It still amazes me that while the powers that control the
funding for IT in government want it to operate like a utility (always on, no
glitches or downtime, already there when you walk into a room), they want to
fund IT projects as one-time expenditures. As you and I know, IT is not a
one-time expenditure, but a continuous investment in resources to keep itoperating like the utility everyone expects.
So how do you go about acquiring the funds to keep
yourself operating? I have observed others' methods and tried several different
ways myself, and I thought I would throw them out to you for consideration and
possible use. There are pros and cons associated with all of them, and I willtry to mention a few for each.
The first method is what I call grab it while you can. This method employs building everything—plus the kitchen sink and
a waste can or two—into your budget request for a particular item/project
(including the cost to operate it for several years). This is accomplished by
over buying or buying ahead for maintenance and services (like buying blocks of
hours that the vendor will carry over multiple years) or disguising operatingcosts as part of the cost of a piece of equipment or software.
I personally don't care for this method and like to be up
front with my budgeting, but I have had my detailed budgets for projects
"massaged" by CFOs and budget officers to better enable them to get
funded. They knew that the time was right for a particular purchase and that
the opportunity to get funding for that type of project probably wouldn't come
around again any time soon. Y2K is a good example; the impacts of major
disasters like 9-11 or Katrina also influence project funding, as well as a
change in administration or leadership. These budget officers also knew that
there would be more flexibility in capital costs/funding that particular yearthan in general revenue.
Grant funding is another way of grabbing
operating funds at the inception of a project. Obviously, getting grant funding
for a particular project can help offset current costs (especially if the
current project is already budgeted and approved) but often grants do allow for
administrative overhead in their funding. This administrative overhead can be
defined quite differently from grant to grant, as well as from one budgetoffice to the next, when interpreting the grant.
However, both of these methods leave you with the
eventuality of having to go back to the well to keep the IT department running.
So how do we acquire the funds to keep the wheels on? Some shops have gone to acharge-back system—where they charge users of technology (in
other departments) a fee for service. I have seen this work through measured
services and aggregated costs that are passed on as charges. The problem with
the former is that you better be darn good at measuring—and some IT work is
hard to quantify as a charge. It also means you need to run a billing system of
some kind. An example of the latter would be a per-phone or data jack cost or
an FTE cost in which all the costs of your operation are aggregated and then
averaged out on a per unit basis. The problem with this method is that users
can end up paying for services they do not use and if you try and break those
out, it can get pretty messy, particularly when trying to justify the per-unitcharge.
One method that has been used in higher education is to charge a technology fee. This fee is either a flat, one time-fee
per semester, year, or credit hour. Note that this is different than an
aggregated charge as described above because it is not designed to charge back
all the operations of IT. The fee is an acknowledgement that it takes dollars
to operate and improve IT operations, and the users are going to pick up part
of the tab. The national average per credit hour is somewhere between 5 and 10dollars for those universities that charge a fee.
I have not seen this method employed in non-education
circles yet (if you have, please let me know and give details—I'm interested),
but it could have some merit in general government IT administration. I can
imagine a scenario where IT departments could charge a per-user fee that is
adjusted yearly with inflation to help offset the costs of continued
operations. This fee could be set at an amount—say $50 dollars per user—and
would be added to the budget of the IT department. These dollars would then be
added to the IT department's budget as additional funds— not asreplacement funds for general revenue funds that they would already receive.
Yes, I realize that in the long run that there is one
pot of money and that these are all accounting games and none of this should
matter. However, the pot has to be divided and there is never enough money for
everything. How you go about making your budget requests can make a significant
difference in what you get from year to year. It is an ART not a science, and
logic plays very little into the final equation. Because IT is so often
overlooked or considered a necessary evil, it is important to ensure that we do
the best job possible come budget time. While my suggestions may or may not be
what you need to do in your environment, hopefully, they will plant some seeds
that will lend you some flexibility and creativity when approaching yours.