Volume 7 The Wormeli Report

The IJIS Institute i

THE WORMELI

REPORT

Volume 7

2014

Volume 7 The Wormeli Report

The IJIS Institute ii

This report is produced free of charge for Member companies of the IJIS Institute. It is made

available for sale to other entities including IJIS Institute Affiliate companies, Alliance Partners,

and government agencies at all levels.

The purpose of The Wormeli Report is to inform interested entities about the current and

projected trends regarding high-profile programmatic directions and funding availability for

implementation of national priority programs. Distribution should be limited to managers and

staff internally in Member companies.

The opinions expressed regarding likely outcomes for funding and programmatic support are

those of the editorial staff and guest writers. They do not necessarily reflect the opinions or

conclusions of the IJIS Institute or its Board of Directors, the Federal funding agencies, or any

individual Member company.

No Federal grant funding was used in the research, preparation, or distribution of this report.

Volume 7 The Wormeli Report

The IJIS Institute iii

TABLE OF CONTENTS

ACKNOWLEDGEMENTS ............................................................................................................ VII

GUEST AUTHORS ..................................................................................................................... VIII

INTRODUCTION ......................................................................................................................... 1

A Message from the IJIS Institute Executive Director .......................................................................... 1

EXECUTIVE SUMMARY ............................................................................................................... 2

FUNDING TRENDS: THE TOUGH TIMES CONTINUE................................................................... 4

National Economic Outlook ................................................................................................................. 4 State and Local Spending .................................................................................................................... 6

State and Local Government Strength ................................................................................................................. 8 Federal Funding to States ................................................................................................................................... 12

Federal Budgets .................................................................................................................................16

Federal Contractor Growth Strategies ................................................................................................................ 18 Federal IT Priorities .............................................................................................................................................. 18 Federal Budget Legislation .................................................................................................................................. 19 Federal Budget Summaries ................................................................................................................................. 22 Department of Justice ......................................................................................................................................... 22 Department of Homeland Security ..................................................................................................................... 27 National Intelligence Program (NIP) .................................................................................................................... 36

THE DEVOLUTION OF HOMELAND SECURITY AND PUBLIC SAFETY FUNDING ....................... 38

SELLING IN LOCAL GOVERNMENT MARKETS ......................................................................... 41

Top 10 considerations for new players ..............................................................................................41 Keys to success .................................................................................................................................43

The Four Rs .......................................................................................................................................................... 43

SEEKING OPPORTUNITIES IN ADJACENT MARKETS ............................................................... 45

Focus on being a ‘winning contractor’ ...............................................................................................46 Dealing with the LPTA environment ...................................................................................................47 Strong business capture process ......................................................................................................48 Obtain candid customer feedback .....................................................................................................48 Use thought leadership effectively ....................................................................................................49 Conclusions........................................................................................................................................50

TECHNOLOGY TRENDS............................................................................................................ 51

Driving forces influencing technology adoption .................................................................................51 Changes in operating models ............................................................................................................51 Environmental factors driving innovation ..........................................................................................52

MAJOR TECHNOLOGY INNOVATIONS ...................................................................................... 54

The application of cloud computing ...................................................................................................54 The pervasive use of video ................................................................................................................56

Volume 7 The Wormeli Report

The IJIS Institute iv

The further development of social media ..........................................................................................58 Smartphone and tablet technology ...................................................................................................59 Collaboration technologies ................................................................................................................60

TECHNOLOGY PREDICTIONS FROM TOP IT INDUSTRY EXPERTS ........................................... 62

IJIS INSTITUTE NATIONAL PROGRAMS .................................................................................... 63

IJIS Institute Core Services ................................................................................................................64 Standards-Based Interoperability Initiative .......................................................................................65

Springboard .......................................................................................................................................................... 65 Overview and Purpose ..................................................................................................................................... 65

Public Safety Information Sharing .....................................................................................................66

DHS Incident Management Information Sharing Program ................................................................................ 66

Cross Boundary Information Sharing Programs ................................................................................67

