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October 29, 2019
Rated Services and Billing
StructureFY 2019-2020
2Overview
FY 2020 Total ITS Cost Base ($913 million)
• Rated Services ($803 million) – Billed across 8 rated service categories including labor, workplace
services, infrastructure, networking, telecommunications, platform, website, and facility services.
• Non-Rated Services ($47 million) – Includes costs that are not billed to client agencies through a rated service. Costs include Agency-Specific Procurements and Direct Bill agreements for non-rated
services.
• Recovered Other Means ($43 million) – This category includes costs recovered through the Journal Voucher process, and also costs allocated through the Statewide Cost Allocation Plan (SWCAP).
• Non-Recoverable/Future-Rated Services ($20 million) – Client agencies are not currently billed for
these costs. Costs include technologies still under development, but not ready for an agency chargeback. This also includes costs associated with excess capacity for newer services that are not
yet fully utilized (e.g. ECM), and are therefore not yet fully recovered by ITS.
3Annual Change Overview
Annual “Look-Back”
• In FY 2019, the total ITS Cost base was estimated at roughly $953 million. In FY 2020, the Rate
model anticipates a total of $913 million, which is a $40 million decrease (4%).
• The net PS increase is primarily due to consultant conversions, as well as COLA adjustments.
• In addition to consultant conversions, NPS has decreased due to savings on enterprise contracts.
• Depreciation has decreased due to prior purchases falling off the depreciation schedule as well as a change in reporting for large software purchases such as in the mainframe environment.
FY 2019
Rates
FY 2020
Rates
$
Change
%
Change
PS 297,626 308,938 11,312 3.8%
NPS All Funds 446,250 398,300 (47,950) -10.7%
Fringe 185,360 193,024 7,664 4.1%
Depreciation 23,766 13,180 (10,586) -45%
Total 953,002 913,442 (39,560) -4.2%
4Annual Change Overview
Annual Increases:
• Telecom: Increased due to better
identification of Vendor Line costs
and higher proportion of network
costs associated with the VoIP
service.
• Platform: Improved data reduced
non-rated services costs, and
shifted costs to database services.
Also, increased usage of
Enterprise Content Management.
Annual Decreases:
• Labor Services – Consultant
conversions lead to decrease in
Contract Labor Bills.
• Network Services – Reduction in
NPS expenses and a
recharacterization of costs to
Telecom.
ITS Recovery ModelFY 2019
Rates
FY 2020
Rates
$
Change
%
Change
Labor Services 367,804 364,490 (3,314) -0.9%
Workplace 176,923 177,393 470 0.3%
Infrastructure 116,411 101,392 (15,019) -12.9%
Network 82,478 76,272 (6,206) -7.5%
Platform 34,620 38,674 4,055 11.7%
Telecom 31,145 35,920 4,774 15.3%
Digital Presence 8,560 9,021 461 5.4%
Facilities 255 124 (131) -51.3%
Rated Service Subtotal 818,196 803,286 (14,910) -1.8%
Client-Specific Billings 44,194 47,105 2,911 6.6%
SWCAP/JVs 43,025 42,894 (131) -0.3%
Other Subtotal 87,219 90,000 2,780 3.2%
Total Combined Billing 905,415 893,286 (12,130) -1.3%
Non-Rated/Non-Recoverable 47,586 20,156 (27,430) -57.6%
Total Impact 953,002 913,442 (39,560) -4.2%
5Rated Service Categories / Bill Types
Service Category Description
Labor/Application
ServicesState and contractor staffing resources to manage and develop business applications.
Workplace ServicesBasic hardware, including refresh cycles, and the software, tools, and services that allow
employees to perform their day-to-day job.
Infrastructure ServicesIT hardware, software, tools, and services that form the foundation for platforms and
applications.
Network ServicesSecurely connects workstations and network devices to critical applications hosted in State
data centers.
Platform Services Includes the application infrastructure that enables business-facing applications and services.
Telecom Services Modern VoIP technology that supports employees in their daily operations.
Digital Presence ServicesIT services that support the demand for business managed channels, content, and user
experience.
Facilities ServicesCo-location services provided at CNSE that include equipment purchases, lease space, and
personnel costs.
Non-Rated Services Agency-specific software that is not included in a rated service.
