March 12, 2026 · Technology Committee · 7,412 words · 9 speakers · 108 segments
JTC will come to order. Mr. Gravy, will you please take attendance?
Senators and Representatives, Baisley.
Present.
Pascal.
Here. Rodriguez.
Here. Weinberg.
Absent. Tatone.
Here.
Madam Chair.
Finally here.
Thank you for your patience as we were trying to get started this morning. We've got judicial requests. We took some action last week. We may not need to take any further action, but we're going to have Mr. Gravey talk through what we did last week. Mr. Gravey.
Good morning. Dan Gravey, legislative council staff. As a reminder to the committee, the outcome of the two votes that were taken on the judicial department requests last week was an approval for a recommendation to fund the operating request and the failed vote on the IT capital system request. And so that was the outcome of the two votes that were taking on the Judicial Department request last week.
Discussion on that. Senator Rodriguez.
Thank you, Madam Chair. I had a meeting with the Judicial Department to discuss why they were in the OIT operating budget and also going through their assessment, which I will share with you guys offline because I'm getting a copy of what the actual LSI is, which stands for Level Supervisory Inventory, which is a sheet that an interviewer goes in and asks questions, and they score, and they put in numbers, 1-0-0-1, and it calculates it. And then it ranks you as a high-risk offender, medium-risk offender, low-risk, which is used by your probation offer to develop your treatment plan. And I think we're at an impasse because their lawyers still think that this is AI, that's making a decision when it's really a calculator or a spreadsheet, which is excluded under this policy. And I'm fine with continuing with the OIT, the budget, operating budget, but if we're in a discussion of that the attorneys still think a calculator or database or a spreadsheet is artificial intelligence, then maybe we need to have that conversation before we approve this, the system's budget. I think that makes sense to me. Do we have a time frame for when we're going to reach resolution on that, or we're just going to?
I feel, and I know that the AG's office was happy to come down. I felt yesterday prudent that the conversation was going good, and they were going back to their attorneys to talk after this morning. they still consider it the calculator a artificial intelligence and maybe it's wonky definition of this because this is new law that's never been done before so you know i'm happy to look at if there's something we need to clarify but i can't get under me and i need to get the ag to come in and i may discuss with them a memo something that they could put out saying this is not what we would consider artificial intelligence because it's not actually even consumer-facing. It's a tool you use in the back office.
Okay, fair enough.
I'm seeing Ms. Falco taking lots of notes. Ms. Falco, are you good with that? We would love to have the AG actually come in and talk to us about this particular judicial request.
Samantha Falco, legislative council staff. I'm happy to coordinate with the AG's office, and we'll set something up for next week.
Okay. Oh, Senator Rodriguez.
Yes, I did talk to the AG's liaison earlier, late last week, and he did say he'd be happy to come down and talk to us. Because that's, I mean, I think at the core of this, where we get into disagreements, what we think is AI under the definition and the generative and all these other discussions, that's all enforced by the AG's office. I think we should be looking at clarification. Nobody has given us a memo saying that the AG does think this is it. I can't even ask them where they think they would be sued for discrimination from the LSI, which if you're not causing discrimination, I don't even know why this bill is. Why it's applicable.
Okay, fair enough. We will get moving on that. That'll make sense. That'll probably provide a lot of clarity. also with our other business related to AI departments and all that kind of stuff, as well as OIT. So we're going to let that ride. We approved the operating request. We rejected the case management request until we have an opportunity to sort through with the AG and then with the lawyers of the judicial department where we are on that. Senator Rodriguez.
Yeah, I think that's prudent for us as the technology department. And if they, I would be surprised that this, if under their definition of artificial intelligence with these systems, why their expenses for implementation wouldn't be different.
Okay. Fair enough. Very good. So we're going to mark that off of our list. We're done with that agenda item. We are going to move again to OIT. Oh, yes, Senator Rodriguez.
Do we need to re-vote for the operating budget?
No. Okay. We accepted operating, and then we...
I'm glad you did.
