SB284 SD1

SECTION 1. The legislature finds that the office of enterprise technology services' data center was created more than forty years ago and has received minimal, if any, subsequent upgrades. The data center runs all key state programs. Because the data center can no longer be brought to acceptable modern data center standards, it is no longer used to run any critical state programs in their current location and condition. The legislature also finds that the office's data center comprises a primary data center that is housed in the basement of the Kalanimoku building, a location that is susceptible to flooding, and two satellite data centers that are housed one each at the university of Hawaii at Manoa and a commercial data center. There are also numerous department- and agency-run processing facilities throughout the State having varying degrees of business continuity readiness. The legislature notes that some agencies are considering relocating the agencies' respective satellite data centers to either the Kalanimoku building or a third-party commercial facility.

The legislature believes that upgrading, modernizing, and consolidating the office of enterprise technology services' data center will improve the State's resilience against physical damage caused by weather‑related events and cybersecurity threats and ensure the continued, uninterrupted provision of state services. The legislature recognizes that Gartner Consulting submitted a report to the legislature in 2013 identifying these issues and recommending that the State consolidate its various equipment into secure and resilient primary and secondary sites. The legislature also believes that, in order to most efficiently and effectively achieve these benefits, it is important for the State to also adopt cloud computing technologies with a preference that they be hosted physically in the State to address latency and financial impacts.

Accordingly, the purpose of this Act is to:

(1) Require the technology services consolidation working group to:

(A) Decommission the office of enterprise technology services' primary data center located in the Kalanimoku building;

(B) Relocate the office of enterprise technology services' entire data center to an interim primary, secure, and resilient facility; and

(C) Efficiently use cloud computing with consideration of latency-sensitive systems that may require local presence or hybrid-cloud design and cloud or remote physical storage for all consolidated state information technology data;

(2) Extend to June 30, 2028, the dissolution date of the technology services consolidation working group; and

(3) Establish requirements for procurement contracts for information technology-related projects.

SECTION 2. Chapter 103D, Hawaii Revised Statutes, is amended by adding a new section to part X to be appropriately designated and to read as follows:

"§103D- Information technology-related projects; in‑state cloud servers and services. (a) A governmental body that enters into a contract under this chapter for an information technology-related project having an estimated value of not less than $250,000, shall decrease the bid amount of a bidder by five per cent if the bidder provides cloud servers and services that are physically located within the State. The lowest total bid, taking industry standard preferences into consideration, shall be awarded the contract unless the solicitation provides for additional award criteria; provided that the contract amount awarded shall be the amount of the price offered, exclusive of the preference.

(b) At the time of submission of a competitive sealed bid or a competitive sealed proposal by a bidder, the bidder shall furnish written proof that the bidder provides cloud servers and services that are physically located within the State and, if awarded the contract, shall continue to certify monthly in writing that the bidder provides cloud systems that are physically located within the State. This subsection shall be deemed to be incorporated into any applicable contract. A bidder who is awarded a contract shall be subject to the following sanctions if, after commencement of work, the bidder at any time during the project no longer provides cloud servers and services that are physically located within the State:

(1) Temporary or permanent cessation of work on the project, without recourse to breach of contract claims by the bidder; provided that the governmental body shall be entitled to restitution for nonperformance or liquidated damages, as appropriate; or

(2) Proceedings to debar or suspend under section 103D-702.

"Bidder" means an entity that submits a competitive sealed bid under section 103D-302 or submits a competitive sealed proposal under section 103D-303.

"Cloud servers and services" include infrastructure-as-a-service, platform-as-a-service, or software-as-a-service systems and servers."

