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Montana's 2013 spending forecast

Posted on: May 8, 2013 | Posted By: Alexandra Howden
Related Categories: Fiscal Update, Transparency, IT Services, Procurement, Technology Trends, State & Local

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.

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

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Florida's FY 2014 Budget

Posted on: May 6, 2013 | Posted By: Randi Powell
Related Categories: Government Reform, Fiscal Update, IT Budget, Procurement, Budget, State & Local, Legislation

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.

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

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Highlights of the President’s FY2014 Budget Request

Posted on: April 10, 2013 | Posted By: Angie Petty
Related Categories: Transportation, Fiscal Update, Office of Management and Budget, Department of Defense, Data Center, Department of Homeland Security, IT Budget, Forecasts & Spending, Department of Labor, Department of Energy, Health and Human Services, Budget, Federal, Health Care, Veterans Affairs, Announcements

Today President Obama delivered a $3.8 trillion spending plan to Congress which includes a $1.2 trillion request in discretionary funding levels and nearly $82 billion for information technology for FY2014. The budget focuses on jobs creation, economic growth and to strengthen the American middle class.

The budget proposal also includes $1.8 trillion in additional deficit reduction measures over 10 years to reach a total deficit reduction of $4.3 trillion. The proposed deficit actions would reduce the deficit to 2.8%of GDP by 2016.

Additionally, the budget proposes $400 billion in cuts to health programs including Medicare. Savings and cuts would come from negotiating better prescription drug prices, fighting waste and fraud, and requiring the wealthiest seniors to pay more.

The table below shows the FY2013 enacted budget levels and the proposed FY2014 levels.

Other budget highlights:

Includes $50 billion for upfront infrastructure investments to invest in repairs to highways, bridges, airports, transit systems, and to encourage innovative infrastructure projects
Invests in in education reforms and training with a commitment to early childhood education
Simplifies the tax code and raises $580 billion for deficit reduction by limiting tax benefits, but not raising tax rates
Creates new “ladders of opportunity” to ensure that hard work leads to a decent living by developing pathways to jobs and partnering with communities to rebuild after the recession
Includes $200 billion in savings from other mandatory programs, such as reductions to farm subsidies and reforms to retirement benefits
Proposes $200 billion in discretionary savings from both defense and non-defense programs
Offers $230 billion in savings from changes in the way the government calculates inflation for annual cost-of-living adjustments for benefits programs

Information Technology

The president’s budget proposes nearly $82 billion in IT funding, a 1.8% increase from the FY 2013 CR and a 2.1% increase over FY 2012 estimated level.

IT-related budget highlights:

$575 million in savings is anticipated from DoD Data Center Closures.
$324 million is being cut from the DoD’s Global Hawk UAV program.
$22 million is being cut from Computer and Information Science and Engineering Research Programs at the National Science Foundation; CISE is the organization responsible for promoting R&D on big data. NSF’s budget takes big hits for its small size, which will affect grant spending on technology R&D.
$81 million is being cut from the DoD’s Precision Tracking and Space System, which is part of Ballistic Missile Defense at the Missile Defense Agency.
$38 million in savings related to the Joint Polar Satellite System is anticipated at the Department of Commerce.
$29 million in savings is anticipated from IRS Business Systems Modernization at the Treasury.

All told, the president’s budget request includes 215 cuts, consolidations, and savings proposals, which according to the administration, are projected to save more than $25 billion in FY2014. The budget proposal outlines the administration’s priorities and proposed methods for generating more revenue, cutting costs, and reducing the deficit. However, it joins competing budget plans in the House and Senate. Serious Capitol Hill budget negotiations are not likely to take place until this summer.

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Surviving Sequestration: The 2nd Half of FY 2013 Could See $300 Billion in Federal Contract Dollars

Posted on: April 5, 2013 | Posted By: John Slye
Related Categories: Education, Transportation, Fiscal Update, Air Force, Department of Defense, Department of Homeland Security, Contract Awards, Forecasts & Spending, Policy & Legislation, Procurement, Department of Labor, Department of Energy, Health and Human Services, Budget, Federal, Army, Veterans Affairs, Sequestration, Financial Crisis, Navy

Increasingly, we hear from companies in the federal marketplace that they struggle to plan and forecast their business prospects. There have been so many delays, false starts, and misaligned priorities that it is sometimes hard to know what opportunities are real and how to position your firm to compete. Now, the impacts of sequestration are beginning to ripple through an already skittish market, adding to the uncertainty. Yet, there are some things to consider that might indicate the contracting potential for the rest of fiscal 2013 and beyond.