That's why I wanted Mr. Gravy to make sure. We're good. Okay. OIT, I would welcome you to the podium. Podium. What is that? Table? Dias. Yeah, dias. All right. Chief Information Officer Edinger, the floor is yours.
Thank you, Madam Chair. Good morning, everyone. It's great to be back. I'll just do some quick intros since we were just here. David Edinger, Chief Information Officer for the state and Executive Director of OIT at the Office of Information Technology. I'm joined by Sarah Thunberg, the Deputy Director for Digital and Delivery. That's a lot of Ds. Jill Frazier, Deputy Director for Security and Infrastructure. Russ Pascal, our Budget Director. And today we plan to provide a quick recap of real-time billing, review R7, known as the Payments to OIT Adjustments, continue the conversation on R1 regarding AI compliance with Senate Bill 24205, and if time allows, review our recent organizational changes. And I will hand things over to you, Russ, if that's okay with you, Madam Chair.
Wonderful. Mr. Paschal, welcome back. We're going to see if you can get through more than three slides this time.
My best. Again, thank you very much. Good morning, Madam Chair. Members of the... Sorry about that.
One letter.
Pascal.
Got you.
Again, good morning, members of the Joint Technology Committee. Thank you again for having us this morning. We look forward to our conversation. I'm Russ Pasquale, budget director here at OIT and the first slide that I hope to get through in a meaningful and time full manner is an overview of real time billing. So what I'll say out loud, more of a narrative, it's also found within our slide deck in the appendix section, slides 24 and 26. But just to level set, real time billing was adopted by the Office of Information Technology in a response to the recommendations from a report commissioned under House Bill 17-1361. And ultimately what House Bill 17-1361 was, was a JBC initiated bill and it was a recommendation for the state auditor to contract with a qualified independent third party consulting firm to conduct an evaluation of the state's IT resources. Some of the findings or recommendations within that report were really honing in on several operational areas including our IT billing practices. And to be more specific, the recommendations had recommended that OIT simplify the OIT billing process, improve reports by minimizing changes to billing codes and create new reports that were consistent and comparable from year to year. So ultimately what real time billing did is it replaced the previous framework that was adopted by OIT which is a 1-12th billing. It took agency appropriations for the full year, divided out by 12 and so each agency agency was getting billed, you know, a fixed dollar amount, but again, that was based on estimates only. A true up would occur for actuals two years later, but with the real time billing framework, essentially the biggest change for agencies is they were getting billed on a monthly basis based on actual consumption. So on the slide that we have in front of you, there's six kind of main activities that we would consider as part of the real time billing process. At the top row, rows one through three represent more of the development side of how agencies and OIT interact with each other and how we ultimately come up to what you all see in the annual long bill called the payments to IT appropriation within each agency long bill line. And then numbers four through six towards the bottom of this visual is more once that budget has been approved, what are the different activities that OIT performs to ensure that we're providing services at the right level but also within a meaningful and valuable way with our agencies. So it really is kind of the once things are live and in operations how we react with real-time billing. So I won't read, you know, each number off but I'll try to highlight as best as I can what each activity represents. To begin the framework, number one, service rate setting. The way that OIT develops our service rates, we take an estimate of what agencies have consumed historically, we take a snapshot in time, we also take into account any future legislation or budget actions that we believe would impact our service delivery and what agencies would need. Once we have that, we mirror up what we believe as an organization, as a service provider, what level of resourcing we need from a cost perspective. So ultimately when you take that cost divided by the assumed demand from a consumer that equals your service rate. Given the amounts of services we have, the billing methods vary. You can have per hour, you could have per unit, you can have direct pass through and then for those shared services across the state that we can't necessarily account specifically to an agency, we will do a percent cost allocation. All of that being said, these are all proposals, right? Number two is really a governing group called the Rates and Services Board. It consists of nine voting members, three of which are OIT leadership members. Five are agency representatives that range from product directors, IT analysts or even business folks as well as one representative from the Office of State Planning and Budget. And really the core reason for having this committee or this board is for OIT to provide updates and recommendations on how our service framework and structure should be. Again given what the rates and services board provides as what they