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South Carolina Department of Transportation SCEIS Federal Billing Feasibility Study Preliminary Design

November 2, 2021

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Table of Contents

1.0 INTRODUCTION AND BACKGROUND 1

1.1 ORGANIZATION OF THE REPORT 3

2.0 OVERVIEW OF AS-IS ENVIRONMENT 5

2.1 GENERAL BACKGROUND INFORMATION 5

2.2 OVERVIEW OF KEY APPLICATIONS 9

2.2.1 STIP AND STIP MANAGER 9

2.2.2 P2S 11

2.2.3 FHWA FINANCIAL MANAGEMENT INFORMATION SYSTEM (FMIS) 14

2.2.4 ENTIRE 14

2.2.5 SCEIS 16

3.0 TO-BE OPERATING MODEL 17

3.1 GENERAL OVERVIEW 17

3.1.1 UPON COMPLETION OF PHASE 1–INTERIM TO-BE 17

3.1.2 UPON COMPLETION OF PHASE 2–FINAL TO-BE 18

3.2 PHASE 1 INTERIM TO-BE OPERATING MODEL 19

3.3 PHASE 2 FINAL TO-BE OPERATING MODEL 30

4.0 REQUIRED CAPABILITIES 40

4.1 GENERAL ACCOUNTING 40

4.1.1 YEAR-END PROCESSING AND THE CAFR 41

4.1.2 1099-S REPORTING 41

4.2 PROJECT BILLING 41

4.2.1 STATE INFRASTRUCTURE BANK (SIB) 42

4.2.2 PARTICIPATION AGREEMENT ACCOUNTING 42

4.2.3 COUNTY TRANSPORTATION COMMITTEES (CTC): C PROGRAM 43

4.2.4 WBS 44

4.2.5 FEMA REIMBURSEMENTS 48

4.2.6 TRANSIT 48

4.3 CLAIMS CONTROL 50

4.4 LABOR DISTRIBUTION 50

4.5 EQUIPMENT USAGE/COST 51

4.6 CONSTRUCTION IN PROGRESS 52

4.7 INFRASTRUCTURE ACCOUNTING 52

4.8 PROCUREMENT CARD, FUEL CARD, AND UTILITIES 53

4.9 CONTRACT MANAGEMENT (PHASE 2) 53

4.10 VENDOR SELF-SERVICE (PHASE 2) 53

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SCEIS FEDERAL BILLING FEASIBILITY STUDY

PRELIMINARY DESIGN (TASK 3)

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4.11 ELECTRONIC REVIEW WORKFLOWS (PHASE 2) 54

5.0 FEDERAL BILLING CONCEPTUAL DESIGN 55

5.1 FEDERAL BILLING SOLUTION 55

6.0 INTERFACE ARCHITECTURE 58

7.0 DATA CONVERSION 62

7.1 DATA MIGRATION STRATEGY 62

APPENDIX A — ACRONYMS 64

APPENDIX B — MAPPING OF CURRENT INTERFACES 65

APPENDIX C — CAPITALIZATION POLICY 67

APPENDIX D — INFRASTRUCTURE ACCOUNTING REPORTS (SAMPLES) 72

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PRELIMINARY DESIGN (TASK 3)

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List of Figures

FIGURE 1: OPTION 2A

FIGURE 2: PHASE 1 AND 2 ANTICIPATED TIMELINE

FIGURE 3: CURRENT TECHNICAL ARCHITECTURE

FIGURE 4: CURRENT "AS-IS" SYSTEMS ARCHITECTURE

FIGURE 5 STIP MANAGER

FIGURE 6: ESTIP PUBLIC ACCESS TO STIP DATA

FIGURE 7: P2S APPLICATION

FIGURE 8: INTERIM POST-PHASE I IMPLEMENTATION OVERVIEW

FIGURE 9: HIGH-LEVEL PROCESS FLOWS INTERIM (POST-PHASE I)

FIGURE 10: POST-PHASE II IMPLEMENTATION OVERVIEW

FIGURE 11: HIGH-LEVEL PROCESS FLOWS POST-PHASE II IMPLEMENTATION

FIGURE 12: THREE LEVELS OF THE WBS

FIGURE 13: EXAMPLE OF WBS LEVELS

FIGURE 14: WBS STRUCTURE OF A FEDERAL PROJECT

FIGURE 15: WBS STRUCTURE OF MAINTENANCE PROJECT

FIGURE 16: WBS STRUCTURE OF CTC PROJECT

FIGURE 17: WBS STRUCTURE OF A SIB PROJECT

List of Tables

TABLE 1: EXAMPLE FUNDING FOR HIGHWAY PROJECT

TABLE 2: OVERVIEW OF INTERFACES

TABLE 3: DATA CONVERSION STRATEGY

TABLE 4: INFORMATION TO BE MIGRATED INTO SCEIS

PRELIMINARY DESIGN (TASK 3)

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1.0 INTRODUCTION AND BACKGROUND

This report is the Task 3 Preliminary Design for the South Carolina Department of Transportation (SCDOT) SCEIS (South Carolina Enterprise Information System) Federal Billing Feasibility Study and provides a preliminary design and set of business requirements for implementing the SCDOT's General Accounting and Federal Billing solution in the State of South Carolina’s SAP-based SCEIS. This project will be referred to as the SCDOT Transition Project.

