It's February. The holidays are over and it's back to reality. The new year has arrived with a mix of apprehension and optimism.

On one hand, there's the dismal economy. The Fiscal Survey of the States - produced by the National Governors Association and the National Association of State Budget Officers - confirms what most of us already know: The financial pressures on government continue to grow.

More than half of states reported budget gaps as of December 2008, according to the report. Furthermore, deteriorating economic conditions are triggering greater demand for unemployment and Medicaid programs. The problem was driven home in early January when a handful of state unemployment systems were overwhelmed by jobless citizens seeking to apply for benefits.

My home state, California, faces an astounding projected budget gap of $40 billion over the next 18 months. Gov. Arnold Schwarzenegger, locked in a seemingly endless battle with state lawmakers on how to close the gap, announced in January that state offices would close two Fridays a month to save money. Meanwhile, about 900 city of Sacramento, Calif., employees will begin taking an unpaid day off each month as the city struggles with its own $40 million budget shortfall.

Things are tough, and they may get tougher.

Now for a little optimism: Among government IT professionals, there's a sense that the new presidential administration may be inclined to sink more money into IT infrastructure and reform federal funding rules that lead to massive inefficiency in how critical systems are deployed and maintained. Besides improving the stability and security of key technological resources, such a move could give governments more of the IT tools they need to cope with rising workloads and shrinking funds.

Colorado CIO Mike Locatis met with President Barack Obama's policy advisers during the Democratic National Convention in Denver last summer. He came away optimistic. "I think they have a very good understanding of some of the challenges we have with federal cost allocation," Locatis said, "and some of the issues associated with creating more of a public-sector ecosystem with federal, state and local governments and how the large technology component of that can be delivered better."

 

Video: Editor Steve Towns talks with Colorado CIO Mike Locatis about ramifications to IT from a new federal administration.

Let's hope he's right, because strengthening the nation's IT foundation is critical to our immediate well-being and our long-term success. In the current economy, agencies will rely more and more on IT systems and infrastructure to cut the cost of government operations. But those IT systems are also vital to the nation's future success in a competitive global economy. Current funds must be used as effectively as possible, and new enterprise investments in critical IT infrastructure are needed to ensure that the nation has the capabilities it needs.