State proposes budget increase to ramp up payroll system project

Published On: February 14, 2020

The State Controller’s Office has proposed to ramp up the effort to launch the state’s new payroll system, with a Department of Finance budget proposal that asks for $3.49 million dollars to add staff to the project.   

The California State Payroll System (CSPS) project is the most recent payroll system initiative after the 21st Century project, also know as MyCalPays, was suspended in 2013.  The state is taking steps to advance the project through approval stages. 

Along with the funding to add eight new total positions, the SCO requests a $1,966,000 General Fund and $1,483,000 Central Service Cost Recovery Fund ($3,449,000 total) in 2020-21.

Currently, CSPS has only completed one of the four stages of the Project Approval Lifecycle (PAL), dating back to Oct. 17, 2017. PAL Stage 2 is estimated for submission in July 2020, while stages 3 and 4 both have submission dates set in 2021. All four stages must be completed to receive approval from the CDT, DOF, and the Legislature.

In an effort to match industry standards in 2016, the State Controller’s Office (SCO) launched a new initiative called California State Payroll System (CSPS) to modernize the state’s current payroll and human resources management, the Uniform State Payroll System (USPS), a legacy system that dates back to the 1970s. 

Four years later, ahead of the 2020-21 fiscal year, the SCO has issued a budget change proposal that outlines the next steps necessary to finish and implement the CSPS. 

Among the steps outlined in the budget change proposal, the SCO is requesting funding for five new positions within the CSPS, including four permanent positions such as contract manager and data management, as well as three permanent positions within Change Control Management. 

According to the SCO website, the CSPS has completed the first step of PAL Stage 2 to develop project baselines, but still needs to complete a number of additional steps, including creating a future state process inventory, conducting SME sessions, conducting vendor outreach and market research, conducting financial analysis, and developing high-level schedules.

Per the 2017-18 Budget Act, the SCO was allotted nearly $3 million to begin the PAL Stage 2, which the SCO anticipated it would complete by August 2018 before the schedule was revised.

The most critical point in the approval process comes between PAL Stage 2 and 3, when the SCO must procure solutions based on alternatives proposed in Stage 2. 

Should they receive the funding requested in the most recent budget change proposal, the SCO outlined an implementation plan that begins with preparing to submit PAL Stage 2, developing project management plans, and ultimately submitting PAL Stages 3 and 4. 

Longtime state IT executive Chris Maio serves at the CSPS Project Director.

According to the BCP, PAL Approval and Expected Submission dates include:
• PAL Stage 1 was approved October 2017.
• PAL Stage 2 is estimated for submission July 2020.
• PAL Stage 3 is estimated for submission May 2021.
• PAL Stage 4 is estimated for submission December 2021.

In the process of justifying CSPS in PAL Stage 1, the SCO listed a number of objectives that the new payroll system will achieve. Primarily, the CSPS will update technology infrastructure and security, automate certain administrative tasks such as validating payroll data and logging transactions, and improving access and user-friendliness for state employees.

Prior to embarking on the CSPS project, the SCO tried to modernize the state payroll system with the failed 21st Century Project, which resulted in a lawsuit and $59 million settlement with the vendor.


About the Author: Will Keys

Will Keys writes about technology issues for the GovReport. He is a graduate of the Reynolds School of Journalism at the University of Nevada, Reno. He can be reached at will at