Preceding this report, the Task 2 Recommendations Report provided SCDOT with a recommendation for addressing SCDOT’s need to modernize their financial and federal billing processes along with their transportation program and project management (PPM) processes. SCDOT chose to proceed with the option presented in the Task 2 report (Option 2A) that recommended transitioning federal billing and all SCDOT general accounting processing to SCEIS (the State's Enterprise Resource Planning (ERP) solution) coupled with a Best of Breed or Commercial off-the-Shelf (COTS) PPM solution. The figure below, Figure 1: Option 2A, provides a visual depiction of Option 2A.

FIGURE 1: OPTION 2A

This SCDOT Transition Project will be implemented in two phases:

Phase 1: This phase will transition general accounting functionality and federal billing functionality to SCEIS (including Federal Highway Administration (FHWA) billing for reimbursement of eligible

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project expenses currently processed by SCDOT’s legacy ENTIRE financial system). Phase 1 will allow SCDOT to decommission ENTIRE and leave P2S and STIP Manager temporarily in use with interim interfaces to SCEIS that will be replaced in Phase 2.

Phase 2: In this phase, a COTS or Best of Breed PPM solution would be procured, implemented, and integrated with SCEIS. Phase 2 will also include an integration with the FHWA Financial Management Information System (FMIS), as well as enabling additional procure to pay functionality for SCDOT within SCEIS, such as contract management, vendor self-service capabilities, internal accounts payable (AP), and contract management workflows. Likewise, the scope of Phase 2 includes the design and implementation of integrations between the new PPM solution and the SCDOT AASHTOWare™ Project™ construction management system and SCEIS for agreement and contract setup, contract change orders/modifications, and invoice processing. Finally, Phase 2 will allow SCDOT to decommission P2S and STIP Manager.

The remainder of this report provides the detail necessary to support the construction of a Request for Proposal (RFP) to acquire services from an SAP system integrator to assist SCDOT in completing the SCEIS-related activities noted above. Those SCEIS-related activities include migrating all financial processing from the ENTIRE legacy application, including federal aid billing, and implementing additional SAP-based enhancements to SCEIS as part of Phase 2. This report primarily focuses on what was identified as Phase 1 and the SAP-based elements of Phase 2 in Option 2A of the Task 2 Recommendations Report recommended option. While the report describes the final To-Be environment at a high level, it does not address the requirements for the PPM solution other than on the SCEIS side of the expected SCEIS-to- PPM interfaces required in Phase 2.

Completing Phase 1 of the recommended option will position the agency to decommission ENTIRE and undertake the next step of the Task 2 Recommendation Report to select and implement a COTS program and project management PPM solution to replace the SCDOT legacy P2S and STIP Manager applications.

A subsequent report (and accompanying RFP) will address the requirements and necessary steps for acquiring the to-be-selected COTS PPM Solution in Phase 2.

The anticipated durations for the Phase 1 and Phase 2 projects are shown in Figure 2: Phase 1 and 2 Anticipated Timeline.

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FIGURE 2: PHASE 1 AND 2 ANTICIPATED TIMELINE

1.1 ORGANIZATION OF THE REPORT

The remainder of this report is organized as follows:

2.0 Overview of As-Is Environment provides an overview of the current SCDOT and other State systems supporting the SCDOT project delivery and financial management processes;

3.0 To-Be Operating Model describes at a high level how business processes will be performed and how various systems will support these business processes. Both the interim To-Be model as of the completion of Phase 1 and the final To-Be model are presented;

4.0 Required Capabilities outlines the required functional capabilities for the general accounting, federal billing, and other SCEIS-based functionality to be implemented;

5.0 Federal Billing Conceptual Design describes the envisioned conceptual design for the federal billing process;

6.0 Interface Architecture provides an inventory of integrations expected to be implemented between SCEIS, other SCDOT systems, and the FHWA Financial Management Information System

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(FMIS) for this project;

7.0 Data Conversion addresses the proposed approach for migrating data from ENTIRE and other supporting SCDOT systems to SCEIS as part of the implementation of Phase 1;

A separate Microsoft® Excel® file containing the Requirements Matrix for this project also accompanies this report; and

Appendices included:

o Appendix A—Acronyms List;

o Appendix B—Mapping of currently Identified Interfaces and their expected dispositions;

o Appendix C—SCDOT Capitalization Policy; and o Appendix D—Example Infrastructure Accounting Reports.

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2.0 OVERVIEW OF AS-IS ENVIRONMENT

This section provides an overview of the SCDOT As-Is financial management and project delivery systems environment. It also briefly describes each of the systems targeted for replacement across the two phases envisioned in Option 2A.

2.1 GENERAL BACKGROUND INFORMATION

SCDOT is the South Carolina state agency responsible for planning, designing, constructing, maintaining, and running South Carolina's state highway system. SCDOT also manages grant programs for various transportation modes, including transit and rail, and is responsible for developing a statewide intermodal and freight program. SCDOT has approximately 4,600 employees with a presence in each of the State's 46 counties, with central offices in Columbia, SC. There are seven highway engineering districts headed by a District Engineering Administrator. SCDOT is responsible for maintaining approximately 41,300 miles of road (90,000+ lane miles) and more than 8,400 bridges. South Carolina has the 4th-largest state-maintained highway system in the nation while serving the 6th-fastest population growth rate in the nation.

Application development work for the initiative will primarily revolve around four South Carolina application systems that work together to support the financial needs of SCDOT, including the federal billing process and project delivery business processes. In addition to the State systems, FMIS is a federal application system involved in federal billing processes. FMIS supports the automation and integration of authorization and payment or reimbursement of federal billings. SCDOT processes with FMIS are currently manual. This project will allow SCDOT to automate those business processes and achieve tighter integration.

