B2G Blog - Procurement

The Army Tightens its Chokehold on COTS IT Procurement

Tue, 18 Jun 2013 09:25:00 -0400

Like all of the Department of Defense, the U.S. Army has struggled in recent years to adapt to declining funding. In response to the tightening fiscal situation, Army leadership has introduced measures that are intended to reduce spending on information technology products and services. As these measures evolve they are reshaping the Army’s IT acquisition environment in dramatic ways. The number of acquisition vehicles that contracting offices can use has been limited, the type of IT hardware and software Army customers can buy has been restricted, and the number of service contracts competed has been reduced. The result is an increasingly challenging business environment that presents considerable difficulties for IT vendors.

Background

Cost reduction efforts introduced in 2011 centered on an initiative called the “Army Request for IT.” ARFIT introduced measures intended to drive down IT costs, including:

Stricter administrative oversight to capture the amount of money being spent on software, hardware, and IT services
Reducing the amount of funds flowing through higher cost, non-enterprise contracts for IT SW, HW, services, and maintenance agreements
Maximizing cost-effectiveness by increasing use of the Army’s Computer Hardware, Enterprise Software and Solutions (CHESS) Program
Improving the security of the Army’s LandWarNet Network

Administrative responsibility for ensuring that ARFIT measures were implemented was initially assigned to four Gatekeepers – the Office of the Assistant Secretary of the Army for Acquisition, Logistics and Technology (ASA-ALT); the Office of the Assistant Secretary of the Army for Financial Management and Comptroller (ASA-FM&C); Army Materiel Command (AMC); and Army Cyber Command (ARCYBER).

One year later, in June 2012, John McHugh, the Secretary of the Army, published a memorandum outlining the responsibilities of three organizations designated as gatekeepers (AMC was dropped from the list at this point). In this memo the SECARM sharpened the stick of Army IT acquisition reform into a point.

The ASA-ALT was directed to enforce the spending of funds through the appropriate authorized contracting vehicles, especially the contracts provided by the Army’s CHESS program and the DoD’s Enterprise Software Initiative Blanket Purchase Agreements
The ASA-FM&C was made responsible for ensuring that Army commands execute IT purchasing in compliance with stated policy (i.e., Commands use CHESS and ESI to the greatest extent possible)
ARCYBER was made responsible for ensuring that IT products and services properly align with the Army’s efforts to secure and defend its networks

Finally, so far in FY 2013 two critical developments have appeared in relation to ARFIT. First, in February 2013, the Army CIO/G6 released detailed guidance concerning IT Management Reform. ITMR calls for ARFIT to be fully implemented no later than the end of FY 2013. Second, in June, the SECARM issued a memo removing the authority of Product Director CHESS to issue waivers for Army customers seeking to purchase commercial-off-the-shelf (COTS) IT. Starting on 1 July 2013, most Army customers (except the U.S Military Academy and those responsible for non-Program Executive Officer/Project Manager managed Military Intelligence Program (MIP) systems) will be required to submit COTS IT waiver requests to Army Headquarters directly for approval.

Implications and Opportunities

The implication of AFRIT for vendors, especially those who sell COTS IT, is stark – either your company wins a spot on CHESS commodity IT contracts or you can forget doing business with most Army customers. This is of course unless your company sells its products through resellers who hold a CHESS contract. Services vendors retain a wider variety of possibilities because of the Army’s size and ongoing struggle getting a handle on services procurement. This said, even Army IT services spending over the next few years is expected to decline.

One possibility in this environment is to compete for the next iteration of the Common Hardware Systems 5 (CHS 5) contract. The current CHS 4 contract held by General Dynamics is due to expire in August 2016, meaning vendors should see procurement activity begin in FY 2014. Then there is the upcoming competition for the follow-on to CHESS’ IT Enterprise Solutions 2 Services (ITES 2S) contract vehicle. ITES 2S is one of the Army’s most used IT services contracts so winning a spot on ITES 3S would be a key victory. GovWin expects the competition for ITES 3S to begin in Q2 FY 2014.

Deltek pulse: General government services May review

Wed, 12 Jun 2013 14:19:00 -0400

In what is no doubt in anticipation of the end of another fiscal year, many government entities ramped up solicitation releases last month. May continued the trend of increased solicitation releases, with a total of 1,811 IT-related general government solicitations captured in Deltek’s GovWin IQ database. This was a 6.2 percent increase in the total number of solicitations released by state and local governments in April.

From May’s solicitations, we’ve highlighted the top 11 most common IT procurement categories in the state and local market:

Software/Applications – 372 solicitations
IT Hardware/Computers/Peripherals – 292 solicitations
Maintenance & Support Services – 206 solicitations
Implementation/Integration Services – 118 solicitations
Wireless & Telecom Equipment/Solution/Services – 66 solicitations
Cloud/ Data Center/ Big Data Solution/Services – 42 solicitations
IT Professional /Staffing/Consulting/Project Mgmt Services – 34 solicitations
Content/Document/Records Mgmt Systems – 30 solicitations
Education Data/Learning Management/Student Info Systems – 30 solicitations
ERP/Human Resources/Financial Systems – 20 solicitations
Data Warehouse/Business Intelligence/Analytics – 7 solicitations

Highlighted opportunities in Deltek’s database

A solicitation was released for a professional license and permit management system for the New Hampshire Department of Information Technology on May 30. The agency plans to procure a commercial-off-the-shelf software system and associated services for licensing and permitting agencies. An optional pre-proposal conference will be held June 19. Questions are due June 24, and proposals are due August 5.

