State and local IT spending to grow in 2017

State and local IT spending to grow in 2017

The pressure to defend against cyberattacks, upgrade outdated legacy systems and meet consumer expectations could keep state and local government IT spending climbing in 2017.

According to a recent Onvia report, “2017 State and Local Government Contracting Forecast,” the continued optimism in tech spending even during economic recovery implies that governments find these solutions “mission critical” and a financial investment.

In fact, annual IT spending by state and local government and education sectors increased 17 percent  from 2009 to 2016, based on data from the Bureau of Economic Analysis. IT purchasing is expected to continue rising at the same rate, as factors like the evolving role of IT, cyber threats, agile development and new ways of standardizing cloud services affect the way local and state governments purchase and use IT next year.

Public sector leaders are updating outdated systems to deliver more efficient citizen services, and secure sensitive data held in older vulnerable systems. State and local government buyers must ensure the security posture of new IT purchases, which could mean aligning with federal standards.

“State and local governments are in a bit of a bind,” said Ben Vaught, director of Onvia Exchange and former state government IT executive. “They have to keep … one step ahead of the bad guys, but they often don’t have the resources to do that,” or to develop the needed standards and policies, he explained. Most rely on National Institute of Standards and Technology’s cybersecurity standards or leverage national resources, like those from the Multi-State Information Sharing and Analysis Center.

However, “having great standards is important but only one portion of the battle,” Vaught told GCN, as cybersecurity concerns make modernizing legacy systems that much more urgent. In 2017, governments might ask for more funding to replace older systems.

And as state and local governments move toward cloud services, it is become increasingly difficult for them to evaluate offerings at the pace technology is changing. Because states can’t afford to evaluate each new cloud service, they are looking for outside sources -- similar to the Federal Risk and Authorization Management Program --  to help. FedRAMP authorizes cloud platforms for federal agencies, vetting cloud service providers for use across much of the federal government. According to Onvia, this model is gaining traction at the state level, with some states standardizing their process for CSP authorization and others are leveraging their work.

States are also buying cloud services  through cooperative purchasing organizations, like the National Association of State Procurement Officials ValuePoint. According to Vaught, NASPO ValuePoint put together a cloud services master contract that addresses data management, data retention policies and levels of data confidentiality to make it easier for states to buy services.

“I think the co-ops can really play an increasingly valuable role, especially with cloud services,” Vaught said.  Particularly for small- and medium-sized cloud providers, he explained, it would be easier to negotiate a single contract with a co-op that multiple states can leverage, rather than trying to contract with states separately.

Agile development also is gaining speed, and some agencies have find that custom development can result in more valuable and fully usable end products. Others that are struggling with the high costs of custom legacy systems, however might be afraid to invest in much custom development.

Even with slow growth in a challenging fiscal environment, Onvia suggests that state and local governments will continue to justify the cost of complex solutions in 2017 as a means of making government more efficient.

Find the full report here.

About the Author

Amanda Ziadeh is a former reporter/producer for GCN.


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