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State employees say Idaho’s Luma business system is still time consuming and unreliable  • Idaho Capital Sun

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State employees say Idaho’s Luma business system is still time consuming and unreliable  • Idaho Capital Sun

More than a year into the launch of the State of Idaho’s $117 million new business system called Luma, state employees and evaluators describe a system that is inefficient, complicated, unreliable and continues to face internal security risks.

The findings come from a new evaluation conducted by the Idaho Office of Performance Evaluation, an independent watchdog arm of state government. The office presented the new Luma evaluation to the Idaho Legislature’s Legislative Council on Thursday at the Idaho State Capitol in Boise. 

“Most users find Luma much less efficient than the legacy systems (that Luma replaced),” Idaho Office of Performance Evaluations Director Ryan Langrill told the Legislative Council. “While we’ve heard some specific cases where Luma has saved time or money compared to the legacy system, you can see only 8% of staff say that Luma saves them time relative to the legacy system. One fiscal officer said that Luma has doubled, if not tripled, the time it takes to complete our normal daily tasks. Processes that used to take two to five steps in the old system now take five to 10 steps to complete in Luma. Another fiscal officer said that there really is no positive or upside to how Luma has affected our agency’s ability to carry out our responsibilities – it has made everyone’s job more difficult, even for the non-financial staff.”

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The state launched Luma in July 2023, and rollout has been rocky at times. After going live, the state was unable for months to generate the official comparative monthly and historic revenue reports that legislators and the public use to verify revenues and the state budget, the Idaho Capital Sun previously reported. Some vendors, including an Eastern Idaho sustainable fire nonprofit organization, reported the state was months behind in grants payments for work that had already been completed. The state even double paid $32 million in Idaho Department of Health and Welfare payments in November 2023, a lapse first reported by the Idaho Freedom Foundation.

Even more than a year after Luma’s launch, some state fiscal officers are running spreadsheets and invoices separately in Microsoft Excel outside of Luma after reporting to the Idaho Office of Performance Evaluation that balances for contracts and invoices in Luma were wildly inaccurate.

“Users have not fully adopted Luma, citing exhaustion, the complexity and lack of intuitiveness of the system, a lack of training, a lack of functionality within the system, a lack of trust with what they’re seeing In the system or a lack of accessibility,” Langrill told legislators Thursday. “So in addition to taking more time, many users reported that the system doesn’t do the entire part of what the system is supposed to do, which means people are using workarounds. People are using systems outside of Luma. And then there’s some users, such as those who have a visual impairment, who simply can’t use the system to do their jobs.”

Additional findings came from audits of Luma conducted by the accounting firm Baker Tilly that were previously released in June. 

Rep. Wendy Horman, an Idaho Falls Republican who serves as co-chair of the Idaho Legislature’s Joint-Finance-Appropriations Committee, said she has big concerns about Luma and budget and finance data tied to the system. The Joint Finance-Appropriations Committee, commonly called JFAC, is a powerful legislative committee that sets every aspect of the state budget for all state agencies and departments. Horman specifically cited the Baker Tilly audits of Luma produced in June.

Rep. Wendy Horman, R-Idaho Falls, listens to proceedings on the first day of the legislative session at the State Capitol building in Boise on Jan. 8, 2024. (Otto Kitsinger for Idaho Capital Sun)

“Anytime an audit finds 60 deficiencies (out of 101 tested measures in the Baker Tilly audit), we have no choice but to be concerned,” Horman told the Idaho Capital Sun in a text message Monday. “Twenty-three of those audit findings are around data validation.”

“The corrective action plans did not inspire confidence that the problems can be corrected, although maybe that is still possible,” Horman added.

Who is responsible for Luma in Idaho?

The Idaho State Controller’s Office, which oversees Luma and was involved with purchasing, issued a statement acknowledging the findings from the reviews and pledging to use the evaluation and the audit as constructive criticism for improving Luma.

The Idaho State Controller’s Office also highlighted sections of the reviews that pointed out the old systems Luma replaced were unstable and the state was justified in replacing the old systems.

“We acknowledge the valuable recommendations, and understand there is more work to do,” Idaho State Controller Brandon Woolf said in a written statement to the Idaho Capital Sun Friday. “While we knew this monumental shift would bring challenges, their findings affirm that we are on the right path – and we will continue our diligent efforts to improve.”

Brandon Woolf
Idaho State Controller Brandon Woolf

In an interview Friday at the Idaho State Capitol, Chief Deputy Controller Scott Smith said Luma is working and he is confident in financial and budget data tied into Luma. Smith said he has confidence in the data because he trusts the expertise of many different state agencies and their financial teams, which he said have been able to work together to produce accurate financial and budget data despite the challenges with Luma’s adoption.

Smith said the transition is massive and has never been undertaken at such scale in state history. Smith said there are and will be numerous benefits to Luma, including enhanced security that was one of the biggest weaknesses of the state’s old systems. Once optimized and fully adopted, Luma should be more efficient by bringing all state business, finance and HR systems into one system – eliminating the need to bounce back and forth between different systems and processes, Smith said. An upcoming Luma module update will also use artificial intelligence to automate tasks, which should save state employees time with reports, Smith said. 

“We believe that that is going to allow us to build an approval process for them that will greatly reduce the time it takes for them to approve invoices,” Smith said.

Smith said he is sorry that there have been so many problems with Luma, and he said state employees should be commended for doing their jobs well despite the setbacks and for their patience and resilience.

“We absolutely value the state employees and recognize their incredible fortitude to make this a reality,” Smith said. “We always want to be collaborative and find these solutions.”

What is the State of Idaho’s Luma system?

State officials and the Idaho Office of Performance Evaluations refer to Luma as an enterprise resource planning system, or ERP. Luma is based in the cloud and is designed to centralize and automate all of the major business, finance, revenue, HR, payroll, budget and purchasing systems into one system for all state agencies and employees.

Luma replaces two legacy systems, STARS and EIS, which date to the 1980s, had exceeded their usable livespans and were vulnerable to security threats, state officials said.

The goals for Luma were lofty, according to the Luma Project Charter signed in 2019 by Idaho State Controller Brandon Woolf, Gov. Brad Little and legislative leaders. The charter called for the state to launch a single new system that “modernizes and transforms the way the State of Idaho does business, improves transparency and provides a core foundation for the future.”

Other states, private companies have struggled with large scale IT systems as well

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Idaho isn’t alone in struggling the implementation of a major new system. Only 13% of large scale government IT projects succeed according to the Office of Performance Evaluations Luma evaluation, which cited 18F, a federal agency that specializes in government software evaluation. 

For example, the neighboring State of Nevada spent $80 million to replace a legacy system, only to walk away from the project and start over before going live. In another example, every state agency in California has yet to implement a $1 billion system that California began implementing nearly 20 years ago, in 2005. In Oregon, the state faces lawsuits in the wake of failures of its new payroll system.

“Large scale IT implementations are difficult to implement,” the Idaho Office of Performance Evaluations said in its Luma evaluation.

“Organizations will often stay with (a new system) that has had a less than successful transition because the transition costs are too high,” the Idaho Office of Performance Evaluations added.

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