Criminal Justice–Health Collaboration Project ................................................................................................... 67 New Jersey Information Sharing Environment (NJ-ISE) ..................................................................................... 68 Prescription Drug Monitoring Exchange (PMIX) Expansion Project ................................................................... 70

Criminal Justice Information Sharing Programs ................................................................................71

Corrections Information Sharing ......................................................................................................................... 71 National Crime Statistics Exchange (NCS-X) Project .......................................................................................... 72 Development of a PREA National Data Standard and Pilot Implementations ................................................. 73 Statewide Automated Victim Information and Notification (SAVIN) Technology Assistance (TA) Project (S-TAP)

.............................................................................................................................................................................. 74

Task Forces ........................................................................................................................................75

Biometrics Industry Government Standards Interoperability Group (BIGSIG) Task Force ............................... 75 Procurement Innovation Task Force ................................................................................................................... 75 Task Force Development ..................................................................................................................................... 76

APPENDIX A: MARKETING RESEARCH RESOURCES ............................................................... 77

APPENDIX B: ACRONYMS AND ABBREVIATIONS ..................................................................... 79

Volume 7 The Wormeli Report

The IJIS Institute v

LIST OF FIGURES

FIGURE 1: PROJECTED GROWTH RATE OF REAL AND NOMINAL GDP ...................................................................... 4

FIGURE 2: PERCENT CHANGE IN REAL GFP BY STATE, 2012 ................................................................................... 5

FIGURE 3: GROWTH IN STATE AND LOCAL TAXES ..................................................................................................... 7

FIGURE 4: STATE GENERAL (GEN) FUND REVENUE, AFTER RECESSION WITH PROJECTIONS ............................... 9

FIGURE 5: STATE TAX REVENUE RECOVERY IS WEAK ............................................................................................. 10

FIGURE 6: STATE TAX COLLECTION BY TYPE ............................................................................................................ 11

FIGURE 7: FEDERAL NON-DEFENSE DISCRETIONARY AID TO STATES AND LOCALITIES ...................................... 13

FIGURE 8: FEDERAL NON-DEFENSE DISCRETIONARY AID TO STATES & LOCALITIES, % OF TOTAL BY CATEGORY:

FY2014 ....................................................................................................................................................................... 14

FIGURE 9: STATE AND LOCAL GOVERNMENT PAYROLL .......................................................................................... 15

FIGURE 10: FEDERAL GOVERNMENT TRENDS IN SPENDING ................................................................................ 17

FIGURE 11: FEDERAL IT PRIORITIES ........................................................................................................................ 19

FIGURE 12: FY2015 BUDGET ACT COMPARISON .................................................................................................... 20

FIGURE 13: APPROPRIATIONS TRACKER ................................................................................................................. 21

FIGURE 14: FY2012-FY2015 FUNDING AND BUDGET BY CATEGORY.................................................................... 24

FIGURE 15: DOJ’S DISCRETIONARY FY2015 BUDGET BY ORGANIZATION ............................................................ 24

FIGURE 17: DOJ’S 2014 DISCRETIONARY BUDGET AUTHORITY BY ORGANIZATION ............................................. 26

FIGURE 16: DOJ ORGANIZATION CHART, NOVEMBER 2012 .................................................................................. 27

FIGURE 18: DHS FY2013-FY2015 TOTAL BUDGET AUTHORITY BY ORGANIZATION.............................................. 31

FIGURE 19: FY2015 PERCENT OF TOTAL BUDGET AUTHORITY BY ORGANIZATION .............................................. 35

FIGURE 20: DHS ORGANIZATION CHART .................................................................................................................. 36

FIGURE 21: NEW MARKET DRIVERS ........................................................................................................................ 41

FIGURE 22: THE 4 RS ................................................................................................................................................ 44

FIGURE 23: ADJACENT MARKETS ............................................................................................................................. 45

Volume 7 The Wormeli Report

The IJIS Institute vi

LIST OF TABLES

TABLE 1: NASCIO STATE CIO PRIORITIES FOR 2013 & 2014 ................................................................................. 16