The four State application systems that currently work together to support the financial needs of SCDOT, including the federal billing process and project delivery business processes, include:

1) ENTIRE, which is a decades-old mainframe-based financial application supported by SCDOT IT staff;

2) P2S, which is a custom .NET-based application for PPM support of transportation projects supported by a SCDOT retained vendor;

3) STIP Manager, which is a custom .NET-based application for management of the Statewide Transportation Improvement Program (STIP), is also supported by the same SCDOT retained vendor supporting P2S; and

4) SCEIS, which is the statewide ERP solution providing support for 76 South Carolina agencies.

SCEIS was initiated as a statewide ERP project in 2008 and went live in 2011.

SCDOT has partially implemented or migrated its financial system's processing to the State's ERP (SCEIS).

However, the general ledger functionality, federal billing process, as well as the creation of the agency’s annual financial report remain within the SCDOT environment. As an objective of this project, SCDOT is planning to complete this migration and eliminate or sunset its current general ledger and federal aid billing processes that run in the ENTIRE mainframe application developed in-house many years ago.

A generalized depiction of the current technical environment is shown in Figure 3: Current Technical

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Architecture. This diagram provides a visual overview of the relationships between the aforementioned four applications key to this project.

FIGURE 3: CURRENT TECHNICAL ARCHITECTURE

In the diagram above, it is worth noting that SCDOT will be undertaking an Enterprise Asset Management System (EAMS) Project to replace their legacy HMMS (Highway Maintenance Management System) at the same time as the SCDOT Transition Project. This is significant given there are interfaces and touchpoints between HMMS and ENTIRE, and ultimately many of them will become candidate interfaces between EAMS and SCEIS. The EAMS project was initiated in 2021.

In addition, SCDOT is also implementing the next generation of the AASHTOWare™ Project™ suite to replace AASHTOWare™ SiteManager and Trns•port™ Preconstruction. It is envisioned that SCEIS will be fully integrated with these next generation AASHTOWare™ Project™ modules as a part of Phase 2. SCDOT is anticipating implementing AASHTOWare™ Project™ Construction and Materials as a hosted solution in 2022. At that point, new contracts will be managed out of AASHTOWare™ Project™ Construction and Materials. The plan is for AASHTOWare™ SiteManager active contracts to remain in SiteManager, and new contracts to be implemented within AASHTOWare Project, so both solutions will be used in parallel until all of the SiteManager contracts are completed, thereby allowing SiteManager to be sunset.

Figure 4: Current "As-Is" Systems Architecture (next page) provides a slightly more detailed overview of today's ENTIRE, SCEIS, STIP, and P2S processing. Interface identifiers are also shown on the diagram. These

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interface identifiers are referenced in the interface listing found in Appendix C.

The upcoming subsection, 2.2 Overview of Key Applications, provides a general overview of the four applications mentioned earlier (STIP Manager, P2S, ENTIRE, and SCEIS) and describes the role of the external federal system for the FHWA FMIS in federal billing.

FIGURE 4: CURRENT "AS-IS" SYSTEMS ARCHITECTURE

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2.2 OVERVIEW OF KEY APPLICATIONS

2.2.1 STIP and STIP Manager

The STIP Manager application is responsible for managing the SCDOT STIP. The STIP contains the six-year transportation improvement program for all projects and program areas receiving federal funding. There is a STIP Manager application that manages the development and tracking of SCDOT's federally mandated STIP. There is also a publicly accessible eSTIP application that provides data on approved STIP items.

As required by federal law, the STIP integrates project requests from multiple sources. These sources include the Transportation Improvement Programs (TIPs) of the 11 metropolitan planning organizations (MPOs) and the 10 Councils of Governments (COGs) in South Carolina (the South Carolina form of the federally defined regional transportation planning organizations for non-metropolitan areas), along with projects defined by SCDOT and the other entities eligible to submit projects for inclusion in the TIP (such as Tribal Governments and FHWA Federal Lands).

FIGURE 5 STIP MANAGER

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FIGURE 6: ESTIP PUBLIC ACCESS TO STIP DATA

The STIP Manager application supports the development of the STIP and manages amendments along with a corrections process for minor adjustments such as moving approved projects between years within the plan, which only requires FHWA approval. These amendments are the formal process required for new projects and new funding sources or funding changes requiring public comment and Transportation Commission and FHWA Division Office approval. Setting up a new project in P2S requires linking the new project to an item already in the approved STIP.

The federally funded project and program areas include the following:

Pavements;

Bridges;

System Upgrades (such as roadway widening and new construction);

Freight;

Safety;

Congestion mitigation and air quality (CMAQ);

Transportation Alternatives Program (TAP);

Railroad crossings;

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Planning;

State Infrastructure Bank (SIB) payments;

Preventative Maintenance and Operations (such as asset management, bridge inspections, bridge maintenance and repair, and others); and

Public Transportation.

2.2.2 P2S

P2S is the SCDOT PPM system that provides financial information tracking and reporting. P2S records data for all projects, including research, planning, construction, etc. In short, it is described as containing information for any project with a WBS (Work Breakdown Structure) element.

Project Managers set up new projects in P2S. If a project carries federal funding, the project manager will tie it to the STIP (in STIP Manager) by Project ID. This connection means a regional planner must have established the project in STIP Manager beforehand. Once the project is connected, the project can be looked up in the STIP or P2S by Project ID. Program/project managers request adjustments/corrections to the STIP as needed.

