Executive Summary
Vermont is a small, centralized market where most state technology decisions run through a single agency — the Agency of Digital Services (ADS), led by Secretary & CIO Denise Reilly-Hughes. Three shifts matter for a Dell seller in 2026. First, ADS is executing a multi-year 'One ADS' strategy that moves the state to a service-based (internal service fund) IT budgeting model, backed by a $15M appropriation, to consolidate fragmented systems and bill agencies for shared services. Second, Governor Scott's new AI Economic Task Force (Executive Order 04-26, signed May 18, 2026), which works with Reilly-Hughes, sits alongside the state's existing Council on Artificial Intelligence (Act 132 of 2022) and is tasked within 90 days with naming priority opportunities where AI can help state employees. Third, a $70M+ Workday HR/finance modernization is mid-flight — recently shifted from phased to all-at-once rollout — and Vermont's federally funded fiber broadband buildout is pushing access toward 99% statewide. Buying runs through Buildings & General Services (BGS) Office of Purchasing & Contracting and ADS vendor procurement, increasingly via the VT Buys platform and statewide IT contracts.
- Infrastructure consolidation under 'One ADS' and the service-based IT funding model — compute, storage, networking, and lifecycle for shared state services.
- Governed AI enablement as the AI Economic Task Force and Council on AI define state use cases — an opening for private/on-prem AI on sensitive workloads.
- Cybersecurity for state and local government via the Cybersecurity Advisory Council and federal SLCGP grants — secure compute, endpoint, and resilience.
- Client/endpoint and data-center refresh tied to the Workday modernization and a record all-funds budget.
Dell Action Plan
- Build the relationship with ADS (Secretary/CIO Reilly-Hughes and team) as the single front door — Vermont's IT decisions are centralized there.
- Tie infrastructure, compute, and lifecycle offerings to the 'One ADS' consolidation and service-based funding model rather than one-off agency deals.
- Lead with governed, private/on-prem AI for sensitive workloads as the AI Economic Task Force and Council on AI define state use cases.
- Pursue state and local cybersecurity through the Cybersecurity Advisory Council and SLCGP grant funding — secure compute, endpoint, and resilience.
- Confirm Dell and reseller coverage on current statewide IT contracts (ITS75 / IT Retainer) and register/stay current on the VT Buys platform.
Budget & Fiscal
Vermont budgets on an annual fiscal-year cycle (July 1–June 30). The enacted FY2027 Appropriations Act (H.951), signed by Gov. Scott on June 16, 2026, totals $9.38B across all funds (+2.10% over FY2026), with $2.57B in General Fund appropriations (+2.88% over FY2026). There is no single consolidated 'state IT budget' line — the state spends well over $140M a year on government IT, distributed across agencies, with ADS now moving toward a service-based internal service fund that bills agencies for shared technology.
- Figures are annual (FY2026) unless a program is noted as multi-year/cumulative.
- Most technology spend is embedded in agency budgets; the 'One ADS' service-based model will reshape how shared IT is funded and billed — confirm which entity owns a program before forecasting.
- FY2027 ENACTED (H.951, signed June 16, 2026): $9.38B all funds and $2.57B General Fund — higher than the governor's January proposal (~$2.53B GF per NASBO) after the Committee of Conference restored spending on health care, housing, and human services; the enacted budget fully funds statutory reserves and pension obligations.
Initiatives & Policy
One ADS — Service-Based IT Strategy18
In progressADS is executing a multi-year 'One ADS' strategy to consolidate fragmented state technology and move to a service-based (internal service fund) budgeting and billing model, backed by a $15M appropriation. The goal is greater reliability, transparency, and predictable cost — a consolidation motion that creates demand for standardized infrastructure, shared compute/storage, and lifecycle services. The enacted FY2027 budget (H.951) adds $9.08M General Fund specifically to ADS for adopting changes to internal billing practices to establish fiscal sustainability — concrete evidence the service-based funding model is moving from strategy into execution.
AI Economic Task Force & Council on AI5
Established May 2026Governor Scott's Executive Order 04-26 (May 18, 2026) created the AI Economic Task Force, working with ADS Secretary/CIO Reilly-Hughes, with working groups on Economic Acceleration, Small Business Competitiveness, and Community Resilience. Within 90 days it must name up to five priority opportunities for AI to help state employees. It complements the existing Council on Artificial Intelligence (Act 132 of 2022) that governs state AI use — an opening for governed, auditable AI.
Workday HR & Finance Modernization4
Mid-implementationVermont is replacing legacy human-resources and finance systems with the Workday cloud platform at a cost exceeding $70M. In April 2026 officials postponed the HR (HCM) go-live and moved to a single 'unified launch' now targeted for 2028 after finding the HR and finance components more interconnected than expected; legislators flagged the lack of an upfront gap analysis and are scrutinizing the project — raising cost, risk, and oversight attention. While the platform is SaaS, the slipping timeline opens room for advisory/integration and the surrounding infrastructure and endpoint refresh.
Cybersecurity Advisory Council & SLCGP6
ActiveVermont's Cybersecurity Advisory Council is extending protection beyond state government to critical-infrastructure and local entities, using a tiered plan (training/planning, risk management, information sharing). Federal State and Local Cybersecurity Grant Program (SLCGP) funds, administered with Ready Vermont, help municipalities meet baseline security — a channel for secure compute, endpoint, and resilience offerings into the SLG market.
