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North Carolina’s road to long-term success

This year, North Carolina Governor Pat McCrory made it clear that the state’s reliance on quick fixes is over and that his goal is to begin focusing on long-term reparations to ensure the state’s ability to provide for its citizens.

The below graph provides a visual representation of North Carolina’s budget from FY 2010 through FY 2015.

                                   

Governor McCrory’s major focus areas include increasing the State Repair and Renovation Fund to launch a 25-year plan to replace and upgrade aging infrastructure. He is also looking to increase the Information Technology Systems Reserve in an effort to fund high-priority IT projects taking place throughout government agencies. These are quite ambitious projects given the state is only increasing the overall budget by 3.6 percent in the first year, and while the governor has indeed asked for a significant increase in the IT Systems Reserve, it comes at the cost of the Office of Information Technology. While the IT Initiative Reserve is set to increase by nearly $35 million between FY 2013 and FY 2014, the Office of Information Technology is losing more than $39 million. Therefore, technology dollars are more so reshuffling existing resources, and there will actually be less money available in the next few years for IT projects.

Overall, the structure of the state’s departments has remained unchanged over the past few years. The one significant exception is the dissolution of the states’ Departments of Correction and Crime Control and Public Safety, and the advent of the new Department of Public Safety. Funding for the new department remained consistent with the funding levels of its predecessors, and no major initiatives, IT or otherwise, are planned for the next two years.

Unfortunately, not all budget changes involved a simple reshuffling; some departments lost significant amounts of money. The biggest loser was the state’s Department of Commerce, which lost more than $3 billion, followed by the Department of Transportation’s $1.5 billion loss, though it is likely that at least some of that loss was transferred to the Repair and Renovation Fund. 

Analyst’s Take

The small increase in the state’s overall budget means that most departments will maintain the status quo for the next two years. Few costly initiatives are planned, and as the governor stated, the next few years will be used to set the stage for long-term growth.

While the overall budget remains fairly steady over the next two years, the IT budget has dropped significantly, which will likely have an impact on spending for the next few years at least, especially for those interested in the community development, general government and natural resources verticals. As expected, health care continues to be a growth area as well as economic development and regulation, which will likely be heavily focused on regulation and compliance.

Vendors interested in finding out more about North Carolina should check out Deltek’s state profile application.

GovWin Recon - May 31, 2013

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts. 

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Big Data / Analytics:

Mobility:

Defense / C4ISR / Embedded Technology:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

Idaho's FY2013-2014 Budget

Governor “Butch” Otter introduced the 2014 Idaho budget earlier this year, which will see a nearly $300 million increase from FY 2013. Of the $162 million in increased state revenues, nearly half will be transferred to the Budget Stabilization Fund, which will rebid the state’s savings accounts depleted during the recession. Figure 1 below shows total state spending starting in FY 2010.

 

 

Medical Assistance Services saw an increase of $77 million to a total FY 2014 budget of $2 billion. Health and human services spending for the state comprises 39.3 percent of the total state budget, with education spending following at 35.2 percent. The Department of Labor saw a $66 million increase, and Public School Support rounded out the top three with an increase of $57 million. Very few departments saw decreases in spending from FY 2013-2014, with the highest drop of $37 million in the Idaho Transportation Department.

The total IT spending for the state decreased by approximately $9 million in FY 2014, bringing total spending to $72.9 million. Some notable projects in the budget included $1.6 million for a benefit and tax system upgrade in the Department of Labor; $5.2 million for a GenTax upgrade for the Department of Revenue and Taxation; $1.7 million for Phase III interoperable communications for the Idaho State Police; and nearly $21 million for the Electronic Health Record (EHR) Incentive Program.

 

Despite tough times that followed the economic recession, Idaho has rebounded with increased revenues that are being used to restart its savings program for the long haul. Vendors working in the education and health and human services space should check out Deltek’s analysis on Idaho’s budget here, and brush up on the Deltek’s state profile application. For a free trial, please click here.

GovWin Recon - May 30, 2013

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts. 

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Big Data / Analytics:

Mobility:

Transparency and Performance:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

Mergers and Acquisitions:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

GovWin Recon - May 29, 2013

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts. 

 

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Big Data / Analytics:

Mobility:

Transparency and Performance:

Waste, Fraud and Abuse:

Defense / C4ISR / Embedded Technology:

Legislation:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

 

Open Government Data Ramps Up

This month’s executive order and administrative policy on open data come four years after the launch of data.gov and an order tasking agencies to provide at least three “high-value datasets.” The hype is already building around the impact of the next phase of open government data.
 
Following the executive order issued on May 9, 2013, Making Open and Machine Readable the New Default for Government Information, the Office of Management and Budget (OMB) issued an Open Data Policy establishing guidance for agencies to release data in “open, machine-readable formats.” (Even the policy itself is open.)
 