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FIGURE 7: P2S APPLICATION

The Project Fund Management Office vets the requested project budgets in P2S to ensure it remains in concert with the Consolidated Plan and STIP. The Obligations Management Office enters the data into P2S and FMIS (if the project is federally funded). For example, if a bid exceeds the approved amount and an adjustment is required in P2S and FMIS, Obligation Management takes the lead while the Project Fund Management Team works on this in the background.

Program Managers utilize P2S to request and manage the project setups. Funding for projects is identified and established in P2S by the Fund Management section, and using information from P2S, federally participating projects are authorized by the Obligations section through FHWA's FMIS application. This funding information is then passed manually to accounting using the PR2 report from P2S to support the setup of projects in ENTIRE. The initiation of new project phases and any changes to project funding during the project's life are managed similarly and communicated manually via the PR2 report to Accounting for entry into ENTIRE to support the federal billing process.

P2S and STIP Manager assist SCDOT in managing advance-construction projects. Advance construction is an authorization technique that allows the FHWA to authorize a project without obligating those billable federal funds. Advance construction conceptually enables states to undertake more projects concurrently

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by eliminating the need to set aside full obligation authority before starting projects. Projects can be identified as advance construction and started without or before obtaining sufficient federal-aid obligation authority to cover the federal share of the project costs.

When the state acquires sufficient obligation authority, it can convert an advance-construction project to a federally funded project by obligating the permissible share of its federal funds and later receiving subsequent reimbursement. In short, advance construction allows a state to conserve obligation authority and maintain flexibility over its transportation funding program to get more project work done. There is no guarantee that federal funds can be obligated. If federal funds end up not being available, the state would not be able to convert the project to a federal-aid project. There may also be instances in which SCDOT ultimately chooses not to convert a project. The advance-construction project application process follows a series of FHWA-defined steps. It is worth noting that an advance-construction project application can only be approved if previously included in the STIP.

P2S also provides several other functions to help project managers manage the delivery of projects within the SCDOT capital program, including tracking the completion of the various preconstruction activities, tracking the target letting date for the project, and managing engineering consultant agreements. Once a project is let to construction, day-to-day project progress is currently managed using AASHTOWare™ Project™ SiteManager™, although any requests for supplemental project funding in response to change orders during construction are initiated and managed through P2S.

P2S is a critical source of information for projects and fund-related data. P2S is heavily relied upon and considered the system of record for projects and project funding. P2S is used to track and manage local, state, and federal authorizations and funding sources for projects. P2S is updated manually daily with federal billing authorizations as the FHWA approves them in FMIS. However, revenue reimbursements from the FHWA are not tracked in P2S. Project charges are fed to P2S via an automated interface from

ENTIRE.

P2S was implemented about fifteen years ago as a .NET solution utilizing Microsoft SQL Server®. P2S was developed for SCDOT by a software vendor. While SCDOT has the source code for the system, the vendor retained the right to repackage the product and sell it to others.

As can be seen in the accompanying figures in this report, P2S receives data from multiple sources, including, but not limited to:

CBES (Contract Bid Estimator System);

STIP;

RIMS (Roads, Bridges, and Railroad Crossings);

Bentley ProjectWise;

Oracle Primavera;

AASHTOWare™ Project™ SiteManager™; and

FMIS.

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It is also a source of information for multiple applications, including:

ENTIRE; and

SCEIS (projects).

P2S is integrated with Oracle Primavera, although there are only a limited number of projects in P2S that are fully captured in Oracle Primavera. Most program/project managers use Microsoft® Excel® and Microsoft® OneNote® for scheduling and project tracking versus the scheduling functionality in Oracle Primavera. Project plans are typically based on project history.

Project budget change orders are handled in P2S by the Project Fund Management Team, Program Manager, and the Director of the Construction Office. The Project Fund Management Team produces general program/project reporting for SCDOT. Additionally, there is an Analytics Team that provides dashboards and reporting using Microsoft™ Power BI™. These reports will need to be analyzed and either replaced or updated in Phase 1 and Phase 2 as the systems of record for the underlying data change.

2.2.3 FHWA Financial Management Information System (FMIS)

The FHWA FMIS is a federal application utilized by FHWA to manage the obligation of federal funds to the states for reimbursing state departments of transportation for the federal share of eligible federally participating project charges. As do all state DOTs, SCDOT utilizes this federal system as a core part of its business processes.

The SCDOT Obligations Section receives federal obligations for each fiscal year through FMIS, records this information in P2S, and provides this information to Accounting for recording in ENTIRE. The SCDOT Obligations Section requests federal funding authorization for projects through manual data entry in FMIS, based on information in P2S, and manages the status of these authorization requests in FMIS. When projects are authorized in FMIS, the Obligations Section provides this information manually to Accounting for entry in ENTIRE. The Obligations Section also manages fund balances using reports from FMIS to reconcile the fund balances maintained in P2S. Any discrepancies in fund balances are investigated, and when required, adjustments are made in P2S to tie with FMIS. Any needed adjustments are also communicated manually to SCDOT Accounting to ensure the corresponding adjustments are made in

ENTIRE.

