The National Institute of Justice's (NIJ) Research, Evaluation, and Development Projects Grants program released a new grant solicitation this week for Sensor, Surveillance, and Biometric Technologies for Criminal Justice Applications. As part of this grant, which I find particularly interesting, the "NIJ seeks proposals to develop a sensor system capable of detecting a handgun concealed under clothing on an individual at least 15 meters away from the sensor. NIJ also seeks proposals for research to better characterize the degree to which current solutions address this need."

Some quick background information on the grant: the NIJ is authorized to make grants to states, units of local government, nonprofit and for-profit organizations, institutions of higher education, and certain qualified individuals. For-profit organizations must agree to forgo any profit or management fee. All applicants are required to register with Grants.gov before submitting an application, and all applications are due February 14, 2011.

As a senior analyst at GovWin, my primary responsibility is to follow government purchasing activities in the state and local justice and public safety marketplace. Thus far, I have not seen any public safety organizations release a solicitation for handgun detection technology, yet I think many would quickly embrace it should the research and development activities produce successful results.

Handgun detection technology, if perfected and reasonably priced, could quickly move from a want, to a need, to a must-have item for police departments. The sales pitch is about as simple as it gets. "Would you like to know if someone approaching you is armed." Most likely, the answer from any law enforcement officer would be, "Of course I would." However, I don't want to get too far ahead of myself with projecting the spread of this technology. In the near future, we are likely to see it show up on an episode of "CSI" than at the local police department. A quick look at the headlines shows the recent uproar over the TSA's use of body-scanning technology, so it is likely that any implementation of handgun detection technology would garner some privacy concerns.

I plan on following this grant very closely. A successful, NIJ-funded research and development strategy could really help legitimize the need for this project and accelerate its spread in the marketplace.

On November 23, 2010, Governor David A. Paterson attended a ceremonial signing of the minority and women's business enterprise (MWBE) Emerging Managers bill (A.9976-C / S.6888-C), which will expand diversity and opportunity of MWBE contracting goals.

"I am pleased to sign this bill into law, as part of my administration's ongoing efforts to ensure our state corrects the long-standing disparities in government contracting and procurement," Governor Paterson said. "This legislation is another step we as a state have taken to improve equity in the procurement process and facilitate greater access for minority and women-owned business enterprises. Through such actions and initiatives, we not only help businesses thrive, we will help our state back on the path of economic recovery and prosperity."

In just four years, New York state has surpassed its hefty goal to increase the percentage of MWBEs taking part in technology procurements. In 2007, the New York state Chief Information Officer/Office of Technology (CIO/OFT) set an ambitious target of raising the MWBE participation level from less than one percent to 20 percent by the end of 2010. At last week's Tech Sector MWBE Forum in Albany, the CIO/OFT celebrated exceeding the goal ahead of schedule.

"I am extremely pleased we met and exceeded our challenging goal. Promoting supplier diversity in state technology contracts has been a top priority of the governor's administration and CIO/OFT," said Melodie Mayberry-Stewart, the state's CIO and OFT director, in a press release.

A May 2010 study conducted by New York's Empire State Development agency revealed statistical and anecdotal findings of discrimination against MWBEs in the state's private-sector market. The study, based on mail surveys and interviews, concludes that MWBEs are more likely to be refused credit due to race and gender influence. It also details the number of underutilized MWBEs in state contracting from April 2004 to March 2008.

During the forum, Dr. Mayberry-Stewart highlighted 11 global IT Corporate MWBE Lead Champions that voluntarily expanded use of MWBEs and met or exceeded their IT-supplier goal by 2010. The pioneering corporations are: Dell, Deloitte, EMC2, Hewlett Packard, IBM, Microsoft, infrastructure technologies, Oracle, Tandberg, Unisys, and Xerox.

New York state has quickly become a model for success for MWBEs. The state's MWBE database, one of the nation's largest, currently has nearly 7,000 certified minority- and women-owned businesses. Along with hitting its participation level goal, the state catapulted its contract award rate nearly 25 percent and rapidly sped its certification process. Today, the state's Division of Minority and Women-Owned Business Development (DMWBD) certifies firms in three months – a mighty cut from the lengthy 24-month process of 2007.