Whenever things get unbearably uncertain it is important to have access to good data and information, plus a little creative thinking. It is the only way I know how to keep from making reactionary decisions and to get into proactive mode. So when it comes to thinking about the business prospects for the remainder of fiscal year (FY) 2013 it helps to build some historical context.

To get a sense of the historical pace and relative magnitude of federal spending for the remaining two fiscal quarters of 2013 I looked at the reported quarterly contract obligations across the federal government for the last five years. As I have noted in the past, we have seen a shift in federal spending to later and later in the fiscal year. Spending in Q1 and Q2 (in varying degrees) has shifted to Q3 and Q4. Even with some yearly fluctuation, the trend has been fairly stable. (See chart below.)

These shifts have occurred during a period where we have seen increasing use of continuing resolutions (CR), omnibus appropriations and other delays to funding federal agencies. FY 2013 is not particularly unique in this respect, so it does not seem unreasonable to conclude that the trend will hold this year as well.

Projected Spending for the Rest of FY 2013 – a Possible Scenario

Now that we have received data for the first two quarters of FY 2013 it becomes possible to perform some rough projections of what might be still on the table for Q3 and Q4. I used FY 2012 data as a basis to make these projections. For FY 2012, adding together Q1 and Q2 departmental obligations and then dividing that sum by the department’s total obligations gave me the relative percentage of total obligations that occurred in Q1 and Q2. (See the table below for the top 20 federal departments and agencies.)

Assuming that agency contracted spending in FY 2013 will be at least 90% of what it was in FY 2012 (sequestration may represent about a 7% cut, so this 10% difference seemed reasonable to me) I followed a similar approach to calculate estimates for Q1 and Q2 percentages and potential remaining obligations for the remainder of FY 2013.

For example, in the table below the Army had combined FY 2012 Q1 and Q2 obligations of $41.6 billion, which was 38% of their total FY 2012 obligations. The Army had a total of $17.8 billion in contract obligations for Q1 and Q2 of FY 2013, which represents 18% of the projected potential total FY 2013 spend, using my 90% of FY’12 assumption. Applying the percentage left over (i.e. 82%) to my total FY 2013 estimate results in a potential remaining obligation balance for Q3 and Q4 of $79.6 billion for the Army.

Granted, performing estimates at this macro level has its limitations and it requires certain broad assumptions for consistency, like a comparable year-over-year obligation rate and that, to some degree, these expenditures are for recurring needs. Some departments have a measure of cyclicality that is underrepresented in a chart covering just a few years. For example, Energy tends to run cyclically between 40% and 68% for Q1 and Q2 every other year or so like a pendulum. Further analysis into the specific contracts is needed to understand why.

Implications

Comparing the 2012 and 2013 percentages reveals that nearly all of the top 20 departments are behind in obligating funds, even with an assumed 10% reduction in spending from FY 2012. While the one-two punch of delayed budgets and sequestration might explain much of this it still remains that these agencies will need to obligate their remaining budgets by the end of the fiscal year. Even (or especially) in this uncertain budgetary environment, agencies will not likely leave money unspent. It is still a “use it or lose it” world out there. So there may likely be some significant pent-up demand that we could see play out in the remaining two quarters.

If this simple analysis holds even close to reality the potential remaining total contract obligations across all federal departments and agencies could be over $300 billion in Q3 and Q4, or 70% of total FY 2013 contract obligations. The second half of fiscal 2013 could potentially see federal contract dollars really flow.

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New Jersey FY 2014 Budget Analysis: Superstorm Sandy just one ingredient in mounting budget problems

Posted on: April 4, 2013 | Posted By: Derek Johnson
Related Categories: Fiscal Update, IT Budget, Forecasts & Spending, Budget, State & Local, Elections

Of all the budgets rolled out by New Jersey Governor Chris Christie during his four years as governor, the 2013-14 plan might be the most important of his career. A maelstrom of structural funding issues, political ambition and environmental acts of God have placed the Garden State’s finances in a precarious position – one with no clear path to closing the estimated $2 billion revenue shortfall that analysts forecast by mid-2013.