see as acceptable or if they want us to approach the billing metrics or if we get scrutinized kind of in the rates we develop, that's our opportunity as an organization to get that buy in or to pivot based on that feedback. There are other representatives on that call. It's not just the board members. we really do invite any agency who has interest in reviewing our services. And again, we meet with them monthly, if not every other week, depending on the topics. All that being said, what you all see ultimately is really the result of agency utilization planning. So during the summer agencies are looking at our list of services that we can potentially provide to them They provide what they believe they will use for that given year And then ultimately that ends up being what we propose as our November 1 submission for payments to OIT So it's a consolidated all agencies together, one packet as November 1. Skipping down to the bottom four through six, service adjustments. So really once the legislature has approved the payments to IT budget, we realign all of our cost pools to then have the year kind of drawn out. The big piece that I should spend most time is this real-time billing supplemental number five. So this is the opportunity with real-time billing where in year when we're looking at actual consumption, actual payments, we can right size as quickly as possible, meaning after three or four months, if we're observing that we've provided a service and our cost estimates are way off, whether we're over or under collecting, we really leverage that supplemental to right size because there should be no reason for over collections. So we bring that all back to the board and help provide context as to the why and then provide resolution of saying, do we reinvest in this service and bring down the rate? Do we reinvest in the agencies and provide a credit? Really trying to hone in on where does the money lie and where is the most appropriate use case for it. And then the last piece, the number six, and it kind of segues into the next slide. The IT revolving fund or what we consider as our 6130 fund, this is partially where or majority of what real-time billing activities, so the collections and the payments related to our framework at real-time billing really impacts that fund. So on our next slide, we'll kind of illustrate the components of real-time billing and how it impacts what you all see within our fund balance.
Representative Titone.
Thank you, Madam Chair.
So thank you for being here. This whole real-time billing thing has kind of been a black box for a lot of people. JVC has called it a black box because they don't know how much money was in it. And every time we have the supplementals, there's always that line that says, payments to OIT, and it's like sometimes it's a little bit less, sometimes a little bit more. But it turns out that there was $36 million more than you needed in the account, and that's what you're giving back. I don't understand how that happens if every year we have that line item in the supplementals in every one of the divisions to give money back and forth, that this $36 million should never have accumulated that much. How did this get to this point? When did, I mean, I've asked this question before. When did you know that this money was there? Were you ever going to tell us that you had an excess amount of money? and how did we get to this point? And I want to remind you that statute says you have to tell us what we want to know and you shall tell us what you want to know according to 2-3-1704, Section 10. You shall tell us the answers we need to know so we can do our jobs. Is this something you know, Mr. Pascal?
Okay. No, thank you for the question, Representative Tatone, I'm sorry, and Chair Marchman. I certainly can provide context from my perspective and to the best of my ability, address the question at hand. So to your point, Representative Tatone, with real-time billing, we're in our fourth, fifth year. From my perspective, it is definitely a level of maturity and learning for what OIT needs to do. In the observation you've made of having 36 million, with the fluctuation month to month of what we collect and what we pay out, again, from my perspective, I do believe that the minute we know, we should be voicing and communicating out to not only our legislative partners and oversight committees, but also our agency partners. And really, all I can say is from an accountability standpoint is having more of that transparency on a regular cadence rather than a, you know, as we have more information. But that's just the current comments I have available at this time.
Makes sense.
Representative Titone.
Thank you, Madam Chair.
That doesn't answer the question, though, because the fund that you need to have a fund balance of, you're saying needs to be $30 to $45 million is what your OIT fund balance target's supposed to be, and you had $36 million more, that's almost double what you need to have to operate the fund. At what point did you know you had an enormous amount of money extra that you did not need, and why did you not bring it to the attention of anyone, and how did that mechanism not work where every single year in the budget with the supplementals we have payments of IT. Why did that money not get redistributed back during the supplemental process of all of the years that we've had as that money is accumulated? It doesn't make any sense to me. Mr. Pascal.