The Massachusetts Information Technology Division released a request for information (RFI) for an enterprise content management solution on May 13, and responses were due May 22. The program office confirmed that the state may utilize ASAP software as well as state contract ITC47 to fulfill these obligations in advance of a new system purchase. There is the potential for this project to be split into multiple procurements, but the state has declined to elaborate on that possibility.

The North Carolina Office of Information Technology Services (ITS) is expected to release a new RFP seeking short-term IT staffing and scanning services after a cancellation notice was released for a related opportunity on May 8. The related RFP was canceled because ITS plans to review and revise the specifications for each IT staffing category, and is expected to expand upon the list of current categories. A new RFP with a revised scope is expected to be released at a later date. A current list of categories of the incumbent contract can be viewed here.

The state of Tennessee released an RFI for a hybrid solution for software as a service (SaaS), in which the comptroller would utilize the SaaS solution to deliver a talent acquisition and management solution while hosting the database within the comptroller’s control. RFI responses were due May 24.

Market analysis

Analysts Alexandra Howden, Joanna Salini and Stephen Moss published a cross-vertical analysis on the state of Wisconsin’s improved economic status by highlighting opportunities within the general government services, health care and social services, and justice and public safety verticals. The report details how Wisconsin has mounted a comeback toward a budget surplus, and unemployment is almost a point less than the national average.

Analyst Randi Powell published an article on North Carolina’s bleak performance audit of 84 IT projects after a state performance audit called out numerous IT projects that cost the state a total of $356.3 million in overages, and took a total of 389 days longer than initial project estimates. Essentially, these projects have cost twice as much and taken 65 percent longer than expected.

What’s on tap?

The general government services team will be releasing blog series the third week of June regarding business intelligence and analytics solutions for state and local government’s big data needs.

GovWin IQ subscribers can read further about these projects in the provided links. Non-subscribers can gain access with a GovWin IQ free trial.

Better Buying Power 2.0: What Can Industry Expect?

Tue, 11 Jun 2013 08:15:00 -0400

Back in 2010, Dr. Ashton Carter, then the Under Secretary of Defense for Acquisition, Technology, and Logistics, announced an initiative to improve procurement processes across the Department of Defense. This initiative, called “Better Buying Power,” (BBP 1.0) was intended to achieve a number of key improvements, including:

Targeting Affordability and Controlling Cost Growth
Incentivizing Productivity and Innovation in Industry
Promoting Real Competition
Improving Tradecraft in Services Acquisition
Reducing Non-Productive Processes and Bureaucracy

Unfortunately, for all of its good intentions, BBP 1.0 created a plethora of knock-on effects that in many cases significantly hampered DoD acquisitions. Practically all of the industry professionals who I have spoken to over the last 24-36 months agree that DoD procurements, at least for information technology products and services, are slower than ever and take longer to award. Why is this?

One important roadblock is administrative as DoD procurement officials exercise greater executive oversight and demand more detailed business cases justifying acquisitions. These challenges arose despite BBP 1.0’s stated goal of reducing non-productive processes and bureaucracy. Then there is the insidious growth in the use of “Lowest Price Technically Acceptable” (LPTA) competitions. The desire to ruthlessly reduce costs and accelerate acquisition timelines generated an increase in the use of LPTA. This unwelcome development evolved despite the government’s decades of failure using LPTA to control long-term project costs. Indeed, countering the negative effect of LPTA was the rationale for introducing “best value” evaluations more than a decade ago. What’s old is new. So, where are we now?

Arguably we are on the precipice of still more unintended consequences as two weeks ago Frank Kendall, the current USD AT&L, announced BBP 2.0, a new series of initiatives intended to take acquisition reform at DoD one step further. Reading between the lines, one could also say that BBP 2.0 is intended to address some of the difficulties caused by BBP 1.0. Take for example the mandated use of Fixed Price Incentive (FPI) contracts. BBP 2.0 recognizes that fixed price contracts do not fit the bill in all circumstances, particularly in services and engineering procurements where costs are derived from the process of developing systems. BBP 2.0 will loosen rules by allowing the use of a variety of contracting types. The list of acceptable types and circumstances when they can be used is yet to be defined. Fixed Price Incentive contracts will still be mandated for Low Rate Initial Production (LRIP) efforts.

Then there is the explicit acknowledgement that LPTA has become the contracting standard. Unfortunately little attention is given to this, with Kendall’s memo noting only that “the Department needs to define Technical Acceptability appropriately to ensure adequate quality.” The problem is that DoD has a very poor track record adequately defining “technical acceptability” for long-term investments. To wit, as Kendall’s memo notes, “long-term capital investment analysis covering product lifecycles of 30 or 40 years [will be] a standard part of the acquisition process.”

Thirty to 40 years? Scope creep often manifests in even the simplest investments within weeks, if not months, of many projects. No one would deny that the DoD needs to rein in costs. However, doing so to the detriment of tried and true best value source selection evaluations practically guarantees that LPTA will continue to be the rule of the day. This may reduce costs at the outset, but if the past is any indication the costs down the road will be much higher than if a best value approach is used. To be fair, BBP 2.0 addresses “best value” source selection as well, but it states only that the DoD needs to do a better job defining performance thresholds.

Finally, the guidance hones the DoD’s effort to reduce the need for executive oversight by stating that greater responsibility must be shifted to Program Executive Offices and Program Managers to oversee acquisitions and program performance. This is a laudable objective that one hopes will result in more efficient oversight of programs.

What should we expect moving forward? I am speculating here, but based on what happened after BBP 1.0 was introduced, this is what I believe lies before us.

