Jeff Bingaman: “today I'm introducing a bill designed to lower the cost of the government's information technology systems and improve…”

“today I'm introducing a bill designed to lower the cost of the government's information technology systems and improve how those systems serve our citizens by encouraging greater use of a ``share-in-savings'' approach to contracting for information technology (IT). Under a share-in-savings approach, the government contracts with a company to provide an improved, lower cost IT service and the company pays the up-front costs of the project, which is not the usual practice. In return, the contractor gets paid a portion of the money saved by the government under the new arrangement. Essentially, the contractor bears the capital costs needed for the government to save some money and has a strong incentive to decrease the government's costs because they get paid a portion of any savings. Although this approach to IT contracting is authorized as a pilot program under the Clinger-Cohen Act, I understand the executive branch has not made much use of this approach to date. Hence, I believe there are opportunities for greater creativity in this area if we give the agencies greater incentives.”