SECTION 3. Act 179, Session Laws of Hawaii 2022, is amended by amending section 2 to read as follows:

"SECTION 2. (a) There is established a technology services consolidation working group, that shall:

(1) Develop a plan for the phased consolidation of all state executive branch information technology services and staff, where determined practicable by the working group, within five years, excluding the department of education, Hawaii health systems corporation, University of Hawaii, and office of Hawaiian affairs, under the office of enterprise technology services. The plan shall include:

(A) An identification of the specific positions and functions to be transferred in each department;

(B) Proposed dates of transfer for each position and function;

(C) Proposed information technology facility, personnel, and operational infrastructure needs of the consolidated information technology agency, with projections on future integration needs as additional agencies' information technology staff and services are added;

(D) Recommendations to enable the office of enterprise technology services to provide expert support to all state agencies regarding information technology activities in order to meet the needs of the agencies and the public; and

(E) Recommendations to ensure that agency services are not interrupted during the phased consolidation; [~~and~~]

(2) Make recommendations to attract high-quality information technology professionals to the State, including the use of internships, partnering with private providers and carriers, and assess the feasibility of exempting certain positions from the requirements of chapters 76 and 89, Hawaii Revised Statutes[.];

(3) By June 30, 2024:

(A) Decommission the office of enterprise technology services' primary data center located in the Kalanimoku building; and

(B) Relocate the office of enterprise technology services' entire data center, including the primary data center located in the Kalanimoku building and any satellite data center located in any facility under the management and control of a state agency, and all consolidated state information technology data to an interim facility that:

(i) Possesses the resiliency to perform concurrent maintenance or upgrades without down time;

(ii) Is located outside the Extreme Tsunami Evacuation Zone; not located in the Federal Emergency Management Agency Flood Zone A, B, C, or V; and not impacted by the National Oceanic and Atmospheric Administration- anticipated climate-related sea level rise of three feet over the next thirty years;

(iii) Is capable of continuing connectivity with at least three physically and logically diverse carriers;

(iv) Maintains a telework-enabled workforce with capitol district office spaces or workspaces, or both, for support of executive branch agencies in the area; and

(v) Provides for a high-speed printing facility within the capitol district for optimal access by executive branch agencies and a second printing facility at the new centralized site for business continuity;

provided that the working group shall submit a report of its findings and recommendations, including any adjustments to the above criteria and any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2025; and

(4) Unless otherwise required by federal law or regulation, by June 30, 2026, use cloud computing with consideration of latency-sensitive systems that may require local presence or hybrid-cloud design and cloud or remote physical storage for all consolidated state information technology data in compliance with state and federal policies and laws; provided that any cloud storage servers or other systems or hardware used pursuant to this paragraph shall be physically located within the State; provided further that the working group shall submit a report of its findings and recommendations, including any proposed legislation, to the legislature no later than twenty days prior to the convening of the regular session of 2027.

(b) Members of the working group shall include:

(1) The chief information officer, who shall serve as chairperson;

(2) The single executive or the chairperson of the executive board, as the case may be, of each principal executive branch department or that person's designee, excluding the department of education, Hawaii health systems corporation, University of Hawaii, and office of Hawaiian affairs; and

(3) Any other person that the chief information officer wishes to invite to serve on the working group.

(c) The working group shall be administratively attached to the department of accounting and general services. The office of enterprise technology services shall provide administrative support to the working group.

(d) No later than twenty days prior to the convening of the regular session of 2023, the working group shall submit to the legislature a preliminary status report. This preliminary status report shall also include any findings, recommendations, proposed legislation, and funding requirements necessary for the completion of the plan for a phased consolidation of state information technology services.

(e) No later than twenty days prior to the convening of the regular session of 2024, the working group shall submit to the legislature a report of its findings and recommendations, including:

(1) The plan for a phased consolidation of state information technology services developed pursuant to subsection (a)(1), including a detailed five-year phase-in schedule;

(2) Recommendations to attract high-quality information technology professionals to the State; and

(3) Any proposed legislation.

(f) The working group shall be dissolved on [~~December 31, 2023.~~] June 30, 2028."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on January 1, 2050.

THE SENATE	S.B. NO.	284
THIRTY-SECOND LEGISLATURE, 2023		S.D. 1
STATE OF HAWAII