With a strong foundation and solid decision-making processes, the Technology Modernization Fund at four years old is poised to have its cake and eat it too.
Four years ago this month, the Technology Modernization Fund came to life when the seven members of the inaugural TMF Board met on March 12 in the Eisenhower Executive Office Building. Through passage of the Modernizing Government Technology Act, enacted into law on December 12, 2017, and the subsequent issuance of guidance from then OMB Director Mick Mulvaney in February of 2018, a new process and funding mechanism for governmentwide technology modernization projects was born.
Four years into this experiment, now is a good time to take stock of what the TMF has accomplished, noting both successes and opportunities for improvement, while also looking ahead to see what the future may hold for this rarest of Washington commodities – an initiative that was founded on, and continues to draw, strong bipartisan support.
That first meeting of the TMF Board in March 2018 was a happy affair but also weighted with a sense of responsibility. The happiness derived from finally seeing the TMF concept, a revolving fund that could address governmentwide IT modernization challenges, come to life after many years of advocacy from both Democrat and Republican administrations. The sense of responsibility came from knowing that the Board's initial actions would form a foundation for future investment – would it be a strong one that could be built upon by future leaders or a weak one that would call into question the entire enterprise? There was also a keen sense that while the initial dollars were modest by federal standards, with a $150M to invest as a start, the level of interest from overseers on the Hill, agency leaders, industry, and the trade press would magnify the early moves that the TMF Board made.
I remember leaving the first board meeting optimistic for three reasons. First, the board members from different agencies and different backgrounds wanted to be there and were full of energy. This was no "working group" that would go through the motions, stuffing 10 minutes of effort into a 90-minute meeting. We had homework and we were happy about it. Second, we started off by focusing on the process for how we would make decisions. The early focus on how we would operate enabled us quickly and fairly to evaluate options once the agencies started proposing projects. Lastly, new groups can take time to gel, but it was evident that we had a great leader in the form of Federal CIO Suzette Kent, who is a good communicator that knew how to quickly win the trust of the group and build consensus.
So, what has the TMF accomplished so far? From the initial two tranches of funding provided by Congress, nearly $100M was awarded to 11 projects. A sea change occurred in 2021 with the inclusion of $1 billion for the TMF as part of the American Rescue Plan, and in late 2021 the TMF Board awarded more than $300M to seven projects, including the first award to a single project for greater than $100M. There will be some hits, some misses, and perhaps even a home run among these initial 18 investments, but the provision of such a large amount of new funding was a vote of confidence in the TMF's processes and foundation that were established immediately after passage of the MGT Act.
Where does the TMF go from here? With almost $700M left to award there is more work to be done, with a likely focus on cybersecurity projects. In addition to the day-to-day running of the fund, there are also opportunities for improvement that will ensure the fund cements the bipartisan consensus that brought it to life and endures as an evergreen source of government-wide modernization funding.
First, the TMF should adopt the GAO framework for evaluating project cost estimates and use this as a guide to help steer projects to success after award. Every so often you have to listen to the auditors, and GAO raises a good point that OMB isn't eating its own cooking by stating, "OMB funding guidelines require projects to include a reliable estimate of any project-related savings, [but] most of the TMF projects' reported savings estimates derived from cost estimates continue to be unreliable."
Second, the Board should post the full progress briefings they receive for each investment, redacting any acquisition sensitive or proprietary information. I've written about this previously and believe that when you have a well-run program, more transparency, and not less, increases the program's positive impact.
Third, now that the novelty of the TMF announcing awards has mostly worn off, agencies and the citizens they serve would benefit from more frequent funding actions. Think of rolling admissions, versus a couple of decision days each year, as the best way to address modernization problems that don't get better with time.
With a strong foundation and solid decision-making processes, the TMF at four years old is poised to have its cake and eat it too. The stakes are high, as a well-funded revolving mechanism for IT modernization with bipartisan support in the Congress is a once in a generation opportunity that must be used to solve today's problems and replenished to help future leaders meet the challenges of tomorrow.
Alan B. Thomas Jr. is the former commissioner of the Federal Acquisition Service at the General Services Administration and now chief operating officer at IntelliBridge. He served as a permanent member of the TMF board from inception in March 2018 until October 2019.
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