6Labor/Application Services
Labor/Application Services ($364 million total) – State and contractor staffing resources to
manage and develop business applications. The FY 2020 Enacted Budget projected an ITS
workforce of roughly 3,500 State FTEs and 850 contractors. Labor services are billed on an
hourly basis.
Significant Change Drivers
• State Labor ($315 million) – Small reduction in State Labor Rate due to slightly higher
percentage of staff hours being billable vs overhead.
Service (Billed per Labor Hour)FY 2019
Forecast
FY 2020
Forecast Change
State Labor 125.33$ 125.22$ (0.11)$
Contract Labor See Rate Card
7Workplace Services
Workplace Services ($177 million total): Basic hardware, including refresh cycles, and the
software, tools, and services that allow employees to perform their day-to-day jobs.
1. End User ($148 million): Hardware and software package that supports standard
productivity including email, web browsing, personal cloud storage, and equipment
replacement based on regular refresh cycles. Includes standard desktop, laptop, or thin
client and accessories for on-boarding new employees. Also includes break/fix and device
management.
2. Mobile ($15 million): Managed mobile service that includes devices, carrier plans,
provisioning, contract management, and billing.
3. Other Workplace Services ($14 million): Includes standalone Office365 licenses and remote
application and desktop access services.
8Workplace Services – End User
End User ($148 million total): Standard desktop, laptop, or thin client and accessories for on-boarding new employees and
asset life cycle replacements. Also includes break/fix, device management, support of existing standard software, desktop
security, protection from intrusion with firewall and antivirus technologies, O365 email. Additional premium software may be
purchased separately.
Significant Change Drivers
• Workplace Services – No significant changes in end user rates.
• Citrix – Rate increase due to users migrating to other VDI services. Cost base has slightly decreased, however, not at the
same rate as the decrease in usage.
ServiceFY 2019
Forecast
FY 2020
Forecast Change
Kiosk User (License/Month) 105.18$ 108.30$ 3.12$
Fixed User (License/Month 127.42$ 125.62$ (1.80)$
Fixed User, no equip replacement (License/Month) 105.18$ 108.30$ 3.12$
File/Object Storage (GB/Month) 0.11$ 0.09$ (0.02)$
O365 Standalone (License/Month) 16.66$ 16.18$ (0.48)$
Citrix Desktop (User/Month 5.85$ 11.92$ 6.07$
Citrix XenApp (Concurrent User/Month) 59.21$ 73.58$ 14.37$
9Workplace Services – Mobile
Mobile ($15 million total): Managed mobile service that includes devices, carrier plans, provisioning, contract management, and billing services for employees who require the use of a mobile phone to perform their job duties, as defined by their agencies. Voice and data is restricted to the United States.
Note: Mobile rates are based on actual vendor contract rates, plus additional security, accessories and add-ons, and general
overhead costs.
Service (Billed at Device/Month)FY 2019
Forecast
FY 2020
Forecast Change
Cell Phone 18.38$ 18.49$ 0.11$
4G Device (Smartphone & Tablet) 42.89$ 43.15$ 0.26$
Aircard / MiFi 39.21$ 39.45$ 0.24$
10Infrastructure Services
Infrastructure Services ($101 million total): IT hardware, software, tools, and services that
establish the foundation for platforms and applications.
1. Servers ($35 million): Includes the support of ITS’ managed network services, managed
platform services, managed web hosting, and hardware and software support.
2. Storage ($11 million): Provides centrally managed block storage services for data center
servers.
3. Mainframe ($45 million): A managed infrastructure for mainframe workloads; IBM Mainframe
is the standard platform. Unisys Mainframe support is included for existing clients.
4. Print ($10 million): This service provides high volume, centralized printing. Enhanced
services such as bursting and highlighting are available.
11Infrastructure Services – Servers
Servers ($35 million total): Includes the support of ITS’ managed network services, managed
platform services, managed web hosting, and hardware and software support. Servers support agency applications, data, and automation needs. Includes standard operating environment
technologies of Windows, Linux, and AIX. Servers are delivered in standard sizes to address application workload requirements.
Significant Change Drivers
• All Server Rates – Cost decrease primarily due to reductions in prior year depreciation expenses. A large portion of the previous server rates included expenses related with data center consolidation.
These costs are now mostly eliminated from all rates.
