States scramble to track federal stimulus bucks
There's no such thing as a free lunch, especially for IT.
Go to the state of Iowa's Web site, and you can see that of the $2.5 billion in federal economic stimulus money earmarked for the state under the American Recovery and Reinvestment Act of 2009 (ARRA), $553 million has already been spent on health, education, infrastructure and other programs designed to create jobs and jump-start the local economy.
Drill a bit deeper into the data and you can pull up the exact amounts spent on weatherization training and technical programs, rental assistance programs and hundreds of other individual projects.
Iowa CIO John Gillespie figures his IT organization has devoted about 800 man-hours so far to making that data available to the state's citizenry. "We actually had to build the application to give [different state agencies and programs] a way to submit data to us," he says.
But the far bigger challenge, Gillespie says, has been building the business rules and defining internal processes to comply with federal reporting requirements, which have changed or been updated several times since the stimulus package was first announced in February. States are required to file quarterly reports that fully account for every tax dollar spent.
Just as the $787 billion ARRA is unprecedented, so are the reporting demands it's making on state CIOs and IT organizations, which are scrambling to whip up new processes and tools to accurately track and account for their states' shares of the stimulus pie. The process has been complicated by a variety of factors, including exceedingly tight deadlines and complex and changing federal reporting guidelines.
The best state Web sites for ARRA tracking
States with the best ARRA-tracking Web sites, as of July:
5. New York
-- Mitch Betts
Source: study by Good Jobs First (PDF), Washington, July 2009
Another big problem is the lack of a central accounting system in most states, which have had to first devise ways of extracting and aggregating data from multiple systems across hundreds of agencies before rolling it up to report it to the federal government.
Like so many of the energy and construction projects launched with stimulus dollars, tracking and reporting systems remain works in progress.
In Missouri, one of a handful of states to have a central accounting system used across all state agencies, funding and budgeting data is relatively easy to access. What remains difficult to grasp, however, is precisely what the federal government wants to know, says CIO Bill Bryan.
Two data points the feds want to track are job creation and retention under the economic stimulus program. "But the definition and requirements for how to count jobs is quite a challenge to understand," according to Marilyn Gerard-Hartman, director of enterprise applications for Missouri.
For example, if the state awards a highway infrastructure project to a contractor who in turn hires a subcontractor, who in turn hires other subcontractors, "how far down the chain is the state responsible for tracking? And do you only count it as a job created if the job wouldn't have existed without the ARRA funding?"
Generally, "it hasn't been clear what the requirements are until fairly late in the game," adds Bryan.
Meanwhile, fulfilling the requirements to the letter of the federal law is critical, Bryan notes. "If you don't comply, you could get thrown under the bus and not get any further funding."
"One of the biggest challenges is just the speed at which we had to get things done," says Iowa's Gillespie. "The rules for the most part didn't get finalized literally until weeks -- not months -- ago. Just keeping up has been the biggest challenge."
Rather than licensing commercial stimulus-tracking tools, Gillespie's team internally developed a tracking and reporting system "using tools already familiar to financial folks who have all the data in Excel spreadsheets," he explains. The data is imported into a database, where it is aggregated, extracted and converted to an XML-formatted report and submitted online to the federal government.
First things first
But before IT could build the tracking system, "we actually had to build a Web-based application to give people a way to submit data to us," Gillespie explains.
Stimulus reporting: The basics
More than two-dozen federal agencies have been allocated a portion of the $787 billion in stimulus money. Each federal agency develops specific plans for its share, then awards grants and contracts to state governments or, in some cases, directly to schools, hospitals, contractors or other organizations. The federal agencies are required to file weekly financial reports on how they're spending the money and their specific activities involving ARRA funds.
Last month, states and other grant recipients for the first time filed the quarterly spending reports required under the law.
The executive branch has worked hard to ensure a smooth reporting operation, according to Rob Nabors, director of the federal Office of Management and Budget.
