Digital Infrastructure Center Services Investment at USDA

This week’s post continues our look at IT investment in the U.S. Department of Agriculture’s Working Capital Fund (WCF). As the first federal agency to implement a WCF-centered investment structure similar to the authorization provided in the Modernizing Government Technology (MGT) Act, it is instructive to analyze what the USDA is doing and how it has arranged its finances to accomplish its IT mission goals. Last week’s post provided an overview of USDA’s WCF investments. This week’s post dives into the first area of that investment – Digital Infrastructure Services.

Readers will recall that Congress passed the MGT Act to create a more flexible funding mechanism for agencies to modernize their IT enterprises, particularly for financing investments in cloud computing. Traditional procurement and budgetary structures are holding back agencies from buying commercial cloud services like a utility so Congress authorized them to use Working Capital Funds to buy the services they need and then pay back the funds owed to the WCF.

To this end, the USDA has divided its WCF into three areas: 1) Digital Infrastructure Center Services; 2) Client Experience Center Services; and 3) Enterprise Network Services. Today’s post focuses on number 1 in this list, which is where the USDA categorizes WCF investments in cloud and data center services. The table below details the WCF funding requests for IT made by the offices and components of the USDA from fiscal 2018-2020.

The use of digital infrastructure, especially cloud services at the Digital Infrastructure Services Center (DISC - formerly the National IT Center), grew by almost 30% from FY 2018 to FY 2020. This said, growth in the use of digital infrastructure is uneven across the USDA. It is best to read the numbers provided as an indication of the level of cloud/data center service that a component/office is relying on the DISC and/or USDA’s International Technology Services to provide.

What we see is that several of the USDA’s components and offices have significantly ramped up their use of DISC cloud and data center services in recent years. If this trend holds it suggests a growing percentage of the USDA’s IT budget will continue shifting toward the DISC and away from being spent via the traditional Operations and Maintenance and Development, Modernization, and Enhancement model. This data certainly reinforces the trend Deltek GovWin is seeing in USDA’s cloud spending over recent years, which has risen from $51.5M in FY 2016 to $126.8M in FY 2018.

The USDA appears to be successfully moving away from the traditional model of financing legacy systems at the expense of modernizing its IT enterprise. By FY 2020 it will have eliminated all of its data centers except for those that provide enterprise cloud services. Offices and components seeking to leverage those services and/or acquire other commercial cloud services are able to do so via the new WCF model being implemented. A modernization revolution is underway at the USDA which could finally usher in the changes in federal IT that many market-watchers have looked for in recent years.