It was just last year that Christie’s administration confidently predicted more than 7 percent revenue growth as part of the “New Jersey Comeback Plan,” and aimed to push through additional tax cuts. However, much of that growth failed to materialize, and by late September, the state found itself more than $250 million short of initial estimates. After Superstorm Sandy wreaked havoc across the Jersey Shore, the resulting economic fallout ballooned the state’s deficit woes to $451 million.

While emergency federal funds passed in January 2013 will help staunch the bleeding from that particular blow, the state still faces some daunting headwinds: a pension crisis that is expected to cost an estimated $5.5 billion annually starting in 2018; the fourth highest unemployment rate in the nation; a perilous choice on Medicaid expansion, and a strong aversion to tax increases or deep spending cuts on both sides of the aisle to help balance the ledger. Adding to this volatile equation is a governor with national ambitions and all 120 state legislators being up for reelection in November.

All-Funds Spending

Faced with this mix of contradictory incentives, Christie unveiled a budget on Feb. 26 that calls for more than $70 billion in all-funds spending for fiscal year 2014. This represents a nearly 9 percent, or $5.8 billion, increase over the 2013 proposed budget. However, when compared to actual spending totals provided by the governor’s office for FY 2013, that increase shrinks to a little more than $1 billion. While topping the $70 billion mark – something not seen in the past five budget years – the state’s general funds are actually operating at around 2008 levels, something Christie boasted about in his address to the state legislature.

The largest gains from last year’s proposed budget were found in the Department of Human Services ($1.78 billion; 13.3 percent increase), the Department of Labor and Workforce Development ($1.58 billion; 32 percent increase) and the New Jersey Transit Corporation ($809 million; 48.8 percent increase). The funding increases in these three departments combined make up more than 70 percent of the increase from last year’s proposed budget. Not surprisingly, the Department of Human Services saw a big increase year over year. With responsibilities for Medicaid and other health care spending, New Jersey is like every other state in the nation struggling to keep up with rising health care costs that threaten to crowd out other budget priorities.

Christie’s decision to embrace Medicaid expansion (and the gobs of federal subsidies that go with it) will yield $227 million in savings this next fiscal year. Built into Christie’s all-funds budget for the department is a $1 billion increase in federal funding, most of which will go toward expanding health coverage to 104,000 previously uninsured, low-income citizens. The overwhelming majority of the non-state appropriated portion of the Department of Labor and Workforce Development goes toward unemployment insurance and bond funds, with about $900 million coming from the state, federal government and other funds. The budget documents do not break out funding for the N.J. Transit Corporation, but the hefty increase may reflect an underestimated price tag for running the state’s public transportation infrastructure in last year’s budget. Though the governor only recommended $1.6 billion of funding in FY 2013, the corporation wound up spending more than $2.4 billion, just $37 million less than what is proposed for FY 2014.

Environmental priorities took the biggest hit in this year’s budget cycle, with the Department of Environmental Protection losing $180 million (18 percent) of funding compared to last year. Funding for the quasi-independent New Jersey Schools Authority nearly dropped off the map, going from $200 million in proposed funds for 2013, to just $435,000 for this upcoming fiscal year.

For the complete version of this state budget analysis, please download or purchase the complete Analyst Perspective here.

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Sunshine Week: Virginia Transparency IT Spending for FY 11 and FY 12

Posted on: March 13, 2013 | Posted By: Derek Johnson
Related Categories: Fiscal Update, Transparency, IT Budget, Forecasts & Spending, Budget, State & Local

Welcome to day three of Deltek’s Sunshine Week transparency blog series. In the lead up to our upcoming transparency report on IT state spending habits, to be published later this month, the general government services state and local team is providing a sneak preview of a handful of states included in the report. Today we will look at the commonwealth of Virginia, which spent more than $348 million on information technology systems, equipment and services in fiscal year 2012.