Shorter Duration Contracts – The award of shorter duration contracts for limited efforts to meet project milestones, sometimes referred to as “modular contracting,” is likely to increase, in part to offset the impact of LPTA. This suggests more frequent competitions, lower value awards, and more frequent use of task order vehicles.
Acquisition Delays – Despite BBP 2.0, Congress will continue to hold DoD officials’ feet to the flames when it comes to acquisitions. This ensures that executives will continue to be deeply involved in approving acquisitions and demanding detailed business cases.
LPTA – This will increasingly become the norm with shorter duration procurements put forward as the solution to the LPTA boondoggle. Adjust prices accordingly.
Scope Creep – Requirement development will continue to be a problem for the department, particularly in the case of newer technology areas like Big Data where the process of formulating requirements is complex and evolving. Even the IC has admitted that it cannot efficiently develop big data requirements. How is the DoD supposed to achieve this?
Strategic Sourcing – Although lip service has been given to increasing competition, strategic sourcing along the lines of the big Microsoft Enterprise Licensing Agreement is likely to become more common. The Government Accountability Office (GAO) reported in April 2013 that industry partners often achieved cost savings of 4-15% over prior year spending through strategically sourcing the full range of services they buy. These are savings the DoD cannot afford to ignore. The White House is also pushing strategic sourcing, meaning the DoD will be required to respond.

2013 IACP LEIM Conference Recap

Thu, 06 Jun 2013 09:05:00 -0400

The 2013 International Association of Chiefs of Police (IACP) Law Enforcement Information Management (LEIM) Conference was held in Scottsdale, Ariz., from May 20-23, 2013, at the Fairmont Scottsdale Princess. The event included a variety of plenary sessions and workshops addressing executive, operational, and technical communications and interoperability. The LEIM section of IACP provides information through a variety of events regarding best practices and updates on state-of-the-art law enforcement technology. More than 1,000 chiefs and information technology professionals are members of the LEIM section, including many from outside of the continental United States.

This year’s IACP LEIM did not feature a keynote speaker, so the plenary sessions kicked off quickly following the opening ceremony and welcoming remarks. The first of the two sessions, “The Evolving Role of Technology in Policing: Results of the IACP/LEIM IT Summit,” featured remarks from Scott Edson, commander at the Los Angeles Sheriff’s Department and Chair of the LEIM Board of Officers; Thomas Casady, Lincoln, Neb., public safety director; Lance Valcour, executive director of Canadian Interoperability Technology Interest Group (CITIG) and member of the LEIM Board of Officers; and Steve Williams, Major Florida Highway Patrol, CTO, and on the LEIM Board of Officers.

A common thread among many of the event’s speakers and sessions was that of using technology to your advantage and finding ways to “make it work” within your agency. One main issue, aside from costs of new technology, is the governance and local-legislator buy in.

For more analysis some of the hot topics and other insights from the 2013 IACP LEIM Conference, please check out the full five-page recap at GovWin.com

Florida increases efforts to combat public benefits fraud

Tue, 04 Jun 2013 11:02:00 -0400

Florida’s health and human services departments are taking many strides to combat fraud and abuse of public assistance programs.

The Department of Children and Families (DCF) awarded a $3 million contract to LexisNexis to provide identification verification services to the more than 11 million applicants the department receives annually for the Supplemental Nutrition Assistance Program (SNAP), Temporary Assistance for Needy Families (TANF), Medicaid, and Refugee Services programs. The verification and authentication solution is integrated into DCF’s Automated Community Connection to Economic Self Sufficiency (ACCESS) system – Florida’s integrated eligibility system provided by Deloitte.

LexisNexis will verify the identities of both new applications and those seeking recertification for eligibility every six months. If an applicant cannot be verified, the system will flag the application and it will be sent to DCF for further investigation.

Florida’s fraud prevention project is the first of its kind in the nation. “Implementing technology that has been successfully used in the private sector will allow us to catch more of these cheats on the front-end while we continue to utilize modern investigative strategies to fight fraud in Florida’s public assistance programs,” said DCF Secretary David Wilkins in a press release.

DCF received proposals from eight vendors, with proposed costs ranging from $1.35 million to $8.045 million. Deltek subscribers can access bid tabulation information here.

According to the 2012 Strike Force Annual Report, overpayments identified by the AHCA Bureau of Medicaid Program Integrity (MPI) totaled approximately $36.1 million for SFY 2011-12. AHCA referred 71 fraud cases to the Office of the Attorney General (OAG), Medicaid Fraud Control Task Force (MFCU), which recovered nearly $162 million for the year – a 46 percent increase from the previous year. Further, AHCA’s third-party liability (TPL) contractors recovered an additional $148 million using computer-assisted analyses of paid claims.

DCF is not the only state agency looking to combat fraud and abuse with IT solutions. As Florida transitions its Medicaid model from fee-for-service to managed care, OAG’s MFCU as well as the state’s Medicaid Public Assistance Fraud Strike Force have been in talks with states that previously made the transition to managed care to learn best practices.

Virginia’s MFCU contracted a firm to perform an audit of providers and refer suspected fraud to the MFCU, whose auditors review and analyze referrals. In Arizona, the Office of the Inspector General’s Medicaid Fraud Unit investigates fraud; the state’s Medicaid Managed Care Organization (MCO) is not allowed to conduct fraud investigations. At a recent meeting of the Strike Force, Florida Attorney General Pam Bondi and vice-chair of the Strike Force “expressed concern that fraud will only get harder to detect as more sophisticated, complex fraud schemes are devised.” OAG is working on a request for proposals (RFP) for an anti-fraud technology solution.

In another fraud-prevention effort, Florida’s Agency for Persons with Disabilities (APD) is planning to procure an electronic visit verification and data management system to combat fraud, waste and abuse of home-based health care services. The solution will allow APD to verify when and where a service is being provided and the actual amount of time the provider spends with the consumer. Currently, APD does not receive a systematic confirmation of service authorization and is not alerted if a consumer goes over his/her allotted units.

