Social Security Administration FY 2020 Budget Observations

In mid-March the White House released its fiscal year (FY) 2020 budget request with detailed spending plans for each Executive Branch department and agency, including the Social Security Administration (SSA). A detailed IT budget for the SSA was also made available on the Office of Management and Budget (OMB) IT Dashboard about a month afterward.

FY 2020 Discretionary Budget

The Social Security Administration has requested $10.1B in total discretionary budget for FY 2020, a decrease of $400M from the FY 2019 enacted level.

FY 2020 funding highlights include:

• Requests $101M for extramural research and early intervention demonstration projects, equal to the FY 2019 and FY 2018 levels. SSA continues to stress to contractors that they must complete projects on time and within budget.
• Proposes $70M ($20M federal, $50M available to states) to improve reporting capabilities for non-covered pensions to enforce the offsets for the Windfall Elimination Provision and Government Pension Offset.
• Allocates $3.9B for Other Services (DDS, guards, etc.), $22M for Supplies and Materials, $269M for Equipment and $537M for Communications, utilities, etc.
• Includes $155M for IT modernization in FY 2020, following $325M in dedicated IT modernization funding in FYs 2018 and 2019. SSA plans to invest $691M over five years. Efforts include modernizing claims processing, improved data quality, data consolidation and developing decision support tools that use artificial intelligence.
• IT budget includes non-payroll-related amounts of $106M for IT modernization, $1.1B for infrastructure, $52M for administrative applications, $48M for programmatic applications and $101M for cybersecurity.

Information Technology – Total IT and New Development Budgets

The SSA is requesting nearly $1.7B for IT spending for FY 2020, almost $5M (+0.2%) above the FY 2019 enacted level and $47M (2%) above the final FY 2018 level.

Within the total $1.7B request the new SSA IT budget provides new development spending, known as Development, Modernization and Enhancement (DME), of $969M, which accounts for roughly 35% of the total FY 2020 IT budget – a fairly consistent proportion from FY 2018 to 2020. The FY 2020 DME level is $9M (+1.3%) above FY 2019 and $29M (+4.4%) above the FY 2018 level. (See table below.)

Deducting the DME funding from the total IT budget will reveal nearly $1.3B in Operations and Maintenance (O&M) funding for FY 2020, which is a decline of $4M from the FY 2019 O&M enacted level, but still $17M above the FY 2018 final O&M level. O&M accounts for nearly 65% of the SSA IT budget in FY 2020, which is about the same proportion as it was in FY 2019 and 2018.

Noteworthy IT Programs

The SSA continues to pursue IT modernization efforts to meet its mission objectives and support larger agency priorities. Below are the top five largest IT budget lines within SSA’s FY 2020 request.

IT funding highlights include:

• Network Standard Investment – The Network standard investment provides data, voice, services, equipment, access arrangements, cable and wiring to manage network and telecommunications activities. At $486M for FY 2020, Network has $8M in total growth over the FY 2019 level and more than 25% ($133M) is for Development, Modernization and Enhancement (DME) efforts.
• Data Center and Cloud Standard Investment – The Data Center and Cloud standard investment provides the IT Infrastructure for SSA's data center facilities. This investment received a $25M increase for FY 2020 to reach $476M up from $450M in FY 2019. This initiative contains about 18% ($85M) in DME funding.
• End User Standard Investment – The End User standard investment provides IT resources such as workstations, mobile devices, end user software, and helpdesk support which SSA requires to meet its workload demands. The $201M requested for FY 2020 is $900K below the FY 2019 level. DME accounts for 25% of the FY 2020 funding request. 
• IT Modernization – IT Modernization is a plan to replace SSA’s core systems with new components and platforms, engineered for maximum usability, innate interoperability, and future adaptability. It receives $155M for FY 2020, a decrease of $12M (-7%) from FY 2019. This initiative is categorized as 100% DME funding.
• IT Security & Compliance – This investment captures the costs associated with IT Security resources setting policy, establishing process and means, and measuring compliance and responding to security breaches. The $139M requested for FY 2020 is $21M below the FY 2019 enacted level and is 59% DME funding.

Once we move past the large enterprise-level IT initiatives the majority of IT investments focus on specific systems or capabilities that receive budgets in the $10-25M range and below. These smaller initiatives focus on maintaining SSA mission applications like claims processing and financial management.

The consistent comparative flatness of SSA’s IT budget, the sustained emphasis on O&M spending and the frequency with which “standard investment” programs frequently hold prominent positions among the top IT budget lines reveals an overall IT environment marked by relative stability, very modest budget growth, fiscal consciousness and progress among multi-year programs. Many of SSA’s refresh, modernization and transformation efforts that the agency has initiated over the last several years have begun reaping some costs savings and efficiency gains.

For a deeper dive into the details of the FY 2020 budget, check out our report: Insights and Implications: FY 2020 Federal Budget Request.

Get a free report summary of Insights and Opportunities: FY 2020 Federal Budget Request.