IRS foresees another decade of dependence on tape records

WILLIAMSBURG, Va.—The success of the IRS’ modernization project will depend
on the replacement of its tape Master File, the agency’s chief information officer
said last month.

“We have modern equipment. We just have antiquated software,” CIO Paul J.
Cosgrave said. It takes the IRS a week to update the taxpayer Master File because the data
is still stored on magnetic tape, he said.

“We will not be totally off that system for at least 10 years,” he said.
“Until we can move from tapes to some kind of relational database, everything is just
patch and fix.”

The IRS is still planning its technological overhaul, having awarded the $5 billion,
15-year Prime contract to Computer Sciences Corp. five months ago.

Cosgrave said the challenge is to break the modernization into smaller, more
manageable parts. The agency has identified systems that will soon benefit taxpayers but
are not dependent on the more grandiose changes planned, he said during the General
Services Administration’s Trail Boss Roundup conference.

IRS executives are formulating a plan to submit to Congress in August that will detail
the agency’s objectives for the next two to five years, Cosgrave said.

“It will be more specific up front and less specific as we go along,” he

CSC is already working to improve call-routing systems, Cosgrave said.

The agency is also developing self-service applications that will let taxpayers get
more information online or over the telephone, Cosgrave said. Those systems will be in
place for the 2001 filing season, just 18 months away, he said.

The IRS, which has been hindered by its multitude of stovepiped systems, is also
focusing on standardized platforms, Cosgrave said.

The year 2000 problem, which has been a major undertaking for the tax service, costing
more than $1 billion overall, helped the agency replace some inadequate systems and
spurred standardization efforts, he said.

“The trick is, can we do one thing that helps us in another?” he said.

The IRS is using its year 2000 funds to fix or replace antiquated systems.

The service is replacing its 286-MHz PCs with Pentium PCs running Microsoft Windows NT,
Cosgrave said.

For mainframes, the IRS has had both IBM Corp. and Unisys Corp. systems. Following
former CIO Arthur A. Gross’ recommendation, the agency is standardizing on IBM

There is still uncertainty about standardization of midtier operating systems, which
now are all Unix, Cosgrave said.

“The thinking is we’ll go with NT there,” he said.

The service’s technological changes go hand-in-hand with the IRS’ revamped
management and business processes, he said.

The service’s new mission statement directs the IRS’ employees to focus on
providing taxpayers with “top-quality service by helping them understand and meet
their tax responsibility.”

The mission statement for the information systems staff has remained unchanged: Create
a team of professionals who focus on taxpayer needs by providing quality information
systems that help implement the agency’s overall mission, he said.

One of the biggest hurdles has been changing the IRS culture, Cosgrave said.

“We’re working to get alignment between the Prime contractor, the business
teams and information systems teams,” he said. “Over the years, the business
folks have learned not to trust the IS folks. And the IS folks have learned not to trust
the business folks. This may sound trite, but part of it is getting all three to respect
each other.”

Another challenge is modernizing systems while maintaining the old systems that support
annual tax processing, Cosgrave said. That complicates implementation because the IRS for
nearly half the year focuses almost completely on processing returns.  


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