Technology changes states' financial models

The fast pace of technology development is reshaping the way states finance information technology projects, according to some experts.

Members of the panel said technology is being developed so quickly that state government IT shops say IT projects can’t be funded by yearly appropriations models.

The conclusion came in a poll of attendees poll done today at the National Association of State Chief Information Officers’ midyear conference. The most popular financing choice among the state and private IT employees was direct appropriations that carry over into subsequent fiscal years.

“Technology may turn over two or three times in the timeframe. You could wind up with obsolete [technology],” panel member Patricia O’Donnell said. O'Donnell is JP Morgan Chase's vice president of business development.

“You won’t have a transparent understanding and commitment from [government officials] to fund it across the life of the project,” Colorado Systems Consultant Martin Benison said.

The second most popular choice was that IT officers share the costs with the private sector,

Massachusetts Comptroller Ron May gave an example where his state contracted with a single company to install fiber optic cable along highways. He said the company went out of business during the project, so the state got the work done for free.

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