TABLE 2: DOJ FY2013-FY2015 ENACTED AND PERCENT CHANGE........................................................................ 25

TABLE 3: FY2014 DOJ FUNDING LEVELS APPROVED BY THE HOUSE.................................................................... 25

TABLE 4: DHS FY2013-FY2015 DEPARTMENT MANAGEMENT AND OPERATIONS BUDGET REQUEST .............. 30

TABLE 5: 2014 IT PREDICTION AND TRENDS CHART .............................................................................................. 62

Volume 7 The Wormeli Report

The IJIS Institute vii

ACKNOWLEDGEMENTS

We would like to express our gratitude for the input that many people and government entities have

contributed to this publication. This report, and our ability to learn about and understand national trends

and programs, would not be possible without the full support of our Federal partners: the Bureau of

Justice Assistance (BJA) of the Office of Justice Programs (OJP) in the U.S. Department of Justice (DOJ)

and the Program Manager for the Information Sharing Environment (PM-ISE). The continuing leadership

and guidance of BJA are key elements to the success of the various projects in which the IJIS Institute is

engaged.

We also benefit from the insights and work products of our many Alliance Partners, including the

National Criminal Justice Association (NCJA), the International Association of Chiefs of Police (IACP),

the Association of Public-Safety Communications Officials (APCO), and other agencies, as well as the

contributions of our Member companies.

We also thank other companies and nonprofits whose reports and reference materials have been quoted in

this report—NCJA, Rockefeller Institute, NASCIO, Deltek, IACP, The Heritage Foundation, Center on

Budget and Policy Priorities, The Congressional Research Service—and others as indicated in footnotes.

The staff of the IJIS Institute is in a unique position to build the bridge

between industry and government. Their attention to activities that are

shaping trends in this field is what allows us to stay reasonably informed

about national market and technology trends.

The IJIS Institute is grateful for the support of the Member companies

and their professional representatives who devote time and share their

invaluable expertise for our various programs.

Volume 7 The Wormeli Report

The IJIS Institute viii

GUEST AUTHORS

We are particularly appreciative for our first guest authors in this edition: Paul Wormeli, owner of

Wormeli Consulting and executive director emeritus of the IJIS Institute; Jeff Webster, manager for

Public Safety Research at Deltek’s GovWin, a market research firm; Michael Pollock, founder and CEO

of Grants Office, a national grants development services firm; and, Monica Mayk Parkam, marketing

director for Market Connections, Inc., brand-conscious marketing firm.

Paul Wormeli, Owner and Innovation Strategist, Wormeli Consulting, and Executive Director Emeritus of

the IJIS Institute

Paul Wormeli is an innovator and entrepreneur who has focused his career on the

application of information technology to public safety, law enforcement, criminal

justice, and homeland security. He has introduced innovative programs in public

policy, as well as innovations in the use of technology. He has been active in the

development of software products, has managed system implementation for dozens

of agencies throughout the world, and has managed national programs in support of

law enforcement and criminal justice agencies. Mr. Wormeli was the first national

project director of Project SEARCH and was subsequently appointed by the

President as Deputy Administrator of the Law Enforcement Assistance

Administration (LEAA) in the U.S. Department of Justice (DOJ). Mr. Wormeli went on to create, and

was the first chairman of, the Integrated Justice Information Systems Industry Working Group (IWG).

After the IJIS Institute was created as a non-profit follow-on to the IWG, he became the first full-time

executive director of the IJIS Institute and served in this capacity until January 2011, when he transitioned

to the role of executive director emeritus. Mr. Wormeli is currently the owner and innovation strategist for

Wormeli Consulting LLC. Mr. Wormeli serves on the Committee on Law and Justice (CLAJ) of the

National Academy of Sciences, is an author and lecturer on law enforcement and justice technology, and

has won numerous awards for his work in information sharing in justice, public safety, and homeland

security.

