Idaho doesn’t know how much money it collected after new software causes errors

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This story originally published Friday, Sept. 15, at Idaho Capital Sun.

Idaho state legislators and government officials can’t verify how much revenue the state has collected during the first three months of the state’s new fiscal year because of errors transitioning to a new statewide business software program, documents obtained by the Idaho Capital Sun show.

State officials transitioned to the Luma software system on July 1, launching a cloud-based software system through the Idaho State Controller’s Office that was designed to increase government transparency. The system is designed for all state agencies to use to centralize and standardize all of the state’s budget, procurement, financial management, payroll and human capital systems.

The rollout had been at least five years in the making, since the 2018 Idaho Legislature passed House Bill 493, which authorized and provided a funding source for the Luma project at an estimated cost of $102 million spread over five years.

But since the July 1 transition to Luma, a series of data entry and reporting errors have hampered the rollout. All state agencies have been affected, according to a Sept. 13 email to state legislators.

Idaho can’t verify revenues

One consequence of the data and reporting errors is the state has been unable to verify revenues or release its traditional monthly general fund Budget Monitor reports that show legislators and the public how state revenues stack up against projections.

“Since Luma went live in July, the state has been unable to verify General Fund revenues due to data entry and reporting errors,” Keith Bybee, budget and policy manager for the Idaho Legislative Services Office wrote in the Sept. 13 email to legislators. “The chart of accounts change has impacted all of state government including the State Tax Commission’s reporting on the comparative statement, which reports on all revenue types collected by the State Tax Commission.”

The state is just days away from finishing up the first quarter of its fiscal year on Sept. 30. State officials hope to provide a first quarter revenue report to legislators by Oct. 20 and, hopefully, resume monthly budget reports in November, Bybee wrote.

Rep. Wendy Horman, the Idaho Falls Republican who serves as co-chair of the Idaho Legislature’s Joint Finance-Appropriations Committee, has met with the State Controller’s Office, Governor’s Office and Legislative Services Office about the Luma errors.

“Some state agencies did their training well in advance of the transition and some are trying to do it right now, and that is part of our problem,” Horman said in a telephone interview. “I am also hearing it is not a very user friendly system.”

It’s unclear the exact scope of the problem. Horman told the Sun she heard of a payroll delay due to an error of not checking a box on a report, but Horman thought the issue was isolated and has since been corrected. Horman also said she had difficulty filling out her own reimbursement forms using the new Luma system for three working trips to Boise that she made this summer.

“I am hearing that across the state agencies there is a very steep learning curve,” Horman said.

“In my opinion this is all entirely solvable,” Horman added. “But it is disconcerting being in the middle of September and not knowing what our revenues are yet at this point in our fiscal year.”

Efforts to reach the Idaho State Controller’s Office and Idaho Division of Financial Management on Thursday were unsuccessful.

This isn’t the first time Idaho has experienced problems implementing large statewide contracts and systems. After Molina Medicaid Solutions took over the state’s Medicaid claims processing contract in 2010, thousands of payments to Idaho businesses that provide health care were delayed for months, the Associated Press reported.

LUMA system designed to increase transparency

Luma was designed to replace the state’s old employee information system, or EIS, and the statewide accounting and reporting system, or STARS, which were acquired in 1987 and 1988, according to the Idaho State Controller’s Office’s website.

According to the statement of purpose and fiscal note attached to House Bill 493 in 2018, the state’s accounting, payroll, human resources and procurement systems were nearing the end of their useful lives and were due to be modernized.

According to the 2019 Luma project charter, which is available on the Idaho State Controller’s website, the Luma project would allow state agencies to modernize their business practices and eliminate redundant systems, which would save taxpayers money.

In his successful reelection campaign last year, Idaho State Controller Brandon Woolf promoted the then-upcoming transition to Luma as a way to add to the Transparent Idaho initiative that provides public records such as state expenditures, public meeting notices and state employee salaries, the Sun reported last year.

After meeting with the controller’s office in recent weeks, Horman said she believes the Luma project will ultimately increase transparency in government operations and expenses by making more data and information available through one system.

Horman said the controller’s staff and other state officials are “pushing hard” to identify and correct the errors and get the Luma system running smoothly.

“The benefits we are going to get from Luma in the long run I believe will compensate for some short-term pain,” Horman said.