Vermont Should Become Leader in E-Government, Report Says

Published January 1, 2006

After two years of work, the Vermont Institute on Government Effectiveness has issued recommendations that would allow the state to make better use of technology to provide services and cut government spending.

The institute’s report says if the recommendations are adopted, services would improve and state government would deliver Vermont taxpayers between $20 million and $30 million in annual savings from the state’s $3.6 billion budget.

Technology Use Has Lagged

Formed specifically to produce the improvement recommendations report, the institute finished operations September 30, after announcing its findings on how to reform the operational and administrative functions of the Vermont state government. The report contains 20 recommendations that lawmakers may consider during the 2006 legislative session.

“Vermont has been a straggler in terms of making good use of technology in government. This report can help us make a huge jump forward,” said state Sen. Susan Bartlett (D-Lamoille), chairwoman of the Vermont Senate Appropriations Committee. “It is amazing to me how the average Vermonter is making better and better use of technology, and they simply expect to be able to get good service from government online.

“Vermont government needs to learn to use technology to provide timely, efficient service to citizens,” Bartlett said. “I’ve never believed that we should look at technology as a way to save money, but as a way to improve service and possibly a way to slow the growth of the number of state employees.”

Government Is Largest Employer

Although Vermont has only 630,000 citizens, the state government has nearly 9,800 full-time and temporary employees, 62 principal business units, and annual expenditures of more than $3.6 billion, making it a large operation in relation to the population. State government is Vermont’s largest employer.

The Vermont Institute was created shortly after Vermont Gov. Jim Douglas (R) announced during his state budget address in 2003 that he would “seek to change the culture of government from one that is so attached to the status quo–it resists even those changes that will move us forward–to one that embraces positive change.” Douglas asked a group of seven private citizens to conduct an independent review and evaluation of state government operations.

That resulted in the creation of the Vermont Institute on Government Effectiveness, Inc., a private 501(c)(3) public benefit corporation that attracted private financial support from more than three dozen contributors.

The Institute’s Summary of Change Recommendations Report includes several findings and recommendations.

IT Reorganization Recommended

Working with the institute, then-Secretary of Administration Michael Smith launched an initiative in July 2004 to reorganize the state’s outdated information technology (IT) infrastructure and organizational management model into a contemporary enterprise managed framework (one that integrates technologies to manage data, business processes, regulatory reporting, risk management, and other business functions at an enterprise level rather than as separate operations).

The goals of the reorganization were to improve the quality and availability of IT services, reduce annual infrastructure inefficiencies and duplication, empower skilled IT personnel, and create productive capacity for meeting future needs of citizens from state government.

Informal estimates provided to the institute by qualified technology firms indicate a $20 million to $30 million annual savings potential from successfully transforming to an enterprise managed framework. Current annual expenditures on IT, including personnel, are approximately $90 million. The institute cites this area as the single greatest opportunity for the state government to save money, better support state employees, transform underlying business processes, increase data security, and serve the public more effectively.

Several state legislative leaders have requested draft legislation on how to support the administration in shaping and effecting this IT transformation.

Web Partnership Recommended

Vermont spends $2 million to $3 million per year to design, support, and develop dozens of standalone Web sites, the indexing site, and custom application development by third-party vendors. However, the availability of e-government services for state employees and citizens today is poor, the report says.

In addition to providing a fundamental service improvement, a Web-based customer transaction can be nine times less expensive than a transaction or question fulfilled via an email or telephone response. In March 2005, the institute conveyed its findings on the transformation of Vermont state government into an e-government leader via a revitalized Web portal through a public/private partnership.

A proposal is expected from the Douglas administration for the start of the 2006 legislative session.

Workforce Transformation Proposed

With the average cost per Vermont state employee exceeding $60,000 per year, technology solutions and process re-engineering create more significant fiscal and customer service opportunities than ever before, the report notes.

Additionally, the report cites an upcoming retirement bubble among state employees that creates a related opportunity for transforming the workforce. Of the executive branch’s 7,935 full-time equivalent employees in FY2004, 26 percent would be retirement eligible in five years and 43 percent in 10 years. Certain categories are nearly double those rates.

As a result, there is growing consensus that the state has a once-in-a-generation opportunity (and responsibility) to flatten the managerial, processing, and bureaucratic layers of the state government organization. According to the institute’s report, that can be done by using better deployment of technology, workforce attrition, and departmental reorganizations.

Listened to Public

Institute Chairwoman Mary Powell said, “What makes this government improvement effort different is that the institute and the Douglas administration have taken state employee input and citizens’ ideas and translated these into actionable opportunities and operating results.”

Since the report’s publication nearly 3,000 Vermonters have visited to review the institute’s recommendations and offer their own suggestions.

The aim of the report, Powell said, is to ensure all Vermonters can be better served by a government that adopts modern information technology, reorganizes to meet growing customer needs, empowers employees, and redesigns internal processes to achieve maximum productivity. The alternative is to continue to add new state employees and increase spending.

Doing nothing is an approach that may no longer be sustainable for Vermonters and their relatively tiny economy, Powell said, noting more effective and fiscally sustainable options for the access, operation, and delivery of government services exist today than ever before.

David Bradbury ([email protected]) is the former executive director of the Vermont Institute on Government Effectiveness and founder of Aggregate Capital Partners, a strategy and government consulting firm in Stowe, Vermont.

For more information …

The Summary of Change Recommendations Report of the Vermont Institute on Government Effectiveness can be found online at