2.2.4 ENTIRE

ENTIRE is the SCDOT legacy financial system, portions of which have been in use for decades. At present, SCDOT financial processing is split between SCEIS and ENTIRE. The SCEIS implementation for SCDOT replaced parts of ENTIRE in 2011 and 2017 (such as accounts payable, accounts receivable (AR), and fixed assets for non-infrastructure assets). However, SCDOT general ledger and federal billing processes remain active in ENTIRE and ENTIRE contains the SCDOT general ledger and year-end processing for SCDOT's books. ENTIRE serves as the project sub-ledger of record for SCDOT, with project budget information, project funding sources and funding splits, and all project costs accumulated in ENTIRE (both federally participating and non-participating).

Labor Distribution is performed in ENTIRE using employee hours charged to projects in SCEIS as the basis for calculating applicable overhead charges to establish the fully loaded payroll cost distributed to

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projects. Equipment cost for projects is also calculated in ENTIRE and allocated to projects based on rental rates maintained in ENTIRE and equipment usage entered by employees through the STARS subsystem of ENTIRE. ENTIRE is also used to track construction in progress (CIP) and manage the depreciation calculation for infrastructure assets. SCDOT depreciates its infrastructure assets rather than using the GASB34 Modified Approach.

Materials and Test charges today are generated via a spreadsheet that originates in the Materials Lab.

This spreadsheet is uploaded to ENTIRE, which in turn, passes the data to SCEIS via an interface.

SCDOT maintains its own set of books in ENTIRE and reconciles with SCEIS at month-end and year-end.

The State of South Carolina uses the cash basis, while SCDOT keeps its books on an accrual basis. SCDOT produces the agency financial statements at year-end for submission to the State Office of the Comptroller General (OCG) for the CAFR (Comprehensive Annual Financial Report) from ENTIRE (from a subsystem referred to as the Year-End System) supported by several manual processes.

Federal Billing is also a subsystem within ENTIRE. Partial automation is in place in the interfaces between FMIS, ENTIRE, P2S, and SCEIS. These applications are loosely integrated and, in some cases, rely heavily on manual intervention (such as rekeying of information) to perform. For example, a paper form (PR2) is generated by P2S for projects and sent to SCDOT Finance for manual entry into ENTIRE. Budget revisions are manually entered into P2S and ENTIRE, which can create Current Bill errors (i.e., the federal bill process) in federal reimbursement requests to FHWA via FMIS. Investigation and correction of these errors is a manual process. The federal bill error reports are in PDF format without the ability to interactively drill down into underlying source transaction details for research purposes. The federal billing process is run twice each month.

Capital projects for non-highway infrastructure projects (such as the construction or major renovation of rest areas or the installation of a new sprinkler system in a building) must be approved by the South Carolina Executive Budget Office (EBO) using an A1 approval process requiring SCDOT Secretary of Transportation and SCDOT Budget Office approvals. These types of capital projects use earmarked or state funds and are initiated with the A1 approval and these projects are set up in SCEIS and ENTIRE. Highway infrastructure projects are captured in SCEIS, ENTIRE, and P2S and do not require EBO approval or involvement as SCDOT is authorized to initiate and manage these projects at the agency-level.

Indirect costs are calculated and distributed to projects in ENTIRE. The federally participating share of these costs is eligible for federal billing in ENTIRE. Once these indirect costs have been calculated in Microsoft® Excel® they are then uploaded into ENTIRE and then sent to SCEIS and subsequently returned to ENTIRE that, in turn, passes them along with other transactions in an interface file to P2S. Indirect costs are applied on all projects except for TAP, MPO, COG, or administration projects or projects with local participation. Indirect costs are not applied on state maintenance projects or County Transportation Committee (CTC) projects. P2S tracks expenditures, payroll, and indirect costs (overhead) based on the project charges interfaced from SCEIS.

The underlying SCDOT technology platform for ENTIRE is mainframe COBOL and Software AG Natural (4GL). Sequential datasets (flat files) utilizing mainframe generation datasets are heavily used. VSAM files are also used but primarily reserved for validation lookups (i.e., the VSAM files are not used for data storage purposes). If business users run into a problem during a mainframe job run, they contact

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Information Technology, and the failed job is rerun. Recovering from processing errors is straightforward as jobs have been set up with multiple steps and rerun when needed by resetting the generation dataset and rerunning the failed job(s). The format and location of this data will be a consideration in the data conversion aspects of the project (data conversion is addressed in Section 7.0 Data Conversion).

2.2.5 SCEIS

SCEIS is South Carolina's statewide implementation of the SAP ERP suite of products. SAP Business Warehouse (BW) is also utilized in the statewide solution. This platform is used to support approximately 75 South Carolina state agencies.

SCEIS is the human resource management system of record for the State and performs payroll processing for SCDOT and other State employees. Time entry for SCDOT is done using either SCEIS in CATS (Cross- Application Time Sheet) or the legacy HMMS application (which will be replaced by the EAMS project).

The system used to enter time is dependent on work division. HMMS time entry is performed by roughly 3,000 of the SCDOT 4,000+ employees, while the remainder of staff enters their time in SCEIS CATS. The SCDOT legacy HMMS application interfaces the time data to SCEIS. The unloaded payroll hours and payroll costs are passed back to ENTIRE for use in SCDOT's labor distribution process within ENTIRE.

Financial functions for the SCDOT are split between SCEIS and ENTIRE: SCEIS provides SCDOT support for accounts receivable, accounts payable, and fixed assets for non-infrastructure assets. SCDOT's general ledger and federal billing processes take place in ENTIRE.

