IRS to request more modernization funds

The Internal Revenue Service next month plans to ask Congress for more money to begin work on specific projects for the tax agency's modernization contract.

IRS chief information officer Paul Cosgrave said the agency nearly has completed its request to fund five business systems modernization projects identified by a special IRS oversight committee for the $5 billion Prime Systems Integration Services Contract.

"We can't talk about when the five projects will be delivered," Cosgrave said.

"We are still working on the timing."How much the IRS plans to ask for has yet to be determined. The five business systems modernization projects include:

* Customer Account Data Engine, which will enable IRS employees to post transactions and update taxpayer accounts and return data from their desks.

* Customer Relationship Management—Central Information for Case Management (CRM Core), which will provide the central, shared electronic case folders needed for case management. CRM Core will create the case management information in a central and accessible repository.

* Correspondence and Document on Demand Imaging, which will image taxpayer correspondence for more efficient customer service and case management.

* Customer Relationship Management --Tax Return Examination, which will reduce the time the IRS takes to examine tax returns. The project will investigate using commercial off-the-shelf software and integration with common CRM Core capabilities.

* Customer Relationship Management—Case Resolution, which will focus on faster case resolution and higher customer satisfaction.

The projects will help the IRS deliver refunds and consistent problem resolutions faster, as well as provide timely notices to taxpayers, resulting in fewer penalties. Also, IRS customer service representatives will have the ability to provide immediate results to account changes, reducing time spent resolving inaccurate information.

If Congress approves the IRS' request, IRS employees and taxpayers could see the benefits for the 2002, 2003 and 2004 filing seasons, according to the IRS. Randy Hite, associate director for the Accounting and Information Division at the General Accounting Office, said IRS officials are sticking with their initial plan of breaking down the 15-year modernization contract into sizable workloads.

"They are approaching it in an incremental fashion," Hite said. "Their approach is consistent with the recommendation we made. Clearly that's the approach we're more supportive of."

In a report on the IRS' modernization effort, GAO approved the IRS' initial planning for its modernization program. The IRS' initial funding plan for Prime, GAO said, was "an appropriate" first step.

Cosgrave said the IRS is determining how to fuse ongoing business systems modernization projects with other information technology tasks that already are in progress. The five new projects are a direct result of the initial funding plan the IRS developed using $35 million in funding approved this summer by Congress.

The initial funding plan enables the agency to identify systems that need to be modernized over the next five years, determine the full modernization cost, justify why each system needs to be upgraded, determine the sequence in which the systems will be developed and deployed, and develop architecture standards.

Hite said the new funding request will be used for the five new projects and also to complete existing projects under the initial funding plan. "They brought those projects up to a certain point and will ask for more funding to complete the next increment," Hite said.