2023-2025 Budget Guidelines

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2023-2025 Budget Guidelines Memorandum

 

North Dakota Information Technology (NDIT) has projected service rates for the 2023-2025 biennium.  The rate schedules and a brief description of the services for Data Processing and Telecom may be found on the NDIT website. Rates that are highlighted in bold are the rates that changed from the 2021-2023 budget instructions. 

Each biennium NDIT looks at the need to adjust the rates for the services provided.  Because it is difficult for agencies to adjust their funding once the budget has been approved, every attempt is made to keep NDIT rates from increasing during the biennium.  The following is an overview of the rate changes for the upcoming biennium.   

The supply chain issues, inflation, and changes in demand make setting rates for the future biennium a challenge.  Vendors have indicated the increased costs NDIT is seeing today will continue through the 2023-2025 biennium.  These increases affect all types of hardware we purchase regardless of make, model and the intended use.  From networking to desktops, wireless access points to servers, the hardware and associated support costs have risen 10-20%.  Delivery of certain products is now taking six months to a year.  In many cases, software vendors have also increased the per user license cost of their products. 

During the 67th Legislative Assembly, IT staff from nine agency’s were unified with NDIT to provide technology solutions and support in a centralized, shared service model.  The chargeback model for these services in the 2023-25 biennium will be reflected in maintenance and operations agreements based on the business need for support.  NDIT staff will be working with agency staff to create these agreements prior to agency budget deadlines.

Enterprise Project Management Office 

Agencies with large projects will be billed a fee to cover the costs associated with the Enterprise Project Management Office and large project reporting requested by the Legislature.  The fee will be $2,500 per every $500,000 of project costs.  This fee will be capped at $25,000 per project per fiscal year.   

Software Development and Toolset Upgrades 

NDIT Software Development continues working under the Agile framework in the approach to developing and supporting applications.  Through the use of Scrum Masters and product owners, work is completed in “sprints” based on the priorities set for that sprint period.  To account for some legislative increase for all staff, the increase to our hourly staff will be between 3-5%.  Development will be billed at $105 per hour, Business Analysts will be billed at $131.50 per hour, and both Business Process Improvement and Project Management will be billed at $136.50 per hour. 

The NDIT Software Development Division supports many software development tools and languages. As part of our cybersecurity posture NDIT upgrades versions of our tools and languages on a regular basis.  NDIT includes the development costs associated with changes to applications as a result of upgrading the overall toolset within the hosting costs of those applications. Examples are Java/Websphere, Oracle, SQL, MySQL and .Net applications.  Agencies will need to account for the changes to applications for unsupported toolsets described below. 

Legacy Application Surcharges 

Several agencies are running older versions of SQL, Oracle or Websphere applications that have not been upgraded to a currently supported version.  These agencies will need to upgrade those applications to current supported versions of these software products.  Agencies who run on older versions should budget for a minimum surcharge of 25% to cover the operating costs of the legacy hosting environments.  Agencies running SQL Server 2014 can incur an increased fee as of July 2024.  Agencies with applications using Oracle 11g, 12c, and 18c should plan to have upgrades completed by the start of the 2023-2025 biennium as each of these versions is end of life and unsupported.  Any applications running versions older than Websphere 9.0 may also incur a legacy surcharge as these versions are unsupported. 

Maintenance & Operations 

Existing maintenance and operations agreements will see the same cost increases as our hourly support rates, approximately 3-5%.  Beginning with the 2023-25 Biennium, the internal database work will be included in these agreements.  Previously, when support required a database administrator to make a change, this would result in the need for a request and usually a cost. 

As stated above, agencies recently unified will have agreements drafted to reflect the required support of your applications.  NDIT staff will be working with agency staff to complete these during the budget process. 

End User Compute (Desktop Support) 

End User Compute is a holistic approach to managing all of the personal computing devices within an organization, including laptops, tablets, and mobile phones. It includes asset management, hardware and software deployment, device support and management, access/authorization management and basic training.  The monthly fee includes hardware replacement cost (machine, monitor, keyboard, mouse, headset), support staff, and support toolsets. 

Managed Print Service 

One of the services provided previously by End User Compute is management of the printing device for the end user.  If your agency receives Desktop Support from NDIT, this labor-intensive service will be managed by a third party beginning with the 2023-2025 biennium.  The cost of the service will be a per page charge for the existing printers residing on the network.  NDIT has included each printer model with the corresponding per page rate at the end of this document.  This rate includes genuine manufacturer’s toner for the specific printer, regular cleanings, service calls, and when needed, the replacement of the printer itself. 

Microsoft Productivity Suite 

The current contract rate of $36.00 for Microsoft Office 365 Premium will be expiring in June 2023.  We are currently working with Microsoft on a price lock for their products to cover the 2023-25 Biennium, however, this rate has not been finalized with Microsoft yet. Our indication is that the rate will be $43.25 per user per month.  The Premium license will be required for state employees as this license bundle contains the Office desktop client, Windows 10/11 OS, and Power BI.  Enterprise Voice is included in the Premium bundle although it is recovered in the phone rate.  Several key security components required for state employees are also included in this bundle.  These are per license fees that will apply to any accounts that require a Microsoft user license including service accounts, privileged accounts, or information accounts as needed. 

For non-state employees such as vendors or contractors, it is possible to use the Office 365 Basic license to meet the user’s needs for $22.40 per month.  

Network Rates (WAN connections) 

Endpoint network rates for fiber locations will remain the same as the 2021-23 biennium.  Base connectivity for state agencies with non-fiber endpoints on STAGEnet will be increasing to 250 Mbps with no additional cost.  There are additional bandwidth options available for additional cost.   