SCEIS also serves as a "shadow" project costing system for SCDOT projects, with all project charges accumulated in SCEIS. SCEIS, however, does not contain any project budget or fund management information. Each SCDOT project in ENTIRE maps to potentially six project records in SCEIS denoted in SCEIS by a unique work breakdown structure (WBS)—with one WBS to capture and accumulate federally participating charges and one to capture non-participating project charges. The WBS is described in more detail in 4.2.4 WBS.

Several SCDOT finance functions have already been implemented in SCEIS. Accounts Payable and Accounts Receivable are currently running in SCEIS. SCEIS also maintains a record of the WBS elements found in P2S, and SCEIS is used primarily to accumulate project costs. This means that some of what might be needed to set up SCEIS to support federal billing is already present. However, it is also possible that what exists will have to be revised to implement federal billing in SCEIS. SCDOT inventory is already running in SCEIS. In general, the SCDOT Transition Project will complete the migration of all finance functions and data from the SCDOT-supported ENTIRE application and its subsystems to SCEIS.

During the life of the SCDOT Transition Project, SCEIS staff will also be undertaking an SAP S4/HANA migration targeted for completion in 2025-26. Therefore, a requirement of the SCEIS Transition project is the SCEIS work done must be compatible with S4/HANA.

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3.0 TO-BE OPERATING MODEL

This section provides a depiction of the To-Be Operating model. It describes how various systems will support SCDOT project delivery and financial processes in both the interim To-Be model at the end of Phase 1 and the final To-Be model at the end of Phase 2.

3.1 GENERAL OVERVIEW

To reiterate, the replacement of the SCDOT legacy project delivery and financial management systems is planned to occur in two phases:

Phase 1: Phase 1 will transition general accounting and federal billing functionality to SCEIS. Phase 1 will allow SCDOT to decommission ENTIRE. P2S and STIP Manager will remain temporarily in use, with interim interfaces to SCEIS.

Phase 2: A yet-to-be-selected PPM solution will be procured, implemented, and integrated with SCEIS and the AASHTOWare™ construction management system. The second phase will also include enabling additional procure to pay functionality for SCDOT within SCEIS, such as contract management, vendor self-service capabilities, internal accounts payable, and contract management workflows. Phase 2 will also include an integration with FMIS as well as the design and implementation of integrations between the new PPM solution and the SCDOT AASHTOWare™ Project™ construction management system and SCEIS for agreement and contract setup, contract change orders/modifications, and invoice processing. Phase 2 will allow SCDOT to decommission P2S and STIP Manager.

The two subsections following the figure (Sections 3.1.1 and 3.1.2) provide in narrative form a more detailed explanation of what will occur in the two phases.

3.1.1 Upon Completion of Phase 1–Interim To-Be

In Phase 1, federal billing and general accounting functions will be transitioned from ENTIRE to SCEIS, allowing SCDOT to decommission ENTIRE. SCEIS will become the system of record for federal billing and will perform all SCDOT general accounting functions currently done in ENTIRE. These functions will also include labor distribution, tracking equipment usage on capital projects, equipment costing to projects, CIP accounting, infrastructure accounting, and year-end processing, including the preparation of SCDOT’s agency financial statements.

STIP Manager will remain responsible for producing the STIP and managing any required STIP modifications and amendments. Until Phase 2 is completed, P2S will remain the PPM system of record for SCDOT and be integrated with SCEIS. Federal apportionments for the federal fiscal year will be recorded into P2S and SCEIS based on information downloaded from FMIS. Project authorizations will continue to be requested manually from FMIS in Phase 1, with project authorizations approved by FHWA and manually entered into SCEIS and interfaced with P2S. Since STIP Manager and P2S will be replaced in Phase 2, these P2S interfaces will be interim.

Accounts payable vouchers for consultant invoices will be entered into SCEIS for payment based on

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information collected and validated in P2S, with charges posted to the project in SCEIS Project Systems upon final approval and payment in SCEIS. Construction estimates will be manually entered into SCEIS for payment based on reports from AASHTOWare™ SiteManager or AASHTOWare™ Construction and Materials1. Charges will be posted to the project in SCEIS once the accounts payable voucher is finalized and approved in SCEIS.

Employees currently entering time through SCEIS CATS will continue to do so in the same manner; that is, time entry will continue to be done in HMMS or EAMS for employees not using CATS directly. When the new EAMS solution is implemented, HMMS time entry will be replaced by the EAMS-based solution. After payroll is run, labor distribution will be performed in SCEIS. Overhead (payroll additives) will be applied to adapt functionality currently used by other state agencies in CATS. Indirect cost will be applied by adapting functionality from the Grants Management module. Fully loaded labor cost will then be posted to the project record in Project Systems.

Employees will enter equipment usage either through a custom extension to the CATS module or a screen in the Plant Maintenance module. SCEIS will perform validity checks on time entered against projects and equipment usage. Equipment costs will then be calculated using rental rates stored in the Plant Maintenance module, with equipment costs posted to the project record in SCEIS Project Systems.

The federal bill and billing of any other funding partners will occur entirely in SCEIS using an adaptation of SAP’s Resource Related Billing function. SCEIS will perform a settlement of construction costs to an asset upon project finalization and closeout. SCDOT year-end processing will take place in SCEIS using reports available within the SCEIS BW.

SCDOT year-end processing will occur in SCEIS. For SCEIS agencies, the State OCG creates the state CAFR from SCEIS BW data extracts, finalizing the content in Microsoft® Excel®. The SCEIS team implemented support for year-end processing in 2012, and the State OCG has been producing the CAFR from BW reports for SCEIS agencies since 2013. Phase 1 will transition SCDOT year-end processing to SCEIS and allow the State OCG to add SCDOT to the list of agencies it pulls BW data from to create the CAFR.

