DC on T2

Capitol Corner — September

Published monthly as part of FLC’s DC Perspective content, Capitol Corner focuses on one notable news item pertaining to the T2 community. The focus stems from agency publications, news sites, and DC-central organizations, with original sources, contacts, and links provided. For more information and Corner-related inquiries, please contact dcnews@federallabs.org.

We’ve followed the creation of the Technology Modernization Fund (TMF) periodically over the past year. It’s recently returned in headlines relating to its usefulness and whether it should be continually funded for fiscal year (FY) 2019.

The TMF was authorized in mid-December as part of the Modernizing Government Technology Act (MGTA), which was amended to the 2018 version of the National Defense Authorization Act (NDAA). While the MGTA created a $500-million fund for agencies to develop and initiate information technology (IT) modernization projects, the TMF was authorized to use $100 million of that fund for FY 2018, with a figure up to the TMF original memorandum’s ceiling of $250 million budgeted for FY 2019. The TMF was piloted as a proposal-based, board-reviewed appropriations fund, which would receive project proposals and award contracts for next-generation technology solutions across all federal agencies. (The memo went as far as standardizing the proposal process via an Initial Project Proposal Template in its appendices.)

Despite the House passing TMF appropriations at $150 million via a shutdown-stopping spending bill, in July the Senate vetoed the hike from its original $100 million. As we’ve previously reported, the TMF lacks transparency related to its homogeneous proposal process and the efficacy of funded projects. (This notion was even seconded by Senator Jerry Moran, an original sponsor of the MGTA and, in turn, the TMF.)

At press time, three agencies—including the Department of Energy (DOE)—received TMF awards in June totaling $45 million. As far as the remaining $55 million in FY 2018, a July report from the Federal Acquisition Service (FAS) claimed 20 other projects were being evaluated to gain a piece of the funding, but neither their sponsoring agencies nor their work scope were identified.

As we await word from Congress about the future of the TMF, let’s elaborate on its purpose, present projects, and the implications of a second round of funding.

The TMF Itself

We’ve already outlined the TMF’s genesis and target budget, its general purpose and plan, and hinted at some of its implementations. The MGTA—which, again, houses the TMF’s authorization—is the first victory in a long fight to modernize government IT. In 2016, two partisan bills were introduced—the Republicans’ Modernizing Outdated and Vulnerable Equipment and IT Act and the Democrats’ IT Modernization Act—in order to further this mission. The memorandum outlining the MGTA’s purpose and proposal process was released this past February.

The memo, titled “Implementation of the MGTA,” formalized both the TMF and its accompanying Technology Modernization Board, while authorizing all Chief Financial Officers (CFO) Act agencies to establish IT Working Capital Funds. The CFO Act created a mandatory CFO position at 23 federal agencies, including the Department of Defense (DoD) and the DOE, to oversee financial management. These 23 agencies are permitted to establish these Working Capital Funds for IT modernization supplies and services. Any agency given TMF money must repay the investment within five years.

The memo continues to elaborate on the TMF’s criteria for fundable projects. Each project should demonstrate a “strong execution strategy, technical approach, and have a strong team with a demonstrated history of successful modernization efforts.” Preference is given to solution proposals that will serve multiple agency components or multiple agencies themselves. All proposals are detailed in the two-page template and should consider the technology’s impact on an agency’s mission, its feasibility of implementation, expected cost savings, and lasting financial impact of the modernization. According to Fund director Liz Cain, proposals that require $2 to $10 million in funding will most likely be approved. Furthermore, cloud-based solutions hosted on public platforms like Microsoft Azure or Amazon Web Services (AWS) have been given more positive reception.

Each proposed IT modernization solution is evaluated by the Technology Modernization Board. The Board is comprised of the federal chief information officer (CIO) acting as chair—currently Suzette Kent, a senior General Services Administration (GSA) official with IT development expertise; a member of the Department of Homeland Security’s (DHS) National Protection and Programs Directorate (NPPD), and four rotating but appointed federal employees with experience in IT development, financial management, cybersecurity, privacy and acquisition.

Three TMF Projects: Streamlining Information in the Cloud

As previously stated above, $45 million has been awarded to three IT modernization projects. Although information about each is sparse, the general scopes of the projects are below—all related to cloud migration or cloud-related services.

  1. U.S. Department of Agriculture’s (USDA) Farmers.gov Customer Experience Portal: $10 million was awarded to USDA to update its customer experience portal for Farmers.gov. This initiative underscores the TMF’s opportunity to create “an omnichannel experience that has the potential to reduce costs while simultaneously improving employee and citizen satisfaction.” As Farmers.gov is the only public-facing of these three projects that directly impacts farmers and agricultural workers, modernization and streamlining user experience is imperative. According to USDA Undersecretary for Farm Production and Conservation Bill Northey, "this new resource also will reduce the time farmers need to take away from their fields today to fill out paperwork.”
  2. Department of Housing and Urban Development (HUD) Cloud Mainframe Migration: $20 million was awarded to HUD to migrate the agency’s Unisys-based mainframe to Microsoft Azure, improve finances, and prevent fraud, waste, and abuse. As the biggest award in this trio, it should reap the greatest benefits. According to the Technology Modernization Board’s evaluation of the HUD proposal, “the code modernization and migration will save $8 million annually, enabling payback and generating working capital to transform additional legacy systems.” In five years, HUD will double the fund’s investment.
  3. DOE’s Cloud Email Adoption: $15 million was awarded to DOE to accelerate cloud email adoption. DOE’s project description claims 64 separate email systems, serving over 180,000 mailboxes, currently govern the agency’s communications network. Accelerating the migration to a centralized, commercially available and cloud-based email service will serve as “a model case for other agencies and a core tenant of the criteria for TMF funding,” according to the Board, as public solutions garner more favor.


Round 2 of FY 2018 TMF Funding: Where Will the Other $55 Million Go?

As we near the end of the fiscal year, government agencies are dispersing funds left and right. With that said, the TMF isn’t legally obligated to spend its FY 2018 pool on the pending projects, but not doing so would leave its FY 2019 funding authorization in question. “I can understand why the Appropriations Committee might be hesitant to give TMF another $150 million when more than half of the original funding has yet to be spent,” said Mike Hettinger, a lobbyist and former staffer with the House Oversight and Government Reform Committee.

Round two of TMF funding, when executed, may potentially have smaller dollar values and more transformational potential. In the February memo, the TMF was to ideally fund projects that could be easily adapted to other agencies with similar technological gaps. (This sentiment has since been echoed after the first round of TMF awards.) The three awards given in the first round were conservative by comparison. Although their dollar values were substantial, the projects were hardly full-scale modernization initiatives. Although round two projects have not been announced, the proposals have been found to be more robust and mission-focused, as agency teams have learned from the three projects that have received TMF backing.

For more information on the TMF and to submit a proposal for the probable third round of funding, please visit the GSA Emerging Citizen Technology Office landing page here.

DC on T2