Under HB 1516, the Texas Department of Information Resources (DIR) possesses some important new powers: it can now require agencies to buy hardware, software and IT services from DIR-negotiated statewide contracts; it now oversees the state's consolidated data center equipment and operations; and it will create and operate "state technology centers" to consolidate agencies' IT infrastructure in such areas as network security, electronic grants and telecommunications.

All of this will unfold over the next few months. Agencies and the DIR have until March 31, 2006 to sign contracts setting the terms and conditions under which the DIR will deliver services to agencies. The DIR isn't waiting around for people to come knocking on its door. Its Strategic Initiatives Division already created an interagency working group to plan for creation of the state technology centers.

DIR Executive Director Larry Olson tapped familiar faces in state government to oversee two divisions key to the consolidation's success.

Brian Rawson -- former CIO of the Texas Education Agency -- directs the DIR's Service Delivery Division; and Kim Weatherford -- former director of IT for the departments of Aging and Disability Services and Assistive and Rehabilitative Services -- is heading the DIR's Statewide Technology Operations Division.

Betting on Consolidation

Support for a radical overhaul of the DIR's power -- and a sharp curtailing of state agencies' power to create their own IT environments -- built slowly in the Legislature. In Texas' case, it all started with something as innocuous as call centers.

"Several years ago, the Legislature started down the path of call centers," said Rep. Carl Isett, R-Lubbock, a fifth-year legislator and author of HB 1516. "But there was never any motivation for the agencies to use them. We didn't mandate that agencies use the call centers. As technologies emerged and opportunities continued to come forward, we were always still stymied by the institutional resistance of the agencies."

After examining agencies' use of technology and how IT relates to their core missions, Isett recalled, legislators began separating out business functions that had little to do with those core missions, soon identifying IT as such a business function.

As part of this change in perception, the Legislature kept after the DIR to expand the call centers, and to work with agencies on overall procurement and major purchases in particular, even though the agencies were still autonomous and didn't have to follow the DIR's lead, said Isett.

"We kept telling DIR to effect cost savings through the call centers or disaster recovery centers, and they had no power, really, to do that," he said. "So all they did was ask the agencies louder every year -- after we screamed at them, they would scream at the agencies."

After a series of meetings with the DIR during 2004, legislators grew comfortable with the idea of ITconsolidation, and with draftinglegislation to make it happen, Isett said. This is a politically dangerous area for legislators to venture into.

Observers of California's political climate say the potential for collateral damage from a highly publicized IT fiasco is a big reason legislators got scared of introducing a centralization bill in that state.

Statewide IT consolidation may be risky, but Isett saw the alternative as even worse.

"It was at least, if not more politically dangerous to do nothing," he said. "To not maximize taxpayer resources is, I think, always a politically dangerous place to be in."

In Texas, the sheer number of agencies able to buy IT goods and services with next to no oversight created a significant sinkhole in the state's budget.

"We appropriate them 'x' amount of money for IT, and every year they come back and ask for billions of more dollars," Isett said. "It became more damaging, politically, to us

Shane Peterson  |  Associate Editor