Editor’s Note, 10/17/2021: Per a message from CapEx chair MaryEllen Carter, this article’s headline was changed to reflect the committee’s investigation into the Town’s software proposal since it has yet to make a recommendation.
Town officials are proposing replacement of what they call an archaic, inefficient financial software package for a three-year cost of more than $1 million beginning in fiscal year 2023.
The Capital Expenditure Committee hosted a detailed presentation at a virtual meeting earlier this month. Similar discussions will be scheduled for the Select Board and the Finance Committee, as preparations start ramping up for the 2022 annual town meeting agenda.
Although the expense was not included in the six-year capital plan, Town Manager Sarah Stanton said that she, the finance directors for the town and the schools, and the information technology director “all feel very strongly that this is the right time to do this.” She stated, “We have a system that does not match our level of quality.”
The Town currently uses KVS for the general ledger, accounts payable, tax and utility billing. Payroll and other human resource functions are on a Springbrook system – actually the parent company of KVS.
The cost proposed for the 2022 annual town meeting warrant is $827,805, including $227,798 for software-as-a-service that is projected as an annual operating cost. The largest component is $407,493 for data conversion. There is also a 15 percent contingency. No hardware purchases will be required.
Stanton, whose background before taking the helm in Bedford three years ago was in municipal finance, told the committee that the current system, used since 2006, is “challenging” and indeed is being phased out by its originator.
The capital proposal is to purchase Munis Financial Management, a product of Tyler Technologies. Munis is used by more than 200 cities and towns in the commonwealth, Stanton said, and some 2,000 nationwide.
Among the advantages she listed were improved controls and efficiency, better reporting capacity, improved town meeting presentations and information delivery to board and committees, alignment with state standards, saving cumulative staff time, and managing town and school finances on a single database.
The conversion would be carried out in three modules – financials, payroll/human resources, and property tax and utility billing –taking nine to 12 months each with the town billed as implementation proceeds, she said.
Annual operating costs would increase significantly because software-as-a-service means data is stored through a cloud service provider rather than on in-house computers. Stanton said the $217,000 charge would cover training and updates as well as storage. The cost of the Town’s current annual service from KVS is budgeted for $66,000.
There will be some overlap during the three years of conversion. “We won’t cut over until we are absolutely confident that we can cut over,” the manager said.
Committee members searched for ways to present the upgrade as a savings. Tony Battaglia surmised that the town could save money on servers. But Stanton pointed out that the servers handle more than accounting software; she mentioned public safety records and town archives as examples.
Mary Ellen Carter, Capital Expenditure Committee chair, said she sees a need to quantify human resource and equipment savings. Stanton pointed out that “the hours that are saved are going to be filled doing a different kind of work. We want to make sure the message to the taxpayer is why this is a critical investment.” Perhaps future savings could be identified, said Battaglia
Finance Director David Castellarin added, “The future is in the cloud, but until we have it for all of our applications, we need to maintain our local servers,”
“We may not see cost benefits but we definitely will see efficiencies,” Castellarin said. “There are a lot of things we have to do manually that this system does automatically.”
Committee member Steve Steele, in a question submitted before the meeting, asked why the proposal was not part of the long-range capital plan. Stanton explained that the impetus was Castellarin’s arrival in June. “He assessed the current system, identified limitations, and has proposed the system overhaul.”
Stanton mentioned that she herself, Julie Kirrane, school finance director, Amy Fidalgo, assistant town manager of operations, and Castellarin have experience with Munis. Castellarin said he has been through conversions to Munis in other towns where he worked. “I have so much confidence in this software. I think it is the best software out there for municipalities,” he said.
Asked about other product options, Stanton said KVS has recommended conversion to Springbrook software. “We asked for an estimate to convert and they did not respond,” she said. The manager also noted that Oracle PeopleSoft systems are customized and much more expensive. “We have done an incredible amount of research looking at alternatives” to KVS, she said.
In answer to a question from member John Carbone, Stanton said the conversion will include as much financial history as possible; there might have to be some manual entry. Member Brad Morrison asked if new billing for taxes and water and sewer will mean increased fees. The town manager said there will be no fees and the bills will look the same as they do now.
Steele also submitted an advance question about the disadvantages of the current system. Stanton’s answer ranged from various limitations that require manual entries to limited corporate support.
The committee also learned at the meeting of other technology-related proposals for fiscal year 2023: $131,000 for equipment and software, including $54,500 for cyber security; $23,789 for the first year of a two-year website redesign; and $8,857 to replace photocopiers.
Mike Rosenberg can be reached at [email protected], or 781-983-1763
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