Contractual services make the lion’s share of the commonwealth’s IT spending totals, with $286 million dedicated in FY 2011 and $281 million in FY 2012. This fact bodes well for the vendor community, though it should be noted that a large chunk of Virginia’s contract spending for common IT needs is likely purchased off of existing term contracts as opposed to one-off technology procurements. Of that contract portion, information management program design and development services ($219.7 million), telecommunications services ($43.9 million) and computer software maintenance ($13 million) are the three largest expenditure categories, and together represent nearly 80 percent of total state IT spending in FY 2012.

From just a cursory look at the data, two things immediately jump out: IT spending overall remains remarkably consistent between FY 2011 and 2012, and the amount spent on specific technologies over this two-year stretch are all over the map. While the state reports only $14,823 of spending on vendor-related computer operating services in FY 2011, that figure jumps to $227,989 in FY 2012 – a more than 15-fold increase. Computer operating services performed by the state’s consolidated technology agency (VITA) is a mirror image, with more than $1 million of contract spending support in FY 2011 compared to just $4,095 in FY 2012.

In isolation, this would make sense and could simply reflect a change in strategy for managing the state’s technology infrastructure. However, this trend shows up over and over again for other spending categories, contractual or otherwise. Technology infrastructure contract spending saw $213,495 in FY 2011 compared to $1.29 million in FY 2012. The state spent $53,973 on computer software rentals in FY 2011 and $313,309 in FY 2012. Computer software purchases rang up $5.7 million in FY 2011 and nearly doubled ($10.8 million) one year later.

Analyst’s Take

From this (admittedly limited) sample, it is possible to make several inferences regarding Virginia’s IT spending strategies. First, that Virginia IT officials prefer to practice binge spending on specific technologies within a given budget year, making upgrades or legacy replacements all at once instead of staggering the purchases according to schedule or individual need. Second, that if you deal with a specific type of IT product (say software rentals or microcomputers) and you want to do business with the commonwealth, you are likely to only get one chance to respond to RFPs or sell your wares every three to four years during the technology upgrade cycle.

Finally, this makes future Virginia spending habits easier to predict, especially since the state updates its IT spend for FY 13 on a quarterly basis. Taking a look at the latest quarterly spending figures and comparing them to last year’s totals can help vendors determine which technologies have been given the purchasing green light by state officials for 2013. For instance, in the first two quarters of FY 2013, the state has already spent significantly more on network servers and network components than it did for all of FY 2012.

The following opportunities are currently being tracked in Deltek’s system and have anticipated solicitation releases in the near future:

Statewide Computers, Peripherals, Commercial Off the Shelf Software and Related Services

Networking Equipment and Services

Enterprise Content Management Integration Services

Deltek will publish a full-length report, “State Government Transparency Report 2013,” providing detailed itemized IT expenditures for the state of Virginia and many other states in the coming weeks.

GovWin IQ subscribers can learn more about these statewide contracts in the provided links. Non-subscribers can gain access with a GovWin IQ free trial.

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California FY 14 budget produces golden results

Posted on: March 5, 2013 | Posted By: Alexandra Howden
Related Categories: Fiscal Update, Transparency, Forecasts & Spending, Procurement, Technology Trends, Budget

On January 10, 2013, Governor Edmund Brown Jr. released the state of California’s FY 2013-2014 budget. This revolutionary budget propels California out of a deficit and sets the stage for successful years to come. California has had an unbalanced budget for the past few years, but this year’s balanced budget provides much-needed stability for the state.

While the governor was able to reduce spending in many departments, he also introduced Proposition 30, which increases taxes on the $250,000 annual income bracket and raises sales and use taxes ¼ cent for four years to fund educational programs. This proposition will provide the state with approximately $6 billion annually to spend on education in an effort to even the playing field for lower-income schools and provide students with equal opportunity. This budget also highlights Proposition 98, which funds educational analysis. The $56 billion accumulation will provide educational programs to K-12 students at a $2.7 billion increase from last year.

Click on image for full-sized.

