State and local IT projects face serious budget pinch

With state and local governments facing severe deficits, the prospects for expansive IT spending likely will continue to be bleak.

'Six months ago people were hoping that the economy would rebound, but now the situation is pretty much the same and people don't see an improvement,' said Aldona Valicenti, CIO of Kentucky and past president of the National Association of State CIOs.

In the current fiscal environment, many states are delaying purchases, she said. Meanwhile, in several states, governors have mandated staff cuts across the board, she said.

Texas CIO Carolyn Purcell agreed that 'all the states are in trouble.' But she pointed out that the current fiscal pinch provides an opportunity for state IT officials to use e-government projects to reduce the cost of providing services.

The National Governors Association reported recently that 37 states had to cut a total of $12.8 billion from their fiscal 2002 budgets. Fifteen states laid off employees, 26 made across-the-board budget cuts and 13 reorganized programs to reduce spending, the association found.

State and local officials noted that IT funding is not being singled out for additional trimming and in some cases is holding steady, but new spending will be limited for the near future.

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