According to a request for information (RFI), “electronic visit verification which will ensure services are delivered as agreed upon and at the times and locations authorized by the agency. This component of the system will feed into an electronic client central record that will contain the key data needed to monitor client progress as well as agency and provider performance and measurable outcomes.”

Analyst’s Take

While fraud and abuse detection systems are not a new technology in the Medicaid world, Florida’s verification system represents one of the first efforts to simultaneously combat fraud across multiple benefit programs, thus helping to eliminate duplicated, redundant systems that are often developed for health and human services programs.

With streamlined systems that determine eligibility for multiple benefits programs at once comes the potential for fraudulent access of multiple benefit programs; therefore, verification systems that can span multiple benefit programs are needed. Further, focusing fraud prevention efforts on the front end of service provision saves the state time, money and human resources by preventing the fraudulent transfer of benefits entirely, rather than recouping fraudulently transferred funds after the fact.

Vendors can expect to see other states following the coattails of Florida’s fraud prevention efforts, particularly those states with existing integrated eligibility systems such as Texas and Illinois. Vendors may also see a spike in consulting opportunities to review and analyze existing fraud prevention measures taken by states and make recommendations for solutions and methodologies the state should implement to combat fraudulent activity.

Not a Deltek subscriber? Click here to learn more about Deltek’s GovWin IQ database and take advantage of a free trial.

Health care to take a large chunk of Ohio's budget for FY 2014-2015

Tue, 04 Jun 2013 10:02:00 -0400

According to Ohio Governor John Kaisch, “economic competitiveness” will be the focus for Ohio’s upcoming fiscal years, in which the state will be placing heavy emphasis on job creation. Governor Kaisch outlined several goals expected to drive this transformation within the state which includes:

Improving Education for All Children: Creating a “world-class” education system that increases achievement and provides high-quality opportunities for all students.
Helping More Students Get Degrees: Increasing the current percentage (25%) of Ohioans with a bachelor’s degree, so they are able to get on an expedited course to long-term success and stability.
Cutting and Reforming Taxes: Cutting small business taxes in half for the first $750,000 in net income, income taxes by 20 percent and state sales tax rate from 5.5 percent to 5.0 percent to help low-income Ohioans who pay no income taxes.
Making Medicaid Work Better: Helping more low-income and working Ohioans have access to health care through Medicaid. This is expected to improve the health of vulnerable Ohioans, and helps free up local funds for enhanced mental health and addiction services.
Meeting Ohio’s Crucial Transportation Needs: Investing O$3 billion into the Ohio Turnpike in order to strengthen the transportation network. Additional highway dollars raised by the sale of the new Turnpike bonds will help accelerate other highway projects in Northern Ohio.
Creating a Smarter, More Efficient State Government: Making sure state agencies are providing sustainable value to Ohioans, a high level of care for the state’s most vulnerable citizens and a jobs-friendly environment for future prosperity.

Health care seems to be taking the lead as far as budget share goes for both FY 2014 and 2015 (See Figure 1). The appropriation for the upcoming fiscal years has increased tremendously, due to a national shift in focus on health-related technologies. If approved, the Ohio Department of Health could receive nearly $650 million in both FY 2014 and 2015. This does not include all the other major health-related agencies within the state such as the Department of Mental Health, the Department of Aging, and the Department of Medicaid. When these entities are included, health care in Ohio could be receiving approximately $26 billion in FY 2014 and $28 billion in FY 2015. As mentioned earlier, one of Ohio’s goals for the upcoming years is improving Medicaid. Funding will be used to tackle issues such as fraud, waste and abuse in order to enhance Medicaid’s efficiency. Payment processes are also expected to be improved, where Ohio will reward hospitals based on quality as oppose to volume. Medicaid is the largest program in the state budget and has a recommended General Revenue Fund (GRF) of $15.1 billion for FY 2014; $16.8 billion FY 2015.

Figure 1

?Part of the plan in Ohio for Medicaid and Health care ?will be to streamline health and human services (HHS) program. This includes modernizing eligibility determination systems and improving state agency operations. The Ohio Department of Administrative Services is in the process of securing services for ongoing Organization Change Management Services to support the rollout and production operations of the Integrated Eligibility and HHS Business Intelligence (BI) System. The development and implementation of the integrated Eligibility and HHS BI System is a multi-phase, multi-year project. Accenture was awarded the contract to build the new system back in February 2013. The contract is worth over $300 million, and will expire in October 2018.

For more information on Ohio’s FY 2014-2015 budget, download an extended version of this article here.

Not a Deltek subscriber? Click here to learn more about Deltek’s GovWin IQ database and take advantage of a free trial.

The business of business development in leaner times

Mon, 13 May 2013 10:57:00 -0400

As talking heads debate how the sequester will affect the economy, companies around the beltway are working to determine how it might damage their bottom line. Will they be directly affected? Will the “trickle down” eventually bite them? It’s very likely that many cannot afford the risk or choose not to take it, so they are looking to cushion any potential blow.

When budgets are tight it is easy to consider Business Development as overhead that should be eliminated; but just like the “trickle down” will eventually bite you, so will reduction of your Business Development resources. Though it may help with short term revenue projections, long-term growth and stability cannot be sacrificed for instant gratification. A thorough understanding of the market, especially when agencies are working tirelessly to rebalance their smaller budgets, is critical in order to get ahead of opportunities and align your internal resources.