ServiceFY 2019
Forecast
FY 2020
Forecast Change
Unix SPARC (Server/Month) 1,264.47$ 879.82$ (384.64)$
Unix HPUX (Server/Month) 1,803.82$ 1,652.57$ (151.25)$
P-Series LPAR (GB RAM/month) 107.48$ 70.99$ (36.49)$
x86 Virtual (GB RAM/month) 30.04$ 19.46$ (10.58)$
x86 Physical (GB RAM/month) 66.01$ 50.23$ (15.78)$
12Infrastructure Services – Storage
Storage ($11 million total): Provides centrally managed block storage services for data center servers, and block and virtual tape storage for the IBM mainframe.
Significant Change Drivers
• IBM Mainframe Block – Significant hardware investment was made in FY 2019 and billed in the service rates in FY 2019. In addition, a decrease in total data center spending has decreased the rate.
Service (Billed at GB per month)FY 2019
Forecast
FY 2020
Forecast Change
Storage-Block 0.22$ 0.18$ (0.04)$
IBM Mainframe Block 1.55$ 0.54$ (1.01)$
IBM Mainframe Virtual Tape 0.17$ 0.14$ (0.02)$
13Infrastructure Services – Mainframe
Mainframe ($45 million total): A managed infrastructure for mainframe workloads; IBM Mainframe is the standard platform. Unisys Mainframe support is continued for existing customers.
Significant Change Drivers
• IBM CPU – Projected costs are relatively flat, but there is an increase in the projection of CPU usage resulting in a lower rate.
• Unisys 2200 – Increased license renewal cost.
ServiceFY 2019
Forecast
FY 2020
Forecast Change
IBM CPU (CPU/Second) 0.0392$ 0.0318$ (0.0074)$
Unisys 2200 (MIP/Month) 209.62$ 250.76$ 41.14$
14Digital Presence Services
Digital Presence Services ($9 million total): Support for WebNY, which offers web
development services from conception and strategy, to design and implementation for NYS
government websites. WebNY provides 24/7 monitoring and reporting, and provides site
governance tools that enables clients to monitor broken links, accessibility, and automatically
perform time consuming website maintenance tasks, while also improving website quality.
Significant Change Drivers
• Relatively flat spending combined with an increase in usage.
ServiceFY 2019
Forecast
FY 2020
Forecast Change
WebNY (Page Views/Month) 0.0186$ 0.0175$ (0.0011)$
15Network Services
Network Services ($76 million total): Securely connects workstations and network devices to critical applications hosted in State data centers through Local Area and Wide Area Networks (LAN and WAN).
• LAN ($48 million): Standard offering includes office site network hardware, software, support and services to provide a secure, monitored and managed local network for all NYS users. At the office site, this service provides connectivity for PC and VDI workstations, video conferencing, as well as network devices.
• WAN ($28 million): Secure voice and data connections from a NYS site to the ITS MPLS network for connectivity to NYS data centers for applications, storage, intranet and MS Office functions. WAN services also connect NYS sites to the internet and cloud-based applications with broadband data circuits. In FY 2019, a WAN overhead rate was established to better align the treatment of WAN costs with all other ITS rated services.
ServiceFY 2019
Forecast
FY 2020
Forecast Change
LAN (Device/Month) 39.57$ 34.25$ (5.33)$
WAN (Various Rates - See Pinnacle) 12% No change to Pinnacle Rates
16Telecommunications Services
Telecommunications ($36 million total): Provides voice services, such as modern Voice-over-
Internet-Protocol (VoIP) technology including dial tone and voicemail, as a standard offering, and
support for traditional lines for existing customers. Also provides dial tone for systems such as
Modem, Alarms, etc. Self-Service and Online Help Guides are available for users.
Significant Change Drivers
• VoIP – Increased share of network related costs.
Service (Billed at line per month)FY 2019
Forecast
FY 2020
Forecast Change
VoIP 10.78$ 13.11$ 2.33$
PBX (at State Ofc Bldgs) 79.27$ 71.49$ (7.78)$
Centrex (Verizon) 47.92$ 51.16$ 3.24$
Vendor Lines Pass-Through 26.49$ 32.50$ 6.01$
17Platform Services
Platform Services ($39 million total): Includes the application infrastructure that enables
business-facing applications and services.
