IT mostly a winner in '97 budget

In the budget he proposed to Congress last month, President
Clinton declared computer investments integral to ending the 1996 budget stalemate and
setting priorities for fiscal 1997.

Next year, Clinton wants to spend more on the IRS' Tax Systems Modernization, the
National Weather Service's forecasting systems, law enforcement systems, and
high-performance computing and communications. Although the budget seeks some new money,
it would cut IT budgets for the Federal Aviation Administration and the Patent and
Trademark Office.

On the policy front, the president called for agencies to pay more of their bills
electronically and to establish more Internet sites offering information to the public.
The president said he wants all payments handled on line by 1999.

Though there is no line item in the budget for governmentwide spending on information
technology, industry analysts predict the federal IT budget next year will not dip below
$25.6 billion, which is what the Office of Management and Budget expected the government
to spend this year. Spending in 1997 might even grow somewhat, the analysts said.

"I would expect a modest increase of maybe up to 4 percent," said Robert
Deller, a GCN columnist and director of market research services for Global Systems &
Strategies in Potomac, Md.

"Last year, there was a switch in emphasis from services spending to more capital
investments in commercial hardware and software," Deller said. "The contracts
will likely be smaller but will give agencies a chance to try at multiple vehicles."

This year's total IT spending is indefinite because some agencies are operating under
continuing budget resolutions, but the total was expected to drop for the first time in
memory. In 1994, the government spent roughly $27.3 billion on systems.

"Budgets will be cut, and agencies will have to do more with less," said Hank
Steininger, chairman of the Information Technology Association of America's Federal
Systems Integration Task Force.

"But technology is looked upon as a silver bullet. Congress is looking to
technology for more efficient and effective government," Steininger said last month
in Arlington, Va., at a joint meeting of ITAA, the Association for Federal IRM and the
Federation of Government Information Processing Councils' Industry Advisory Council.

IT spending details were sparse and scattered in Clinton's $1.6 trillion spending
package because the White House and Congress have yet to agree on a final spending plan
for this year. The departments of Commerce, Education, Health and Human Services, Housing
and Urban Development, Interior, Justice, Labor, State and Veterans Affairs, along with
the Environmental Protection Agency and many independent agencies, still are operating
under continuing resolutions that keep spending below fiscal 1995 budget levels.

The odds against agreement between the White House and Congress on a 1996 or a 1997
budget remain high because Republican leaders say Clinton's budget proposals won't balance
the budget by 2002.

Nevertheless, the president used his annual budget message to make the case that IT is
essential to cut the government's administrative costs and boost productivity.

"We have cut the size of the federal work force by over 200,000 people, creating
the smallest federal work force in 30 years," Clinton said. "Just as important,
the government is working better. Agencies such as the Social Security Administration, the
Customs Service and Veterans Affairs Department are providing much better service to their
customers. Across government, agencies are using IT to deliver services more efficiently
to more people."

The White House proposed a spending boost for IRS' troubled TSM project, seeking $850
million in 1997. This year, Congress approved only $695 million after IRS sought $1
billion.

The service faces a renewed battle for full funding. Treasury officials have defend
their program twice in the last month at congressional hearings (story, Page 6).
The budget document promised that IRS would comply with congressional demands for stronger
system performance and management.

Clinton proposed a $65 million spending increase for another beleaguered program, the
National Oceanic and Atmospheric Administration's weather systems modernization. If
approved by Congress, the National Weather Service budget would grow from an anticipated
$606 million this year to $671 million next year. In 1997, NWS expects to roll out the
Advanced Weather Interactive Processing System.

The FAA air traffic control modernization, however, would be cut from $926 million this
year to $891 million next year. The president also wants to shave other FAA systems
expenses by $24 million, from $118 million to $94 million.

The budget proposal said that despite these cuts, FAA still will have enough funds to
develop en route, terminal, tower automation and communications systems.

As for PTO, the budget proposes honing funds for the agency's automated patent and
trademark initiatives by about $5 million, to $568 million. But PTO's general budget for
computer operations, networks, communications, equipment and software would receive a $3
million boost.

One of Clinton's biggest IT spending increases is the $38 million fiscal 1997 hike
earmarked for the 2000 Decennial Census.

As the Census Bureau gears up for its next national population survey, the White House
has proposed a $10 million budget boost for the bureau's Continuous Measurement Program, a
$7 million increase for the Computer Assisted Survey Information Collection Program, an $8
million increase to upgrade the Topologically Integrated Geographic Encoding and
Referencing database and the Census Master Address File, and a $13 million increase for
data processing.

Clinton also used his budget to reaffirm support for systems that help law enforcement
agencies fight crime, perennial administration favorites.

The White House called for increasing the FBI's law enforcement support budget by about
$25 million and spending $7.8 million to expand work on the Immigration and Naturalization
Services' biometric system for nabbing illegal aliens at border crossings. Another $16.8
million would finance development of technologies for Southwest border enforcement.

Clinton provided few details on his IT priorities at the Defense Department. But
Pentagon officials recently laid out details of the anticipated DOD systems budget,
estimating it would remain flat at about $9.8 billion (see story, Page 71).

Meanwhile, Clinton swallowed some of his own budget-cutting medicine and proposed
freezing IT spending by the White House's Office of Administration at $13 million for the
third consecutive year.

1996 1997

(in millions)

Winners:

Decennial Census $ 64 $102

FBI law enforcement $531 $556

HPCC $315 $337

IRS Tax Systems

Modernization $695 $850

National Weather

Service Modernization $606 $671

Losers:

FAA Air Traffic

Modernization $926 $891

Patent and Trademark

Office Automation $573 $568