MGT Returns

Today agencies are spending upwards of 75% of their IT budgets on operations and maintenance, in some cases over 90%, leaving little to no money for IT modernization efforts. Congress has attempted to legislate a solution to modernizing legacy IT systems several times in the last calendar year, with three bills introduced to tackle the problem.

The Modernizing Government Technology (MGT) Act is bipartisan legislation that combines major elements of previous IT modernization bills.  The bill would establish working capital funds at each agency that they could draw on for IT modernization projects and pay back with savings in order to fund future projects.  The funds could be accessed for up to three years, unlike traditional appropriations that must be used in the same fiscal year. 

The bill would also establish a central IT modernization capital fund to be administered by GSA, where agencies could apply for funding and pay it back with savings. The previous version of the legislation called for $3B in this revolving fund, which CBO estimated would amount to a total price tag of $9B for implementation of the bill.  The high cost met with some Congressional reservations. The new bill lowers the amount of the centralized fund to $500M, $250M in FY 2018 and $250M in FY 2019.  New language about reallocation and reimbursement along with the decrease in the general fund is expected to produce a lower CBO cost which will be more appealing to appropriators.

Jerry Moran (R-KS) and Tom Udall (D-NM) introduced companion legislation in the Senate. 

The bill passed through the full committee markup on May 2nd without objection and will now proceed to a House vote.