1. Database Servers ($35 million): Managed relational database services using Oracle, IBM
DB2 and Microsoft SQL server technologies to establish a highly-scalable, simplified delivery
and consumption model intended to reduce costs, improve service levels and enhance
information access, security, and rationalization.
2. Application Services ($4 million): Includes SOA Akana, Enterprise Content Management,
and eFax services.
18Platform Services – Database Servers
Database Servers ($35 million total): Managed relational database services using Oracle, IBM DB2, and Microsoft SQL server technologies to establish a highly scalable, simplified delivery and consumption model intended to reduce costs, improve service levels and enhance information access, security, and rationalization. This service includes the physical database design in addition to the infrastructure support.
Significant Change Drivers
• All Database Rates – Overall spending in database services has slightly decreased, however, there has been an increase in the share to billable vs. non-rated/non-recovered.
Service (Billed at DB
Instance/Month)
FY 2019
Forecast
FY 2020
Forecast Change
Oracle 922.54$ 987.89$ 65.35$
SQL Server 492.18$ 559.58$ 67.40$
DB2 776.44$ 1,263.47$ 487.03$
19Platform Services – Application Services
SOA Akana ($1 million): Enterprise-class platform for designing, implementing, securing, managing, monitoring, and publishing
Application Programming Interfaces (APIs). The platform automates access and control of the connections and traffic between
the APIs exposed on your network and the applications that use them. API Management securely delivers APIs across multiple
channels (i.e. mobile, cloud, on premise, and Internet of Things), enabling data sharing, connecting and integrating applications.
Enterprise Content Management ($3 million): Provides the ability to store and retrieve documents using APIs. This offering
enables a business unit to use their existing capture solution to convert paper files into electronic format, store the electronic
documents into a secure enterprise content repository, and retrieve the documents efficiently and immediately for viewing.
eFax ($284K): Enterprise eFax
Services using the RightFax Fax Over
IP environment including, new fax
numbers, troubleshooting, and quick
start guides.
Significant Change Drivers
• ECM – Total cost pool saw minimal changes year-to-year but, fewer costs have been deemed non-recoverable
due to utilization growth and a decrease in under-utilized capacity.
• Akana – Decrease in NPS spending and PS reduction due to staff primarily residing in Portfolios working on
agency-specific activities. These costs have been allocated to the State Labor Rate.
ServiceFY 2019
Forecast
FY 2020
Forecast Change
Enterprise Content Management
ECM Small 1,688.00$ 1,962.69$ 274.69$
ECM Medium 8,440.00$ 9,813.47$ 1,373.47$
ECM Large 16,880.00$ 19,626.95$ 2,746.95$
SOA Akana 0.43$ 0.14$ (0.30)$
eFax 0.07$ 0.11$ 0.04$
20Non-Rated, Recovered other Means, and Non-Recoverable Services
Non-Rated/Recovered other Means/Non-Recoverable ($110 million total): Includes
development costs of future services, migration costs of old technologies, and other costs not
eligible for reimbursement.
1. Non-Rated Services ($47 million): Includes Agency-Specific Procurements and NPS Direct
Bill agreements not included in a rated service.
2. Recovered other Means ($43 million): Includes SWCAP and NPS costs recovered outside
of the rate model and through Journal Vouchers.
3. Non-Recoverable/Future Services ($20 million): Future rated services Include Managed File
Transfer, WebSphere, WebLogic, Client Engagement Services, and Data Reporting and
Analytics. Non-Recoverable costs include excess capacity in ECM and eFax.
21Forecast Rates vs. Billing Rates
In addition to the FY 2020 Rate Development, ITS, in conjunction with Maximus Consulting Services,
completed a prior year reconciliation effort to address under and over billings from prior years. The reconciliation effort is especially important for federal cost allocation purposes.
Federal regulations (2 CFR Part 225 Appendix C) require States to reconcile central cost-allocated
services and make adjustments for any identified variances between actual revenue and allowable costs. States are given several options to reconcile their costs, including carrying forward any
variances into the rates established for a later year (the option selected by ITS).
As a result of the prior year reconciliation, ITS reduced FY 2020 client agency billing by a combined $4.7M, or less than 0.6%. This results in reduced FY 2020 rates to “reimburse” agencies for these
costs.
