If you want to understand the evolution of cloud computing adoption in state and local government, one place to start might be in the Alachua County Property Appraiser’s Office in Gainesville, Fla.

The appraiser’s office occasionally struggled to maintain the onsite GIS it operates for itself and other local jurisdictions. “We've had experiences where our software license management server has been up and down,” said Bob Bates, executive director of GIS, Technology and Support Services. “We've had staffing issues in the IT department. We got proposals for contracting the service out, but it's very expensive.” So a few months ago, the county shifted its Esri ArcGIS instance into the cloud with Amazon Web Services (AWS). Its first monthly bill was only $230. “That is the beauty of the cloud,” Bates said. “It is pay as you go. If we want more resources, we can just check a box.”

Logan Couch, a GIS programmer analyst, said many things can be done much faster in the cloud. “We can do the type of setup in one day that used to take weeks because it would have to touch on several county departments and city agencies. Now I can just jump in and do it myself.”

Bob Bates, executive director of GIS, Technology and Supprt Services, Alachua County, Fla., Property Appraiser's Office


Bob Bates, executive director of GIS, Technology and Support Services for the Alachua County Property Appraiser’s Office in Gainesville, Fla.

Bates said the county is considering putting a disaster preparedness and response application in the cloud too, so that city and county executives could use their mobile devices to access it. “We're just getting our feet wet,” he said.

Alachua County’s experience shows how and why resource-constrained government agencies are taking advantage of cloud services.

Steve Halliwell, senior global director of state and local government and education at Amazon Web Services, said he sees lots of customers like Alachua County that turn to the cloud to execute well on their core business functions. They're realizing they can experiment and have more agility in terms of starting on projects without waiting for hardware or a business justification based on capacity planning, he added. “I see folks who don’t have their own data center or 60 IT people on staff, but are able to use AWS to get going quickly because we do the undifferentiated heavy lifting and they can focus on their business processes.”

Budget cuts have forced the hands of many small local governments, said Lauren Nelson, an analyst for Forrester Research. They're out of data center space, so what do they do? It's basically an outsourcing story, she said. The recession forced many local governments to scale back on IT costs and staffing. “Many have the same amount of work but half the team,” she said, so moving to cloud services, both hosted private and public, can help.

Besides budget pressures, there are elemental changes in how vendors talk about cloud now that could encourage public-sector cloud adoption, said Charles King, principal analyst at Pund-IT. A few years ago, it was common for early adopters to predict that desktop computing and private data centers would disappear and be replaced by enormous public cloud infrastructures. But customers have told cloud vendors that some proprietary apps and heavily regulated data will never leave their data center, he said.

“Now we're seeing repositioning around the notion of the hybrid cloud, where an organization could put some business processes, such as customer relationship management [CRM], into a cloud like Salesforce.com offers,” King said. “This allows CIOs to support departments with services from Amazon or Google but still keep critical IT assets behind locked doors.”

Interested in cloud services? Here's an interactive map of nearly 60 companies that provide almost anything as a service for public-sector customers. You can also view a list of these companies here.

At the other end of the spectrum from Alachua County’s Property Appraiser’s Office are larger, more sophisticated IT organizations developing cloud strategies that fit into their enterprise architecture planning.

The promise of software as a service (SaaS) rings true for Delaware CIO Jim Sills. In 2010 when the governor’s office needed a CRM application for constituent tracking, and wanted something quickly, the state turned to Salesforce.com for Government and got it up and running in two months. That was one step in a much larger process.

“In 2009 we began the cloud-first policy by piggybacking on the federal policy,” Sills said. “We've set up a private cloud and virtualized 85 percent of the state’s physical servers, which saves the state $4 million per year.” The state now has 70 applications in the cloud — from event notification to cybersecurity training.

Delaware has been a leader in developing cloud policies, including the creation of procurement and contracting language. At first, IT leaders worked with the procurement team to piggyback on another state’s contract. “That was the only way we could procure initially because the state laws had not kept pace,” Sills said, adding that buying cloud services adds more complexity to the procurement process. “With software as a service, you're actually buying a bundle of things: software, hardware and network security in a bundled package. Most states don't have contract vehicles for all those components. It is still a challenge to procure.”

In 2010 Delaware started documenting SaaS terms and conditions instead of starting from scratch with each vendor. “We came up with nine mandatory and 13 preferred conditions to help us vet cloud vendors more efficiently,” Sills said. Now Delaware is working with several other states, a dozen cloud companies and the Center for Digital Government on a task force to develop standard cloud terminology. The task force is using Delaware’s terms and conditions template as a base for other state, city and county governments to use. [The Center for Digital Government is owned by e.Republic, publisher of Government Technology.]

The city and county of San Francisco also is investigating how best to apply private and hybrid cloud environments for the scalability and flexibility they offer. “There are legacy applications that we're going to keep on premises, but even on premises, you can still take advantage of the cloud approach or value proposition,” said Miguel Gamiño Jr., acting CIO for the city. “Cloud is a very broad term. It is a philosophy, not a product. I can apply cloud strategies and philosophies to my on-premises environment.”

San Francisco’s IT leaders look at a matrix of public, private and hybrid clouds, as well as onsite environments. “We go platform by platform and application by application and draw a box where it might best reside. We also are re-evaluating our own data center constructs, architectures and vendors, as we establish those different environments,” explained Gamiño, who's also leading San Francisco’s transition of close to 30,000 users to Microsoft’s Office 365 public cloud.

