State readies one-stop regulatory shop for business owners, entrepreneurs

From the Hartford Business Journal.

This summer, businesses and entrepreneurs will see the first major, public-facing example of the Lamont administration’s push to modernize and streamline the state’s information-technology systems.

Business One Stop promises to drastically simplify the process of starting a business in Connecticut, which often involves submitting filings and applications, online or in person, to numerous state agencies. Perhaps even more frustrating is figuring out exactly what’s required in the first place.

That’s where the cloud-based Business One Stop platform — which is currently being built under a Department of Administrative Services (DAS) contract worth up to $18 million — will come in.

By asking an entrepreneur a progressive set of simple questions, the website will spit out a precise regulatory-requirements roadmap, which will differ based on the type of business and other details provided.

Similar to how TurboTax asks simple questions and spares tax filers from having to manually pour through often-complicated tax codes (not to mention doing math), the Business One Stop promises to quickly give businesses the information they need.

“It hides all the other complexity,” said DAS Commissioner Josh Geballe, a former IBM executive and software entrepreneur tapped by Gov. Ned Lamont a year ago to help spearhead efforts to modernize the state’s IT and explore other ideas to reduce the cost of state government. “You don’t need to know about the requirements for starting a gas station if you’re starting a software company, and vice versa.”

Business One Stop is a piece of a larger effort to further shrink the number and cost of state employees, or at the very least, reallocate those resources to different tasks.

At first, businesses that use the online platform will still have to visit separate agency websites to file their applications and other forms, but a series of planned updates over the next few years will make it possible to send that information directly from one virtual location, Geballe said.

Connecticut is following in the footsteps of several other states that have taken a one-stop approach to business registration, including Delaware and Indiana, which have seen increases in revenue and faster approval times since launching their systems.

Geballe is already beginning to think about a resident-facing version of the platform that could be used to renew a fishing license or apply for state benefits, but he’s far from finished with Business One Stop.

The initial contract to build the platform, awarded in December to four vendors including Accenture and Deloitte, will open the door to new and more efficient ways of sharing information with companies once they are up and running, he said.

Geballe, who was CEO of Branford-based laboratory software maker Core Informatics when it was acquired in 2017 by Thermo Fisher Scientific for $94 million, envisions future upgrades that further leverage all information collected and shared between various agencies and Business One Stop, making state communication with companies smarter and more automated. Geballe said agency data is largely siloed today.

Companies would be able to login to view custom-tailored updates, curated with the help of artificial-intelligence tools, such as reminders about license and permit renewals, new state laws that affect employers, and financial offerings and other assistance from the state or federal government.

"We’ll have a much more modern ability to serve information intelligently,” Geballe said.

Slimming government

A more pleasant and convenient government experience for businesses isn’t the state’s only goal when it comes to Business One Stop.

By increasing the number of online, self-service transactions that might otherwise be handled over the phone or in person by state agency employees — something the state has already been doing at the departments of Motor Vehicles and Consumer Protection and other agencies — Business One Stop also aims to shrink the state’s workforce.

Driving the momentum is a potential wave of state-employee retirements in the next few years. In mid-2022, upwards of 15,000 workers will become eligible for retirement, according to the state, though only around 5,000 people are likely to leave the workforce right away.

That, combined with worries about future budget deficits, is driving Lamont’s examination of various ways to streamline government in the years ahead.

“We’re preparing for it with a corresponding sense of urgency,” Geballe said.

“We will see savings in the coming years as agencies use this platform to sunset legacy systems and reduce the manual workload of state staff,” he added.

DAS is working with Lamont’s budget office, the Office of Policy and Management, and others to identify strategies, whether technological or structural, that could lessen the need to backfill state positions as they become open.

To that end, OPM recently sought out consultants to study how the state can ensure its executive branch agencies continue to operate in the near term through the coming retirement wave, and recommend opportunities for efficiencies and cost savings in the longer term. Besides technology and increasing automation, the final report could include ideas like merging agencies and shifting or eliminating job duties.

The administration has already been working on organizational changes. For example, a move last year to centralize more than 300 human resources employees across multiple agencies is expected to reduce headcount by 20 percent, mainly through attrition after coming retirements.

Labor unions are watching the workforce modernization, since it could impact their membership. Officials from both sides say the lines of communication are open. Geballe said the state expects to collaborate closely with employee unions, calling them important stakeholders.

The state, however, has some autonomy over choosing to fill an open position or not, but certain changes, such as eliminating jobs directly through the use of technology, could veer into collective-bargaining territory.

Jody Barr, executive director of AFSCME Council 4, which has approximately 12,000 members working in the state’s executive branch, from clerical workers to corrections officers, said the union is worried that whatever results from Lamont’s streamlining push will worsen the quality of state services to the public.

“We are so thin in many of those areas already,” said Barr, who is skeptical about technology’s ability to achieve major cost reductions. “At this point, it’s not cutting fat, it’s cutting services.”

Meanwhile, the state’s business lobby is cheering on the effort in the hopes it lowers state budget burdens, helping to reduce the chances of future tax hikes on businesses.

“This is a once-in-a-generation opportunity to reinvent state government,” Joe Brennan, CEO of the Connecticut Business & Industry Association, said of the higher-than-usual number of looming retirements.

The situation opens the door to cutting government headcount through attrition, rather than layoffs.

Brennan said he’s hoping the discussions will lead to more outsourcing of social and other services to the private sector, which has been a contentious issue over the past decade.

However, the state’s hands are somewhat tied. The 2017 SEBAC agreement between the state and its employee unions offers outsourcing protections through 2027.

OPM’s recent request for proposals advised bidders interested in conducting the executive-branch efficiencies study that outsourcing would not be the contract’s aim. While the RFP closed in December, it remains under review, and no contract had been awarded as of press time.

However, Geballe said the contract is “very close.” He declined to name the vendor.