- The Washington Times - Sunday, June 2, 2019

The federal government has wasted hundreds of billions of dollars over several decades by building its information technology from scratch rather than buying off-the-shelf systems, public watchdog groups say.

“Fundamentally, history has shown that the federal government is woefully lacking for processing tech innovations for themselves because they operate on a different set of incentives than the innovative private sector,” said Curtis Kalin, spokesman for Citizens Against Government Waste.

Silicon Valley has a low success rate because of fierce competition, but Washington has IT legacy systems that the federal government never allows to fail, which creates a cycle of questionable spending, Mr. Kalin told The Washington Times.

“They [the federal government] have no reason to do things better, cheaper and quicker,” he said.

A recent report by the Alliance for Digital Innovation, a coalition of tech companies, underscored the legacy/waste problem. It estimated that misspent IT costs on built systems — rather than commercial off-the-shelf solutions (COTS) purchases — as high $345 billion over the past 25 years — or about $2,737 per every American household.

“Decisions that were made in the 1990s about how to buy tech have never been updated,” Mandy Smithberger, director of the Center for Defense Information at Project on Government Oversight, told The Times. “If you do not have a smart buyer, you are going to pay a stupid price.”

The Trump administration and its Office of Management and Budget reportedly are encouraging spending on COTS as opposed to highly customized government IT systems to address the issue.

Researchers at the Alliance for Digital Innovation (ADI) analyzed the government’s IT spending as a percentage of total discretionary funding since Congress passed the Federal Acquisition Streamlining Act, the 1994 law that directed federal agencies to buy commercially available hardware and software instead of developing their own tech solutions.

“We have to break the stranglehold of an outdated culture that for too long has resisted changes to the status quo,” John Wood, chairman of ADI and CEO of Telos Corp., told The Times in an email.

ADI is a recently established association that tracks federal IT spending and includes several companies like Amazon Web Services, Novetta, Palantir and Palo Alto Networks.

A failure to highlight the problem has not been an issue, ADI said, noting that the Government Accountability Office wrote “no less than 800 reports” on the need to improve IT spending efficiency between 2010 and 2016.

Last month, COTS were front-and-center during the Senate confirmation hearing of Michael Wooten, President Trump’s nominee to lead the OMB’s Office of Federal Procurement Policy.

“Oftentimes in the federal government we procure commercial off-the-shelf products, COTS, but then we proceed to break the COTS solution and try to retrofit it into the peculiar set of government policies or practices,” Mr. Wooten told lawmakers. “That needs to end.”

The federal General Services Administration, which declined to comment on ADI’s report, has been moving toward addressing the issue. Last month officials unveiled plans to begin testing an e-commerce marketplace that aims to ease COTS purchases.

GSA officials submitted a plan to Congress noting the need for an “achievable timeline to evolve [COTS] buying across the whole government” with a proof of concept for the e-marketplace anticipated by the end of 2019.

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