Gov. Reynolds ends controversial agreement to overhaul state computer systems

DES MOINES, Iowa (KCRG) - Governor Kim Reynolds has ended a contract with a software company to overhaul the state’s computer systems and hired a new firm, ending a project highlighted by controversies.

Gov. Reynolds had hired Workday to update the state’s computer systems to a modern cloud-based network. Republicans and Democrats agreed the state’s 20-year-old systems were in need of updates but the implementation drew criticisms.

Gov. Reynolds signed a $50 million agreement with Workday in 2019 without going through a typical competitive bid process, the Gazette reported.

That agreement came under new scrutiny in 2020 when Iowa State Auditor Rob Sand said the Governor had misused COVID-19 relief funding to pay for the project. Governor Reynolds defended the use of COVID-19 funding but ultimately, the state was ordered to repay $21 million to the COVID-19 relief fund.

In ending the agreement with Workday, Reynolds did not address either controversy but said the state had determined Workday’s system would not work for the state’s needs.

“This is not the outcome we wanted, but I’m confident in our team’s recommendation and greatly appreciate their diligence throughout this process,” Governor Reynolds said in a release. “Despite the time, effort, and money invested, this decision is the responsible and prudent course of action to ensure the state has the right tools to support our operations, save money over the long term, and improve service to Iowans.”

The Governor’s Office said Workday’s human capital management system was deployed in 2021. However, the state discovered issues with Workday’s financial platform as it started testing last summer. That ultimately led to Gov. Reynolds decision to end its agreement. It’s unclear if Workday will still receive the full $50 million dollar contract with the state only using its human capital system and not the financial platform.

Instead, the state reached an agreement with its current vendor, CGI, to move financial computer systems to a cloud-based network. The details of that agreement were not immediately available but the Governor’s Office said work would start in April and be completed by March of 2024.