Dealing with the year 2000 problem tops the list of priority initiatives in President
Clinton’s fiscal 2000 budget proposal—even though the budget will take effect
six months after the date when all government systems are supposed to be ready.

Information technology, on which the federal government will spend nearly $30 billion
next year, plays a prominent role in the $1.7 trillion spending package Clinton sent to
Congress last week.

Of the administration’s top 25 objectives, most are tied to IT efforts. The goals
include items such as protecting the nation’s critical systems infrastructure,
further implementing electronic government initiatives, streamlining the Social Security
Administration’s disability claims system and modernizing student aid delivery.

The spending proposal, wrapped with a black cover to symbolize the government’s
budget surplus, highlights some significant IT projects, such as the IRS modernization and
the Customs Service’s Automated Commercial Environment program.

Despite the surplus, however, there will be no large increases in overall government
spending because of the 1996 budget agreement between Clinton and Congress. That agreement
demands strict spending limits. So the push will continue for agencies to streamline and
modernize, making use of IT to improve services and cut costs whenever possible, Office of
Management and Budget officials said.

“A key element in the administration’s ability to expand investments while
reducing the size of government has been the reinvention of government,” OMB Director
Jacob Lew said at a White House press briefing. “We’re doing more with less, and
we’re getting more for the tax dollars the American people send.”

As to 2000 work, the budget noted, “There is no more immediate management
challenge facing governments.”

Although the administration expects that most mission-critical systems will be ready by
the OMB-imposed March 31 deadline, the government will need to work well into 2000 to
ensure that all end-to-end processes run smoothly after Jan. 1, the budget said.

As in their requests for this fiscal year, few agencies specifically asked for year
2000 funding. The IRS was an exception. The service has requested $250 million for 2000
work next year. The IRS plans to spend the money on its mainframe consolidation effort and
the Integrated Submission and Remittance Processing System, both of which will replace
systems that are not 2000-ready.

As has been the trend in recent years, IT projects with the potential for high
payoff—both fiscal and political—generally received the administration’s
nod.

For instance, the budget proposal calls for $1.4 billion for protecting critical
infrastructures and fighting cybercrime. As part of that, the Justice Department has
requested $122 million for personnel who will fight cyberterrorism. Some 60 FBI agents
will form 12 cybersquads to prevent attacks on systems.

Justice is also requesting $93.2 million “to improve the information sharing
abilities of the department and upgrade much needed legal and management tools.”

About $39 million of that money would go to the FBI’s Information Sharing
Initiative, which would let agents share case data. Another $37 million would be allocated
for a Legal Activities Office Automation project aimed at upgrading Justice case
management software.

The administration has requested $50 million for the Immigration and Naturalization
Service to enhance the Integrated Surveillance Information System. INS uses the system to
monitor the U.S.-Mexican border.

At the Treasury Department, the IRS wants to spend $1.5 billion on systems next
year—a $200 million decrease from the $1.7 billion it received this year.

To support the Customs’ modernization project, the administration wants to impose
user fees.

The administration proposal earmarked $8 million for ACE next year but said the
project’s overall $1.4 billion cost could be paid for mainly with fees from users.
The fees would generate $163 million next year for spending by Customs in 2001.

This is the second time the administration has requested such a user fee. Lawmakers
rejected the proposal last year.