Jeff Webster, Manager for Public Safety Research, Deltek

Jeff Webster focuses solely on the State and Local Justice/Public Safety and Homeland

Security Information Technology market for Deltek. Webster identifies upcoming

opportunities in various state and local governments, as well as tracks ongoing and

past state contracts. He is also responsible for keeping all state profiles updated and

researching IT industry and Public Sector procurement developments and trends.

Monica Mayk Parkam, Marketing Director, Market Connections, Inc.

Monica Mayk Parham directs strategic marketing and client outreach activities for

Market Connections, Inc., overseeing content development, promotional

communications, public relations and events.. Monica is instrumental in the

development of Market Connections’ syndicated research of the government

contracting marketplace and the company’s robust content offerings on

FedConnects.com and MarketConnectionsInc.com. Monica’s expertise includes brand,

thought leadership, creative and event management. She serves as executive editor of

FedConnects.com and Market Connections’ eNewsletter, Insights in Action.

Volume 7 The Wormeli Report

The IJIS Institute ix

Michael Pollock, Founder and CEO, Grants Office

Michael Paddock is the founder and CEO of Grants Office, a national grants

development services firm, and he recently completed five years as an award-winning

grants columnist for Homeland Security Today magazine. He served from 1996-2001

on the US Interagency Electronic Grants Committee and co-founded the New York

State E-grants project in 1999. His 2007 published article "Funding the First 72 Hours"

is a reference in the National Blueprint for Secure Communities, a joint project of the

National Council on Readiness and Preparedness and the John F. Kennedy School of

Government at Harvard University.

Volume 7 The Wormeli Report

The IJIS Institute 1

INTRODUCTION

A MESSAGE FROM THE IJIS INSTITUTE EXECUTIVE DIRECTOR

The purpose of this report is to inform IJIS Institute Member companies about national programs,

initiatives, and trends affecting justice, public safety, and homeland security. This analysis and

aggregation of information is intended to be useful in strategic and tactical planning, resource allocation

for marketing or investment in products and services, and evaluation of market segments and

opportunities.

Because of the IJIS Institute’s role in national dialogues on

information technology (IT)1 policy and information sharing and

safeguarding, the Institute is in a unique position to identify, observe,

and collect data on these trends. It is an important part of our mission

to share this information so that you can be prepared to make

decisions as to the extent of your market participation in these new

areas of opportunity.

The aggregation of the information that comes to the attention of the

IJIS Institute staff is not based on hard surveys; rather, we make the

attempt in this report to bring together our joint knowledge of

program directions, funding, and the results of many discussions with

government leaders at the Federal, state, local, tribal, and territorial

levels. Further, we collect and aggregate comments, forecast, studies,

and reports on the economy and technology from leaders in our fields

of interest.

We recognize that the understanding of significant national programs varies among our Member

companies, and even within divisions of our larger Members. This report is specifically aimed at

executives and senior managers who contribute to or make decisions on business direction and strategy.

The report is, therefore, a high-level overview and is well footnoted to provide direct links to further

information on each of the market trends and programs discussed.

We hope you will find the observations and conclusions in this report useful.

Steve Ambrosini

Executive Director, IJIS Institute

www.ijis.org

1 See Appendix B for a full list of acronyms and abbreviations.

Volume 7 The Wormeli Report

The IJIS Institute 2

EXECUTIVE SUMMARY

Businesses have faced a number of challenges in the past

few years: Taxmageddon, the Fiscal Cliff, sequestration, a

Federal government shutdown, and the debt ceiling

debacle. While experts are predicting the U.S. economy to

expand by 2.6 percent in 2014, we are still facing flat or

limited budgets in most government agencies.

The good news is that any expansion of the national

economy will trickle down to the state governments which

are still struggling to recover from the biggest revenue

decline in history. However, indicators show an overall

positive trend in state revenue collections for 2014, which

puts them well ahead of cities’ recoveries with revenue

totals surpassing pre-recession levels for the first time in

FY2013.2

According to the National League of Cities’ (NLC) annual survey City Fiscal Conditions, city

government finances are improving as well.3 As a result, justice and public safety company-supplied IT

systems are projected to increase at a 2.4% Combined Annual Growth Rate (CAGR) from 2013-2018,

which should equate to a modest increase in spending primarily in the local market.

