State and local government CIOs deal with constant changes and threats to their funding. The ongoing US federal government shutdown is a glaring example. With the shutdown stretching into its second week, here is what I’m seeing right now: As state and local CIOs watch federal funding dry up, their immediate response is to freeze everything and wait it out.
It’s an understandable reaction. But it’s exactly backwards.
The Real Cost of Doing Nothing
When budgets tighten, the instinct is to preserve what you have. Modernization gets shelved. That AI pilot gets pushed to next fiscal year. The legacy system groaning under tech debt? “We’ll deal with it when funding comes back.”
Meanwhile, you’re burning money keeping those old systems running. You’re paying maintenance contracts on software that should’ve been retired five years ago. Your team is manually doing work that could be automated for a fraction of the cost.
The math doesn’t add up. You think you’re saving millions by waiting, but you’re spending it anyway…just slower and with nothing to show for it.
It’s Never Been Cheaper to Build
Here’s what’s changed: Building production-ready applications doesn’t require multi-year roadmaps and eight-figure budgets anymore!
I’m watching agencies burn $2-3 million maintaining legacy systems when they could modernize the entire thing for $300-400K and cut their annual run costs in half. The tools, the accelerators, the cloud infrastructure…it’s all there. Many of these accelerators are free to use.
AI isn’t some future-state luxury. It’s the most cost-effective way to deliver services right now. Agencies that implement real AI applications, not pilots, not proofs-of-concept, but actual production systems, are processing permits faster, answering citizen questions 24/7, and freeing up their people to do work that actually requires human judgment.
The Multi-Year Plan Trap
The biggest mistake I see? CIOs treating modernization like it’s 2010. They’re building three-year transformation roadmaps, forming steering committees, hiring consultants to write 200-page requirement docs.
By the time you finish planning, your requirements are outdated, and your budget’s been cut twice.
The agencies winning right now are moving fast: identify the highest-pain legacy system, spin up a modern replacement in 90-120 days, prove the value, then move to the next one. Rinse and repeat.
What to Do Right Now
If you’re a state or local CIO staring down budget uncertainty:
- Stop hoarding cash for some perfect future moment. That moment isn’t coming. The political and fiscal landscape will always be uncertain.
- Pick one high-value, high-pain application and modernize it this quarter. Not next year. This quarter. Prove you can deliver something real for a few hundred thousand dollars instead of talking about spending millions someday.
- Use the accelerators that already exist. You don’t need to build everything from scratch. Companies like us at Presidio have invested in tools and frameworks specifically to cut your time-to-value. They’re built. They’re proven. They’re often free to use.
- Measure everything in months, not years. If your roadmap extends beyond 12 months, then you are planning, not executing.
When Budgets Tighten, Winners Act Differently
The shutdown will end. Another fiscal crisis will come. Then another. That’s the reality of public sector funding.
The agencies that thrive aren’t the ones who pause and wait. They’re the ones who use constraints as forcing functions… to kill sacred cows, to move faster, to prove they can deliver modern capabilities without the old playbook.
Your citizens need better services now. Your staff is drowning in manual work now. Your cyber vulnerabilities are growing now.
The good news? You can actually afford to fix it. You just have to stop waiting for permission.