The DMWBD recently launched a website to attract more certification activity. With a mission to "to promote equality of economic opportunities for MWBEs and to eliminate barriers to their participation in state contracts," the website offers certification details, resources for technical assistance, access to capital, contract opportunities, event listings, and a revamped vendor registry search engine for identifying certified MWBEs.

While New York state maintains focus on raising MWBE procurement participation, GovWin will continue monitoring MWBE activity in our database of conference attendees, bidder's lists and awarded vendors. New York state's success may be the first domino toppled in what could be a nationwide movement toward increased MWBE involvement.

With so much rapid legislation surrounding the implementation of health care reform taking place, it is easy to shy away from determining whether or not the main goal of lowering costs and improving efficiency is really being achieved. With the reform bill passed and essentially catalyzing the development of various information technologies, it is now time to think about what will tie all of these systems together. Cloud computing – a form of Web-based processing that allows for the sharing of resources, software and information – may be the final IT piece to the health reform puzzle. States are involved in creating and/or maintaining current eligibilities systems and health information exchanges, which poses the question of how the information will flow seamlessly through departments within local governments. Cloud computing allows information to be shared in an efficient manner.

IBM, in conjunction with Aetna, recently brought its cloud-based health solution services to Puerto Rico. The recent agreement with Medens Corp. – a Dorado, Puerto Rico health IT firm – authorizes Medens Cloud, a cloud-based SOAPware EMR and practice management system. The Medens Cloud will increase efficiencies by providing an assortment of services allowing doctors to easily manage medical and financial data. Earlier this month, IBM launched Federal Community Cloud, which is used to assist in claims processing and research. The cloud has a high level of privacy and security and aids in the processing of electronic benefits claims, in addition to identifying waste, fraud and abuse in programs like Medicare. The New York Conference of Mayors (NYCOM), along with the Michigan Municipal League (MML), will be working with IBM to help member municipalities operate more efficiently. NYCOM and MML intend to collaborate on a pilot testing IBM's Municipal Shared Services Cloud.

According to research by Gartner, spending on revenue from cloud computing services is expected to grow from $68.3 billion in 2010 to $148.8 billion in 2014. However, some issues have been raised concerning security with cloud computing. These concerns may influence whether cloud computing is used in areas such as electronic health records, where patients have more control over where they choose to store information.

GovWin's Take:

With progress in health care reform, and cloud computing systems being built and implemented, vendors can expect to see more focus on true integration and sharing of information. For that, vendors should start brainstorming ways in which information can be seamlessly and securely shared to cut costs and improve efficiencies in health care. Also, the trend of quickly obtaining information makes the element of "real-time" an extremely appealing component to health IT. Information sharing is inevitably the final step in improving the deliverance of health to citizens; therefore, there must be a connection amongst these systems.

Back in June, then OMB Director Peter Orszag announced an immediate review of twenty large Financial Systems IT projects to determine their project performance and cost effectiveness. We now have a glimpse into the result of these reviews. During his opening remarks at the Northern Virginia Technology Council's Titans Breakfast this morning U.S. Chief Performance Officer Jeff Zients gave those in attendance some basic data on the results that may serve to set expectations for future projects of similar size, scope and purpose.

Preliminary Findings of the Financial Systems IT Projects Review

• 10 programs were deemed on track;
• 5 programs received a reduced scope;
• 3 programs were accelerated;
• 2 programs were terminated;
• $1.6 billion in IT budget was redirected; and
• Overall delivery time was reduced by half.

• Smoke does not always mean fire.  Half of the programs target by the review received a “passing grade” and only two were canceled. Many will recall that the original review announcement sent veritable shock waves through the inside-the-beltway IT community. Now that the reviews are finished we find that maybe they were not so bad after all.
• Reviews can result in more resources. While we do not yet have the details, it seems reasonable to conclude that the three programs that were accelerated likely received additional resources.
• Scrutiny does not mean less spending. Notice that the $1.6 billion was redirected, not canceled or saved. We do not yet have visibility into where this money went and it may not have gone to IT. But it went somewhere which means some other activities got a boost.
• A “microscope” can be a time-saver. It is unclear whether the 50% delivery time reduction could have been produced without a “stop-work” review, but it seems unlikely. If nothing else, it gave those involved the opportunity to step back, assess the situation and choose a course alteration. 