Although the reconciliation has only a minimal net impact on agency billings, it is allocated through the rate model as an “adjustment” to the FY 2020 rate card. The reconciliation results in both rate
increases and decreases; however, the net impact is less than 0.2% in total. The rate that is reflected in agency bills includes the reconciliation.
22Forecast Rates vs. Billing Rates
Service Original Forecast
Rate
Adjusted
Billing Rate
(with True-Up)
Change
Infrastructure Services
Storage:
Storage-Block $0.18 $0.21 $0.02
IBM Mainframe Block $0.54 $0.52 -$0.02
IBM Mainframe Virtual Tape $0.14 $0.12 -$0.02
Unix SPARC $879.82 $1,071.40 $191.58
Unix HPUX $1,652.57 $394.55 -$1,258.02
P-Series LPAR $70.99 $69.71 -$1.28
x86 Virtual $19.46 $22.91 $3.45
x86 Physical $50.23 $42.34 -$7.89
IBM CPU $0.0318 $0.0300 -$0.0018
IBM CMOD Support $570.45 -$2,668.22 -$3,238.66
Unisys 2200 $250.76 $270.42 $19.66
Unisys Series A $100,482.57 $102,313.99 $1,831.42
zVM LPAR for DFS $586.69 $1,173.44 $586.75
Print $0.0422 $0.0407 -$0.0015
Platform Services
Database Servers:
Oracle $987.89 $1,065.19 $77.30
SQL Server $559.58 $546.02 -$13.56
DB2 $1,263.47 $1,041.69 -$221.78
Enterprise Content Management
ECM Small $1,962.69 $1,631.77 -$330.92
ECM Medium $9,813.47 $8,158.85 -$1,654.62
ECM Large $19,626.95 $16,317.71 -$3,309.24
SOA Akana $0.14 $0.00 -$0.14
eFax $0.11 $0.07 -$0.04
23Forecast Rates vs. Billing Rates
Service Original Forecast
Rate
Adjusted
Billing Rate
(with True-Up)
Change
Digital Presence Services
WebNY $0.0175 $0.0218 $0.0042
Network Services
LAN $34.25 $32.54 -$1.71
WAN
Workplace Services
Kiosk User $108.30 $124.97 $16.67
Fixed User $125.62 $128.21 $2.59
Fixed User (no equip replacement) $108.30 $124.97 $16.67
File/Object Storage $0.09 $0.08 -$0.02
O365 (Standalone) $16.18 $18.96 $2.78
Citrix Desktop $11.92 -$13.40 -$25.32
Citrix XenApp $73.58 $84.80 $11.22
Cell Phone $18.49 $21.74 $3.25
4G Device (Smartphone & Tablet) $43.15 $49.48 $6.33
Aircard / MiFi $39.45 $46.84 $7.39
VoIP $13.11 $6.12 -$6.98
PBX (at State Ofc Bldgs) $71.49 $59.95 -$11.54
Centrex (Verizon) $51.16 $21.03 -$30.13
Vendor Lines Pass-Through $32.50 $40.26 $7.76
See Pinnacle Rates*
*No Mid-Year Adjustment
24Forecast Rates vs. Billing Rates
Service Original Forecast
Rate
Adjusted
Billing Rate
(with True-Up)
Change
Labor Services
State Labor $125.22 $121.20 -$4.02
Contract Labor
Business Analyst $85.58 $91.21 $5.63
Database Administrator $91.94 $97.99 $6.05
Programmer $87.85 $93.63 $5.78
Project Manager $106.74 $113.76 $7.02
Software Architect $105.02 $111.93 $6.91
Specialist $74.17 $79.05 $4.88
System Administrator $88.18 $93.98 $5.80
Technical Architect $107.15 $114.20 $7.05
Technical Writer $54.27 $57.84 $3.57
Tester $63.91 $68.11 $4.20
25Sample Agency Billing Summary – Direct Bill
26Sample Agency Billing Summary – Memo Bill
27
Additional Questions? Contact ITS Finance at:
Director of Rate Setting
Joe Schultz – [email protected]
ITS Billing Team – [email protected]
Contact Information and Rate Card
Rate Card:
The FY 2020 rate card will be available at the following link prior to bill
release: https://its.ny.gov/service-rates
