CASE STUDY | Rhode Island Division of Taxation The ......Rhode Island was running a $3 billion tax...
Transcript of CASE STUDY | Rhode Island Division of Taxation The ......Rhode Island was running a $3 billion tax...
Following implementation of Phase One, incremental modernization was well underway. Reaching a six-to-one return on investment. The Division also accrued a number of intangible but equally significant benefits since the project start:
• The Division established a track record for success, having multiple successful projects under the Division’s belt before embarking on the full ITS implementation.
• The Division gained invaluable experience and trust working alongside RSI.
• The Division staff increased their familiarity and experience with Revenue Premier’s capabilities and modern technology.
• The Division had now managed multiple IT projects successfully while also developing confidence and comfort.
• Robust knowledge transfer from RSI to the Division staff took place, providing foundational training that the Division would carry forward.
The Division needed a technology partner that could partner over their 10-year journey towards modernization. The modernization project was implemented in three phases in order to minimize disruption to taxpayers. Through three competitive bids, the Division, in three separate procurements, continued to select RSI as its technology partner.
The first procurement included Revenue Premier’s Portfolio Warehouse and Audit Manager modules to support tax discovery and collections. Second, RSI was selected to implement its modernized e-File (MeF) solution. The third procurement included implementation of the remaining Revenue Premier functionality, including the Taxpayer Portal, which resulted in a fully integrated tax solution (ITS).
Rhode Island was running a $3 billion tax division on 15-year-old technology. The Division of Taxation was relying on a mainframe developed 40 years ago using COBOL. Additionally, the Division had over 58 tax types that were stored in many systems, including an offline Access database, as well as spreadsheets which were not integrated. This resulted in an inflexible, expensive system that was not meeting the needs of the Division.
Costs to maintain the old system were prohibitive and prevented the Division from delivering the citizen experience expected in today’s digital world. Moreover, changing the system to reflect new legislation was difficult and error prone. The Division administers five major tax types and 58 different tax and fee types.
CASE STUDY | Rhode Island Division of Taxation
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Rhode Island Division of Taxation Ups Its Technology Game Rhode Island’s Taxes and Fees are Now Successfully Maintained and Accessed on a Single, Agency-Wide System Following a Ten-Year Journey of IT Modernization
THE CHALLENGE
RSI PROJECT APPROACH
Increasing Costs and Inefficiency were Holding Back the Division
Incremental Modernization was Required to Reduce Project Risk and Fund the ITS ImplementationThe Division’s primary objective of incremental modernization was essential for delivering an ROI and building the on-going business case for funding the full integrated tax system.
The Division kicked-off the modernization journey with Phase One which ran from 2007 through 2012. In this first phase, the Division made business process changes in a step-by-step progression. The first work included installing the RSI Portfolio Warehouse, and supporting case management and correspondence system and modernized e-File (MeF). Even with the successes and progress made in this first phase, the Rhode Island Division of Taxation was still managing a complex tax apparatus using an assortment of computer systems, most of which were stand alone and not integrated.
Minimizing Taxpayer Disruption with Phased Implementation
The Experience to Deliver Government Innovation
PROJECT BENEFITSEach of the steps delivered incremental efficiency and collection benefits delivering a 6:1 return on investment. This success built the business case for the second phase of modernization, an integrated tax system (ITS). In 2012, the Division of Taxation started the five-year effort to procure and implement an ITS with objectives of processing taxes in real-time, offering higher levels of service to customers and operating on a single platform.
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“Taxation is proud of the partnership
established with RSIduring the IT modernization.
The Rhode Island Division of Taxation provides a model for
other tax agencies to follow in their quest to improve operations and
technology.”Neena Savage
Rhode Island Tax AdministratorRhode Island Division of
Taxation
Tax compliance in Rhode Island had been under-achieving in its collection targets. In order to make better decisions on audit candidates based on risk of non-compliance, the Division of Taxation began using comprehensive historical data that was made available through the Revenue Premier Portfolio Data Warehouse. With new business processes and access to the complete historical taxpayer data, the Division was able to improve detection of non-registrars, non-filers and under-reporters. The Division started down the path toward better data-driven decision-making generating significant results which laid the groundwork for the next phase of the modernization.
