Maximizing Cost Savings - Unleashing the Value of Federal IT Modernization


April 15, 2024


In the rapidly evolving digital landscape, investments in federal IT modernization are essential to serve the American people better. Rather than a mere expense, IT spending serves as a vital investment that empowers agencies to modernize infrastructure, enhance citizen services, improve national security, and foster innovation. 

While these reliability and efficiency gains are significant outcomes of IT system modernization, the rising costs associated with maintaining legacy IT systems provide further justification for upgrading outdated structures. IT modernization can yield long-term cost savings and efficiencies. 

The new report "Maximizing Cost Savings: Unleashing the Value of Federal IT Modernization" explores eight instances across the federal government that demonstrate this phenomenon. These include the following:

2020 Census Online at the U.S. Census Bureau

The Bureau launched the first nationwide online census through a website that significantly improved the user experience, which saved the agency $1.9 billion and made participation safer during the COVID-19 pandemic.

Customs Modernization at the Department of Homeland Security

The Department saved $30 million a year in operations and maintenance costs by migrating to a cloud-based platform. Modernized key workflow processes, including payments to improve security and the user experience, supported critical COVID-19 responses.

Specialty Crops Inspection at the Department of Agriculture

Modernized critical back-office processes resulted in reduced food waste and spillage. This yielded annual savings of approximately $1.72 million in operations and maintenance expenses. Cost savings were achieved through the elimination of manual processes, which reduced the need for manual data entry and documentation for farmers, small business owners, and consumers. 

Cloud Email Migration at the Department of Energy

By consolidating on-premises email environments and migrating 225,853 mailboxes to the cloud, the Department of Energy eliminated wasteful spending on maintaining 64 separate email systems. 

Labor Certificate Modernization at the Department of Labor

The Department of Labor saved $2 million annually in supplies and labor expenses while increasing the issuance of H-2A certifications by 176% and H-2B certifications by 109% in a single day. A cloud-based system enabled interagency sharing and improved data management. at the Department of Interior

Improved user experiences resulted in approximately 9 million online transactions, more than 1.55 million mobile app downloads, and 4.25 million camping reservations in FY 2021 alone. This was enabled by a successful public-private partnership without government funds. 

Mainframe to Cloud Migration at the Department of Housing and Urban Development

An estimated annual saving of $8 million was achieved by decommissioning the legacy mainframe. This supported 30,000 users across more than 100 Housing and Urban Development grant, subsidy, and loan programs and disbursed $27 billion annually. 

Digital Modernization at U.S. State and Local Government (Using Federal Pandemic Relief Funds)

Federal funds, distributed through state and local agencies, modernized IT systems to improve digital delivery, reduce fraud, and increase cost savings. 

Learn More

This report expands on previous research conducted by the U.S. Chamber on government digitization, which is available here.

Maximizing Cost Savings - Unleashing the Value of Federal IT Modernization