Guest Column

Eugene Huang



 

IT Savings Are Coming

 

Savings from Gov. Warner's IT reforms will add up to $50 million by fiscal year 2006. The sum would have been larger if Republicans in the General Assembly hadn't slowed the process down.


 

In response to Patrick McSweeney’s column of last week ("Time to Come Clean", March 15, 2004), I’d like to set the record straight on the Warner administration's record on the reform and consolidation of information technology (IT).

 

McSweeney’s column offers a less-than-balanced summary of a series of exchanges that the Warner administration has had with Del. Robert G. Marshall, R-Manassas, on the topic of streamlining state government. In letters dated Feb. 2, 2004, from the secretary of administration and Feb. 16, 2004, Feb. 23, 2004 and March 30, 2004, from the secretary of technology, the Warner administration lays out in significant detail the status of both the Wilder Commission recommendations and the efforts to reform IT within state government.

 

As is made clear in these letters, the Wilder Commission emphasized that implementation of its proposed recommendations would result in long-term savings that would take between two and four years to demonstrate initial results. It is therefore not possible or practical to assume that significant savings from either the Wilder Commission reforms or the IT consolidation would begin to accrue immediately in the short term.

 

It may come as a surprise to Mr. McSweeney that efforts to achieve even further savings through IT consolidation were stymied by Republican members of the General Assembly. Although the governor proposed an expedited timetable for consolidation in legislation presented to the 2003 General Assembly, Republican leaders in the General Assembly insisted upon a compromise calling for an 18-month timetable and a phased transition for IT consolidation. This compromise has a significant impact upon the ability to achieve savings quickly, with the bulk of the savings envisioned for the IT consolidation initiative occurring only after the consolidation has been completed.

 

In spite of these obstacles, the Warner administration projects that some early savings will be achieved through IT consolidation. Gross savings totaling nearly $50 million are anticipated so far through the upcoming budget biennium, broken down as follows:

 

  • FY 2004 - $10.3 million

  • FY 2005 - $17.2 million

  • FY 2006 - $22.1 million

So how does this reconcile with the $100 million in annual savings that Governor Warner asserted in his interview with the magazine Information Week? Governor Warner made clear in his quote that these figures are long-term savings, quoted as “combining IT operations under VITA will save Virginia taxpayers nearly $100 million a year” (emphasis added).

 

Mr. McSweeney’s letter is another of his misguided attempts to belittle actual efforts to reshape state government and find ways to spend taxpayer dollars more effectively. Virginia is experiencing what every major corporation and entity that changes a business practice finds: Change is hard and requires constant vigilance to achieve savings. It is not a magical and easy way to produce hard savings, but will result in long-term benefits for the Commonwealth.

 

If Virginia had not embarked on this path with Gov. Warner’s leadership, would Mr. McSweeney and his allies have known enough to suggest these reforms? Or would they simply continue to bemoan ‘fat’ and ‘waste’ in government, offering no meaningful suggestions to eliminate it?

 

-- April 12, 2004

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Eugene Huang is deputy secretary of technology for the Warner administration.

 

 

 

Supporting Documentation

 

Letter to Del. Robert G. Marshall, Feb. 2, 2004

 

Commission of Efficiency and Effectiveness: One Year Progress Report

 

Letter to Del. Robert G. Marshall, Feb. 16, 2004

 

Letter to Del. Robert G. Marshall, Feb. 23, 2004

 

Letter to Del. Robert G. Marshall, March 30, 2004