The results of this early work afforded the Division the additional revenue which made possible the business case for the integrated tax system (ITS).
CASE STUDY | Rhode Island Division of Taxation
A STRATEGIC VISION FOR INCREMENTAL MODERNIZATION
RHODE ISLAND OBJECTIVESRhode Island Division of Taxation had a number of objectives, defined from the start of the project to guide the project.
Minimize Implementation Risk• Bring full processing of IFTA in-house• Begin full retirement of the mainframe system• Demonstrate ability to configure new tax types, beginning to end, in a short timeframe without impacting the larger ITS project• Resolve safeguard issues resulting from security limitations in the legacy system• Deliver each phase on time and on budget
Improve Operational Efficiencies• Standardize processes and procedures• Minimize costs associated with training• Establish organization change and training programs• Apply business process improvements from phase to phase• Consolidate Individual Collections• Ensure entire agency is using vendor supported software for all primary responsibilities• Establish standardized approach to audit workpapers
Increase Automation• Set a foundation for operating efficiencies in the future• Standup front-end imaging and data capture system• Create higher configurability of refund fraud rules• Increase automation of returns processing edits• Establish modern agency operational procedures
ACHIEVING THEIR LONG-TERM VISION THROUGH COMPLIANCE EXCELLENCE
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“The STAARS system is up and running, on time and
on budget. We are handling roughly 58 different tax types,
everything from cigarettes, to alcohol, to sales tax, personal tax and corporate
tax. All of those are now integrated in a single solution. It has been a great partnership
with RSI.”
Neena SavageRhode Island Tax Administrator
Rhode Island Division of Taxation
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Having developed a long-term vision for implementing their integrated tax system, the Division then proceeded through incremental modernization in partnership with RSI. As technology partners, Rhode Island Division of Taxation and RSI strategically designed a phased implementation in order to establish the business case for an integrated tax system.
Over ten years, Rhode Island Division of Taxation continued to select RSI as its technology partner as the Division progressed on their journey toward a fully integrated tax system. The early phase success, including a 6:1 ROI, enabled the Division of Taxation to generate sufficient incremental revenue to build a business case for phase two; a complete ITS.
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THE RESULTS - EXCEEDING EXPECTATIONS
increase in revenue during
Phase One
600% on-time and
on-budget for all stages of the
work
100%
2007 2008 2009 2010 2011 2012 2013 201620152014 2017PHASE ONE PHASE TWO
Revenue Premier Portfolio Warehouse
2007 to 2009
Revenue Premier Case Mgt and Correspondence
2008 to 2009
Revenue Premier Modernized e-File
2009 to 2011
Revenue Premier Business Initiatives
Collections Management2010 to 2012
Rhode Island Division of TaxPrograms and Tax Types Impacted
ITS Vendor Selection (RFP)
2012 - 2013Release 1 goes live
July 2014
Release 1.5 goes liveDecember 2014
Release 2 goes liveJuly 2014
Release 3 goes liveNovember 2016
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Impacted Areas Office AuditPersonal Income TaxProgramming
Impacted Areas Field AuditBusiness TaxesProgramming
Impacted Areas ProcessingProgramming
Impacted Areas CollectionsProgramming
Impacted Areas Tax TypesTax ProcessingExcise Tax
International Fuel Tax Agreement (IFTA)
Impacted Areas Tax TypesProcessingCorporate TaxExcise Tax
48 Tax TypesExciseMisc. CorporateFees
Impacted Areas Tax TypesTax ProcessingIncome TaxCollectionsOffice Audit
Personal Income TaxComposite Income TaxFiduciary Income TaxPass-thru Withholding
Impacted Areas Tax TypesTax ProcessingCorporate TaxEstate TaxCollectionsField Audit
16 Tax typesBusiness taxes, incl Corp.SalesWithholding
tax types including IFTA implemented
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