In my previous blog, I pointed out a few of the technology investments that the California Department of Corrections (CDCR) has planned for the coming years. In this post, I have contrasted the department's technology plans with its current budget problems. When comparing the ambitious technology projects with the reality of the CDCR's funding issues, it brings the question of whether or not the department will be able to pay for any of this. At this point the best answer is "probably". A definitive "no" is not appropriate because a rise in incarceration rates, coupled with a continued decrease in the tax base, could force the department to cut all nonessential spending.

The state of California Legislative Analyst's Office released California's Fiscal Outlook: The 2011-2012 Budget , on November 10, 2010. This report estimates that in 2010-2011, California will spend about $1 billion more than originally budgeted for corrections. Total spending for the CDCR operations are estimated to reach a staggering $9.3 billion this year. On November 18, 2010, the LA Times reported that seven in 10 Californians support slimming down the state's corrections spending. The Times also pointed out that Californians have been influential in increasing the burden on corrections budgets in the past by supporting ballot initiatives that created tougher sentencing laws. These statistics bring to light the difficult situation that public officials face in trying to develop a more efficient state prison system.

California will have to find ways to rein in the prison population to achieve any sustainable reductions in the CDCR budget, but some relief is in sight. in the coming year Inmate and parolee populations are projected to drop . Last year, inmate good-behavior credits were adjusted to provide inmates with more opportunities to earn credits to reduce their sentences which accounts for some of the projected drop. However, one statistic that the CDCR released on November 18, 2010 points out that a short-term drop in headcount may not be a cure all In FY 2005-2006, 67.3 percent of inmates returned within three years. Without engaging the state legislature to change laws to divert the flow of felons from prisons to alternative sentencing methods, or early-release programs, the department must hope for a drop in the crime rate to lower the headcount. Although, the question of how to bring about a sustainable drop in the statewide crime rate is a question better suited for sociologists than a technology blog.

One way to immediately cut prison spending is to reduce staffing. Outgoing Governor Schwarzenegger utilized furloughs as a cost cutting mechanism. At best, furloughs represent a short-term solution to a long-term problem. With most state prisons already well past their intended capacity, any reduction in staff without an equal reduction in prisoners could present serious challenges to maintaining order. It is worth pointing out that two of the technology projects listed yesterday – Investigate Alternative Statewide Transportation Unit Radio System and Replace/Upgrade all CDCR Institution Radio Systems – would bring about significant improvements to maintaining order and correctional officer safety by streamlining communications inside and outside of correctional facilities. The CDCR must maintain a difficult balance because it must plan for the exact number of employees on the payroll each year, but can only estimate how many inmates will enter the system.

Technology vendors will have to continue to plan ahead to go after these opportunities. Vendors need to wait to see if the state moves forward with an aggressive long-term plan to rein in the prison system, or makes minimal cuts while pushing the problem down the line from fiscal year to fiscal year.

On October 29, 2010, the Department of Health and Human Services (HHS) announced the Early Innovators Grant, which allows states to apply for federal funding to set up health insurance exchanges that will serve as models for other states. The level of funding will depend on how complex the states propose their system design to be.

According to the Q&A recently released by HHS, states will be awarded grant funding based on the following:

• Progress in assessments and gap analysis for establishing an exchange
• Achievement of an advanced state of readiness in engaging in early phases of a systems development life cycle process
• Demonstration of technical expertise to accomplish an accelerated development schedule
• Demonstration of a clear understanding of the importance of using standards
• Commitment to their use in the exchange
• Commitment to establishing an exchange that serves their state
• Sharing of specification, design, implementation, test methodology and results of their exchange IT systems solutions with other states
• Compliance with any IT guidance relating to the exchange or Medicaid issued by HHS and continuance of updating their plans based on changes to guidance

Further, the two-year grant, due on December 22, 2010, will award up to five states or coalitions of states. Funding is expected to go out on February 15, 2011. States exemplifying a high level of innovation, consumer-friendliness, and assurance in efficiency will be selected as leaders for the health insurance exchange market. GovWin is currently tracking over 40 opportunities relating to these exchanges and recently released a report on the new market which can be found here.

