Committee: Joint Appropriations Subcommittee #2
South Dakota Bureau of Information and Telecommunications
Ms. Annie Mertz, LRC, presented the committee with budget information ( Document #1).
Senator Lange moved the committee approve Subcommittee #2 minutes for January 20, 1999.
Seconded by Representative Putnam. Motion prevailed by voice vote. Representative Klaudt moved
the committee approve Subcommittee #2 minutes for January 21, 1999. Seconded by Representative
Derby. Motion prevailed by voice vote.
Mr. Otto Doll, Commissioner, Bureau of Information and Telecommunications (BIT), presented
the committee with a budget summary ( Document #2). He introduced members of his staff: Mr.
Dennis Nincehelser, Telecommunications Services Director; Ms. Deb Larson, Finance Manager;
Mr. Dale Luckhurst, Standards Manager; Mr. Jerry Gooding, Data Center Director; and Ms. Julie
Andersen, Public Broadcasting Director. Commissioner Doll also introduced Mr. Jim Neiles,
Fiscal Analyst, Bureau of Finance and Management.
Commissioner Doll presented an overview of the Bureau, noting in particular the Data Center, the Development Division, Telecommunications Services, and South Dakota Public Broadcasting. He reviewed the FY97 audit finding on the Rural Development Telecommunications Network (RDTN) operation costs. RDTN expenses are in line with revenue. BIT has increased hourly rates of RDTN
by 125% for education and government, 83% for non-profit organizations, and 63% for businesses.
In FY00 RDTN will be close to breaking even. Commissioner Doll estimates a cumulative loss of
$2 million since the RDTN system was initiated. The original cost of the system is estimated at $3
million. The Commissioner does not believe the system is outdated. The greatest number of system
users are from the Board of Regents, Department of Education and Cultural Affairs, and Bureau of
Personnel. Commissioner Doll presented figures on RDTN usage: 14,448 requests for FY95; 17,485
for FY96; 15,902 for FY97; and 11,988 for FY98.
Mr. Nincehelser noted the Bureau has lowered the network cost and is looking to be a gateway
between different video networks in the state. The function of RDTN is changing. Commissioner
Doll outlined two main issues facing the system: 1) a paradigm shift to individual video
conferencing, and 2) the ability to schedule conferences not presented on the RDTN system but for
which RDTN is the carrier. He predicts no change in the usage of the system for FY00, and the
Bureau uses FY99 figures to predict profit and loss figures for FY00.
Commissioner Doll referred to the budget pages and explained the Bureau is requesting an overall
increase of $1.9 million for FY00 -- $494,863 in general funds and $696,156 in other funds.
Within Personal Services, Commissioner Doll highlighted longevity, reclassifications, overtime, and
the Co-operative (Co-op) Education program with Dakota State University. He explained the
benefits of the Co-op program, including the creation of a stable, cost-effective staffing solution that
should lead to an experienced future work force.
The BIT data center is requesting $188,242 in capital outlay to proceed with the Microcomputer
Modernization project. The project is focused on consolidating systems and upgrading the operating
and hardware systems of the computers.
The Development Division of BIT is requesting $50,000 in capital outlay for additional hardware
and software to develop testing of new desktop and Internet computing information systems. Field
Office Computing is working to consolidate servers and want to implement a standardized
environment for 20 of the largest field offices. Senator Frederick inquired whether BIT has
considered issuing a request for proposal to private industry for cost savings. Commissioner Doll
responded BIT has the advantage of a low pay scale relative to the rest of the industry and the ability
to have numerous technicians physically out in the field.
In response to a question from Senator Hainje, Commissioner Doll noted that the budget process,
the Governor, and the state agencies all play a part in overseeing BIT. Representative Klaudt
inquired how many of the 96 BIT employees are technicians. BIT has 63 employees who support
computer systems; only 20 employees are non-technical.
Senator Bogue assumed the gavel.
Senator Lange asked how the Bureau handles employee turnover. Commissioner Doll acknowledged the Bureau has a high turnover rate. He estimated the average salary for a T15-T16 technician is $40,000 per year. In response to an inquiry from Senator Bogue, the Commissioner
explained the design goal of his Bureau is to place computer equipment with agencies that will last
for five years or longer. Currently the Bureau oversees support of 8,100 personal computers for state
government. In 1996 the number was approximately 6,000. Mr. Dennis Nincehelser noted the
Bureau is willing to out source technical support for particular geographic areas but no business with
that ability has come forward.
Senator Frederick assumed the gavel.
Commissioner Doll overviewed South Dakota Public Broadcasting (SDPB), noting three new
initiatives: 1) a request for $279,000 in contractual services to produce, acquire, and distribute new
local educational programs and outreach materials; 2) a request for 50,000 in contractual services
to develop a plan for the transition from analog to digital television; and 3) a request for $165,000
in capital outlay to a necessary componet to the existing production and operations plant.
Ms. Julie Andersen and Commissioner Doll provided information on programming options that will
be available in the future through digital television. When the conversion to digital television is
complete, SDPB tentatively plans to carry multiple channels during daytime hours, offer high
definition television during prime time, and offer multiple channels again overnight.
In response to Representatives Putnam's question about the $50,000 request, Ms. Andersen
explained SDPB is using those funds in conjunction with other money already set aside to explore
engineering issues. Ms. Andersen described how to find the programming for educational television
and information available on the SDPB web site. The site is accessed between 1,000 and 3,000
times per month.
Commissioner Doll presented an update on the Year 2000 issue. He noted the problem is greater
than a personal computer problem and that the Bureau's process is to test, remediate, and certify
computer technology to ensure compliance with Year 2000. The Commissioner projected the
Executive Branch will spend $3.7 million to resolve the problem. To date the Bureau has spent
approximately $2.63 million, and the cost could reach $4.2 million. The total cost to state
government is projected to be $6 million.
MOTION:
ADJOURN
Moved by:
Senator Klaudt
Second by:
Senator Hainje
Action:
Prevailed by voice vote.
Deborah Rumrill