will be replaced next.
In response to a question from Representative Riner regarding the Construct Vital Statistics Service Center and Vault project, Mr. Clark said that the storage facility would been hardened (protected) against environmental conditions that may cause the deterioration of older, fragile documents. The facility would not be hardened against electromagnetic pulse attack or hackers.
Finance and Administration Cabinet
Troy Robinson, Executive Director, Office of Administrative Services and Andy Casebier, Director, Division of Engineering and Contract Administration, discussed the cabinet’s capital needs. Agencies within the cabinet submitting capital plans included the Commonwealth Office of Technology, Department for Facilities and Support Services, Department of Revenue, and the Secretary’s Office.
In response to a question from Representative Riner regarding the Commonwealth Energy Management and Control System (CEMCS) project, Mr. Robinson said the project will result in a 15 percent energy reduction with annual savings of about $900,000.
In response to a question from Mr. Hicks regarding the Renewal of the Capital Plaza Complex project, Mr. Casebier said $14 million of the $82 million project cost is for demolition of the Tower, and removal of asbestos and other hazardous materials that must be removed before demolition can begin. The remaining $68 million project cost is for new construction, parking, and other infrastructure costs.
Justice and Public Safety Cabinet
J. Michael Brown, Cabinet Secretary, discussed the cabinet’s capital needs. The following agencies within the cabinet submitted plans: Department of Corrections, Department of Criminal Justice Training, Department of Juvenile Justice, Department of Public Advocacy, Kentucky State Police, and the Secretary’s Office.
In response to a question from Senator Humphries regarding the Renovate Medical Examiner Office/Jefferson Lab project, Mr. Brown said renovations to the first floor, which will house the Medical Examiner’s Office, should be completed by March 2017.
Adjournment
There being no further business, the meeting adjourned at 11:40 a.m.