Thank you, Chair Marchman, and thank you again for the follow-up question, Representative Detone. The only added context I could provide in terms of knowing, you know, having $36 million above what the reserve balance is, is just the delineation between the fund balance being not truly just cash in hand for us where we could dole out or, you know, just redistribute it. The ultimate fund balance represents assets minus liabilities. So within that assets kind of category, it truly does include cash, but majority of our assets in a certain given point in time are actually more of the traditional PP&E or equipment and property. So these are assets that aren't necessarily quick to convert to cash. And so in that instance, if, and typically what I will say from my knowledge, majority of our assets lie in that bucket where it's not that quick to convert to cash unless we've got a, you know, we can sell off and have an interested buyer have that piece. But to your point, again, I don't know the answer to when that $36 million, you know, in what point in time was that known within OIT. Representative Titone.
Thank you, Madam Chair. what could have possibly have converted over that was $36 million? I mean, this seems like something you would have anticipated. And when we asked you before, when I started asking these questions last year when I was running 1310, it was $10 million, and then it was $20 million. Now it's $36 million. So obviously, this number has been known for a while now, And when I said, can we get the money back, the answer was no in the beginning. And now, finally, that we've shined the light on it, the money is going to be going back. But it does not add up. There's still a lot of opacity here, and there needs to be more transparency because this seems to be a way bigger amount of money than there should ever be. I get you're going to be over a percentage, but this is a massive percentage over what you should have. And if you're setting the rates constantly, how does this happen? It doesn't make sense how this happens that you get this huge jump. And I get like two or three years, and I think that's even more troubling that this money is just like, oh, look at all this extra money that's in here. When did you know that this $36 million was there? And when did this happen? When did this conversion happen? I hear a lot of reasons, but nothing concrete, as to when. You have the accounting, don't you? And can we see the accounting so we can actually understand when this happened? So I genuinely want to understand this. I get that real-time billing is complicated. This is a large amount of money. and I want to understand it. So please, and we can do this later on, and if you could show me what the balance sheets look like so I can see it, I think that would be much easier for me to see what's going on because this seems like something's just really not adding up and there was no notice or anything sent to JTC.
Yeah, and I would say a couple of things. I do think we should be looking at this fund pretty regularly. One of the questions I was going to ask, and I always hate to ask, but if we could study the supplementals in that step five, if we could get an understanding of what they've looked like against the balance of the account over the last, since the inception of the fund, that might be helpful for us just to graphically see that. I do want to flag that we are supposed to be making decisions on R1 and R7 today. And so I just want to make sure we can get to those. But with those two notes, does that make sense? We are going to monitor this more, and then we're going to put a request for information in related to all the supplemental requests as it looked to the balance. Awesome. Thank you, Ms. Falco, and thank you for that good line of questioning. If we could move into whichever priority R we want to go to, R7, that sounds great. Let's go to R7 if we could.
Mr. Pascal. Thank you, Chair Marchman. So just a quick debrief, R7, as Executive Director Edinger had mentioned, is our payments to OIT adjustment, also known as the statewide common policy submission. What we were presenting back in November 1st was our submission, which is a $10.8 million increase compared to last year. What we just wanted to note, how is the $10.8 million derived? What we're essentially saying is that from what agencies had submitted in FY26 compared to FY27 there was an increase by that 10.8 million. So it's just the difference between what was requested from year to year. Predominantly the agencies had requested a larger increase within their agency specific direct pass through lines, also known as kind of just the vendor cost like Salesforce or Microsoft and then also an increased request regarding data management and government services such as hourly roles within the data world as well as warehousing. The third kind of main driver of this increase were the statewide total compensation common policy impacts. So that would be salary benefits and POTS increases. And one thing I just wanted to flag, if you're adding up 6.8, 3.6, and 6.5, that certainly exceeds the 10.8 that you're seeing on the slide deck. Just wanted to call attention to that. As part of the increases that you're observing, OIT did observe, or projecting to reserve, projecting to observe cost offsets in 27. So some of the items that were offsetting the increase were a decrease in our legacy infrastructure costs. And then one kind of example about that is just the elimination of billing for the physical mainframe. So that kind of is what netted out to that 10 million. And then just the one quick update as of yesterday we do acknowledge that there are figure settings going on for each individual agency and we aware that there have been recommendations made by JBC staff to reduce their agency payments to IT lines So from our perspective, that $10.8 million may no longer be an accurate number of the year-over-year increase, and that, again, the JBC staff members for each of those agencies have been putting forward recommendations to have that reduced closer to net zero.