Over that past few weeks, the state of California has released quite a bit of information regarding future technology plans for the California Department of Corrections (CDCR). On October 20, 2010, the Office of the Chief Information Officer released the state Public Safety Communication Strategic Plan, and on November 12, 2010, released a report by the Sex Offender Supervision and GPS Monitoring Task Force I have highlighted the planned corrections technology projects below. Tomorrow, I will follow up with a blog contrasting the ambitious technology plans with the fiscal pressures the CDCR is facing.

Technology Plans :

Sex Offender Monitoring Center (GovWin Opportunity # 638254)

The task force recommended that the CDCR create a sex offender monitoring center to keep tabs on the 6,000+ sex offenders currently on supervised parole with GPS monitoring. This center would allow the state to consolidate resources to ensure all parolees are monitored effectively with all GPS alerts investigated. At this time, it is unclear how much technology purchasing would result from the creation of this center, but purchasing could include items generally found in a fusion center, such as monitors, desktop computers, dispatch stations, servers, and redundant power sources.

Refresh Radio Equipment for Parole

The Public Safety Strategic Plan indicates that "CDCR's Parole and Office of Correctional Safety units are dependent on a combination of cell phones and borrowed local agency radios for emergency communications." The plan calls for a refresh of these radios in the next two to three years with standards-based, multiband interoperable radios. This could result in increased purchasing from statewide term radio contracts (GovWin maintains opportunity reports for all of these contracts), or possibly the establishment of new contracts based on changing requirements.

Investigate Alternative Statewide Transportation Unit Radio System (GovWin Opportunity # 66590)

The CDCR reports that "transportation units have become overly dependent on cell phones and 911 for communications and emergency support." This is particularly troubling because many of the largest facilities are located in remote areas of the state, and having corrections vehicles travel through areas of spotty cell phone service could present serious safety concerns. The state would like to look into a statewide transportation unit radio communications system. This project is likely several years out. I expect to see the CDCR move forward with a request for information (RFI) or consulting engagement in the shorter term in order to get a better idea of what solutions the market can provide and how much they might cost.

Replace/Upgrade all CDCR Institution Radio Systems (GovWin Opportunity # 66539)

Of the proposed corrections technology projects, this one is by far the most involved and the most needed. The Public Safety Communications Strategic Plan states that all institutional radio systems must be replaced within three years. The CDCR maintains 33 adult facilities across the state. Quite a bit of work must be done in terms of planning and engineering studies to develop systems capable of serving large prison campuses, many of which are very old and not constructed to facilitate in-building radio coverage. The report calls for planning to begin immediately, and I am interested to find out how the state decides to proceed.

Stay tuned tomorrow for a look at the CDCR's financial stresses, including the California Legislative Analyst's Office's estimate that it will exceed its annual budget by nearly $1 billion.

During a November 15, 2010 meeting, the New York Metropolitan Transportation Authority's Metro-North Railroad and Long Island Railroad committee heard a motion to approve a list of prequalified vendors for MTA's all-agency, as-needed Information Technology Consulting Services project (Contract # 70816)(GovWin Opportunity # 638254). This project was formally bid in April 2010, with proposals due June 2010. The request for proposals (RFP) process resulted in 66 proposals received, in which 38 firms were prequalified. The prequalified vendors are as follows:

• 22nd Century Technologies
• A-1 Technology
• Aegistech, Inc.
• Artech Information Systems
• ASR International
• Avaya
• Bowne Management Group
• CMA Consulting
• CMC Americas
• CompuForce
• Computer Aid, Inc.
• COMSYS
• Derive Technologies
• DTG Consulting
• EKI Consulting
• Enterprise Engineering
• ExpInfo, Inc.
• Infopeople Corporation
• InfoSys International
• InTrans Group
• Lancaster Systems
• PruTech Solutions
• PSI International
• QED National
• RCG Information Technology
• Rotator Staffing Services
• Sharp Decisions
• SoftSol
• Staffing Solutions USA
• Tailwind Associates
• Technisource
• Technodyne
• TekSystems
• Unique Computer, Inc.
• Universal Technologies
• US Tech Solutions
• Verizon Business
• V Group, Inc.

The firms have been selected to cover the 65 categories of IT-related work. Some of the consulting services include, but are not limited to: development or maintenance of various microcomputer-based application programs; test planning and execution using automated test tools, installation, and maintenance; and troubleshooting of microcomputers and telecommunication services. The contract is for five years and has a not-to-exceed budget of $32.37 million.

