Ditching Legacy Systems Will Require Adjusting Some Regulations, Experts Say

The coronavirus pandemic revealed how overdue investment in government technology systems really is, according to experts speaking at a House Budget Committee hearing Wednesday. Technology must be upgraded, not just maintained, if governments of many levels are to serve the people, they agreed.

But pinpointing what is stopping the federal government from doing so is a critical issue. According to the testimony, the problem is not regulation writ large, as conventional wisdom has parroted in the past, but rather that current regulations entrench legacy systems and are biased toward already established companies.

Jennifer Pahlka, executive director of Code for America and one of the founders of the United States Digital Service, highlighted the procurement process as a behind-the-scenes blocker of innovation. Rules and restrictions that seem innocuous at first glance are, in fact, incentivizing piecemeal updates to legacy systems that critics say make federal information technology unwieldy. 

“Most procurement officers will insist on putting something in a procurement that says, ‘only a company that has done a project of this size in the past,’” Pahlka said. “Well, that’s very anti-competitive, and it really means that that will then only be able to go to probably two companies.” 

These practices don’t change because people are afraid of getting hauled in to testify before Congress, Pahlka said. Contracting officers need to know that they have the support of the legislative branch behind them so that they can take innovative approaches as they seek new partners with forward-thinking ideas for modernization, she said. 

Another problem with procurement is related to Congressional Budget Office and Government Accountability Office metrics. Teresa Gerton, president and CEO of the National Academy of the Public Administration, said current rules make technology investments look larger than they really are. Right now, the full cost of investments must be recognized in the first year without factoring in the long-term savings modernization provides. 

“As Congress is thinking about alternative tools and flexibilities, I think one of the key features would be engaging with CBO and GAO to encourage their flexibility in how they score and how they audit,” Gerton said. 

Much of the discussion was framed through the lens of how delivery of pandemic-related services, such as unemployment insurance, has failed American citizens because IT systems were underprepared for normal government functioning, much less the surge in demand COVID-19 caused. 

The unemployment insurance backlogs and delays highlight the idea that relying on outdated technologies represents a direct failure to take care of American citizens. Rep. Joseph D. Morelle, D-NY, called the reliance on legacy systems “almost criminal.”

Rebecca Dixon, executive director of the National Employment Law Project, used the failure of Florida’s unemployment website as a specific example of this problem. Dixon said that the scramble by states to modernize unemployment insurance systems to keep up with the pandemic has caused disruptions to service, backlogs and delays.

“Modernization is not a panacea, and it does not always lead to progress,” Dixon said in her opening statement. “After all, Florida has quote ‘modernized’ their system. But it was built on a foundation of public policy choices that were designed to limit access to [unemployment insurance].”

A new task force through the Labor Department should be created in order to help states with information technology and give them hands-on assistance with modernization, Dixon said. This task force could review contracting agreements, audit contractors and require states to document contractor performance. It would also help ensure programs are complying with civil rights law, she said. 

Pahlka said she has seen the trouble with unemployment insurance delivery in the pandemic firsthand through her work with the non-profit U.S. Digital Response. No matter how hard public servants work to deliver services, their efficacy is automatically limited by outdated technologies. 

“The public servants that they are partnered with are not incompetent,” Pahlka said. “They’re very dedicated, they are working as hard as they can given the constraints that they are under.”

“But the system itself is pushed to its limits,” she said. 

Yet it’s exactly through the lens of services that are tangible to the American people like unemployment insurance that may help show the public why overhauling federal information technology is a worthy investment. 

“What’s really important is not just that we speed government for its own sake but that the people who are waiting on those benefits start to see a difference,” Pahlka said.