Opinion: California is giving lipstick to its FI$Cal pig technology project

The California State Capitol Building
The California Capitol Building in Sacramento. File photo courtesy of the Office of Sen. Toni Atkins

The state government’s chronic inability to deploy high technology in a timely and cost-effective manner is nowhere more evident than in a project called the Financial Information System for California.

This cumbersome title was devised to give it the catchy title “FI$Cal,” but whatever the case, the effort to create a single program to manage government finances was nothing but trouble and has nearly two decades of policy work in it Consumed and bureaucratic time and cost the taxpayer at least 1 billion dollars.

The State Audit Office, charged by law with overseeing the progress of FI$Cal, or lack thereof, has issued a series of reports detailing the missed deadlines, incomplete functions and ever-increasing costs. At one point, the auditor even whistled an attempt to have the project declared complete, even though it was far from fully operational.

Earlier this year, the auditor again cataloged FI$Cal’s shortcomings, including its apparent inability to meet a June deadline for completion, noting that the most important final step — making it usable for the Office of the State Controller to to produce comprehensive financial statements — “has defaulted.” The report warned that if the state is able to “release accurate and timely financial reports,” it risks having its credit rating downgraded and not qualifying for federal funds.

“These financial reporting delays may ultimately prove costly to the state,” the auditor warned.

The legislature was frustrated by the project’s dismal record, and as the June deadline neared, both chambers voted for more oversight. They passed a bill mandating detailed annual reports on the number and duration of unplanned outages and changes in order for FI$Cal to function well enough to meet federal requirements.

The author of the measure, Rep. Rudy Salas, a Bakersfield Democrat, told lawmakers in a statement: “As FI$Cal enters its 18th year at a cost of approximately $1 billion, it is clear that a stronger Supervision and transparency must be created. ‘ adding, ‘This legislation will help create better oversight and functionality at a high-risk government project and get FI$Cal back on track.’

Eight days after the passage of Salas’ bill on June 23, the legislature did something else in relation to FI$Cal, although few lawmakers were likely aware of what they were doing, given that it was one of the many budget “supporter” bills passed was buried with little trial.

The trailer bill simply stated that “The project objectives of the system … are determined to be complete by July 1, 2022. Therefore, no further Section 11546 reporting on system development, implementation, improvement, maintenance and operations, security or related workload is required.”

In other words, the trailer bill enacted what project managers had once attempted themselves – to declare FI$Cal complete when clearly it is not. The legislation also removed the State Comptroller as the independent overseer of the entire project, relegating it to a much narrower role and essentially giving the project’s managers another 10 years to make it fully usable.

Last month, Gov. Gavin Newsom completed the fictitious exercise of declaring the apparently incomplete FI$Cal over by vetoing Sala’s bill.

“While I appreciate the intent to improve the functionality of the Fl$Cal system, this bill is unnecessary,” Newsom said in his veto message. “This issue was resolved in the final budget agreement for 2022-23 included in Assembly Bill 156, which expanded statutory reporting requirements while facilitating the transition of multiple departments into the Fl$Cal system. For these reasons, I cannot sign this bill.”

It’s reminiscent of the old saying about putting lipstick on a pig.

CalMatters is a nonprofit journalism company that explains how the California State Capitol works and why it matters.


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