Bill would shut down over-budget, behind-schedule IT projects

A bill introduced on Tuesday would require agencies to report to Congress when information technology projects exceed their original cost or projected completion dates and to create Web sites to provide information on the cost, schedule and performance of all major IT projects.

The Information Technology Investment Oversight and Waste Prevention Act of 2009 would require the Office of Management and Budget to increase the transparency of federal IT investments by posting information on their cost, schedule and performance of on a Web site. OMB last year created a site, VUE-IT, but it lacks the information Congress is asking for and is uninformative, a source on the Hill told Nextgov.

Cost overruns and poorly performing IT projects are caused by agencies not properly defining requirements at the outset, Vivek Kundra, federal chief information officer at OMB, told a hearing of the Senate subcommittee on Federal Financial Management, Government Information, Federal Services and International Security.

In many cases, agencies lack the technical expertise and writing skills to draft business cases to relay to vendors accurately what they want to purchase, resulting in numerous requests for changes and cost overruns later, he said.

The bill, introduced by Sen. Tom Carper, D-Del., would require agencies to work out business needs and completely define requirements before a project is started.

"Nearly one-third of all federal IT investments are considered by OMB to be poorly planned," Sen. Tom Carper, D-Del., said in a statement when introducing the bill. "Many of these investments will be delivered over budget, behind schedule and not performing up to agencies' original expectations. To correct this, our bill also empowers OMB and agency chief information officers to take action if they realize a project isn't going as planned, before it spirals out of control. This action could be the assignment of highly trained IT experts who could help bring projects back on track."

Also sponsoring the bill are Sens. Susan Collins, R-Maine; Joseph Lieberman, I-Conn.; and George Voinovich, R-Ohio. Carper introduced a similar bill in July 2008.

When Carper asked Kundra if he would be willing to shut down agency projects or reject weak business cases, Kundra responded, "Absolutely, especially now" during the economic downturn.

Kundra said his organization is still analyzing the best method to gather and report information on federal IT investments. The process likely will include consolidating lists of troubled IT projects, such as OMB's High-Risk and Management Watch Lists, along with the Government Accountability's high-risk list.

Kundra has not reviewed the bill, but he said he would like the information on IT investments to be readily available and "as close to real-time data as possible." He proposed creating a dashboard software application that would allow federal managers to monitor the status of their IT projects in real-time, but said the creation of such an application is still months away.

The bill also would require agencies to notify OMB and Congress when costs or schedules deviate by more than 20 percent from the original estimate. If a project runs 20 percent over budget, OMB will create a team of IT managers who will advise the agency on requirements, improving business processes and managing contractors. If an investment deviates from the original baseline by 40 percent or more, then OMB and Congress will consider shutting down the project.

Karen Evans, who held the same position as Kundra in the Bush administration, warned the subcommittee against relying too much on deviations from original cost estimates, saying the metric is more applicable to large-scale investments rather than smaller projects. At times, federal program managers and contracting officials have been reluctant to call out contractors for poor performance because contractors often blame agency managers for not providing complete requirements at the outset of a project, she said.

Evans said performance-based contracts would help the number of troubled IT projects. But Kundra said the majority of IT contracts should be fixed price.

Kundra also said OMB was looking to add more data on IT investments and subcontracts to usaspending.gov, which tracks government contracts. He said his team is learning from the lessons of the stimulus transparency Web site, Recovery.gov, and wants to apply them to usaspending.gov.

The bill also directs the Office of Personnel Management and OMB to consider ways agencies can recognize and reward employees who complete projects on time and under budget.