Before Phase 1 can go live, FHWA certification will be required and must be achieved as part of the SCEIS Transition project before it is allowed to go live. FHWA certification refers to FHWA approval to receive project billings from SCEIS. Guidelines for acceptance are provided by FHWA and the system integrator will assist SCDOT in the implementation by providing leadership, facilitation, and coordination to the engagement of the FHWA South Carolina Division Office and the FHWA National Resource Center team to achieve the certification. As such, FHWA engagement and involvement in the solution and the workflows will be a critical milestone in the work needed to achieve go-live.

3.1.2 Upon Completion of Phase 2–Final To-Be

In Phase 2, project planning will take place in the new PPM application. The development and management of the STIP, including STIP amendments and modifications will be performed in the PPM

1 See earlier comment in Section 2.1 General Background Information on the transition from AASHTOWare™

SiteManager to AASHTOWare™ Project™ Construction and Materials and where projects will reside during this transition.

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application. The Federal apportionments (obligation balances) for each fiscal year will be recorded in the PPM solution electronically via an interface with FMIS and subsequently passed/interfaced to SCEIS.

Project managers will request project initiation by linking a project to one or more approved STIP items in the PPM application. The project will be set up simultaneously in the PPM application and SCEIS via an interface. SCDOT will determine proposed funding for a project and record this in the PPM solution, which will then be interfaced to SCEIS.

The project authorization will be requested in FMIS via integration through electronic data sharing (EDS) between the PPM application and FMIS. FHWA’s approval (with any changes reflected), once received will then be recorded in the PPM application and interfaced to SCEIS to keep the two systems synchronized.

Phase 2 will require a second FHWA certification to be conducted prior to approval for go live implementation.

Consultant invoices will be submitted by consultant firms directly into a vendor self-service portal within SCEIS, a feature not yet implemented in SCEIS by the state. Consultant invoices will then be interfaced with PPM for review and approval as the PPM application will be the more detailed subsystem of record for consultant agreements. Once approved in the PPM application, the approval is transmitted back to SCEIS to trigger the completion of accounts payable processing and the posting of the charge to the project record in SCEIS. According to SCEIS, this is already a part of a larger project they have currently underway with South Carolina State Procurement and is currently planned for roll out to all agencies within the next 24-48 months. The expectation will be for the system integrator to assess and ensure that the full needs of SCDOT are met by this added functionality.

Construction estimates, once approved in AASHTOWare™ Project™ Construction and Materials, will be interfaced to SCEIS as accounts payable vouchers for final processing and posting of the charge to the project record in SCEIS.

As in Phase 1, the federal bill and billing of any other funding partners will occur fully in SCEIS. The settlement of construction costs to an asset upon project finalization and closeout will be performed in SCEIS. Labor distribution, tracking of equipment usage, equipment cost, federal billing, CIP, and year-end processing will continue to be performed in SCEIS as described under Phase 1.

3.2 PHASE 1 INTERIM TO-BE OPERATING MODEL

Figure 8: Interim Post-Phase I Implementation Overview below illustrates the high-level key information flows at a very high level in the interim To-Be model at the end of Phase 1. General accounting and federal billing functionality will be performed in SCEIS, with financial statements developed in the SCEIS BW. An integration will be developed between SCEIS and FHWA FMIS to support federal billing. Temporary integrations will be created between P2S and SCEIS to support the automated transfer of project information and project funding information between the two systems.

FIGURE 8: INTERIM POST-PHASE I IMPLEMENTATION OVERVIEW

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The Phase 1 project will:

Implement the functionality in SCEIS necessary to decommission ENTIRE, including the general ledger and federal billing;

Implement funds management support in SCEIS limited to supporting the SCEIS-based federal billing processing;

Implement temporary or interim integrations to/from P2S; and

Require FHWA Certification before being allowed to go live.

A critical component of the implementation project will be the FHWA Certification of the SCEIS federal billing solution. At a minimum, this certification will require prior FHWA approval before SCDOT and SCEIS can implement the federal billing solution that will process project billings in SCEIS. The guidelines for this approval and acceptance are provided by FHWA, who will be the approver of this task and could change requirements at any time. Requirements for this certification should be understood before the on-site FHWA visit to approve the proposed solution. Early communication and coordination with FHWA by SCDOT will be vital to ensuring precise specifications are gathered, development is in line with requirements, and all possible efforts have been made to ensure the successful completion of the certification process. It is expected that the system integrator will assist and guide SCDOT in this task in the following manner:

Provide leadership, facilitation, and coordination in engaging with the FHWA South Carolina Division Office and the FHWA National Resource Center team during the project;

Prepare and conduct a design review with FHWA at the end of the Phase 1 Blueprint or design task along with design or configuration changes in response to any concerns or issues raised by FHWA;

Support SCDOT in periodic update sessions with FHWA during the project;

Prepare a detailed script for the FHWA review process based on the FHWA provided guidelines;

Assist SCDOT staff in preparing for the formal FHWA review process, including supporting dry runs of the FHWA review process to ensure an effective review and approval; and

Support SCDOT end-users and make any necessary system corrections or bug fixes to obtain FHWA approval that might be identified during the formal FHWA review process or as requested by the FHWA in their follow-up report after the review.