Considering the $9.2 billion deficit from FY 2013 that was weighing on Governor Brown, this balanced budget is quite an accomplishment. It sets the stage for future years and budgets, and shows that by reevaluating what is necessary and what is not, a balanced budget is quite plausible. In FY 2013, the governor stated that over the next few years he would reduce the state deficit, and he is well on his way with FY 2014’s budget. It offers a multiyear plan that pays down the debt from previous years while also creating a $1 billion reserve safety net. This budget alone will tackle $4.2 billion of the debt by repaying budgetary borrowing.

A full analysis of the California FY 14 budget is available here. Non-subscribers can gain access with a GovWin IQ free trial.

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Texas-sized budget proposals are back in the Lone Star State

Posted on: March 1, 2013 | Posted By: Stephen Moss
Related Categories: Fiscal Update, IT Budget, Forecasts & Spending, Budget, State & Local

As the saying goes, everything is bigger in Texas – and from vehicles, food portions and clothing accessories, to the chief executive’s time in office and the economy – the adage lives up to reality. Nowhere is this more apparent than with a cursory glance at the state’s budget. In 2011, at the height of the fiscal crisis that plagued states, Deltek parsed through the political rhetoric to report on the health of Texas’ budget. In that report, we examined Governor Rick Perry’s proposed budget and found that a budgetary deficit of $27 billion had prompted him to slash spending in nearly every department and vertical, minus public finance. In retrospect, we can report that the depth of the cuts proposed by the governor for the FY 2012-13 biennium were not borne out in the actual expenditures from FY 2012. Indeed, the governor’s current biennium budget proposal contains a near complete restoration of funding to 2011 levels.

In the FY 2014 – 15 biennium budget, we gain an excellent opportunity to compare the proposed budget with actual expenditures. At face value, Governor Perry’s proposals reflect a high point in FY 2011, with massive cuts in FY 12-13, and a near restoration of funding in FY 14-15 (Figure 1).

Click on image for full-sized version

However, the real story, reflected in Figure 2 below, is far different. Yes, the governor proposed a budget for FY 12-13 that was severely cut vis à vis FY 11, but when one observes the actual expenditure data, it becomes clear that the state found it quite difficult to slash the budget across all verticals as originally proposed. The actual expenditures show an increase in funding for the health and human services, general government, natural resources, and public safety verticals. This is a far different picture of fiscal health than the one painted in Governor Perry’s original budget proposal. .

A full analysis of the Texas proposed budget is available here. Non-subscribers can gain access with a GovWin IQ free trial.

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NASCIO divulges state CIO priorities in annual survey top tens

Posted on: December 5, 2012 | Posted By: Derek Johnson
Related Categories: Government Reform, Fiscal Update, Shared Services, Cloud Computing, IT Budget, Forecasts & Spending, Procurement, Technology Trends, Consolidation, Emerging Technologies, Budget, State & Local, ERP, NG911

The National Association of State Chief Information Officers (NASCIO) recently published its 2013 State CIO priorities and priority technologies, based on its annual state CIO survey. The survey is a valued peak into the minds and wish lists of state IT executives, and when compared against past priorities, we can see that consolidating existing IT infrastructure and optimizing it for the future (particularly for the cloud) will be among the highest priorities for CIOs this year.

In this year’s top three, we see a fairly consistent pattern among the states of shifting away from the budget cutting, cost-saving measures of the post-recession years, toward much-needed reinvestment in long-term IT infrastructure. Among last year’s top three, consolidation/optimization remains number one, but budget and cost control falls to number five, and governance drops off the list completely. The second spot this year goes to cloud services, which didn’t even make the list until 2011. Security makes a triumphant return to the top three after being a middle-of-the-pack priority since 2009. In my opinion, these three priorities are all connected and track fairly well with what Deltek has seen in the market over the past few years.

Initiatives to consolidate or upgrade existing data centers have been, or are taking place in Oklahoma, Texas, Florida, New York, Pennsylvania and North Carolina. Among these states, New York, Pennsylvania, North Carolina and Texas require significant cloud capabilities for their new consolidated data centers. In many cases, states are looking to the private sector to implement these initiatives and guide them on the right path. Of course, as the importance of cloud-based IT services rise, so do concerns about secure technologies. While security is no longer the barrier to cloud entry that it has been in the past, it is and will remain one of the top concerns for CIOs as they continue integrating the cloud into their existing IT infrastructure.