Over the next three months, agencies are expected to incorporate this new policy into performance goals. A six month timeline is set for agencies to update policies and create public listing of available datasets. Within 30 days of the policy release, federal chief information officer Steven VanRoekel and federal chief technology officer Todd Park were tasked with publishing “an open online repository of tools and best practices.” Not long after the policy announcement, OMB and the Office of Science and Technology Policy (OSTP) launched Project Open Data, including implementation guidance, tools, resources, and case studies. Within 90 days, OMB will integrated the policy into governance for purchasing of agency IT systems and services.
 
The Sunlight Foundation’s John Wonderlich responded with enthusiasm to the release of more government data, but he noted that delivery of this data is supposed to be done without any additional spending. Agencies are also supposed to take the “mosaic effect,” piecemeal information combined to pose a risk, into consideration with the information they make public. So, before disclosing information, other publicly available data (in any medium, from any source) could be combined to identify an individual or pose another security concern. This raises question about what datasets agencies will release. As Wonderlich noted, “Concerns like cost, privacy, and security will be used to justify non-disclosure (as they often are), and will be used to try to justify keeping even a description of many datasets private.” This suggestion reiterates that the barriers to delivering high value datasets are not technical ones.
 
Last May, with the Digital Government: Building a 21st Century Platform to Serve the American People, agencies were directed to create public application programming interfaces (API) the could be leveraged by government and private developers. And, on Thursday, May 23, 2013, government officials will release the final set of almost 300 APIs that will enable users to stream information from agencies to computers, websites and mobile applications. Officials will continue adding API’s to the list after the launch. It’s hoped that this API catalog will enable private companies and non-profits to leveraging government data, as with Global Positioning System data. In remarks delivered in Austin, Texas on May 10, 2013, President Obama explained that greater access to government information will “fuel more private sector innovation and discovery,” yield entrepreneurial opportunities, enable startups, and promote economic growth. It also has the potential to improve the solutions available to government organizations.
 
The increasing liberal use of the phrase “treasure trove of data” in referring to the measure of information within the government calls to mind another expression about the relative nature of “treasure.”  While developers will put data to work, the value it returns will rely on the viewpoint. For the most part, open government data has been outward facing, related to products and activities of agency mission areas. Inward looking information, related to management and decision making, comes sparingly by comparison. 
 
Government contractors expand and improve current products and services stand to benefit from the move toward open data. Since, open and machine readable data will be part of governance for federal IT purchases going forward, products and services that currently meet those requirements will be well positioned.
 

Originally published for Federal Idustry Analysis: Analysts Perspectives Blog. Stay ahead of them competition by discovering more about GovWinIQ. Follow me on twitter @FIAGovWin.

Agencies Evolve Toward Cloud and Leading Cloud Vendors

Recent data released by OMB shows that federal agencies spent $4.5 billion on cloud computing services in FY 2012 and 2013. OMB estimates that agencies will spend another $2.2 billion on cloud services in FY 2014, bringing the three year total to $6.7 billion. This data shows that the federal perspective on the cloud is changing, a development that is to industry's benefit.
 
When the White House published the President’s Budget Request for Fiscal Year 2014 back in April, the materials released included an Excel workbook called the Exhibit 53C.  This workbook provided data documenting federal spending on cloud based solutions in FY 2012 and FY 2013, and it provided an estimate for anticipated cloud spending in FY 2014.  Taken together, these numbers reveal that federal agencies have spent a total of $6.7 billion on cloud computing since FY 2012.  The deployment type of the cloud solutions that agencies have been buying shakes out as follows:

Two conclusions can be drawn from this data:
 
First, it is clear that cloud solutions are a hit with federal customers.  FY 2013 in particular was a good year for cloud service providers as federal agencies spent a total of $2.3 billion.
 
Second, federal customers overwhelmingly prefer private cloud solutions.  If projected spending in FY 2014 is any indication, this trend is likely to continue as feds ignore the cost benefits of moving to public, community, and hybrid of clouds in favor of a private cloud model that fits their comfort level.  The takeaway from this is that federal customers have overcome their initial hesitation about the security of cloud computing, but they have also chosen to hedge their bets.  Could this be one of those rare moments when we are witnessing evolution?  Federal customers are still risk-averse, but at the same time they are showing signs of innovation too.
 
Leading Cloud Vendors
 
Turning to the other side of the story, who in industry is benefitting from all of this contract money being spent?  Here at Federal Industry Analysis we track developments in the federal cloud market, including who is winning business.  Our data does not account for all of the dollars spent by federal agencies on cloud solutions that makes up the OMB data set above, but it does account for approximately $6 billion in awarded contract value (this includes consulting and strategic planning) since FY 2009.  Given the data we have we are able to make a few observations on the state of competition in the market.