Understanding how agencies and their budgets will be affected by the cost cutting and how they plan to absorb these cuts will not only put you ahead of the curve in terms of preparing for upcoming opportunities, but it will also inform you about what has been moved to the backburner. Resources saved are resources earned. For example, as it stands currently, the Navy’s operations and maintenance accounts will be reduced by more than $4B, its IT expenditures will be cut by 25% and at least a half dozen “new start” multi-year procurement projects will be deferred. Anticipating and knowing about these delays will prevent you from wasting business development valuable resources where they are not needed.

GovWin Consulting specializes in understanding each agency’s priorities and can work with your company to help uncover where that department or agency plans to shift its focus and funding. With less budget to go around it is critical to develop an action plan in order to best position your company’s products or solutions. Communicating the values and messages that resonate with your intended audience and understanding their current financial hardships, can be the difference in winning new business. Our team delivers in-depth strategic targeting department and agency solutions tailored to your company’s business priorities and sales goals. For more information concerning GovWin Consulting’s capabilities please visit our website.

A closer look at Mississippi?s IT hardware term contracts

Fri, 10 May 2013 09:53:00 -0400

With more than 70 statewide term contracts from Mississippi’s IT Hardware Express Products List (EPL), it’s evident that the IT hardware category is a hot one in today’s market. The state took one solicitation and created 70-plus contracts offering a wide range of products including desktop/mobile-based computers, GIS-level workstations, monitors, printers/scanners, servers, storage, and video-conferencing equipment.

Mississippi has 77 approved manufacturers and 99 resellers on the IT Hardware EPL. While there is no confirmed spend value for statewide term contracts since they are based on purchases over the course of a contract, vendors may see large returns; statewide term contracts offer a large range of products and are available for use by all Mississippi agencies, universities, colleges and governing authorities.

The state has a purchase limit for users of $200,000 per project, per fiscal year for the IT Hardware EPL, which notes the anticipated high value. Mississippi also requires customers to obtain quotes from at least two EPL sellers if their purchase will be more than $50,000, which increases vendor competition. Another benefit to the EPL is that new sellers can submit proposals to get in on the action every six months.

Mississippi’s EPL Interactive website provides in-depth contract, vendor and pricing information, specifically for the IT Hardware EPL contract, but is not as robust with spending information. The site allows users to search by category, manufacturer, and seller name. You can also search by manufacturer reseller group, where a manufacturer sets a not-to-exceed price that resellers must obey; from there, some resellers will offer discounts on that manufacturer’s price. They keep this updated as the manufacturer changes any products on their website to make sure it meets state requirements.

Displayed in Table 1 are the different IT hardware categories offered under the EPL. The audio-visual components class is offered by 20 manufacturers and 66 resellers, the most of all categories. Interactive devices, which include whiteboards, voting devices and displays, is a close second with 18 manufacturers and 64 resellers. Some vendors offer both of those top contracts, like the Visix Term Contract. Deltek’s State & Local Term Contract resource has a searchable, saveable, living record for each of the more than 70 Mississippi IT hardware contracts, and 1,200 IT hardware term contracts throughout the United States.

Key take-aways

The IT Hardware EPL contract is set to expire in June 2014, and the state has indicated a replacement RFP will be released in April 2014. If IT hardware vendors don’t want to wait for the new solicitation, they can get on this contract in the next update cycle – the due date for proposals is June 4, 2013.

Forty-six states are using term contracts as an approach to purchase IT hardware. To explore more term contracts and gain insight into competitor contracts and pricing, check out Deltek’s State and Local Term Contracts resource. Not a Deltek subscriber? Click here to learn more about Deltek’s GovWin IQ database and take advantage of a free trial.

Deltek pulse: General government services April review

Thu, 09 May 2013 09:07:00 -0400

April saw the highest number of solicitation releases so far this year, with a total of 1,705 identified IT-related general government (GenGov) solicitations captured in Deltek’s Govwin IQ database. Last month showed a 10.7 percent increase in the total number of solicitations released by state and local governments from March.

From April’s solicitations, we’ve highlighted the top 11 most common IT procurement categories in the state and local market:

Software/Applications – 258 solicitations
IT Hardware/Computers/Peripherals – 227 solicitations
Maintenance & Support Services – 152 solicitations
Implementation/Integration Services – 125 solicitations
Cloud/Data Center/Big Data Solution/Services – 99 solicitations
Wireless & Telecom Equipment/Solution/Services – 63 solicitations
IT Professional /Staffing/Consulting/Project Management Services – 44 solicitations
Content/Document/Records Management Systems – 35 solicitations
Education Data/Learning Management/Student Info Systems – 24 solicitations
ERP/Human Resources/Financial Systems – 18 solicitations
Data Warehouse/Business Intelligence/Analytics – 17 solicitations

Here is a look at current tracked GenGov IT opportunities:

The state of Montana released a request for proposals (RFP) for a remediation information management system. The vision for RIMS is to improve the availability and quality of the information necessary to effectively deliver timely and accurate services to support DEQ’s remediation and associated programs, and to provide data integrity and system availability. The state is seeking a vendor to design, develop, support, and maintain the state’s new system (RIMS). Proposals are due by 2:00 MST June 11, 2013.

The California Department of Education released an RFP for its standardized account code structure system replacement project on April 9, 2013. The selected solution will integrate the functions of the four components into a single, Web-based system and will add functionality that streamlines the LEA reporting process for both LEAs and CDE FAIS staff. Questions and requests for meetings are due by June 5; draft proposals are due August 1; final questions are due Sept. 27, and final proposals are due November 8. An award is planned for January 2014, and the contract will run for a base term of three years.

The Kentucky Department of Revenue released an RFP for an electronic tobacco tax filing system on April 29, 2013. The selected solution will facilitate the licensing of cigarette and tobacco-product dealers; return filing (including supplemental data); cigarette tax stamp ordering and tracking; cross-checking between taxpayer filings and manufacturers; collection of master settlement agreement data from wholesaler filings; auditing functions and reporting. RFP responses are due by 3:00 PM EST May 17, 2013.

