States Blaze New Partnership Path

Eye on the States Thomas R. Davies

States Blaze New Partnership Path

The past few years have seen dramatic examples of new business partnerships in state governments focused on information technology.

These innovative partnerships parallel changes in the way state governments procure information technology goods and services.

Not content to simply embrace the feel-good qualities of keeping up with the latest marketing buzz around partnerships, states are raising the bar on what it means to have a true business partnership. And the industry is responding in kind.

One example of an innovative technology partnership was announced recently by the commonwealth of Pennsylvania. Under a purchasing partnership with Microsoft, all executive branch agencies will use Microsoft software for personal computers and desktop terminals.

State agencies will gain access to the latest software upgrades at no additional charge, and state employees will get access to consulting expertise and computer network assistance.

The agreement, which is expected to save the state more than $9 million over three years, includes a Microsoft investment of about $12.8 million.

The need for economic development is one driver of the latest round of state partnerships. From the onset of Connecticut's statewide outsourcing procurement, state officials have made it very clear that making a strategic contribution to the state's economic development is a primary bid evaluation criterion.

The impending award of that IT outsourcing contract - which could exceed $1.5 billion in value - is likely to fuel a new wave of business partnerships between industry and government.

Other state partnerships involve the exchange of land and resources for access to a vendor's technology.

Maryland developed a contract that offers communication companies non-exclusive use of its 5,000 miles of rights of way along state highways, roads and bridges. The partnership allows companies to install, operate and maintain communications systems along rights of way, and the state is allowed to use a portion of the communications bandwidth and equipment.

Maryland developed this contract to gain access to advanced communications services without having to make its own investment into a new system.

The standard competitive procurement, though still used on a regular basis, has been challenged by the growth in partnerships. That is because partnerships require both states and vendors to have greater flexibility on cost and performance issues.

Consequently, some states have begun to modify their procurement rules and practices to facilitate formation of partnerships.

California, for example, has added an Invitation to Partner to its list of approved solicitations.

These days, not all partnerships are between government and industry. Government-to-government partnerships are on the rise. One of the more common types has been among several state governments.

For example, a partnership among Maine, New Hampshire and Vermont allows these states to procure more innovative and powerful systems with greater efficiency.

Primarily because of their size, these states faced some difficulties in keeping their technology infrastructure up to date.

In the near future, a tri-state consortium plans to procure a delivery system based on smart cards for the three states' Women, Infants and Children benefits program. The partnership will allow the states to pool their resources and create a standardized system at a lower price.

Other state-to-state procurement partnerships on the drawing board include a planned joint radio system for California, Utah, Arizona and Nevada and a series of intelligent transportation system projects between Kansas and Missouri.

Where will the trend in partnerships take state government? It's hard to say because the scope of future partnerships will be limited only by the needs, the imagination and the creativity of those involved.

While Pennsylvania was announcing its partnership with Microsoft, it also announced technology partnerships with Canada and Singapore. And it executed the Singapore agreement using digital signatures over the Internet.

Now that's progress.

Thomas Davies is senior vice president of Federal Sources State and Local Government practice in McLean, Va. David DeBrandt provided research support.

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