White House eyes $4.9 billion IT budget increase in 2004

President Bush will request $59.1 billion in federal information technology funding for fiscal 2004, White House official Mark Forman said Jan. 20.

The request is about $4.9 billion more than $54.2 billion in IT spending expected in fiscal 2003. Forman, associate director for IT and e-government in the Office of Management and Budget, broke down the fiscal 2004 IT budget request into three components:

* A base of $52.6 billion;

* $1.6 billion in IT money already being spent but not previously accounted for as IT spending; and

* Homeland security, war on terrorism and other modernization spending of $4.9 billion.

The $1.6 billion is money that OMB did not know was being spent on IT until it required more rigorous business cases from the agencies beginning last year, Forman said.

Much IT spending "is part of salaries and expenses or a working capital fund or some other revolving fund. Unless we get the data through the agency's capital investment plan, we don't know. We had to put the discipline in the process," he said.

The fiscal 2004 request is $6.5 billion higher than the president's request of $52.6 billion for fiscal 2003, which began Oct. 1. Much of the fiscal 2003 funding is on hold because Congress has passed only two of 13 spending bills. The government has operated on a series of continuing resolutions since October.

Many of the modernization projects included in the fiscal 2004 budget request are already underway, so in effect, the increase in federal IT spending has already begun, Forman said.

"When the business cases came in, it was very clear there were opportunities to start some of the initiatives this year, in 2003, so the big increase has already started," he said.

Forman said the president's 2004 budget request is expected to include the following:

* $37 billion for IT that supports agency programs and missions;

* $21 billion for the office networks and infrastructure behind that mission IT;

* $1 billion to enhance agency enterprise architectures, or strategies for modernizing operations; and

* $4.7 billion for cyber security, an increase of more than 10 percent over 2003.

Forman said that more than 700 major IT projects accounting for about $21 billion in fiscal 2004 spending are on the administration's list of at-risk projects. The at-risk projects include mission-critical endeavors that have not shown sufficient potential for success through a business case, or have not adequately addressed IT security. Most projects that were labeled at-risk last year have since been taken off the list, he said.

Among OMB's business case requirements from each agency are good project management, a clear idea of how the agency is going to close performance gaps, accurate cost estimates and security plans, Forman said.

"They [also] should have alternatives for not just IT but organizational and process improvements," Forman said. "If we are going to spend billions on a project they ought to look at the costs, benefits and risks of several alternatives."


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