GovWin's justice and public safety team recently released a report titled "Public Safety Interoperable Communications 2010-2015." The report primarily covers public safety interoperable communications, funding, legislation, and upcoming opportunities. This report is particularly well-timed because the Federal Communications Commission's (FCC) narrowbanding completion mandate is only two years away. It is estimated that $38.7 billion will be spent on public safety communications due to the mandate, which was first announced in 2004.

The report covers:

• Background on public safety interoperable communications
• Legislation
• Funding
• Technology
• Contracting Opportunities
• Recommendations for vendors

Public safety interoperable communications remains at the forefront of public safety spending and is significant for a number of reasons. Sixty-eight percent of state homeland advisors saw interoperable communications as a top priority in 2009. $593 million was requested through earmarks for public safety communication efforts for 2011, and GovWin has uncovered more than $4 billion in upcoming public safety communications projects through 2015. This is a burgeoning market, and GovWin's latest report will help vendors stay on top of new developments.

The report aims to help government contractors in several ways. Government vendors will learn the importance of public safety interoperable communications, along with significant state legislation and priorities, such as D-block allocation legislation. The report will also help government contractors identify current funding streams from the Department of Justice and the Department of Homeland Security. Finally, GovWin has identified past, present, and future contracting opportunities for vendors, in addition to identifying helpful approaches for being a key player in the interoperable communications marketplace.

Due to the FCC narrowbanding mandate, state and local agencies have been forced to reevaluate their existing communications infrastructure. They have the option to either narrowband their existing infrastructure or replace their entire system. The 2007 public safety interoperable communications grant provided nearly $1 billion for agencies to evaluate and assess their level of interoperability, while providing necessary funding for new purchases. Due to these factors, state and local agencies will be willing to spend more money for reliability and coverage on interoperable communications. This will also ensure that interoperability will remain a top priority for state and local public safety officials in the future. Events ranging from catastrophic to every-day will fuel this market's growth.

It is imperative that vendors continue to be involved in the interoperable communications market, especially as we get closer to the FCC mandated 2013 narrowbanding deadline, when more state and local agencies will be looking to update their systems. Vendors should pay close attention to awarded grant funding and earmark requests. They should also follow development standards and make their equipment standards-compliant. For more information on the public safety interoperable communications market, download the full report HERE.

The 2010 mid-term elections are done and the dust is beginning to settle. But for how long? The House is now controlled by Republicans and Democrats retained the majority in the Senate, but each has new players in the mix. Although there's not much action yet - incoming members of Congress are trolling for office and parking spaces and the existing Congress is preparing for it lame duck session - the picture for federal contractors is slowly coming into focus. It all comes down to three things: insourcing, oversight, and spending.

Last week I attended an interesting session conducted by the law firm Venable, LLC, home to former Deputy Administrator of the Office of Federal Procurement Policy (OFPP), Robert Burton. Three other attorneys gave a useful look into the impact of the election on the structure and focus of several committees, but as a hunter for all things related to federal contracting, I was there to validate some of my thoughts about the impact with Mr. Burton as well as get his insights into other areas of focus. He delivered predictions for the new Congress, which I'm delighted to say concur with GovWin's initial thoughts (and he introduced a couple of new insights for consideration):

#1: Expect Republicans to revisit the ban on public-private competition (A-76). If you recall, the FY2009 Omnibus bill placed a moratorium on public-private competitions due to criticism around the costs and length of time to conduct competitions, the methods and information agencies were using to calculate long-term, and the age-old question about inherently governmental functions. There is already an anti-contractor sentiment in the air (even with the realizations that insourcing may not yield the intended cost-savings), so I would not be surprised if this issue is revisited as the government tries to rebalance the employee/contractor workforce.

#2: More focus on small business. Burton believes that we'll see more hearings about the impact of the Obama administration's procurement rules on small business (including insourcing). This seems highly likely considering the administration's conviction that the key to saving our economy is small business. They need fair opportunity to win work that will result in jobs, which in turn reduces unemployment and increases tax revenues. The tone so far has been around parity – not just in producing fairness in competition between large businesses and small businesses, but also within the small business community in terms of the special status programs, such as women-owned businesses and Alaska Native Corporations.

