This story is reprinted with permission from the May 2005 issue of Government Technology's Public CIO
Talk to any state or local official about how the federal government approves and grants funding for IT projects, and you will likely hear a litany of complaints. In 2001, for example, John Cuddy and Jerry Friedman, then officials with the Human Services Departments of Oregon and Texas, respectively, pointed out just how outdated the entire process had become in their report, Re-engineering the Approach by Which the Federal Government Approves and Monitors the Creation of State Human Services Information Systems.
"The decisions that led to the current approach were made many years ago in an environment much different from that in which IT projects are conceived and managed today," the report states. What may have worked when mostly mainframe-based information systems were stable and "big-bang" systems development predominated does not apply in today's world -- where rapidly changing technology and new approaches allow for more flexible and improved system development.
Former Georgia CIO Larry Singer, in a 2002 testimony before the House Subcommittee on Technology and Procurement Policy, described the tension between the federal government and states even more strongly. "Of all federal grant processes, this APD [Advance Planning Document] process is the most cumbersome, expensive and provides the least value to the federal oversight process and to the states."
On one hand, the federal government believes it exercises expected and appropriate controls over the billions of dollars it gives states to implement IT projects. On the other hand, many states feel the federal grant process is onerous, hindering them from implementing quickly and efficiently. The prevailing question that arises can be expressed in several ways: Where do we hang the "trust net" between the federal and state governments? Does federal money have to come with strings, or can states be trusted to spend wisely? When does the accountability requirement for public funds interfere with good management practices and efficiencies that yield savings?
Addressing such a complex issue and set of questions is a difficult undertaking. States receive federal funding for IT projects covering health, homeland security and transportation, to name just a few key areas. Nothing is more problematic, however, than health and human services. The difficulties can be traced back to welfare reform legislation passed in the early 1990s that levied on states many more federal directives, including those addressing key programs, such as Temporary Aid to Needy Families (TANF), child support, food stamps and Medicaid.
As families became more independent and moved from assistance to self-sufficiency, states realized a more integrated IT infrastructure to more efficiently manage caseloads was necessary. But as Cuddy and Friedman pointed out, the federal funding approval process had not kept up with the changes taking place. Tension grew to the point that many states argued the federal IT grant process actually stymied their efforts to help those most in need.
Although most observers would agree that today states are much more knowledgeable in defining IT systems, obtaining good contractors, controlling scope, managing projects and getting good results, former Ohio CIO Greg Jackson argues that problems continue for the health functions in many states, for example. Notoriously underfunded, these departments received a surge of funding in the wake of 9/11 and the anthrax attacks that followed. Although welcomed, the funding presented a dilemma: States now had lots of money, but not enough resources and staff experience (including program management expertise) to manage the sums adequately. "States need program management services," Jackson said. "Anytime you have a large amount of money, it requires a large amount of program and project management."
Some state officials say the current IT approval process no longer reflects the reality of what is needed