Final stimulus bill preserves IT spending, with some exceptions

The compromise on the $790 billion economic stimulus plan agreed to on Friday preserves much of the nearly $50 billion in spending on information technology included in the previous House and Senate versions.

The final conference bill, posted online late Thursday night, includes billions of dollars to encourage the adoption of electronic health records, expand broadband Internet access into rural areas and research energy efficient technologies. Several agencies, including Social Security Administration and the Transportation Security Administration, also received funding for IT modernization and individual information technology projects.

But Congress cut some IT funding, including money to modernize the Farm Service Agency's computers to process payments to farmers. The final bill set aside $50 million for the effort, far less than the $245 million the House originally set.

"The main priorities didn't shift, but the dollar amounts shifted a bit," said Deniece Peterson, principal analyst with market research firm INPUT in Reston, Va. "The main themes of the package are very consistent with President Obama's priorities on the campaign trail."

As expected, the $19 billion for electronic health records was within original funding levels. The House had earmarked $20 billion for health IT and the Senate had given a total of $25 billion. The money will be used to provide incentives for clinics, hospitals and private health care providers to adopt electronic records. The bill set aside $220 million of the total for the National Institute of Standards and Technology to develop standards that will allow health records systems to share records.

Peterson said the final bill takes a more local approach to funding health IT than the previous version. "The wording before was very in-depth from a strategic point of view, now it seems like it's being refined and it's becoming clear that the money will flow to state and local governments and private medical providers," she said.

The billions in health IT was, unsurprisingly, welcomed by technology contractors that stand to profit form the increased spending. "These funds should significantly advance patient safety and care while creating good paying jobs in the health IT sector, especially if we can achieve the goal of developing an electronic health record of every American," said Harry Greenspun, chief medical officer for Perot Systems, a health IT company in Plano, Texas. "[There is] plenty of work that must be done to finalize the rules and standards for the implementation of electronic health records to ensure interoperability, data security and effectiveness."

The bill also includes more than $6 billion to expand the availability of broadband Internet access to rural and underserved areas, with the funding split between the Rural Utilities Service, which will get $2.5 billion, and the National Telecommunications and Information Administration, which Congress pegged for $4.7 billion.

The bill requires the funds to be spent mostly in rural areas and regions where more than one service provider can offer service. The bill requires the NTIA will create a nationwide broadband inventory map.

The government also will spend money on research into more energy efficient technologies. The Energy Department received $16.8 billion for its energy-efficiency and renewable energy program, slightly less than the $18.8 billion in the House bill but more than the $14.4 billion in the Senate version. The money will be used to research technologies such as advanced vehicle batteries and smart grid technologies that can reduce electricity use.

The funding for advanced battery research resembles the type of state-sponsored programs in countries like China, where the research eventually is pushed to the private sector to spur innovation, Peterson said.

The National Oceanic and Atmospheric Administration received $170 million for climate modeling, and NASA received $400 million to develop climate research missions and to increase its supercomputing capabilities.

Several agencies received funding for individual technology projects or modernizations, including $1 billion to the Transportation Security Administration for explosives detections system to be used at airports and $160 million to U.S. Customs and Border Protection for nonintrusive inspection systems and tactical radios.

The Social Security Administration received $1 billion to help address its backlog of disability and retirement claims. Half this money will be spent on a new National Computing Center to replace the nearly 30-year-old facility it now operates. A union representing the employees at SSA recently argued that a shortage in workers, not aging technology, has caused the backlog of claims.

NASA received $150 million to research the NextGen air traffic control system. "We're ecstatic about the NASA money, anything for NextGen is money well spent," said Dan Elwell, vice president of civil aviation at the Aerospace Industries Association, adding it was rare for the aerospace industry to come together as it has to support NextGen. "Philosophically, if you're not looking at recapitalizing the 1950s aviation infrastructure in the 21st century, it's short-sighted."

In a statement accompanying the final bill, lawmakers included estimates on the number of jobs created by the modernization programs, including 3,537 for the TSA inspection equipment and 400 created by the $290 million allocated to the State Department for an immediate IT security upgrade.

"I wouldn't even know how to calculate that," said Peterson on the accuracy of the jobs figures, although she acknowledged it was possible to make an estimate based on the current workforce assigned to those tasks. "They're trying to satisfy critics of whether this is a stimulus or spending bill."