The chart below shows the top ten cloud service providers by number of awards.  This data was collected for the period from Calendar Year 2010 to May 2013 and it makes up a total of 54 cloud contract awards.  The calendar year has been used in place of fiscal year because the exact date of award for many of the efforts could not be confirmed.

According to this small data set, Terremark/Verizon is the leading provider of cloud solutions to federal customers, followed closely by HP Enterprise Services and CGI Federal.  This data includes all kinds of competitions – GWACs, task/delivery orders, GSA IT 70 procurements, and set-asides.  Another interesting point worth making about the data set is that neither Google nor Amazon appear in it.  With the recent announcement of Amazon Web Service’s FedRAMP certification one would expect to find AWS on this list.  AWS is missing, however, because of a curious trend in the cloud market.  Specifically, 3rd parties are often given contract awards to move agency applications to cloud environments hosted by AWS and Google.  For example, several of the Smartronix awards on the chart are for efforts that resulted in the migration of agency apps to Amazon’s Elastic Compute Cloud.  These efforts make is seem as if AWS and Google are not big players in this market when they actually are.
 
Lastly, below is the same breakout of vendor awards by NAICS Code.  Of the 8 codes represented the one under which the most contracts have been awarded is 541519: Other Computer Related Services, with a total of 18 awards.  This is followed by 541513: Computer Facilities Management Services, with 12 awards, and 541512: Computer Systems Design Services, also with 12 awards. 
 

 
 

The variety of NAICS codes used suggests that contracting offices too have evolved to handle cloud procurements.  This is borne out in other data I have seen as well which shows that contracting offices have adapted to the subscription pricing model common to cloud services.  Therefore, with this and other procurement adaptations around pricing and NAICS codes accomplished, the path seems to be clear for the federal adoption of cloud computing to accelerate in the years to come.

 

Originally published for Federal Idustry Analysis: Analysts Perspectives Blog. Stay ahead of them competition by discovering more about GovWinIQ.

Reintroduced DATA Act Aims to Curb Federal Waste and Fraud

Rep. Darrell Issa (R-CA) formally introduced the Digital Accountability and Transparency Act, known as the DATA Act, on May 21st to the House and the Senate.

The Data Act, would require agencies to use standard formats to share internal and external federal spending information and make it available on a searchable web platform.  The legislation calls for Treasury to establish the data standards in consultation with OMB, GSA, and the heads of federal agencies, and to make the data publicly accessible in a bulk, machine-readable format via an improved USASpending.gov site.

The DATA Act originally made its debut in 2012 where it passed the House in April of last year, but died in the Senate after only one hearing.  Sen. Mark Warner (D-VA) introduced similar legislation in the Senate in September. 

The Obama administration is also promoting open data by way of an executive order issued to agencies on May 9th.  However, the purpose and focus of the executive order is to promote continued job growth, government efficiency, and the social good by making federal data more open and widely accessible, whereas the DATA Act is aimed specifically at federal spending transparency and accountability.

The last time around, the Obama administration did not support the DATA Act, complaining that it would create a new set of regulations and rules, and would add more complexity and burden on agencies.  Changes have been made to the legislation since the original 2012 draft, but it is unclear whether or not it will garner support from the White House.  

The bill is backed by the Data Transparency Coalition headed by Hudson Hollister, former counsel to Issa’s committee, and has support of Eric Cantor (R-VA), House majority leader.  The legislation is also backed by government watchdog, the Sunlight Foundation who promotes greater government openness and transparency, and provides new tools and resources for media and citizens.  

Whether the act passes or not, the administration will continue to pursue transparency as a way to stimulate innovation, increase efficiency and reduce waste.  Contractors, grant recipients, and agencies should expect financial reporting requirements to persist and even increase in order to add transparency across government spending and decrease waste, fraud, and abuse.  

 

 

GovWin Recon - May 28, 2013

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts. 

Sequestration / Budget:

Federal IT:

Agency News:

Vendor News:

Cybersecurity:

Cloud Computing / Data Center Consolidation / Virtualization:

Big Data / Analytics:

Mobility:

Transparency and Performance:

Defense / C4ISR / Embedded Technology:

Contracting / Acquisition:

State and Local:

AEC News:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

 

GovWin Recon - May 24, 2013

GovWin Recon, produced by Deltek's Federal Industry Analysis (FIA) team, is designed to support awareness and understanding of the issues impacting the government and the contractors that serve it. Recon highlights key developments surrounding government technology, policy, budget and vendor activities.

Headlines beginning with an * include quotes from Deltek analysts. 

 

Federal IT:

Agency News:

Vendor News:

Cloud Computing / Data Center Consolidation / Virtualization:

Big Data / Analytics:

Mobility:

Transparency and Performance:

Waste, Fraud and Abuse:

Defense / C4ISR / Embedded Technology:

GovWin Recon is Deltek's daily newsletter highlighting federal government contracting news and analysis from around the government contracting world. Get it delivered to your e-mail inbox, free!

 

 

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