Legislation Aims to Slash Government IT Waste

One of the classic items on the agenda for all presidential candidates, including incumbent Barack Obama and challenger Mitt Romney, is to cut federal government waste. In fact, the Obama administration has been campaigning for nearly the past two years to reduce waste and improve the efficiency of federal information technology with a 25-point action plan.

However, that plan isn’t working — or at least it’s not working well enough for Rep. Darrell Issa, R-Calif., who chairs the House Committee on Oversight and Government Reform. Instead of relying on administrative actions, Issa has proposed legislation to light a fire underneath federal agencies to ensure improvements in IT management.

“The federal government currently spends (US)$81 billion each year on information technology, yet its use and deployment of IT is full of duplication and failure,” Issa said last month upon introducing draft legislation designed to improve the procurement and management of IT by federal agencies.

“Because of the antiquated way the government defines its requirements and acquires IT, we are wasting billions of taxpayer dollars each year on failed programs,” Issa added.

Sixteen years after the Clinger-Cohen Act laid the foundation for the federal government’s acquisition and management of IT, and 10 years after the E-Government Act established a federal chief information officer, failure rates and cost overruns still plague between 72 percent and 80 percent of large federal IT programs, according to Issa.

Federal managers say that 47 percent of their budget goes to maintain obsolete and deficient IT resources. Estimates suggest that the cost to the taxpayer is as high as $20 billion wasted each year.

The draft legislation would enhance the role of the chief information officer at each federal agency by giving CIOs greater budget authority over IT programs. In addition, the bill would put the federal CIO Council in charge of developing shared services and shared platforms. The Council is made up of the CIOs at major cabinet departments and federal agencies and is administered through the White House. The proposal includes provisions to improve the caliber and performance of the federal IT workforce.

Vendor and Contract Impact

The Issa bill includes acquisition overhaul procedures that could have a major impact on the procurement of IT hardware, software and services. The proposal also supports migration to cloud solutions, greater use of open source software, improving websites and complementary apps, and data center optimization.

Procurement and Contracting: The Issa proposal encourages centralized, government-wide IT procurement versus single-agency supply schedule acquisition, by favoring the use of the Federal Strategic Sourcing Initiative, which facilitates collaborative procurement among several agencies. In addition, the proposal establishes Assisted Acquisition Centers of Excellence so that if one agency, such as the Department of Veterans Affairs, develops competence in healthcare IT, that agency will be used by other agencies for the procurement of similar health-related IT. Issa also included a provision for establishing a cloud brokerage function within the federal government.

The bill would establish a Federal Commodity Information Technology Acquisition Center to serve as a focal point for coordinated acquisition and securing the lowest cost for federal procurement of commodity IT. The center would be empowered to launch a government-wide contract vehicle allowing the purchase of a license agreement that would be available for use by all executive agencies as one user.

“To the maximum extent practicable, in establishing the government-wide contract vehicle, the center shall pursue direct negotiation and contracting with major software publishers as prime contractors,” the bill says. The commodity IT section of the bill strives to facilitate communication with the private sector by calling for “active engagement with the private sector to use up-to-date commercial technologies and to remove unnecessary burdens on industry in its interactions with the government.”

Price Transparency: The bill requires the development of a federal price catalog listing any price provided by IT vendors for the same — or similar — good or service. The catalog must improve agency ability to make price comparisons and analyses using standard data formats. In addition, the bill requires public disclosure of existing and future blanket service agreements.

Open Source: The bill requires that federal IT procurement embrace “all open source software that meets the definition of commercial items,” including all such software that is used for non-government purposes and is licensed to the public. The legislation orders the Office of Management and Budget to provide guidance to agencies for using market research on acquiring open source IT and “to educate the acquisition workforce by providing information to identify and counter misconceptions about open source software.”

It also requires the development of government-wide standards for security, redistribution, indemnity, and copyright in the acquisition, use, release, and collaborative development of open source software.

Warm Private Sector Welcome

“In every area covered in the Issa proposal, there is also a specific requirement for accountability for implementing, and for the success of each initiative from the agencies to the federal CIO to Congress, with independent assessment and reporting by the General Accountability Office,” Van Hitch, senior advisor at Deloitte Consulting, told the E Commerce Times.

“The proposal also specifically identifies mechanisms for funding of these activities through fees to the agencies. The funding idea is clearly an important step forward if agencies are to comply,” he said.

The Issa proposal addresses some of the issues raised by GAO in its continuing program to evaluate federal IT performance.

“We are currently in the process of providing comments on the bill to Chairman Issa’s staff, but I can say that legislation that addresses CIO authorities and codifies data center consolidation efforts could be helpful in furthering the key IT reform efforts,” David Powner, director of information technology management issues at GAO, told the E-Commerce Times.

“Overall, it appears that Issa has listened to what OMB has tried to do with the 25 Point Plan,” said Gregg Bailey, another Deloitte expert, but he thinks more needs to be done to make the reforms successful.

“The Issa proposal puts more teeth in many of the reforms spelled out in the 25 point plan,” Bailey told the E-Commerce Times.”The plan also gives significantly more authority to agency CIOs and to the federal CIO, which is a positive step.”

While the bill imposes numerous reporting requirements for federal agencies in meeting IT performance goals, it also recognizes the need to facilitate procurement with the private sector. For example, tucked away in the commodity IT section of the bill is a provision that requires “active engagement with the private sector to use up-to-date commercial technologies and to remove unnecessary burdens on industry in its interactions with the government.”

The Software and Information Industry Association (SIIA) complimented Issa “for his recognition that there needs to be a substantial improvement to federal IT procurement practices,” in addressing evolving technologies.

“We look forward to working with Chairman Issa and committee members as they move forward to craft a final bill that serves to improve IT acquisition practices to the benefit of vendors and the federal government,” said Mike Hettinger, SIIA’s vice president for the public sector innovation group.

The proposal is available at the committee website. Issa is seeking input from all stakeholders, both public and private.