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DHS Requests Half a Billion Dollars More for IT

Published: April 17, 2013

BudgetCybersecurityForecasts and SpendingDHSOMB

The release of the fiscal year (FY) 2014 Federal Budget request last week initiated a flurry of reports and analyses of what priorities federal agencies were seeking to pursue and what they were intending to spend. Information technology (IT) often undergirds agencies missions in a major way, especially at big tech spenders like the Department of Homeland Security (DHS). While sequestration and the expectation of budget cuts by appropriators continue to cast uncertainty on the outcome, DHS has requested roughly a half billion dollar increase in its IT budget for FY 2014. Let’s see how this shakes out.

DHS’s FY 2014 IT budget, released on the federal IT Dashboard, is included as part of OMB’s Exhibit 53 spreadsheet Federal IT Spending for Budget Year 2014 Report covering all Executive Branch department and agency IT budgets.  Looking at the three fiscal years included in the report – 2012, 2013, and 2014 – for total spending, new development spending, a.k.a. Development/Modernization/Enhancement (DME), and operations and maintenance (O&M) spending provides a sense of direction in these areas. (See table below.)
 
 
 
IT Budget Highlights
 
  • Total DHS IT
    • FY12-14 $ increase $515M or 9.3%
    • FY13-14 $ increase nearly $400M or 7%
    • FY12-13 $ increase $117M or 2.1%
  • DME
    • FY12-14 $ decrease -$252M or -20%
    • FY13-14 $ decrease -$128M or -11.3%
    • FY12-13 $ decrease $124M or -9.9%
  • O&M
    • FY12-14 $ increase $766M or 17.8%
    • FY13-14 $ increase $526M or 11.6%
    • FY12-13 $ increase $241M or 5.6%
 
Bureau/Agency Observations
  • DHS central IT (Bureau name = DHS) nearly doubles their IT budget from 2013 (+99%) or 2012 (+98%), regardless of which base year you use for comparison. The FY 2012 final budget was $350M and the proposed 2014 budget is $692M.
    • The Infrastructure Transformation Program (ITP) at $228M accounts for nearly half of this bureau’s IT budget request and sees a 60% increase in 2014 over 2012/2013.  Funding for this program is all O&M spending aimed at efficiencies and consolidating DHS infrastructure, including data center, network, email, etc. This one initiative is nearly 4% of all DHS’s 2014 IT budget.
    • The National Capital Region Infrastructure Operations (NCRIO) line is a fee for service Working Capital Fund activity that serves DHS Headquarters (HQ), select Department Components and select field offices with network services, IT and telecom infrastructure. As the DHS “bureau’s” 2nd largest program, NCRIO’s FY 2014 request is nearly $185M – a big increase over 2012 ($32M) and 2013 ($35M). This program is also 100% O&M and accounts for 3% of total DHS IT for 2014. NCRIO
  • National Protection and Programs Directorate sees a 67% IT budget increase from 2012-14. The big bump was from 2012 to 2013 of 64.3% plus a 1.3% increase from 2013 to 2014.
    • NPPD’s largest IT line is the National Cybersecurity & Protection System (NCPS), which is the civilian department and agency IT infrastructure cyber protection system. NCPS got greater than a 40% increase from 2012-13 and a 24% bump from 2013-14, resulting in a 2012-14 increase of nearly 78%. NCPS’s $406M for FY ’14 makes up nearly 7% of all DHS’s FY ’14 IT budget. The line item is almost 18% DME ($72M) and that percentage has steadily declined year-to-year from $129M in 2012, as the program has matured.
    • The Continuous Diagnostics & Mitigation (CDM) program at $168M for 2014 is NPPD’s 2nd largest program. This budget line is down 8% over 2013, but still a major investment at 3% of DHS’s total IT budget and with over 70% DME.
  • Federal Emergency Management Agency (FEMA) at $170M for FY 2014 sees a 15% IT budget increase from its FY 2013 enacted budget and nearly a 30% increase since FY 2012.
    • It is noteworthy that the FEMA FY 2013 IT budget request was $268M – roughly $100M more than its current FY 2014 request. In fact, the final FY 2012 IT spend of $132M reported by FEMA this year is half of the $272M they reported as their estimated FY 2012 budget in last year’s FY 2013 budget request.
    • FEMA’s largest IT investment is its Infrastructure Support program, covering end user systems, mainframes, and server services and support and receiving $40M for FY 2014 which is a 7% yearly increase.
  • Customs and Border Protection (CBP), at just under $1.6B for FY 2014, sees slight declines over the last few years resulting in a -3.7% drop since FY 2012. That said, CBP restates their FY 2012 and FY 2013 IT budgets by +$167m and +$67M, respectively, meaning their current reporting is higher than previous estimates.
    • CPB’s Automated Targeting System (ATS) inbound/outbound cargo and passenger inspection support system gets a 55% increase from 2012 from $72M to $111M. This is all O&M spending.
  • US Coast Guard has seen an increase of about $100M in their IT budget compared to estimates they reported in last year’s FY 2013 IT budget. (Their FY 2012 final budget just reported is $740M, compared to their FY 2012 estimate reported last year of $643M.) 
    • At $164M for FY ’14 the USCG Infrastructure program, a collection of many small steady-state infrastructure investments, sees a 6% increase over 2013 and represents nearly 25% of their FY 2014 IT budget.
 
Implications
 
Clearly, an IT priority at DHS and several of its directorates and agencies is managing their IT infrastructure, increasing economies, and improving efficiencies. With the departure of CIO Richard Spires over the tug-of war for directorate control of commodity IT spending it is curious that the central DHS IT “bureau” would be growing so much. Was that growth part of Spire’s plan to centralize that commodity spending to drive buying power efficiencies? Will that growth move be reversed now that it appears the directorates have won the debate? We’ll see.