“We have to build those various platforms before we can move the applications, but we have to analyze the applications’ eligibility for those platforms, so we scale them properly,” Gamiño said. “It is a classic chicken and egg problem. We have to build it and plan for it simultaneously.”

Like San Francisco, Michigan’s cloud adoption has matured and evolved from experimentation to something more systematic. “Every time projects are prioritized, we look at architecture and design and ask ourselves which model makes the most sense,” said Rodney Davenport, CTO of the state’s Department of Technology, Management and Budget (DTMB). “Return on investment is applied to projects at the highest level and cloud is considered as an option. We have to look at the relative strength of where it makes sense to run which applications.”

The DTMB regularly reviews how its computing functions align with state agency business needs in light of new cloud computing opportunities and offerings. Michigan’s MiCloud initiative — a centralized cloud computing service launched several years ago — has made great progress in areas like virtual data storage and virtual server hosting. And as the DTMB has noted previously, one benefit of cloud computing is that it frees up resources. “We reduce cycle times for standing up test and production servers, because development server requests are removed from the work queue,” a DTMB document notes. “Our capital is not tied up in physical development infrastructure; virtual development servers are de-allocated when not in use. This also saves power, HVAC, UPS capacity, rack space, floor space, switch ports, SAN ports, monitoring capacity, O/S licenses, application licenses and database licenses, among others.”

One promising aspect of cloud computing in the public sector is the opportunity for shared services. “There may be certain kinds of functions and processes that don’t vary much from one state to the other. It seems silly to have 50 unique applications for something like managing payments,” said Pund-IT’s King. “The idea of states working together with common pools of resources to develop platforms they need and share development costs makes perfect sense.”

Michigan's state government has explored working with other jurisdictions on sharing cloud infrastructure and applications. “We are working with Oakland County [Mich.]’s G2G Marketplace on an RFP for external cloud providers,” Davenport said. “We expect to use several for storage and processing in burst capacities.”

Michigan also partnered with Illinois on a shared services cloud module that they've dubbed “Medicaid as a Service.” The first of three envisioned phases included the recent rollout of the Electronic Health Records Incentive Payment Program, an online solution that lets state administrators review provider registrations and authorize incentive payments for approved providers.

Multijurisdictional efforts like these are starting to become more common. “We're starting to see more examples of shared services happening,” said Patrick Mungovan, vice president of strategic programs for Oracle Public Sector. He cited as examples shared ERP implementations between Allegheny County, Pa., and Pittsburgh as well as Local Government Information Services, a long-standing organization that provides applications and IT services for 45 Minnesota cities and counties.

“It gets more complicated when you cross state lines,” Mungovan said. “We hear lots of talk about multistate community clouds, but we have not seen a whole lot of activity yet. The cloud is not a panacea, and it doesn't reduce the complexity level of things like procurement.”

Government Technology has reported on the ups and downs of several of these efforts, including the Southeast Consortium for Unemployment Benefits Improvements and the Western States Contracting Alliance shared GIS data storage procurement project.

San Francisco’s Gamiño sees an opportunity in multijurisdictional cloud efforts. “Right now we are getting our hands around our jurisdiction’s ability to leverage the cloud, but if you can get municipalities within a county or state to share data, then it can grow exponentially.” Can cities and states share data with one another and the federal government? “The opportunity is there, for sure,” he said. “We are seeing a lot of municipalities focus on trying to take advantage of it.”

Over the past three years, Amazon’s Halliwell said he's noticed an evolution toward more sophisticated uses of cloud computing in state and local government. “When I first started engaging with customers, they were looking at some first-adopter things such as websites and storage,” he said. “Now we're seeing more customers doing big data analytics, high-performance computing, collaborative applications, government-to-business portals and statewide archiving, as well as disaster recovery and GIS applications in emergency response.”

Pund-IT’s King said another promising area is using the cloud as a development platform. “It is an area where Amazon found its real success. It is easier for application developers to create an Amazon instance than to set up physical hardware on-premises,” he said. “That model continues to be a major portion of Amazon’s service business, and there is no reason application and process developers at the state and local level couldn’t gain the same kind of benefits.”

Shawn McCarthy, IDC Government Insights research director, also sees promise in hosted development environments. An agency or group of agencies may lease a cloud space to develop something. They may keep it in the cloud, or because of agency restrictions about who can access it, they may move it back onto internal servers. “As more of these cloud environments get approved for government use, there is not necessarily a reason to move them back inside.”

Open data initiatives may be another good candidate for cloud computing. Chris Thomas, government industry manager of Esri, said his company is working on ArcGIS for open data. “I am not sure, but I think cities will tend to put those in the cloud for scalability.”

San Francisco, which has devoted considerable resources to open data initiatives, sees potential for the cloud in those initiatives.

“Open data is an interesting paradox because on one hand we are trying to make data available in a readable format, because we want people to be able to access it in its raw state,” Gamiño said. “But we also have increasing security concerns regarding the source systems of that data. We have to be careful about how we build those open data systems to make sure data is transparent and easy to get to. The hybrid cloud may help with those conflicting priorities, so we can lock the gate but let you see through it.”

Visit page 2 of our story for a list of nearly 60 cloud companies.

David Raths  |  contributing writer