2013 CIO Technology Priorities

NASCIO also queries its members about their top 10 priority technologies. While the shakeup from last year’s top three is less pronounced, we continue to see a distinct pattern emerging in the minds of state CIOs. It is clear that many envision a future government workforce that is mobile, virtual and able to access workplace resources from anywhere on the planet. While this likely falls short of representing a harbinger of doom for the face-to-face, brick-and-mortar way of doing state business, the investment in these top three technologies may very well be laying the groundwork for such a future.

Not surprisingly, the new top technology pursued this year is cloud-based services. This comes as no surprise to Deltek, which has seen an explosion of cloud-related procurement in the last three years, as well as procurements for other technologies with specific cloud-integration components built into solicitations. We are quickly approaching the point (if we have not reached it already) where cloud integration requirements for state technology RFPs are the norm, not the exception.

Also notable is the journey of mobile workforce technologies, which hung around as a low-level CIO priority from 2007-2009, dropped out of the top 10 entirely in 2010-2011, and returned this year with a vengeance as the number two priority technology. As cloud computing continues to make it easier for government employees to virtually access their workplace from remote environments, governments are planning to put some serious dollars into making sure their workforce has the mobile computing tools necessary to take advantage of this new environment.

For the full version of this AP with a complete breakdown of policy and technology priorities, click here (subscription required)

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General government state and local ballot initiatives: Education

Posted on: November 12, 2012 | Posted By: Derek Johnson
Related Categories: Education, Fiscal Update, IT Budget, Forecasts & Spending, Policy & Legislation, Procurement, Technology Trends, Budget, State & Local, Elections

While media outlets nationwide concentrate heavily on how Tuesday’s election results will affect federal government spending, contracting and state and local funding, I would like to shine a light on a series of state and local ballot measures that will certainly fly under the radar in the wake of President Obama’s reelection, but may nevertheless have major impact on business, procurement and IT needs. Here’s a breakdown of several measures that are sure to affect the state and local education landscape, lottery and gaming operations, and procurement law:

EDUCATION

Illinois:

- In Chicago, voters have tentatively passed Ballot Measure E, which would provide $78 million for improvements to Chico Unified School District campuses. That is a hefty amount, and there is sure to be a fair amount put toward upgrading the district’s technology infrastructure.

Arizona:

- Prop 204 would have approved a 1 cent per dollar sales tax hike. Approximately 80 percent of the revenue from the tax hike would have gone toward bolstering education funds; contractors within the state largely supported its passage. The measure failed by a 2-1 margin.

Coconino County, Arizona:

- A measure to increase the operating budget for the Page Unified School District in Coconino County would have led to a $1.16 million increase in funding through 2017-18. The measure failed to pass.

Maricopa County, Arizona:

- The West-MEC bond will lead to almost $75 million in bonds to pay for new campuses and vocational training centers for the Western Maricopa Education Center. The initiative will also result in new facilities in Buckeye and North Phoenix, and improvements to existing facilities in Glendale and Surprise. According to the Phoenix Arizona News, the measure was overwhelmingly approved.

California:

- The passing of Governor Brown’s proposition for a sales and income tax increase (Prop 30) was a major win for education. The measure is expected to raise $6-$9 billion in additional revenue for schools. Brown’s measure will raise taxes on high-income earners and be retroactive to all revenue earned since January 1, 2012. This measure will presumably stave off massive cuts to California’s education system that would have had devastating long-term effects on education procurement in the most populous state in the nation.

- Butte County’s Gridley Unified School District failed to pass a measure to borrow $11 million to “improve student access to computers and modern technology.”

Many states and localities had ballot initiatives seeking to secure funding for education and schools through the issuance of bonds, tax increases or other forms of borrowing. In the vast majority of these cases, the intention was not to find new money, but rather find ways to continue status-quo funding or bolster large funding shortfalls. While this will not necessarily result in a wave of new spending on education or education IT, at the end of the day, the money will be used to preserve existing programs and contracts that would otherwise be canceled or discontinued without new sources of revenue. This represents more of a “staunch the bleeding” act for many governments, but if it means that existing contracts have enough funding to be re-bid moving forward, that will still result in a net gain for government contractors.

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