The state of New Jersey released an RFP seeking a budget preparation and monitoring system on April 30, 2013. The purpose of this RFP is to solicit proposals for the Enhanced Decision and Information System of New Jersey (EDISON) project. The new system will replace existing decision support and publishing systems used to create and monitor the statewide budget, with a commercial-off-the-shelf (COTS) product. Questions are due May 15. An optional pre-proposal conference will also be held May 15. Proposals are due July 31, 2013.

The Wyoming Department of Education has released an RFP for an educator credentialing, assignment validation, and reporting system. RFP proposals are due by May 21, 2013. The state estimates an award date of June 24, and a contract start date of July 1, 2013.

April’s Market Analysis

Analyst Derek Johnson published an article on transparency success stories of Tacoma Public Schools (TPS), where he interviewed contract manager Steve Demel. The article focuses on the school district’s transparency efforts to make all contracts available online. More school districts and state and local governments are engaging in these types of transparency initiatives. This openness assists vendors in identifying future business opportunities by seeing what and how government entities have purchased goods and services in the past.

GovWin IQ subscribers can read further about these projects in the provided links. Non-subscribers can gain access with a GovWin IQ free trial.

Montana's 2013 spending forecast

Wed, 08 May 2013 08:49:00 -0400

Just four months into the year, Montana has already awarded 86 statewide contracts – 11 of which were IT related – according to the state’s transparency website. The state started off the year slowly, only awarding a few contracts in January and February, one of which was IT related; but with more than half of the contracts awarded in April, Montana’s procurement cycle is picking up steam.

The beginning and final months of the year are always slightly slower with contract awards, while the start and end of the fiscal year (ending in June and beginning in July for most states) prove to be much livelier for procurement.

Last year, Montana’s awarded contracts had a bell-curve distribution; Q1 started off sluggish, the majority of contracts were awarded in Q2 and Q3, and activity died down again in Q4. If this year is any reflection of last year, we should look for an active next couple of months in the state.

As awarded contracts are growing in number, the Q2 spending trend becomes evident. Oftentimes states with a June-July fiscal year see a lull in spending at the end of the fiscal year, once funds have been used up. However, they typically see spending pick back up in July as project funds are approved and allocated. Therefore, vendors should be ready for high procurement activity ahead.

Most of this year’s awarded IT contracts are for software and software systems, and awarded vendors include Dell, High Point Networks LLC, and Hewlett Packard State and Local Enterprise Service. Further IT procurements include contracts for telecommunications systems, technological equipment, and professional services, of which CenturyLink, Compview Inc, and Northslope Capital Advisors are among the awardees. All of these vendors are pretty big players in the IT market, which means Montana contracts are fairly competitive and the state tends to do business with existing vendors. Smaller and newer vendors should take note of this.

The awarded contract values range from $17,000 to $500,000, and total approximately $1 million spent on IT contracts this year. Vendors should keep an eye out for more high-value contracts in the coming months as Montana still has a lot to spend.

Additionally, state departments just submitted their proposed budgets and bills for approval, and as Governor Steve Bullock approves them, procurement activity will rise. The Governor’s Information Technology Summary mentions a few projects the state is most interested in pursuing, including a statewide voter registration system, enhancing e-services for property and state taxes, and a computerized management maintenance system. The state outlined more than $15 million for these opportunities, as well as more than $14 million in long-term IT projects. Further opportunities can be found in the Montana state profile database.

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Florida's FY 2014 Budget

Mon, 06 May 2013 10:30:00 -0400

What a difference a fiscal year makes! For the past two budget cycles (FY 2012 and FY 2013), Florida Governor Rick Scott has been requesting deep cuts to health care, education and public safety to curtail the state’s declining tax revenues and multibillion-dollar deficit. Now, Governor Scott is touting a $4 billion surplus, and the fiscal year 2014 budget recommendations Scott released on February 6 actually add funds to state programs for the first time in six years. Also, in a reversal from years passed, Scott’s top budget priorities for FY 2014 include health care and education, both of which were once on the chopping block.

The governor’s FY 2014 state budget recommendation, also called the Florida Families First budget, asks for a pay raise for K-12 teachers and state workers, an increase in funding for state universities, and, surprisingly, accepts federal funds to support the Affordable Care Act’s (ACA). If adopted, the Republican governor’s FY 2014 budget would be the largest in state history, at $74 billion.

This economic upswing has allowed Scott to tailor his budget around job creation by cutting business taxes, investing in workforce training programs, and calling for $8.3 billion in transportation projects. Scott has also added $3 billion to higher education, essentially restoring funds to pre-recession levels. Additionally, Florida’s unemployment rate dropped to 7.7 percent, signifying an increase in revenue from income taxes. The combination of less spending and larger revenues has resulted in this unexpected surplus.

Now that the state is seeing a fruitful recovery, there is more push from department heads to restore services and programs and take on new projects. Despite cries for relief, Scott’s budget largely resists large-scale funding restorations; instead, he has smartly decided to split the difference by recommending a smaller increase in spending while opting to replenish the state’s once-dry emergency fund.

The top vertical increases in Scott’s FY 2014 budget recommendations (compared to FY 2013) focus on higher education (66.2 percent), transportation (33.7 percent), and public finance (24.3 percent) verticals. The Highway Safety and Motor Vehicle Department within the transportation vertical received a $20.6 million increase compared to FY 2013. This increase includes a $4.9 million funding request to procure a new motorist service system that is expected to be implemented over multiple years.