Agencies that have any broadband connectivity (DSL, cable, wireless, satellite, cellular) are reminded that all connectivity should be purchased through NDIT and there is an associated broadband add-on charge in addition to vendor cost of the broadband connection.  The add-on rates will increase to $185 per circuit for the 2023-2025 biennium.  The premium add-on rate applies to locations that require network to network connectivity and comes with extended support hours.  The broadband connection provided by the local telecommunication company is a direct bill back to each agency and is subject to rate changes throughout the biennium based on provider.   

Technology Fee 

The changes to the Technology Fee for the upcoming biennium will be to both the metric used for chargeback as well as the charge itself.  Historically, NDIT has used the prior biennium appropriated FTE count per agency as the metric for this fee.  This metric did not account for vacancies within agencies, temporary staff, or possible contractor staff.  As such, a change in the metric used to recover these costs was needed to align usage with cost recovery. 

Beginning with the 2023-2025 Biennium, the Technology Fee will be assessed to any user that also has a Microsoft Office 365 Premium license.  This change will increase the units by which cost recovery is spread over considerably.  Therefore, the Technology Fee for next biennium will be $63.00 per Office 365 Premium user. 

Technology Fee includes hardware, software, and support for the network backbone, the data center and the redundant internet.  It includes VPN, Anti-Virus, and multi-factor authentication for all users.  The fee includes any hardware and staffing support of all Microsoft productivity tools such as Office, Exchange, Teams, SharePoint, OneDrive, Stream, Planner and several others. 

The Technology Fee also covers the expenses associated with providing enterprise services and solutions such as the Enterprise Architects, Customer Success Office, Granicus SMS, Adobe Sign and the State Website Platform. 

ConnectND 

NDIT bills each agency for the cost of ConnectND (the PeopleSoft financials and human resource applications). Each agency has a ConnectND fee on their data processing bill each month. The changes to fee per agency can vary depending upon budget and FTE.  The amount each agency needs to budget is as follows: 

  • $11.84 per month for each legislatively authorized FTE identified in the 2021-2023 Legislative Appropriations book. 

  • $7.59 per month for every $1 million appropriated to the agency as identified in the 2021-2023 Legislative Appropriations book. 

Storage Rates 

NDIT storage rates are expected to hold fairly steady from the 2021-2023 budget rates. Premium storage will decrease, Basic storage will remain the same, and File Share disk will increase slightly for both on-demand and dedicated disk.   Enterprise backup storage will remain the same.  Agencies that have significant storage growth projections should meet separately with NDIT to determine if other storage pricing tiers will help to mitigate the cost impact of their storage growth.  NDIT continues to explore storage options available from cloud providers.   

General Hosting Rates 

NDIT will continue exploring cloud computing options, doing so within the current rate structure for server, disk and application hosting.  Server fees will be remain the same for the 2023-25 biennium.  Application hosting will increase 8% and will account for the toolset upgrades for Oracle, SQL, MySQL, Websphere, and .Net applications.  Agencies should review their current usage levels and anticipate any areas of growth to determine increases for specific hosting services.  Increased usage of Dynamics platforms, Robotic Process Automation, Chatbots, Artificial Intelligence, Machine Learning, PowerBI Publishing, Data Analytics and Data Lake solutions will incur hosting fees on a deployment by deployment basis.  

Centralized Log Management 

This next biennium, NDIT is introducing a new service called Centralized Log Management. In response to a need for a Centralized Log Management solution and to avoid having unique logging solutions spread throughout the Enterprise, NDIT created a new system to meet the complex needs of our infrastructure and business applications. This simplified solution has the capability to ingest logs from many different environments (cloud, on-premise, application logs, etc.), indexes them for operational needs, and can produce reports for consumption by business units. 

NDIT will be covering the base fee for this service as part of our infrastructure and security needs. Platforms and systems that have large compliance needs or atypical requirements for logging, will be charged a fee to fairly consume the service across the Enterprise. The rates can vary based on needs, but we are attempting to simplify on a handful of rates to make the budgeting process far easier for our business customers. 

  • Medium Requirements (low/medium logging rate, low/medium storage requirements for both operational or long-term needs, low/medium/high reporting requirements) - $2000/month 

  • High Requirements (high logging rate, medium/high storage requirements, medium/high reporting requirements) - $4000/month 

Mainframe  

During the 2023-25 biennium there will be a continued effort by agencies to rewrite applications and migrate away from mainframe-based applications.  Due to the continued hardware, software and staff requirements of these systems, remaining agencies may see some fluctuation in the current CPU costs, therefore it is advisable to budget the full CPU rate for the upcoming biennium.   

Telecommunications 

For the 2023-2025 biennium, NDIT will be consolidating the Basic and the Analog phone services into a single cost to receive a dial tone.  This rate will be $25.00 per dial tone, regardless of the intended use after a dial tone is established.  This rate will still include all the phone features as well as the licenses needed for establishing a state specific government phone number.  This rate does not include a physical telephone.  Options are available for a physical phone upon request.  

This service also allows the state phone number to be configured to deliver phone calls to an employee’s cellular phone in addition to the employee’s office phone. Rightfax services are included in the basic phone rate charged for that fax number. Call Center costs will be split into two rates.  One for the Anywhere365 solution and one for the legacy Avaya solution. 

Micrographics Rates 

NDIT will continue to coordinate micrographics services in state government but has outsourced the actual processing of microfilm due to equipment costs coupled with the declining use of microfilm in state government.  Agencies using Micrographic services should contact NDIT to determine what rates to budget for the 2023-25 biennium.