President Trump recently signed the Modernizing Government Technology Act into law as part of an amendment to the defense bill. This statute now allows federal agencies to reprogram unused IT budget allocations to fund modernization projects. While this action only targets federal agencies, it is indicative of what is happening at the state and local levels of government. Technology modernization has become a critical priority at all levels of government. Lots of resources, time, effort and funding will be dedicated to modernization of legacy systems in the coming months.
Old methods, dated technology, computer systems and outdated application programs are often referred to as legacy systems. Operating on old applications is not only inefficient, but it is also grossly insecure. Old code leaves data vulnerable to cyberattacks and government officials know that they must make large commitments to modernization efforts in 2018.
In 2017, state agencies spent $108 billion on technology. That amount is expected to increase 4 percent to $112 billion in 2018. At the municipal level of government, the focus has been on smart city solutions which are ideally built on strong and modern technology systems. The smart city applications cannot be implemented on most old legacy systems. Counties throughout the country are updating voting technology and that is no small task. Because of these immediate priorities, modernization projects and projects related to securing data will continue to drive up government spending on technology for the next few years. It would be hard to find a governmental agency that is not currently involved in some sort of planning related to technology modernization.
The city of Norman, Oklahoma, has had its Enterprise Resource Planning (ERP) software since 1995 and there has never been an upgrade. However, last month the city council approved a $6 million plan to upgrade and modernize the entire system. The ERP software is critical to the city because it is responsible for the city’s finance, accounting, payroll and human resources as well as customer utility information and billing.
Long Beach, California, is planning to spend quite a bit more on technology upgrades – approximately $67 million to be exact – for modernization projects. About $43.1 million of the total amount will be allocated for replacement of outdated infrastructure and servers. Other funding will be used to expand and upgrade the city’s cyber network.
Last month, Watertown, New York, got bad news after an audit revealed major flaws in the city’s computer systems. According to the report, city data is vulnerable because of the city’s outdated legacy systems. While no official timeline has been announced for the release of a solicitation document, the city plans to upgrade both its hardware and software systems as soon as possible. This is an upcoming opportunity that bears watching.
In Michigan, both Grand Traverse County and Traverse City have requested $6.4 million for technology upgrades. Immediate priorities include a new enterprise virtual server, an ERP System, new network switches, routers and firewalls as well as a new court operating system. The city and county intend to work together to get this project initiated as soon as possible.
Officials in Bartlesville, Oklahoma, will ask voters in March to approve a $16.5 million bond package which will include funding to overhaul the city’s computer servers. If the bond passes, the city will replace all existing servers and install a new records management system for the Bartlesville Police Department.
These projects are representative of the types of modernization projects that can be found in almost every regional governmental jurisdiction. Cities, counties and state agencies are expected to move aggressively in the coming year to modernize all public-sector legacy systems. It’s a matter of maintaining security, efficiency and accountability.
These are good times for companies with technology modernization solutions. It will be extremely interesting to monitor how long it takes for private-sector investors to begin to offer funding options to public officials. Government technology, networks and computer systems are a good, stable investment vehicle and funding is available if bond issues do not pass and alternative funding is not readily available. It’s not that public officials have options about whether or not to modernize old legacy systems in 2018!