Thank you. Representative Titone.
Thank you, Madam Chair.
How does the agency-specific direct pass-through of vendor costs not fall into the real-time billing? Because that's what I would expect this sort of fund that you have Continuous Spending Authority to cover, and that's why you have to have a certain amount of money in there to adjust. and maybe this is something that is going to be an ongoing cost for a while and it may reduce your account balance over time, but we don't have a lot of money to throw around right now. Is that something you can absorb with the account that you have and get us through to the next year? Maybe we can make up for that and then supplement it later on. Thank you very much Chair Marchman and thank you Representative Titone for the question.
To answer your question, yes that is certainly something I believe that OIT could evaluate every year to say, hey what do we have within our fund balance and what are the costs being requested by those agencies specific to what you had pointed out, the agency specific direct pass through costs. Some of those costs that we ultimately do go through real time billing if an agency requests for very specific work from that vendor. Sometimes they're recurring annual, you know, provided services, so we'll engage, purchase, and then pass it through directly at cost. But to answer the question, I do believe that that amongst other services are items that we should be considering in terms of what can we absorb versus what should be passed on to agencies depending on the financial positions.
Representative Titun.
Awesome. Thank you. You can keep going.
No, thank you. I believe that's...
At the end of R7. Yeah, that's the end of R7. Okay, I am going to open that up. We had the real-time billing conversation, and we heard about some savings from legacy, which is what we're definitely looking as we continue to improve our IT. um miss falco did we hear anything from jbc or their staff in terms of um input or what we are
going to be providing to them we samantha falco legislative council staff we did um joint budget
committee took action to request that the joint technology committee makes a recommendation for
specifically R1 and R7, and we do have JVC staff here if we need any more specific questions, but we do want to take action on it.
Okay, I just wanted to clarify that. So they are waiting on us to take action on this, so we'll need a motion if there's no discussion. I didn't write one down. Are you good? That's fine. Do you want to just? You're good. That's fine.
Representative Titone.
Thank you, Madam Chair.
I would just like to propose that we do recommend it, but to have the JBC look into this agency-specific direct pass-through to vendor costs to see if any of that can be absorbed into the revolving cash fund, to see if that number can be reduced. That would be my recommendation.
I like it. We're getting scrappy. Okay. You don't have to put that in the memo. And then I'll just do it officially. I move to approve the R7 budget request for OIT as requested with the caveat of the agency-specific direct pass-through line item be looked at to reduce, to absorb into the revolving cash fund. Is that a motion? It's a very proper motion. Very good. Mr. Gravy, would you please poll the committee?
Senators and Representatives, Baisley. Aye. Pascal. Yes. Rodriguez. Aye. Weinberg is absent. Tatone. Yes. Madam Chair. Aye. So that recommendation goes with our caveat.
Very good. I feel so great that we finally, it's like we've tried this three times, finally getting that done.
Oh, yes, Rhett Paschal.
Thank you, Madam Chair.
I just wanted to add the comment. Somewhere in this conversation was mentioned that we should be hearing about this more frequently so that we can understand it and track it, and I think that's a great idea. Same.
