OMB's budget theme continues: Do more with less

Agencies face fiscal 2008 with a challenge to get more value from past IT spending

2008 budget would give booster shot to health IT

The Bush administration will push to improve existing information technology programs, but it has proposed few major new IT investments in its fiscal 2008 budget request. Industry officials immediately criticized the budget, saying it will force federal contractors to adjust to a spending climate in which agencies must do more with the IT they have. The budget attributes the decrease in new investments to better capital planning and reduced duplication.

President Bush proposed greater spending increases for defense, energy, health IT and information security, which are administration priorities.

The president’s request would increase total IT spending to $65.5 billion, a 2.7 percent increase compared with his $63.8 billion request for fiscal 2007, according to budget documents from the Office of Management and Budget.

The Defense Department’s request for $31.4 billion for IT spending represents a 2.1 percent increase, or an additional $650 million, compared with its fiscal 2007 IT budget request. Civilian agencies’ overall average IT increase is 3 percent, totaling $34.1 billion.

Slightly more than half of the civilian agencies requested larger IT budgets than they did for fiscal 2007. The departments of Defense, Treasury, and Health and Human Services would receive the largest dollar-figure increases. The Nuclear Regulatory Commission (NRC) would receive one of the largest percentage increases if Congress enacts the budget proposal.

“These are investments that are supporting the priorities going forward,” said Karen Evans, administrator of e-government and IT at OMB, at a budget briefing last week.

Presidential priorities
In his State of the Union address, Bush said the government needs to reduce health care costs and medical errors with better IT and encourage price transparency. Evans said the president’s fiscal 2008 budget request would let federal agencies invest $5.3 billion in health IT.

The president, who said he wants the country to develop alternative energy sources, requested a 45.5 percent funding increase for the NRC, from $94 million to $137 million. All of NRC’s 14 project business cases are on OMB’s Management Watch List. Evans said those projects are not having problems, but they are on the list because they are important.

Rep. Tom Davis (R-Va.), ranking member of the House Oversight and Government Reform Committee, said he is pleased with the administration for ending duplicative programs and emphasizing information security.

Davis said he supports the administration’s initiatives to increase data privacy protection and stop security breaches.

Industry perspective
Davis was more positive than industry officials about the president’s budget. Several officials said the budget proposal is merely recycled paper because it offers few new initiatives and minimizes IT spending. Bush’s budget proposal would force federal contractors to focus on helping agencies do more with the IT they already have.

“The key now is managing your IT resources,” said Larry Allen, executive vice president of the Coalition for Government Procurement. Contractors have to adjust, he said.

Ray Bjorklund, senior vice president and chief knowledge officer at Federal Sources Inc., said the proposed budget is good for businesses that can introduce cost-saving technologies, but it is not so good for companies supporting systems  that will be shut down.
From the fiscal 2008 budget proposalNCES to grow in ’08 and ’09
The Defense Information Systems Agency has budgeted $205.2 million for its Net-Centric Enterprise Services (NCES) program for the next three years, with more than half the spending planned in 2009.

The operations and maintenance budget for NCES is $28 million in 2007, $29.4 million in 2008 and $86.9 million in 2009, for a total of $144.3 million.

DISA said it plans to use NCES to replace unconnected interfaces between Defense Department networks and information systems with a set of enterprise services that will make data visible to a wide range of DOD users through the use of metadata tagging and Web discovery, search, and collaboration tools.

DISA awarded its first NCES collaboration tool contract, worth $17 million, to IBM in July 2006, and plans to award a second contract in June.

The IBM NCES collaboration tool offering is based on the company’s Lotus Sametime software suite, which includes instant messaging, Web conferencing, white board tools, application sharing, broadcasting, chat, and audio and video capabilities.

— Bob Brewin



Budget proposal advances health IT initiatives
The Bush administration’s proposed budget would nearly double funding for the Office of the National Coordinator for Health Information Technology and increase health IT-related funds for the Agency for Healthcare Research and Quality (AHRQ).

ONCHIT’s budget would grow from $61 million this year to $118 million in fiscal 2008 to support a variety of initiatives, including activities for coordinating standards and testing implementations of prototypes developed in 2006. The proposed increase in spending would also help pay for reconstituting the American Health Information Community, a high-level advisory committee led by Health and Human Services Secretary Mike Leavitt, as a nongovernmental entity. Funding would also be available to continue efforts to resolve variations in state laws, including privacy laws that hinder exchanges of health data.

Janet Marchibroda, chief executive officer of the eHealth Initiative, predicted that ONCHIT would end up with a budget more nearly resembling this year’s. Nonetheless, she said, the federal government is doing the right things to advance health IT.

The budget would give AHRQ $15 million to spend on a new initiative for linking electronic health record databases and making them available, with patients’ identities masked, to researchers.

The databases would become part of what is being called a rapid learning network that would let researchers use data mining and related analytical techniques to discover patterns of treatments and outcomes. It could reveal side effects of drugs and information about what treatments work best in certain circumstances, for example.

At the Defense Department, the proposed budget calls for spending more than $1 billion on health care information management. Spending would increase from $905 million to $1.04 billion if the budget request is approved.

— Nancy Ferris



Census slated for big budget increase as dress rehearsals ramp up
The Bush administration has requested a major budget increase for the Census Bureau as the agency begins exercises in preparation for the 2010 census.
About $281 million of a total $1.23 billion census budget is set to support several tests for data collection and a 2008 dress rehearsal live exercise. Handheld data collection computers are at the center of those tests. They are an important part of the bureau’s efforts to modernize the 2010 census.

The bureau found major problems with previous versions of handheld devices in 2004 and 2006. Wireless data transfer functions and the Global Positioning System service on the devices frequently failed in both tests.

The Government Accountability Office has said in several reports that if the bureau can’t get its system working, census-takers might still be using paper in 2010. In response to the bureau’s problems, Congress cut the fiscal 2007 budget by $54 million.

The bureau is now working with new handhelds.

— Wade-Hahn Chan



Requested e-archiving system coming
The National Archives and Records Administration is on track to release the first version of its Electronic Records Archive (ERA) in September. President Bush’s proposed budget for fiscal 2008 apportions $58 million for the e-archive, a $25 million increase compared with the $33 million fiscal 2007 spending request.

A substantial funding increase would enable NARA to move forward on development plans for ERA and a sister archive for classified records, said Martha Morphy, NARA’s chief information officer.

The planned sister archive’s primary use would be to preserve the records of the Bush administration, Morphy said. The president’s fiscal 2008 budget proposal stipulates that $38 million of the $58 million request could be held over and used for archiving the official records of the administration.

— Wade-Hahn Chan

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