#3: Legislation vs. regulation maneuvering. This in particular will be very interesting to watch. The Obama administration has spent a good deal of time on several pieces of legislation to the chagrin of many Republicans. However, we've also seen a good deal of regulation directing significant changes to how agencies operate. With the mood emerging from the new Congress, it makes perfect sense for the administration to pull back on legislation, which obviously is MUCH harder to accomplish, and focus more on the regulatory side which provides a much easier avenue for setting priorities and circumvents the need for Congressional interaction. However, Rep. Darrell Issa, the Ranking Member of the House Oversight and Government Reform Committee, will likely present a major roadblock to this approach by using legislative reform to address regulatory reform. In September, he released a report entitled, ""A Constitutional Obligation: Congressional Oversight of the Executive Branch," which sets the tone for the future stating that "today, at a time of unprecedented expenditures and growth in the federal workforce and its presence in Americans' lives, with all the potential for fraud, waste, and abuse such growth carries with it, the Democratic-controlled Congress has consciously abdicated (the report's emphasis, not mine)its Constitutional responsibility to provide oversight of the Executive Branch."

While many would argue against the growth of the federal workforce (it's actually remained pretty flat for the past decade, especially compared to spending), and lack of oversight (leadership over at DoD and DHS in particular would probably laugh out loud considering the number of Congressional reports they produce) in the statement, it sets a clear path for where this committee may go in the 112th Congress. I read this as establishing roadblocks wherever the administration goes on whatever avenue it chooses. However, Burton warns that some procurement policy reform could be tempered in the short term – he expects OFPP to be busier preparing testimony for the new Congress than with rewriting actual policy.

#4: Focus on reduced spending. This is almost a no brainer considering all of the rhetoric we heard leading up to the elections, but it bears noting that Burton agreed that that are some areas that WILL see growth, including IT (including Health IT and cybersecurity) and battling waste, fraud and abuse. He expects Issa to conduct more hearings about the latter. It seems that the momentum behind cutting costs is rapid, but as Stan Soloway, President of the Professional Service Council stated at our recent FedFocus event, the question is whether the government will use a scalpel or a hatchet. But there are even bigger questions in my mind, like where the scalpel or hatchet will be used and who will make the decisions about where and how to cut (Congress, the administration, agency leadership? Likely all three.).

#5: Revisiting specific contracting initiatives. I've rolled a couple of things into this area for the sake of simplicity. There are two legislative and regulatory issues that impact federal contractors that, according to Burton, will receive new attention (one possibly in the near-term and the other further out):

• 3% Withholding Tax on Federal Contracts - Section 511 of the Tax Increase Prevention and Reconciliation Act (TIPRA) of 2005 (signed in May 2006), will require federal, state, and local governments to withhold 3% of the total contract from all payments for goods and services to guard against possible business tax evasion. It's set to go into effect in January 2012. This is intended to be similar to individual's withholding tax in which the IRS takes a percentage throughout the year to use as a credit against your total tax burden. Only this would be for each new contract over $10,000.

  Burton is of the mind that this will likely be eliminated or delayed. One reason could be the impact on small business. He suggests talking with the freshmen coming into Congress about the small business implications; several of them are small business owners themselves and may be more receptive to a discussion. However, in a time of fiscal anxiety, this revenue-generating plan may still have legs.

• High-road Contracting – Earlier this year there was a hailstorm of talk around a plan that the administration is considering to require agencies to consider a company's labor, employment and compliance reports, as well as compliance with tax and consumer protection laws when evaluating bids. It's clearly not a priority, but the administration's focus on acquisition regulations seems to be keeping it alive. Some Republicans have already expressed their concern - in September 2010, 29 GOP Senators wrote a letter to SBA Administrator Karen G. Mills about the proposed rule. It's controversial, but most likely not dead.

The remainder of this year will be taken up by jockeying for leadership positions (such as Nancy Pelosi's unexpected and not so welcome bid for Minority Leader as well as committee positions) and a lame duck session that will likely focus on passing an FY2011 budget and deciding whether to extend the Bush administration's tax cuts. Next year will clearly be when we begin to see the real fallout from the elections.

GovWin Federal Industry Analysis (FIA) subscribers can track future coverage of the impact of the 112th Congress and all things federal contracting via our Analyst Perspectives blog/newsletter ( log-in required).