I think what we'll do is when we get our quarterly OIT updates, we're going to ask to have a specific conversation about the revolving fund, specifically that R5 that you're working on that's step five and any true ups that are going on, just so we can see it a little more frequently. Maybe that quarterly update is the right place. Good call. All right. Let's move to R1. Director Edinger. Thank you, Madam Chair,
and thank you for the robust conversation, JTC, on R1. And I think I see no reason why we can't
provide that information going forward on a monthly basis, quarterly basis, and certainly
to want to evaluate whether we can look retroactively to see what we can learn from the fluctuations throughout the year and why or why not that revolving fund is needed to be at that balance or perhaps could be limited in some way or sweeped in some way. So those are great ideas and we're looking forward to those. Moving on to R1, let's continue that conversation related to the budgetary request for ensuring compliance with Senate Bill 24205. We maintain that the definitions with respect to Senate Bill 24205 are overly broad and we do not yet have clarity from the Attorney General's office on how to specifically interpret them. Still, since you asked, we have working definitions we have started to use internally in the absence of clear guidance. Building on the material we covered last week, let's jump into the definitions, the budgetary requests, calculations, and a couple of examples that I think will illuminate how we've approached things so far. We've also shared OIT's full generative AI inventory including whether the technologies
face Coloradans directly and if they appear to meet the substantial factor or consequential
decision threshold in Senate Bill 24205.
The purpose of the R1 request is to present estimated resources in terms of human resources
and budgetary dollars needed to comply with the law. This is treated as a standalone analysis focused entirely on that question. Sarah Thunberg will present the details of the OIT portion of that R1 request. And with that, Madam Chair, if it's okay with you, I'll turn things over to Sarah. That sounds great.
Director Thunberg.
Thank you so much, Madam Chair. And thanks, Dave. So shown here is the language of the bill. Again, as David Edinger said, we are awaiting rulemaking, rule setting, and definition from the AGs. We have provided the inventory to you, and then I want to share some information first about how we came up with OIT's portion of the fiscal note requesting 3.5 FTE. So, next slide, please, page. So when the fiscal note was submitted, OIT had received roughly 150 Gen AI evaluation requests. A reminder, we're using the NIST framework currently, so medium, high, prohibited. We use their definitions. but early patterns suggested we would get roughly 500 submissions per year in the earliest phases of Gen AI being a thing. Every application needs to be evaluated because it is use case based. And under 24205, we don't know if it's likely to meet the criteria from the outset. So we need to determine if it is that consequential decision significant factor in each use case, and then if so, we need to review them annually. So based upon that within the law, we did some math. About 75% of the Gen AI evaluations take six hours. 25% of them are more complex, taking roughly 12 hours. That gives us a weighted average of seven and a half hours per evaluation. 500 submissions times 7.5 hours, 3750, using our calculation of how many work hours an OIT or state employee has, we get to 2.5 FTE. That's just for the evaluations. Then on top of it, we estimate we need one FTE to do the next set of work related to 24205. Next slide, please. This includes the annual assessments and high-risk determinations, the consumer notifications and appeal workflows, which are net new things. We do not do that work currently, as well as participating in the Attorney General's disclosures. Again, we don't know what that's going to look like, so it's one person. Looking ahead, we are working with haste to automate the routine evaluations. Obviously with a human in the loop, but let's use Gen AI to make these things faster and quicker. We do not contemplate needing more. Rather, we want to build better processes that hold us steady or go down in the level. But that's how we got to our 3.5.
That all checks out.
Thank you for showing us the math and the accounting on that as a math teacher.
I really appreciate that.
Okay. Oh, yes.
Rep. Haskell. Could you tell us a little bit more about taking approximately six hours? Because to my mind, it's a flow diagram, right? So first question is, is there a consequential decision involved? If the answer is no, then you're done. So is that true? And why would that takes so long to answer that question since most of them the answer is no. I'm wondering why most of them take six hours. Director Thunberg. Thank you for the question. I'm wondering if I might provide the two examples in the next slide to illustrate why I appreciate it. Yes, it is a good
question. Yep. Thank you. So the first example here is the Microsoft Copilot Code Assist. This is in itself, the technology is not high risk. Itself is not making a consequential decision, but in this use case, it is working in a data set that is FERPA-protected student data. And under the definition, our current interpretation, what we know without rulemaking, without guidance, FERPA-protected student data makes it a higher-risk situation where we would have to do the annual evaluation. So the process begins with what is the solution, what is the use case, what's the data set, and then we engage in a conversation about mitigation, about how we can reduce it. So this is one of those use cases where on the outset we would be like oh co low risk But then we like oh actually really really important data that specifically called out in the legislation thus increasing the time it takes for us to understand. And I will say that each of these is net new because we need to understand them in context. It's not just like, and check, unfortunately. Do you want to hear the other example? You want to ask your question real quick?