The integrations to P2S are described as interim/temporary because after Phase 1 is complete and stable, SCDOT intends to initiate Phase 2, which will likely be of equal duration, to implement a COTS PPM solution to replace the legacy P2S and the STIP Manager applications. Therefore, the integrations will be interim but must be solid and robust enough to serve the agency’s needs for at least two years of service.

The key steps in the project life cycle in the Interim To-Be model are as follows:

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STIP Development

1) Potential projects/project ideas are entered into STIP Manager

2) Proposed projects are included in a draft STIP in STIP Manager. The approved STIP is developed and then monitored in STIP Manager; any required STIP modifications and STIP amendments are managed in STIP Manager.

Apportionment and Obligation Balances

1) Federal fiscal year apportionment information (obligation balances) is updated manually in SCEIS based on information obtained by pulling a report from FMIS.

2) Obligation balances are periodically reconciled throughout the year by using reports in SCEIS and

FMIS.

Project Initiation

1) A project manager requests project initiation in P2S by linking to an item(s) in the approved STIP in STIP Manager and all of the necessary approvals to initiate the project take place in P2S.

2) The project is set up in Project Systems in SCEIS via an interface from P2S. In designing the interim solution, an important point to consider will be that P2S is the agency-facing application for many end-users and will need to maintain realtime data and be the system of record. For example, projects eligible for indirect charges are hand-written on the PR2 form produced by P2S and manually entered into ENTIRE. A design consideration for the interim solution will be that P2S has no place to store this handwritten information needed in SCEIS. The P2S to SCEIS interface will need to accommodate this data requirement.

3) Project funding decisions are made and entered into SCEIS in a draft status. The proposed funding is then interfaced from SCEIS to P2S.

4) Multiple funding profiles can be set up per project (WBS element) in SCEIS, with funding rules defined to govern the use of each funding profile.

5) The project authorization request is entered manually into FMIS by SCDOT and reviewed and approved by the FHWA South Carolina Division office.

6) Any adjustments made by FHWA prior to approving the project authorization are reflected manually in SCEIS, and the changes interfaced to P2S.

7) The project is flagged in SCEIS regarding whether settlement (asset under construction processing) is required for the project.

Project Charges–Internal Labor

1) Employees charge their time through the CATS module in SCEIS.

2) Payroll is run on the first and 16th of each month for time reported for the previous period.

3) Labor distribution is run following payroll processing to apply overhead charges using an

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adaptation of functionality in the CATS module of SCEIS.

4) The second part of the Labor Distribution process is then run to apply indirect cost using an adaptation of functionality in the Grants Management module.

5) The loaded labor cost is posted to the project in Project Systems in SCEIS.

Project Charges–Equipment Cost

1) Employees enter equipment usage to a project using either customization in CATS or functionality available in the Plant Maintenance module in SCEIS.

2) Each payroll period, equipment costing is performed in SCEIS using the usage entered by employees and the equipment rates maintained in the Plant Maintenance module in SCEIS.

3) The equipment cost is posted to the appropriate project in Project Systems in SCEIS.

Project Charges–Design and Engineering Consultants

1) Consultant agreements are established in P2S. These agreements can either be project-specific or non-specific agreements that may be used via specific task orders for work on one or more projects.

2) The consultant agreement is manually entered into SCEIS as a contract document. Task orders are also manually added to SCEIS as established and tied to the project. Finally, a purchase order is issued from SCEIS for the authorized amount of a task order expected to be worked in the current fiscal year. SCEIS today supports multiple agencies managing contracts and other multi-year construction projects using Project Systems (PS), Grants Management (GM), Business Planning and Consolidation, and Supplier Relationship Module (SRM). This includes support for projects spanning up to ten years (although it is conceivable that SCDOT could exceed this duration as well as the respective dollar amounts used by these agencies). Some of these projects include federal funding utilizing GM to handle all financial accountability in conjunction with Project Systems.

3) Consultant invoices are received by project managers and logged into P2S following the current process.

4) Consultant invoices are reviewed and approved by the project team in P2S.

5) Invoices approved by the project team are entered into SCEIS as accounts payable vouchers and undergo final review by Accounting prior to payment in SCEIS.

6) Consultant charges are posted to the project record in Project Systems.

Project Charges–Construction Contractor Estimates

1) Proposals packages for construction projects are developed using AASHTOWare™ Project™

Preconstruction and then interface to Bid Express for contractors to submit their bids electronically.

2) Bids received are interfaced from Bid Express to AASHTOWare™ Project™ Preconstruction for

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analysis and SCDOT determination of the lowest, responsive, and responsible bidder.

3) The contract for the awarded bidder is established in AASHTOWare™ Project™ Construction and Materials via an interface from AASHTOWare™ Project™ Preconstruction.

4) The contract document is established manually in SCEIS, and a purchase order is issued for the amount of the contract required for that fiscal year.

5) Construction contract progress estimates are generated in AASHTOWare™ Project™ Construction and Materials (typically bi-weekly) based on information entered on daily work reports by SCDOT inspectors. The contractor’s progress estimate is reviewed and approved by the project team and Construction Office in AASHTOWare™ Project™ Construction and Materials.

6) The approved contract progress estimate is manually entered into SCEIS by Accounting and undergoes final approval in terms of coding.

7) The contract progress estimate is paid via SCEIS.

8) The contract progress estimate is posted to the project record in Project Systems in SCEIS.

Federal Billing

1) The Resource Related Billing function within SCEIS sweeps the…