'Disjointed and Dysfunctional': After EDD Scandal, SF Assemblyman Pushes to Update State’s IT System

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A woman sitting in front of a laptop which is displaying the EDD homepage.
During the pandemic, EDD has had numerous issues with its systems, resulting in delayed unemployment checks and billions paid out in fraudulent claims. (Beth LaBerge/KQED)

State Assemblymember David Chiu, D-San Francisco, is calling for a widespread update of California's information technology systems following several failed or delayed efforts to modernize them over the past few years.

“Our state's IT systems have been decentralized, disjointed and dysfunctional, and the experience for everyday Californians of government has been incredibly confusing and stressful," Chiu said in an interview.

The state of California has more than 130 individual IT shops across its various departments, each managed individually. Some of the state’s largest agencies, including the Department of Motor Vehicles and the Employment Development Department, rely on COBOL, a decades-old computer programming language, for some of their operations. During the pandemic, EDD has had numerous issues with its systems, resulting in delayed unemployment checks and billions paid out in fraudulent claims.  

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Chiu said it’s time for a change.

He has introduced Assembly Bill 1323, which would give the California Department of Technology power to prioritize which older systems should be upgraded first. The bill also calls for the agency to identify which IT services could be centralized across departments and how to make that happen.

Chiu said, too often, the department is treated like an emergency room physician.

"They are brought in to try to create the IT defibrillator experience when a project is on life support," he said. "And they're expected to fix something that's been broken for quite some time. And they're brought in, often, too late to resuscitate a completely dysfunctional modernization project."

Despite being the home of some of the largest technology companies on the world, Chiu said the state has a dismal record when it comes to managing its own IT systems.

"It seems like most times the state has tried to modernize a department system, something goes massively wrong," he said. "These efforts have been way over budget, woefully behind and plagued by major glitches."


One of the clearest examples of this is the state's Financial Information System for California (FI$Cal) — a management system that is supposed to integrate the state's accounting, budgeting, cash management and procurement processes. This effort started in 2005 with a six-year timeline and a $138 million budget. Since then, the cost has ballooned to around $1 billion and the deadline has been pushed to 2022 as the scope of the project has gradually increased.

These issues have created skepticism among some state lawmakers, making them reluctant to approve funds for improvement projects that may never be completed.

Gov. Gavin Newsom's administration has been taking steps on its own to try to overhaul how the state deals with technology. In 2019, Newsom put in place a new procurement system that requires vendors to show a proof of concept before they're awarded a contract. The state is also taking a more modularized approach to updating legacy systems, rather than ripping out and replacing an entire system at once.