Rep. Paschal.
Thank you, Madam Chair. Sorry, what does co-pilot CODIS do? I don't even know what that is. So what is the operation here?
Director Thunberg.
Thank you, Madam Chair. Thank you for the question, Representative Paschal. It is a generative AI tool that sort of rides sidecar with an engineer or a developer and develops code snippets, brings in library components. It is a very technical, also does automated testing as you go. So when you commit code, it will run a script to say, ah, you missed something, or oh, here's a recommendation. Because it's in this really sensitive data set, it becomes subject to these additional components in our current understanding.
Great.
Senator Baisley and then Senator Rodriguez.
Thank you, Madam Chair, and thank you all for your presentation here. I was doing the math on the 3.5 FTE. So with 3,750 hours in a year divided by that 3.5, then it comes down to the 1,071 hours a year. So you said something about that being an average, I don't know, like a, I don't remember the words you used, but like a productivity amount. Is 20 hours approximately a week? Is that what that usually comes to? Because it seems a little low to me.
Director, Eddinger.
Yeah. Madam Chair, thank you for allowing me to speak, and thank you, Senator Basley. It wasn't the 3.5. It was the 2.5 FTE calculation. We had that extra one that was separate. So those hours were 3,750 hours divided by the state standard FTE calculation, which is what I think you're asking about, which is 1,548. 1,548 hours is the state definition of a full-time equivalent. When you start with 2,080 hours and subtract out vacation time, sick time, training time, that kind of stuff. So that was the number we were using to define the FTE was the 15. Thank you. Much better.
Thank you for clarifying that for me. Thank you.
Yeah, that is helpful. Senator Rodriguez.
Thank you. The current work around that's going on in the task force and looking at the bill, I don't know, and for my colleagues here who know what FERPA is, FERPA was written in 1974. It's a basic disclosure that's given to students and their parents. They get it once a year, usually in the student handbook or a school email. What it is, a general list of your rights and what the school calls directory info. Often buried in a handbook or posted on a school bulletin. And schools must remind you of your rights annually. The difference with the AI Act is that every time a high-risk AI is about to make a decision, when you get it is every time it makes a decision, what is in it, specifics on the AI purpose, how it works, and your right to appeal. directly to you in plain language so you can understand. The FERPA just says often buried in a handbook or posted on an actual school bulletin board. And updates every year, they must post a public summary in all the AI that they use. That's the difference between that. And it's the same thing the schools must notify every year. Of somewhere in a handbook and they give you your rights in a booklet that they hand you to tell you your rights to do it. The AI bill just says if you're using a computer and AI to do a decision, they have to tell and what's being used to make a decision on. FERPA is a little, like I said, 1974. I will say, though, as a teacher and as a parent, FERPA is what keeps everyone honest in our schools. I don't mean to say it like that. Maybe I could have said it differently. But it's really what protects my students' information as a parent. But also, as a teacher, I am bound by FERPA. I used to pull gifted and talented kiddos, kiddos and I had to do it super secretly because that was FERPA protected data, the kids I actually had on my caseload. So, yeah, it's old. But, yeah, Senator Rodriguez. I don't disagree with you. There wasn't computers, spread seats, data, and the mass amount of internet. That's why there's nothing in FERPA telling you that it's making a decision. I see what you're saying. It's wonky, but it's pretty outdated and compliance with where we are with technology now.
Representative Titone.