The top vertical decreases in the FY 2014 budget recommendations are for natural resources (-5.8 percent), K-12 education (-7.3 percent) and social services (-9.6 percent) verticals. The bulk of losses for social services are represented by a $575 million decrease from the Elder Affairs and Children and Family Services departments, stemming from reduced public services and pending layoffs. However, the IT expenditures under the social services vertical actually see a 7.9 percent increase from FY 2013, due in large part to projects such as the state’s public assistance eligibility system and the child dependency information management system.

One of the bigger gaffes Florida faced during the 2013 fiscal year was the defunding and decommissioning of the Agency of Enterprise Information Technology (AEIT). Last year, Scott vetoed legislation that would have replaced AEIT with a new central information technology agency that would have focused more on the state’s data center consolidation effort. Scott justified the veto by stating he believed the new agency’s scope was too narrow. Even though both Scott and the legislature promised to work together for fiscal year 2014 to avoid another misstep, it seems the House and Senate have each introduced competing legislation – though each is requesting a new agency, the agencies would have differing scopes and oversight schemes. An aide in Senator Jeremy Ring’s office confirmed that, despite political maneuvering, the hope is to create a central agency to manage the state’s IT efforts and oversee nearly $51 billion in IT contracts, rather than have 19 different state agencies inefficiently managing their own.

There are two major differences in oversight and scope between the House and Senate bills. Senate Bill 1762 calls for the head of the new agency to report to the governor alone, while House Bill 5009 calls for the head of the new agency to report to the governor as well as the cabinet. There’s also a difference in scope, as the House bill would pare down the new agency’s ability to influence IT purchasing decisions, while the Senate bill would create a department with robust authority including oversight of all IT purchases that involved multiple state agencies. Ultimately, HB 5009 would really only allow the new agency to track and analyze IT purchases and draft IT strategic plans in more of an advisory role. Since Governor Scott has yet to throw his support behind either bill, this battle will likely continue into the summer.

For an extended version of this article, please go here.

For more information on Florida FY 2014 budget, visit the state profile here.

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PSAP demographics across the United States

Tue, 30 Apr 2013 10:58:00 -0400

Last April, Deltek utilized the Federal Communications Commission’s PSAP Registry to give vendors an overview of public safety answering points (PSAPs) in counties nationwide. Now, we’re using the current registry to detail information on consolidation efforts and other changes that have taken place across the country in the last year.

Consolidation projects have been taking place for the last few years as cities and counties work to become more efficient and, ultimately, save more money; however, the total number of PSAPs actually increased by 64 from 2012 to 2013. Still, of the 8,393 PSAPs, only 7,485 act as the primary call-taking location – 908 are considered “orphaned” and are no longer utilized. These orphaned PSAPs will not be included in future filings with the FCC.

PSAP Quick Facts 2013
U.S. Population (July 2012 estimate)	313,914,000
Total number of PSAPs	8,393
Average number of individuals served by each PSAP	37,401
State with the most PSAPs	Texas
State with the fewest PSAPs	New Hampshire
Average number of calls to 911/ year (NENA)	240,000,000
Average number of calls to 911/day	657,534

Just as in 2012, Texas has the most PSAPs (667), followed by California (587) and Illinois (422) – all three states also saw slight increases in their total number of PSAPs year to year.

New Hampshire still has the fewest PSAPs (5), and Delaware’s nine puts it second from the bottom. Washington, D.C. held that spot in 2012, but an increase from seven to 11 PSAPs now ties the district with Vermont and Hawaii for having the third lowest number.

As of April 2013, a total of 719 PSAPs have changed name, state, county or city compared to only 679 that had as of April 2012. The majority of these took place in California, followed distantly by Nebraska – providing further evidence that dispatch centers in many locations are consolidating efforts and working to cover a wider geographical span.

The below chart provides a visual representation of PSAP locations by city and county in 2012 and 2013, as well as information on where vendors can find the most opportunities.

Analyst’s Take

The number of dispatch opportunities in each of the regional areas has remained steady since 2012, with nine solicitations in the works in Los Angeles and Boston, and 12 within 100 miles of Chicago and 21 within 100 miles of New York City. This should provide some hope for vendors that cities and counties are still interested in purchasing dispatching technologies despite the tough economic climate.

Dispatch technologies are among the most vital tools that police use, and localities have little choice than to purchase new ones once they reach the end of their life cycles. This trend, along with increasing number of PSAPs, is likely to continue as individuals’ ability to report where and when crimes take place becomes easier.

Not a Deltek subscriber? Click here to learn more about Deltek’s GovWin IQ database and take advantage of a free trial.

Deltek releases annual state-of-the-states analysis: Webinar to be held this Thursday

Mon, 29 Apr 2013 15:06:00 -0400

Every year, Deltek analysts carefully comb through all 50 governors’ state-of-the-state and budget addresses to identity crucial trends in rising and falling priorities. Understandably, the past few years haven’t been so fruitful, with states cutting key programs, canceling major projects and shifting efforts to stay afloat amid recession’s strapped-budget undertow.

Fortunately, states are successfully weathering the storm, and this year’s report contains a bevy of potential vendor opportunities as governors’ agendas increased project items for the first time since 2008. Overall, the total number of governor agenda items rose a sharp 11.6 percent from 2012.

In addition to the report, Deltek is presenting a free webinar this Thursday at 2 p.m. EST so vendors can learn how to align technologies with current and emerging policy trends. Go here to register for the free event.