As Nabors puts it: "Between OMB and the vice president's office and others in the White House and out in the agencies, we've done 169 different conference calls with recipients. There've been 170 events with state officials. We've had 37 different events with local government officials. There have been seven White House forums, and there've been 20 separate Recovery Act reporting training sessions. That by itself is an unprecedented effort by the federal government to make sure that we get it right, and this was something that started all the way back in February."
-- Julia King
All of this was done in a matter of weeks by a small team comprising a designer-architect, a programmer and a project manager who is the chief liaison between IT and the state's stimulus office. The team already had some experience from working on the state's recovery Web site, which Gillespie says has "been kind of an iterative process that has been going on since the first recovery money came out."
He chalks up the speedy rate of progress on both projects to what he describes as healthy competition among states to have good reporting and great Web sites. "We wanted to be better than everybody else," he says.
But given the fierce push to quickly distribute ARRA funds and get new projects up and running, traditional IT project management practices, such as having a comprehensive set of user requirements, have in some cases gone out the window.
In Missouri, for example, a team was in the midst of implementing Microsoft Corp.'s Stimulus360 software for tracking funding and projects when the feds issued a change in data models for reporting.
"We had to move forward with plans and put things in place even though you knew [more] changes were coming," says Gerard-Hartman.
Like a start-up
At the newly formed Massachusetts Recovery and Reinvestment Office, Deputy Director Ramesh Advani likens the fast pace and deadline-driven atmosphere and culture to the environment of a start-up company.
"When you're doing something for the first time, you deal with systems issues, people issues, deadline issues, and you come across something new every day," he says. Tracking and reporting how many jobs are created with ARRA funds is a prime example. Meeting the first federal reporting deadline of Oct. 10 required some on-the-fly tactics.
"For the first round of reporting, what we have done is develop some manual templates, which we issued out to state agencies. Each agency must use the same template and also pass it on to subrecipients and vendors. That data will then be gathered and uploaded into a recently launched central database, then uploaded through XML to the federal system," he explains.
But this is only for the first round of reporting, Advani emphasizes. For the long term, the state is developing an automated data-gathering and -analysis system that includes Oracle Corp. business intelligence tools, data marts and data warehousing.
"We're trying not to make this a short-term solution, because ultimately we want to upgrade how we do grants management and our budgets across the board. We want to make sure we can use the same tools and reporting database beyond ARRA," Advani says.
ARRA timeline: 2009
* Feb. 17: The American Recovery and Reinvestment Act is signed into law. The federal government's Recovery.gov Web site goes live.
* Feb. 19: Federal agencies begin announcing block grant awards.
* May 17: Agency and program plans are posted on Recovery.gov.
* May - October: ARRA stimulus money is distributed to states and other recipients.
* May - August: Reporting requirements and updates are developed and distributed.
* Sept. 28: Recovery.gov is relaunched with geographic mapping.
* Oct. 10: The first quarterly deadline for recipient reporting is reached.
* Oct. 30: Recipient grant and loan data is posted.
-- Julia King
ARRA's tight timeline and strict reporting deadlines have already driven some key process improvements in the state. For example, funding for ARRA transportation and highway projects had a 120-day "use it or lose it" deadline. But it typically took the state between 100 and 300 days to advertise projects and solicit bids from contractors. "We ended up drilling down into the system to get it down to a 40-day process, which is something we're proud about," Advani says.
Another long-term improvement is the creation of the program office itself. Going forward, the office will oversee all activities involving grants reporting, monitoring and compliance. The goal is to increase overall information transparency "beyond what's expected for federal reporting," says Advani.
Maine CIO Dick Thompson says he's already been directed by a legislative committee to ensure that IT work done to meet ARRA reporting requirements is also used to increase information transparency statewide. Before ARRA, for example, the state didn't provide electronic versions of contracts on its Web site -- which is a requirement under ARRA. "Now, we'll take that technology and process new contracts through the same system so we can provide broader information on all contracts that have been awarded," he says.
The result of ARRA reporting, CIOs agree, is a lot like the road signs popping up that say: "Temporary Inconvenience, Permanent Improvement."