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Backup Plan for Y2K State/Federal Interfaces

The president's Year 2000 office said almost all of the states were making "excellent progress" in preparing their federal program interfaces for the millennium date change. A report by the President's Council on Y2K Conversion said that while 48 states and the District of Columbia had received access to a database of the interfaces, two states--Illinois and Oklahoma--and six territories had not even requested passwords to the system by Feb. 19.

Even so, John Koskinen, chairman of the council, said the federal government will work with state governments on contingency plans to keep social services programs running if any state computers crumble because of the Year 2000 problem. Koskinen made his remarks last month to a group of state technology leaders at a National Governors' Association meeting.

Koskinen said social services recipients will receive benefits such as food stamps and health care payments even if interfaces between federal and state computer systems malfunction. About 165 federal interfaces with state systems have been identified, but the number could increase. Koskinen advocates end-to-end testing at the federal and state levels to make certain that interfaces with 40 major welfare assistance programs can be sustained.

Planning for disruptions is appropriate to protect programs that dramatically affect people's lives, said Mike Benzen, president of the National Association of State Information Resource Executives. Benzen claimed that more than 65 percent of state interfaces with federal systems are compliant. While he allowed that some states are behind others, he is confident all of them will be compliant by Dec. 31.

"States don't get a cookie if they finish in April or if they finish in December. The bottom line is that they finish by deadline. This is not a race," Benzen said.

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Internet Gambling Ban Called 'Futile'

A policy paper released last month by a think tank predicts that any attempt to outlaw Internet gambling will fail. The report, "Internet Gambling: Popular, Inexorable and (Eventually) Legal" by Cato Institute scholar Tom Bell, states that attempts to quash access to the more than 140 Internet gambling sites now operating will only prompt gambling businesses to move to other countries where Internet gambling is legal.

States and municipalities that govern gambling and collect millions of dollars in taxes from casinos and the sale of lottery tickets are watching the issue closely. Last summer, the Senate voted 90 to 10 to ban Internet gambling. The bill, sponsored by Sen. Jon Kyl (R-Ariz.), was included in a 1999 spending bill.

Companion legislation introduced in the House bogged down last fall, but the bill likely will be put to a House vote this year. Also due this year is a report to President Clinton detailing findings of a national committee that has been studying the impact of gambling for the past two years.

Internet gambling is big business. About $600 million was spent on gambling via the World Wide Web in 1997, according to the U.S. Justice Department. While there is strong support to extend the prohibition on gambling to the Internet, enforcement would be difficult. Opponents of current legislation say international cooperation and international regulations will be necessary to enforce a ban.

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E-Commerce Commission Dispute Goes to Court

The National Association of Counties and the U.S. Conference of Mayors last month filed suit to block meetings from taking place by a national panel assembled to decide the future of Internet taxation. Frustrated because Congress failed to add more local government representatives to a new Internet tax commission, the two associations lodged the class-action suit in the U.S. District Court for the District of Columbia.

NACo, USCM and several other government associations have argued that congressional appointments to the Advisory Commission on Electronic Commerce are skewed toward industry. The commission was spawned from last year's Internet Tax Freedom Act, which called for a 19-member panel to examine electronic commerce taxation and policy issues during a three-year ban on the levy of any new Internet taxes.

"The Internet is the major boulevard of commerce for the 21st century. In order for the commission to conduct a fair study and make legitimate recommendations, state and local governments must be given an equal place at the table with business and industry interests on the commission. This cannot be achieved with the current makeup of the commission," the civil action stated.

The associations have asked the court to declare the Advisory Commission on Electronic Commerce improper, prevent the group as it is currently composed from meeting and reimburse NACo and USCM for legal fees.

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FY 2000 State and Local IT Market Worth Almost $60B

In 1999, state and local governments could spend as much as $50.7 billion on information technology, up significantly from last year's $46.1 billion.

Next year, the market could be worth $55.8 billion, according to recent figures from market research firm Federal Sources Inc., McLean, Va.

Those expenditures were split 50/50 between state and local governments, which together dwarf federal technology outlays of about $19 billion.

Major management issues facing state and local IT officials include outsourcing, strategic partnerships, work-force retention, privacy, security and enterprise computing, which makes up almost 20 percent of the activity in the market.

Top technologies include imaging, card technology, biometrics, Asynchronous Transfer Mode, mobile laptops, World Wide Web tech and geographic information systems. Some of the hottest solutions are point-of-sale systems, digitized driver's license systems, data warehousing, offender-based tracking systems and case management.

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New CIOs and Others on the Move

- California Gov. Gray Davis tapped San Bernardino County's chief information officer, Eli Cortez, to head California's Department of Information Technology (DOIT). Replacing John Thomas Flynn, Cortez is only the second to hold the California CIO position since the department's inception in 1995.

- Richard Varn took the top tech post in Iowa. Varn previously served 11 years in the state legislature. For the past five years, he served as director of telecommunications at the University of Northern Iowa, where he managed IT services, multimedia and distance-learning applications.

Varn's first challenge will be creating a central IT department to oversee the state's now-disparate technology enterprises. "The current organizational and functional structure for information technology does not work. We have neither the authority nor consensus on coordination of spending, alignment of mission, money and objectives," Varn said in an interview.

That may soon change. A bill pending in Iowa's legislature would create a department of information technology to ride herd over state IT services and manage the state's fiber-optic network that connects the government, schools, courts and hospitals.

- Illinois Gov. George Ryan (R) also named a chief technology officer, Mary Barber Reynolds, to preside over the state's new tech office, which is endowed with nearly $100 million in funding for education in kindergarten through 12th grade, higher education and technology grant programs. Reynolds, who will report directly to the governor, spearheaded technology efforts for the lieutenant governor and served as executive director of the Illinois Science and Technology Advisory Committee.

- In other appointments, Massachusetts deputy purchasing agent Gary Lambert became president of the National Association of State Procurement Officials. He replaced Dave Gragan, formerly the Texas purchasing director, who is now at Oracle Corp. Gragan will advise Oracle on state and local government electronic commerce issues.

Gragan is the third state purchasing official this year to leave state government for a private-sector electronic commerce post. He follows former Massachusetts Comptroller Bill Kilmartin, who went to Fairfax, Va.-based American Management Systems Inc., and Chuck Grady, who left his post as California purchasing director to consult for Ariba Technologies Inc. and Andersen Consulting.

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DOD Reaches Out to States on Y2K

Concerned that the Year 2000 problem may disrupt public safety services and other critical domestic utilities, the U.S. Defense Department is developing contingency plans to assist state and local authorities in the event of widespread power and systems outages, senior DOD officials told Congress recently.

Testifying before the Senate Armed Services Committee, Deputy Defense Secretary John Hamre said DOD is beginning to formulate plans for supporting state and local governments in their efforts to restore critical services that might fail as a result of the Year 2000. "Our goal is to identify all dependencies outside DOD within federal, state and local governments that affect the department's ability to perform mission-critical activities," Hamre said.

As an example of the type of assistance DOD could provide, Hamre told members of Congress that DOD has the ability to construct and operate up to 30 airports if required-a capability that the department maintains for wartime contingencies. However, DOD is questioning whether it is "going to need to do that in the United States," Hamre said.

Although there are no federal government plans to mobilize the National Guard in the event of Year 2000 disruptions, Hamre said several states, including Washington and Oregon, have established detailed agreements on Year 2000 matters with the National Guard Bureau.

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