DW External Data Loads Initiation Certification 041409

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					                 Project Initiation
                        Request for Certification and Release of Funds Form
                               ALL CERTIFIED PROJECTS MUST FOLLOW NM STATE POLICIES AND PROCUREMENT CODE




 PROJECT NAME                         Data Warehouse                      PROJECT NUMBER
                                      External Data Loads
 AGENCY CIO                           Joel Matek                          DATE                       04/15/09

 LEAD AGENCY / AGENCY CODE            TRD / 333                           OTHER AGENCIES
 EXECUTIVE SPONSOR(S)                 Phillip Salazar                     PROJECT MANAGER            Aysha Mora




                This is a controlled document, refer to the document control index for the latest revision
Revision: 04/06/09                                  Page 1
                  Project Initiation
                         Request for Certification and Release of Funds Form
                                ALL CERTIFIED PROJECTS MUST FOLLOW NM STATE POLICIES AND PROCUREMENT CODE


 PROJECT DESCRIPTION (PROVIDE A BRIEF DESCRIPTION AND PURPOSE FOR THIS PROJECT)
 The New Mexico Taxation and Revenue Department (TRD) has implemented a Compliance
 Data Warehouse (DW) to enhance the ability to identify and collect unpaid taxes owed to the
 State of New Mexico. There are two major thrusts to this effort: 1) improving audit selection,
 and 2) implementing tape match programs. Both require the loading of internal and external
 data sources, including GenTax data, MVD license and vehicle registrations, Federal IRS data,
 etc. The focus of the Data Warehouse External Data Loads (DWEDL) project is to load new
 external data sources into the DW to enhance efficiency by both improving existing
 compliance projects and initiating new efforts, thus improving compliance and bringing in
 additional revenue. The DWEDL project will cost $500k.

 External sources include; property tax, voter registration, active duty military website, death
 index, customs data, PRC corporation information, USPS address changes, DFA contract
 information, and Dodge reports. Business entity information could also be loaded from third
 party sources that provide detailed financial, demographic, and affiliation information. This
 would improve our ability to establish taxpayer nexus in NM, help optimize our project
 subpopulation targets with additional valuable information, and increase our assessment
 revenues and recovery ratios to bring additional revenue to the General Fund. Our current DW
 IT staff is already being used to their capacity and has no time for these activities without
 delaying other projects that would reduce collection activities; therefore TRD will contract
 with the DW COTS vendor to perform these services.

 Our previous tape match projects were fairly unsophisticated in that they generally used a
 single Federal data source (e.g. IMF/IRTF for Federal tax return) compared to GenTax
 Personal Income Tax (PIT) return. The addition of more data sources makes these projects
 better by helping eliminate prospects that are mistakenly included in our population as “good
 audit prospects”. An example of this would be people that are deceased that we typically do
 not target – even though their estates may still owe taxes. These could be excluded through
 use of a death index data source.

 Studies have found that the tax gap could be anywhere between 10 – 15% based on IRS
 research. The tax gap is related to those individuals and business entities that usually operate
 on a cash only basis and are not following requirements for registration and reporting and thus
 not paying taxes. Additional data sources would help us identify additional entities that are
 currently non-compliant for personal and business taxes.

 The Weight Distance Tax (WDT) Enforcement Initiative developed by DPS, DOT and TRD
 estimate that between 10 – 20% of WDT due is not paid or approximately $9M to $18M. The
 plan to increase enforcement and compliance is endorsed by the New Mexico Truckers
 Association and will be paid for with private sector fees now authorized in statute. The part
 involving the TRD Compliance Data Warehouse involves using it to see if truckers are
 reporting all miles subject to tax. TRD will use the DW to match data that will allow TRD to
 pick the best audit prospects. We have defined three projects: a selection population based on
 International Fuel Tax Agreement (IFTA) registrations; an audit selection based on IFTA
 Clearinghouse transmittals; a tape match based on IFTA and GenTax data sources.
 Planned Start Date                      05/01/09                        Planned End Date             6/30/10
                 This is a controlled document, refer to the document control index for the latest revision
 Requested amount
Revision: 04/06/09 this                  $100,000 Page 2                 Remaining                    $760,000
 Certification                                                           Appropriation not
                                                                         Certified
                   Project Initiation
                          Request for Certification and Release of Funds Form
                                  ALL CERTIFIED PROJECTS MUST FOLLOW NM STATE POLICIES AND PROCUREMENT CODE




 PROPOSED CERTIFICATION SCHEDULE
 Phases                   Planned         Amount to be            Major Deliverable(s) / Performance Measures
                        Certification      requested
                           Date
 Initiation:            05/01/09         $100,000            Develop contract for IV&V and Vendor support;
                                                             execute IV&V contract
 Planning:              N/A                                  Will request waiver from Planning Phase
 Implementation:        7/1/09           $760,000            Purchase required hardware and software; execute
                                                             vendor support contract; Perform implementation
 Closeout:              6/30/10          $0                  Closeout




 APPROPRIATION HISTORY (INCLUDE ALL FUNDING SOURCES, E.G. FEDERAL, STATE, COUNTY, MUNICIPAL LAWS OR GRANTS)

    Fiscal Year            Amount                 Funding Source(s) (use specific citations to laws, grants, etc.)
 FY10                   $500,000          Laws of 2009: Chapter 124, Section 7, Item 2
                        $360,000          NMSA 1978, Section 7-15A-13



 IT SYSTEM ANALYSIS
 Existing Hardware in the development environments is near end of life and presents contention of resources
 for existing developers. The purchase of a dual blade enclosure will enable the DW to replace an existing
 end of life system while utilizing leading edge technology. Virtualization will provide isolated
 environments in which the vendor will operate so the there will be no interruption or contention with
 existing TRD DW staff.

 Network demand is expected to be consistent with the current DW load.

 Any impact will be coordinated with appropriate DoIT staff as decisions are completed. Secretary Mackey
 and Mike Baca are currently aware of our plans for DWEDL.


 BUSINESS CONTINUITY STRATEGY

 TRD currently runs full database backups nightly. Once each week, full backups are stored to tape for one
 month. This project will also follow these practices and be added to TRD’s disaster recovery plan. All
 production DW components are housed at the DoIT data center. Virtualization will allow the ability to
 perform environment snapshots as an extension of existing disaster recovery plans. Virtualization also
 provides hardware fault tolerance to ensure business continuity.




                  This is a controlled document, refer to the document control index for the latest revision
Revision: 04/06/09                                    Page 3
                 Project Initiation
                        Request for Certification and Release of Funds Form
                               ALL CERTIFIED PROJECTS MUST FOLLOW NM STATE POLICIES AND PROCUREMENT CODE



 SECURITY STRATEGY (APPLICATION AND DATA SECURITY PROCESS, PLAN, OR STANDARD)
 TRD DW servers have been separated into an isolated subnet; servers, desktops and laptop
 computers were hardened; and numerous other security-related improvements were completed. All
 DW systems are compliant with IRS publication 1075 and security SCESMS, as coordinated with
 current NIST standards.


 SIGNIFICANT RISKS AND MITIGATION STRATEGY

 RISK 1: Availability of data sources
      MITIGATION 1: Start process of obtaining agreements with applicable agencies now to obtain
      data early in project to ensure data availability
 RISK 2: TRD resource availability
      MITIGATION 2: Ensure senior management and stakeholders are involved and support the
 project.




                This is a controlled document, refer to the document control index for the latest revision
Revision: 04/06/09                                  Page 4

				
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