HONOLULU - Walking into the windowless office where payroll is processed for the state of Hawaii is like stepping back in time.
Clerks scour thousands of pages marked with red pen to calculate overtime and other changes to paychecks. They pencil down department totals in a paper ledger.
In most places, such work is done on computers, but in Hawaii decades of putting technology funding on the back burner has led to an environment where state workers process payroll the same way they did 40 years ago, when offices were commonly equipped with rotary phones.
The longhand accounting is an extreme example of how essential functions across state government are performed with minimal or antiquated technology, forcing employees to spend large chunks of time on a preponderance of paper records and manual tasks that breed inefficiency and waste taxpayer dollars.
Now, Hawaii's first chief information officer wants to lift the state into the 21st century, leapfrogging into a world where residents might be able to get their child's report card and pay taxes using a mobile app on their smartphone or tablet computer.
"We can skip those 20, 30 years. We can skip cassettes. We can skip CD and DVD and go straight to cloud," said Hawaii's CIO, Sanjeev "Sonny" Bhagowalia, referring to online virtual information storage.
To get there, Bhagowalia and his team must modernize and integrate a labyrinth of equipment and software across more than a dozen departments and other state entities such as Hawaii's public schools and hospitals. Bhagowalia's team has counted 743 different systems and databases -including separate email systems for each department.
Then, there are the functions that have never been computerized - like Hawaii's $130 million payroll.
Traci Fujita, central payroll supervisor, and four clerks use calculators to tabulate department payroll data on papers that are delivered by hand to another group that enters the figures in a computer system. If there's a discrepancy, Fujita's team goes through paper records one by one to determine whether numbers were input incorrectly or a department's figures are wrong. Only then may the state send 70,000 to 80,000 paychecks every two weeks.
"Even 30 years ago, they had said they were going to move away from this," Fujita said. "And 30 years later it's still here."
Another example of the sort of institutional inefficiency that leads to wasteful, overlapping effort arises when employees request time off.
To go on vacation or take leave for jury duty, state workers must submit a request on a paper form, which a supervisor must sign before sending it along to a division or department head. It can take two weeks or more for leave to be tallied. Sometimes papers are sent to another office only to be lost and forms need to be filled out all over again.
"A lot of this activity is just people going around in circles. It's activity not to be confused with progress," Bhagowalia said.
Making do without modern technology is hard, and Bhagowalia called employees heroes for managing.
"But having said that, it's time to really give them computing. You shouldn't have to deal with that," he said.
Bhagowalia blames 30 years of underinvestment in technology for the current situation.
Ideally, states should spend 3 to 5 percent of their overall budgets on information technology, he said. Hawaii's annual spending recently amounted to 1.4 percent, or about $160 million, which is less than half of what Bhagowalia says is necessary.
This year, the state is spending an additional $25 million on IT transformation initiatives. Gov. Neil Abercrombie is asking the Legislature to raise this to $60 million for each of the next two fiscal years.
State Sen. David Ige, chairman of the Senate Ways and Means Committee, said he's supportive of the governor's plans, having pursued similar reforms for decades.
Previous administrations either weren't interested in spending the money or realized the need for tech investments too late in their tenure to make changes, he said.
The state Senate's experience going paperless in 2008 illustrates the potential benefits, Ige said.
Staffers who once spent most of their time copying, collating and stapling papers now focus on researching and analyzing public policy. Issues are easier to follow because keyword searches quickly locate relevant bills and documents.
The Senate is saving more than $60,000 a year, with paper consumption down more than 80 percent.
Over at payroll, Fujita said computerization will free clerks to audit departments.
The problem isn't necessarily unique, Todd Sander, executive director of the Center for Digital Government, said every state has pockets of outdated technology.
Hawaii's commitment to improve earned it a B- in a survey of state government technology plans published last year by the center, a for-profit research and advisory organization based in California. The Aloha State's upgrade strategy ranks alongside six others in the middle of the pack - but ahead of 20 other states.
"The trend in Hawaii is toward continued improvement, whereas in other states, unfortunately, it's going the other way," Sander said.
Hawaii's turnabout dates to the 2010 gubernatorial campaign, when Abercrombie and his major opponents all promised to upgrade technology.
After the election, a nonprofit group that had recently received a $50 million donation from eBay founder and Honolulu resident Pierre Omidyar offered to help.
A $3 million Hawaii Community Foundation grant allowed the state to quickly conduct a national search for a chief information officer and develop a 12-year transformation plan.
It's paying off, Bhagowalia says. Already, residents can register a business using a recently introduced mobile app. The state plans to launch six more apps over the next three to four months, he said, adding that the plan is to make government "better, faster and cheaper."
The change will attract money to Hawaii, he said.
"For example, why is Singapore so successful? People want to invest there because the government is effective and efficient. They're always like: 'How can we help you get what you need? Come to Singapore,' right? Same with South Korea now," Bhagowalia said. "Why not us? That's what we're trying to do here."