Broadband Buildout — VCBB & CUDs7
AcceleratingThe Vermont Community Broadband Board (VCBB) and locally governed Communications Union Districts (CUDs) are building fiber into rural Vermont with a ~$229M, BEAD-anchored program; NEK Broadband alone won ~$93M to reach ~10,000 addresses. The goal is ~99% statewide access. Primarily a fiber/ISP motion, but the expanding state and CUD digital footprint drives downstream network, edge, and security needs.
Procurement & Competition
Vermont technology buying is centralized. Statewide purchasing policy and contracting run through the Buildings & General Services (BGS) Office of Purchasing & Contracting, while the Agency of Digital Services (ADS) owns technology strategy, standards, and IT vendor procurement. The state is standardizing sourcing on the VT Buys eProcurement platform, and maintains statewide IT contracts that agencies buy from without running their own solicitations.
| Vehicle / gate | What it means for Dell |
|---|---|
| Statewide IT contracts (ITS75 / IT Retainer) | Pre-competed statewide agreements for software, resellers, and IT professional services with set rates; agencies purchase against them. Confirm Dell and reseller coverage is current and correctly scoped. |
| VT Buys (eProcurement) | The state's emerging primary platform for sourcing, solicitation, contracting, and supplier management — register and stay current here. |
| ADS vendor procurement | ADS leads technology-specific solicitations and standards; engage early to shape requirements for consolidation and AI/security workloads. |
| Key buying entity | Role |
|---|---|
| Agency of Digital Services (ADS) | Central IT, cybersecurity, telecom, and standards for all of state government — owns the statewide technology motion. |
| BGS Office of Purchasing & Contracting | Statewide purchasing policy, contracting, and the VT Buys platform. |
| Agency of Administration / Finance & Management | Budget, the Workday modernization, and finance systems oversight. |
| University of Vermont (UVM) & UVM Health Network | Independent research-computing, data-center, and security buyer; UVM Health Network sits on the Cybersecurity Advisory Council. |
Vermont is a small, relationship-driven, centralized market. Volume is modest versus large states, so differentiation comes from fit with ADS consolidation, governed AI, and state/local cybersecurity — plus presence on current statewide IT contracts and VT Buys — rather than price alone. Incumbent resellers and SaaS platforms (e.g., Workday for ERP) hold key footholds.
Power Structure
| Decision-maker | Why they matter |
|---|---|
| Phil Scott5 Governor · State of Vermont | Established the AI Economic Task Force (EO 04-26); sets the administration's technology and economic agenda. Filed May 28, 2026 for a sixth term (2026 is a gubernatorial election year); polls as the most popular U.S. governor and is favored — expect continuity if re-elected. |
| Denise Reilly-Hughes3 Secretary & State CIO · Agency of Digital Services | Leads all state IT and cybersecurity; works with the AI Economic Task Force on state-employee AI opportunities. The single most important account contact. |
| John Toney14 Chief Information Security Officer (CISO) · Agency of Digital Services | State CISO (appointed 2024; current per 2026 sources). Priorities include critical-infrastructure/water-utility protection, CISA-aligned compliance, and consolidating the state's security-tool stack — a fit for secure compute, endpoint, and vendor rationalization. |
| Sarah Clark4 Secretary of Administration · Agency of Administration | Oversees the budget and the $70M+ Workday HR/finance (ERP) modernization. |
| Cybersecurity Advisory Council6 Statewide security governance · ADS-led | Coordinates state, local, and critical-infrastructure cyber; gateway for SLG security demand. |
| Joint Information Technology Oversight Committee (JITOC)4 Legislative IT oversight · Vermont Legislature | Reviews large IT projects (including Workday) — useful for reading project risk and direction. |
News & Signals
Sources
- Vermont Legislature — H.493 (Act 27), FY2026 Appropriations Act status
- ADS 2026 Annual Report (Vermont Legislature)
- StateScoop — Vermont governor names Denise Reilly-Hughes statewide CIO
- VTDigger — Changes to Vermont's $70M+ IT (Workday) overhaul could increase costs and delays
- Office of Governor Phil Scott — Establishes Vermont AI Economic Task Force
- GovTech — Vermont Cybersecurity Council to extend protection beyond state gov
- VTDigger — Vermont broadband board outlines $180M proposal, major NEK investment
- Vermont BGS — Office of Purchasing and Contracting
- Vermont ADS — Vendor Procurement
- Vermont ADS — Artificial Intelligence
- NASBO — Summaries of FY2027 Proposed Budgets (June 2026)
- Vermont Business Magazine — Scott signs 16 bills, vetoes S.190 (June 17, 2026)
- Vermont Public — Lawmakers scrutinize $70M IT overhaul as administration postpones rollout (Apr 8, 2026)
- StateScoop — Securing water utilities a top priority for Vermont's new cyber chief (CISO John Toney)
- Inside Privacy (Covington) — Vermont Data Privacy Bill (S.71) Signed into Law (June 2026)
- VTDigger — Vermont Gov. Phil Scott is running for reelection (May 28, 2026)
- Vermont Legislature — H.211 (Act 138) data-broker overhaul, bill status
- Vermont Joint Fiscal Office — FY2027 Budget Highlights, Committee of Conference (H.951)