Major take-aways from “State of the States, 2013,” include:

Governors’ renewed interest in performance-based management, particularly in education
More effort to cut corrections and incarceration costs by investing in probation, parole and electronic monitoring programs
Heavy focus on Medicaid expansion (both for and against), and how to reduce its costs
Increased dedication to developing a strong future workforce by establishing a wealth of present educational opportunities, led by digital learning platforms
Amplified justice and public safety initiatives due to natural disasters (Hurricane Sandy) and national tragedies (the Newtown shootings)
Continued plans to streamline and consolidate government operations through technology

The report also breaks down governors’ 2013 goals per vertical market, with several charts detailing the number of agenda items mentioned year to year and technology-specific projects.

The full list of report graphs include:

2013 by vertical
2011-2013 comparison by vertical
2008-2013 average by vertical
2013 Agenda Item Popularity vs. 2011-2013 average by vertical
Top 25 cross-over agenda items
Agenda items with mention of technology, 2013
Agenda items mentioned by state, 2013
Community development, economic development/regulation, natural resources/environment, and transportation agenda items, 2013
Education agenda items, 2013
General government services and public finance agenda items, 2013
Health care and social services agenda items, 2013
Justice/public safety agenda items, 2013

To read the full, 33-page report, please go here. Deltek clients that subscribe to State & Local Industry Analysis (SLIA) may also request (via their Deltek Client Advisor) the Excel workbook containing all of the agenda data compiled for the report.

Lastly, please register for our free webinar this Thursday to learn more about the initiatives and implications of 2013’s state-of-the-state addresses.

Transparency success stories: Tacoma Public Schools

Mon, 22 Apr 2013 11:24:00 -0400

The first step in determining what a government is going to want to purchase in the future is to get a good sense of what it purchased in the past. For this reason, the transparency initiatives undertaken by the Tacoma Public School District over the past few years should be encouraging for vendors.

According to Stevel Demel, contracts and warehouse manager, the impetus to make existing contract information more readily available stemmed from a desire to proactively respond to frequent information requests from the vendor community that bogged the procurement department down in paperwork.

“Prior to 2011, the Tacoma School District Purchasing Department would typically get 3 – 5 public disclosure requests for information per month,” said Demel in a written response to Deltek. “As a result, we spent hours copying and preparing documents for disclosure.”

The idea of making all contract information available online came after the district began utilizing online bidding technology for open procurements. This system already allowed the district to automatically post bid tabulations – a fine feature since one of the most frequent requests Deltek gets from members is who they are competing against for a particular procurement. In late 2011, the district was able to pay for the ability to upload its contracts database to the Web for public viewing, which Demel said has dramatically cut down on ad-hoc public disclosure requests.

Tacoma Public Schools provides contract transparency in three forms: inter-local, inter-district and current public contracts. This provides vendors with more or less visibility into all contracting activity for the district, past and present. Additionally, you can filter your searches to search for all contracts set to expire within the next year, making it handy for quick, lead-generating searches. In 20 minutes, I was able to assemble a table of active IT contracts the district currently holds:

“We are convinced more bidders means more competition and better prices, so ultimately our customers are benefitting from our transparency efforts as well,” said Demel.

However, the drive for transparency does have limits, and Demel is skeptical about openly discussing upcoming projects to foster competition.

“We tend to avoid [pre-RFP discussions] if doing so would limit competition or drive the specification,” he said. “We want to strike a balance between fairness and the need for discussions/information.”

Further, Demel said the best thing a vendor can do to win a contract is homework. Doing so will ultimately help them develop the best value proposal or bid. He also said the worst things a vendor can do are assume that the last bid submitted will win and failing to read the bid document carefully enough during the RFP process. Purchases below $75,000 can be limited to a list of pre-identified companies; anything over that figure should be competitively bid.

Tenth round of HIX funding released

Tue, 16 Apr 2013 10:03:00 -0400

The Department of Health and Human Services (HHS) recently awarded a tenth round of Health Insurance Exchange Establishment Grants. Awardees this time include Arkansas ($16.5 million), Hawaii ($128.1 million), Illinois ($115.8 million), New Hampshire ($5.4 million), and Rhode Island ($9.8 million).

States are able to use these grants to improve and enhance key functions of their insurance exchange. Each grant is made through an extensive examination of funding requested by the state, in addition to an analysis to determine reasonable funding from the federal government. Establishment grants will continue to be awarded through 2014.

Here’s a look at key insurance exchange initiatives from this month’s awardees:

Hawaii: The state will be using funds to hire staff, develop and execute contracts as it continues to develop a robust insurance exchange system. CGI was awarded a $53 million contract in December 2012 to build Hawaii’s exchange. The state has also plans to procure for a Small Business Health Insurance Options Program (SHOP) exchange in the near future.

Arkansas: The state will be using its award to fund an Arkansas In-Person Assister (IPA) Guide program to assist in the deployment of more than 500 certified IPAs to assist consumers across the state during open enrollment. The state chose the partnership model for its exchange and is currently in the process of securing health connector outreach and education campaign services.

Illinois: The state will be using funds for a variety of tasks including recommending qualified health plans, operating its IPA program, raising awareness for its exchange, and implementing systems. Illinois will also be utilizing the partnership exchange model and is in the final evaluation stages for selecting its insurance exchange project vendor.

New Hampshire: The state will be using funds to continue planning and developing its consumer partnership marketplace, which includes hiring consultants to add capacity and manage activities. New Hampshire will be moving forward with a partnership model for its exchange.

Rhode Island: The state will be using funds to assist in the design of its comprehensive IPA program, in addition to developing a product and delivery system for its state-based insurance exchange, which it awarded Deloitte a $105 million contract to build. Rhode Island is also in the process of securing contact center services for its exchange.

Want more? Be sure to check out Deltek’s latest report on insurance exchanges. Deltek’s database contains a wealth of information about states’ efforts in implementing insurance exchanges. Not a Deltek subscriber? Learn more and sign for a free trial, here.