Thank you, Madam Chair. I was just, you know, you said a lot of the code generation kind of thing. And I would say under the exclusions in the bill that I would fall under the technology that communicates with consumers in a natural language for the purpose of providing users with information, making referrals or recommendations and answering questions that are subject and accepted to use policies that prohibits generating content that is discriminatory or harmful. I mean, you're using, it's basically, it's a chat bot essentially that makes code in a language that is computer code language that, I mean, we call them languages for a reason. And that's, you know, it's up to the person employing the code to make the decision on whether the code is proper or not. So I don't know. I mean, I guess that's a legal interpretation. I don't have that, but that's where I would expect that that would sort of fall under.
Director Thunberg.
Thank you so much, Madam Chair, and thank you all for the feedback. I think this is the place where we are stymied, which is I'm not a lawyer. I'm a technologist, is how to interpret it. and in the context, until we get legal guidance, we are doing the best we can. And I would say that in this FERPA instance particularly, in the consequential decision component of the legislation, there is a call-out about educational enrollment and education opportunity, which is where this all gets sort of moneyed. So, yes. If possible, I have one more example if it's helpful. Okay, example two. To the part of the legislation which Representative Tatone just mentioned, the disclosure around consumer-facing conversational AI. We have in production currently a generative AI virtual agent with a contact center at one of our programs. This is call around and facing. You call the phone number and a generative AI virtual assistant is what picks up. We have not flagged this as high risk under the legislation, our current iteration, our learnings about it, but we do believe that we need to disclose it. And so now we're engaging and actively conducting user research around how do we meet that disclosure obligation, making it clear and in a non-disruptive way to the customer, the consumer, that this is Gen AI. This is a new thing they're experimenting. So even in low risk and non-consequential decisions, we still have this compliance obligation that we're trying to navigate through good design.
Senator Rodriguez.
Yes. I wish I had my laptop and I wasn't searching on my phone. There is a notice, a simple notice if you're interacting with AI, simpler than that. And I think the definition of the policy is very, very simplistic. It's as simple as just saying Grok AI or Facebook AI or, hi, I'm Alice, your AI assistant. All you need to do. It's not telling you. And many of us deal with it now, if you're on a computer and you're talking with a chatbot or a system, and it's being done pretty commonly now. So I don't know how that drives a cost versus just a simplistic way of saying AI. So I hear there's some compliance confusion, too. It feels like for compliance requirements, IT is feeling like they really need to dig in, whereas maybe it's just you're using Welcome to Alice or whatever it is.
So, committee, I want to just look at our time. Yeah, yeah, rep to tone.
Yeah, I mean, and we talk about it in the bill, it's an essential government service. So some of these things, I mean, what is considered to be an essential government service? is it making code for someone that's not an essential government service, that's behind the scenes, things that are happening. So I think that that's something we can probably get the Attorney General to help us understand.
Awesome. Okay, I am going to pause us here. I'm going to recommend that we have the Attorney General come in or Attorney General's office come in next week to try to help us a little bit on this. And I'm curious if we have any kind of a deadline for JBC. God, Representative Falco.
Sam Falco? Samantha Falco, Legislative Council Staff. Andrew McLear with the Joint Budget Committee will be making his recommendations on March 16th. That's the current plan for it.
So if the committee wants to voice their opinions before those recommendations, today would be the day.
Today would be the day.
Yeah. So, committee, would you be – I know I'm not in a good position in the next two minutes to make feel good about what I'm going to do, but I also don't want to drag you all into another meeting if you don't want to. That said, Friday doesn't work, but would Monday morning work for us just to have a one-off committee meeting? Hey, Chatty Cathy's. I'm sorry. You're good. Is it okay if we meet on Monday morning? We can't meet tomorrow because of Ledge Council, but can we meet Monday morning to talk about this? I have to talk to a committee to explain my bills. I would rather be there. Okay. We are going to attempt to do that then. We're going to have a special meeting on Monday. Nine. Should we? Nine in the morning because House 4 or 4 works. We have to do it. We have to still do it at 8 for other meetings. That works. Sorry, y'all. Monday at 8. Okay, so we are getting closer. Thank you so much. I really appreciate you all being here. With that, JTC will be adjourned for today. Thank you.