Regardless of the positive trends for state and local government, the Federal government plans to cut non-

defense discretionary funding again in 2014 by about 2%. Further, Deltek expects Federal budgetary

cutbacks could decrease IT spending for products and services by about $8B by 2017.4 On the bright side,

the FY2015 budget request designates about $13B across the government to improve cyber security and

expand continuous diagnostic technologies to mitigate threats to Federal networks.

Looking at commentary by various organizations, we believe the following key economic forces will

shape the future market:

1. In the early weeks of 2014, the Consolidated Appropriations Act, 2014 (H.R. 3547; 113th

Congress) was passed by Congress and signed by the president; it included spending cuts that

have the potential to affect our markets.

2. We will see continued recovery, albeit slow.

3. Inflation will remain low, near one percent; however, interest rates will start to climb but likely

not enough to dampen business startups or growth in the near term.

4. Real estate has slowed recently but should still provide significant revenue to the struggling local

governments.

5. The biggest issue affecting growth may well be the policy uncertainty that continues in a divided

Congress.

In addition to the economic predictions and budget realities discussed in our report, we provide a

technology comparison of Paul Wormeli’s predictions, NASCIO’s state view, and Gartner’s commercial

2 http://www.nasbo.org/publications-data/fiscal-survey-of-the-states

3 http://www.rockinst.org/pdf/government_finance/state_revenue_report/2014-03-11_Data_Alertv3.pdf

4 Federal Information Technology FY 2014 Budget Priorities, APR 10 2013.

http://www.whitehouse.gov/sites/default/files/omb/assets/egov_docs/2014_budget_priorities_20130410.pdf

Volume 7 The Wormeli Report

The IJIS Institute 3

trends. Interestingly, the only two trends cited by these organizations where there is unanimous agreement

is the importance of cloud computing and mobile workforce technologies.

Also in this report, conclusions about what is of primary interest to agencies in the public safety, justice,

and homeland security spaces are provided. The technologies are:

1. The growth of cloud computing,

2. The move to mobility,

3. Cyber and information safeguarding,

4. Identity credentialing and access management,

5. The pervasive use of video,

6. The further development of social media, and

7. Collaboration technologies.

In addition to these predictions, the annual InformationWeek survey of Federal government technology

professionals and contractors lists the top five Federal IT priorities:

1. Cybersecurity/security,

2. Disaster recover planning/continuity planning,

3. Data records management,

4. Virtualization, and

5. Data center consolidation.

An article in Washington Technology reports that government contractors facing decreasing IT budgets in

their markets will adjust their growth strategies for 2014 and beyond by: searching for new markets,

improving competitiveness, improving capture and proposal processes, outsourcing more services, adding

business development resources, realigning organizations, and reducing costs.5

For the first time, the IJIS Institute has invited leading experts in our markets to contribute their thoughts

to the Wormeli Report on topics of interest to our Members. For more on strategies to help grow your

business see the sections on The Devolution of Homeland Security and Public Safety Funding, Selling in

Local Government Markets, and Seeking Opportunities in Adjacent Markets.

The National Programs section provides brief updates on the status of major national initatives in which

the IJIS Institute and its Member companies are involved such as Corrections, Statewide Automated

Victim Information Notification, the Springboard Certification Program, and the New Jersey Information

Sharing Initiative. In this section, we discuss our observations based upon direct involvement, as well as

the potential impact of those observations on the market in terms of potential changes and industry

opportunities.

In the final section, read about the new task forces which are addressing contemporary problems defined

by industry and practitioner participants. The task forces currently under development are: Geospatial,

Standard Data Exchange between Jail Management Systems/Records Management Systems and Livescan

Systems, Law Enforcement-Image Technology, and Information Safeguarding.

5 Contractors reshape growth strategies for 2014. Washington Technology, January 15, 2014.

http://washingtontechnology.com/Articles/2014/01/15/Insights-lohfeld-2014-strategy-reset.aspx?Page=3