Government Technology is Finally Modernizing — Are You Ready?

Government organizations are finally starting to pursue a “cloud-first” digital transformation, and many are seeking guidance.

Government CIOs report that their traditional data centers and legacy applications are holding them back from implementing technology-enabled innovation. They’re also struggling with legacy cultures and contracts and limited access to talent.

But the federal government may finally have the beginning of a comprehensive plan to modernize its aging technology stacks, complete with enabling mechanisms and FUNDING.

In May of 2017, the President signed an executive order which prioritized the modernization of federal information technology systems through elimination of legacy systems and increased use of modern commercial technology.

Six months later, the President signed the National Defense Authorization Act (NDAA) for fiscal 2018, officially codifying the Modernizing Government Technology (MGT) Act into federal law, authorizing two types of funds for the purpose of modernizing the federal government’s legacy information technology: agency-specific IT modernization funds reallocated from IT cost avoidance and reductions and a government-wide IT modernization fund overseen by the Office of Management and Budget (OMB). And in March, the President signed the fiscal year 2018 appropriations omnibus, officially funding the IT modernization efforts for all appropriated agencies.

Federal IT is aging, but NOT gracefully

The 2015 U.S. Government Accountability Office (GAO) High Risk report1 found that collectively, agencies had spent more than $80 billion on IT in the prior fiscal year alone, with more than 75 percent devoted to operations and maintenance of “legacy IT.” Furthermore, they found this spending on O&M had been increasing annually, resulting in indefinite perpetuation of legacy programs and little to no research and development.

In December of that year, the House Committee on Oversight and Government Reform requested details from all agencies2 about: aging mission-critical systems, legacy programming languages, old IT hardware/infrastructure, wholly unsupported software, quantity of decommissioned systems and IT staffing. The following are some of the lowlights the agencies reported:

  • Over 930 million lines of code using more than 70 legacy programming languages
    • 156 million lines of 1960s-era COBOL
    • 136 million lines of 1960s-era FORTRAN
    • Not coincidentally, the two languages requiring the most staff to support:
      • COBOL (1,085 employees)
      • FORTRAN (613 employees)
    • Over 550 IT systems heavily dependent on completely unsupported software, including:
      • A Fortran compiler that was last supported in 1991
      • Windows 3.1 (released in 1992 and last supported by the vendor in 2001)
      • Windows NT (released in 1993 and last supported in 2004)
      • Windows 95 (released in 1995 and last supported in 2001)
    • Ten agencies did not indicate a date or plan for decommissioning a SINGLE IT system.

Potentially the most devastating finding was that 5,233 out of approximately 7,000 federal IT investments were O&M activities with no corresponding R&D, including $12.5 billion comprising the entire top ten investments.

What took so long?

Government technology is behind, we get it, but why has it taken so long to right the ship?

Anyone who has worked in government IT will tell you there are many reasons, but probably the most universal and insurmountable is budgetary. The government’s ability to spend money is rivaled only by its ability to complicate and prolong the actual act of spending that money.

Every year, government agencies must go through a long and arduous process to get each and every dollar, including all technology funding. They must decide 12-18 months ahead of time for which programs and initiatives to request funding and submit formal and fixed requests accordingly.

Even existing programs and continuing initiatives from prior years must request continued funding, while any net new programs and initiatives must be further scrutinized and submitted for additional authorization by Congress. Both the authorization and appropriations processes are now typically delayed by many months, if they ever happen at all. This means as a federal CIO, you may be waiting almost two years for funding of a specific technology initiative you’re championing.

Two years. Anyone who knows anything about technology knows that two years in technology is literally a lifetime. Every member of my family has a brand-new smartphone at most every two years, often much sooner. Entire technologies have come and gone in two years. Some private sector companies are able to replace their entire IT environment every two years. Netflix is making changes to their running systems twice an hour! If you told the CIO of Netflix that any changes in technology spend would have to be communicated in writing 18 months ahead of their introduction, he would laugh you out of his office.

AWS recently introduced per second billing. That’s great for Netflix, but that just exacerbates the problem for the government. At the end of the month, the federal CIO has to account for why a certain program is coming in four cents under the programmed budget, if she’s able to use cloud at all. We’ll get to that in a minute. With budgetary constraints so incongruent with the current state and rate of change of technology, it’s actually quite easy to see why simply maintaining the IT status quo is the preferred course of action 75 percent of the time.

As a federal CIO, it’s your duty to ensure that every technology function continues to hum along. Cloud migration? You’d love to, but then you’d have to pay for two environments concurrently, in addition to the R&D efforts necessary to get from A to B. It’s not in the budget.

How does the MGT Act change that?

For once it appears the government has approached the problem holistically. Obviously, you can’t sunset a system without a replacement, and you can’t create the replacement without some research and development, and concurrently running environments for at least a short period of time.

MGT allows you to designate a program for IT modernization, borrow funding for the R&D efforts, concurrent environments and migration, and then pay back the working capital fund with the reduced or avoided cost of running the replacement system in a more modern and efficient way. Truly a brilliant concept — now you just need to get started.

Join Rackspace Government Solutions for the AWS Public Sector Summit at booth 557 on June 20 and 21 in Washington, D.C., where we’ll be discussing our holistic approach to IT Modernization.

IT Modernization-as-a-Service across leading cloud technologies

If your organization is looking for help, Rackspace can assist. We offer expert guidance within the framework of the Modernizing Government Technology Act. Government organizations are confronting a daunting task: pursuing a “cloud-first” digital transformation in the face of complex, longstanding legacy technology and contract challenges.

By turning to Rackspace, you get a team of unbiased experts across a range of leading cloud and infrastructure technologies — built on a compliance-ready framework and backed by ongoing managed operations, continuous monitoring, security services, living compliance documentation and audit assistance.

We are a web-scale managed service provider, delivering 24x7x365 hybrid-cloud management, operational support and security services as a packaged, on-demand, audited and pay-as-you-go service. You get the same commercial services that power the Fortune 100, in a compliance-ready state, with the additional security controls and governance necessary for your unique mission.

Brad Schulteis is Director of Government Solutions. Previously, he served as Principal Architect and security specialist for Rackspace. He has over 15 years of enterprise IT expertise, across the public and private sector. He previously worked at AWS World Wide Public Sector, supporting some of their largest US federal government customers. Prior to that, he served for many years in a staff position within the Department of Defense, managing all aspects of their private cloud computing platform. Brad's work on this platform earned him a DoD Value Engineering Award, Special Act Award and Joint Meritorious Unit Award. Concurrently, he served on many government IT transformation working groups and study committees. He has a proven track record of working with complex requirements and driving change throughout large IT enterprises. Find Brad on LinkedIn.


  1. Brad, this is good context for MGT, we rarely see numbers behind legacy applications and systems, I am especially surprised with the number current employees supporting COBOL and FORTRAN systems, and number of unsupported Windows system. There is security risk for unsupported systems, which a cloud service provider can mitigate with controls mandated by government. This is well done, thank you for this blog. Cheers!


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