Maryland CIO Eyes Innovative Plans

Maryland CIO Eyes Innovative Plans

Maryland is weighing no-cost bids from several large contractors for the creation of a statewide electronic commerce network, according to Leslie Hearn, the state's new chief information officer.

The contract, which may be awarded by January, won't cost the state anything up front because the winning vendor will be paid according to the volume of business carried by the network, said Hearn, a former U.S. Department of Transportation technology director who was appointed in June as the state's first CIO.

"What we need to do is have a win-win situation," he said.

State agencies would use the network to buy goods and services worth up to $25,000 per transaction, said Hearn, who declined to say which companies are bidding on the contract. However, all of the bidders are large vendors, he said.

For example, California state officials have hired a vendor to upgrade the tax-collection system operated by the California Franchise Tax Board at no cost to the state, he said. Instead of being paid an up-front fee, the vendor will be paid out of the increased tax revenue generated by a more efficient system, he said. "That is an early example and it has taken hold in all the states," he said.

In Maryland, state officials have launched a variety of innovative and experimental programs, even as they struggle to pay the estimated $100 million price tag for repairing the year 2000 software bug in state systems. Among the examples cited by Hearn are:

• The new electronic commerce initiative, in which the bidders were asked to design a statewide electronic commerce network and develop innovative funding schemes. If successful, the network could eventually be used to handle contracts worth more than $25,000 apiece.

• The deployment of 11 computer kiosks where citizens can view government data and fill out forms. Maryland officials are now trying to develop ways in which the kiosks can be used by the blind or people in wheelchairs.

• Formation of a joint industry-government council to draft a digital signature law for approval by the state government in Annapolis and by the state courts. Without a digital signature law that would give legal standing to online contracts "signed" with the help of specialized encryption technology, online contracts could be questioned by courts, thus curbing the growth of electronic commerce in the state.

• Opening up the state's procurement laws to allow city and county officials, as well as Maryland schools, to buy products and services from large, state-sponsored information technology contracts.

• Boosting competition throughout the life of a state information technology contract by selecting at least two vendors for contracts valued at more than $50 million.

• Using a 1997 law that allows state officials to buy goods and services via large contracts signed outside the state by the federal government or state governments. These contracts can offer cheaper technology or quicker access to products and services not available on existing Maryland contracts.

However, the state's improvement efforts are being delayed by the massive cost of the year 2000 fix and by difficulties with one of its largest programs, the automation of the state's welfare system.

In 1990, development costs for the welfare automation program were expected to be $35 million, but costs have since grown to at least $130 million by 1997. Although some portions of the new system have been deployed in the state, the state's largest city, Baltimore, won't have its new system until next year, said Hearn.

The program "certainly cost more than anyone projected," Hearn acknowledged.