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Local government information technology trends: a 1995-1998 comparison for Virginia local governments.

In the Spring of 1995, the Virginia Government Finance Officers Association endorsed a survey on technology use by local governments to collect information regarding computer software, networks, and hardware. Questions were asked about technology currently in use as well as future plans. The 1995 study was replicated in the spring of 1998, when it was expanded to include questions about Internet use. This article highlights the major differences in findings between the two surveys, which suggest that there have been some shifts in technology emphasis by local governments.

The survey was sent out to all 95 Virginia counties, 41 cities, and 32 major towns. The localities range from populations of more than 800,000 to less than 6,000. The response rate in 1995 was 59 percent (99 responses) and the response rate in 1998 was 35 percent (59 responses).
Exhibit 1

FINANCIAL REPORTING SYSTEMS (FRS) PLATFORMS

Platforms FRS Runs On 1998 Results 1995 Results

Host (Mainframe or Mini) 81% 76%
Local Area Network 19 17
Stand Alone PC - 7

Total 100 100
Exhibit 2

AGE OF FINANCIAL REPORTING SYSTEM

Age Bracket 1998 Results 1998 Results

 % of total % to be % of total % to be
 replaced replaced

0-2 years 12 30 14 15
2-4 years 10 0 12 18
4-6 years 12 0 12 27
6-8 years 19 33 25 22
8+ years old 47 45 38 40
Total 100 33 100 28


Accounting Software

Participants were asked a range of questions regarding their financial reporting systems (FRS) and related subsystems such as accounts payable, payroll, and tax assessment. Exhibit 1 shows the survey responses regarding the hardware platforms used to run the FRS systems. The responses indicate that mainframe and minicomputers continue to be the platform of choice for running the core financial applications, despite other findings (reported later in this paper) indicating that local governments are increasingly investing in the construction and maintenance of local area computer networks.

Exhibit 2 reports the age of the financial reporting systems as well as data on planned replacements. A full one-third of all local governments responding in the 1998 survey report that they will replace their FRS within the next two years, as compared to planned replacements of 28 percent reported in the 1995 survey. Forty-five percent of all systems more than eight years old were scheduled for replacement at the time of the survey; the high level of planned replacements for these older systems may be driven partially by municipalities using system replacement as a method to achieve year 2000 compliance.

Personal Computer Software

Participants were asked a range of questions regarding the software used on personal computers (PCs). Exhibit 3 provides information on the use of word processing software. In 1995, responses indicated that WordPerfect was the most commonly used word processing product in local governments, and plans for 1996 indicated little expected change. The 1998 data reveal a significant shift. Although the use of WordPerfect for Windows was reported at approximately the same level, large growth in market share occurred as Word for Windows software moved from a distant third place to become the dominant word processor used.

A similar shift can be seen in the use of spreadsheet and database software [ILLUSTRATION FOR EXHIBITS 4 AND 5 OMITTED]. Excel has replaced Lotus 1-2-3 as the dominant spreadsheet software and Access has become the leader in PC databases, taking the position once held by the dBASE.

The shift in PC software is partially the result of the bundling of applications into software "suites." Participants were asked in 1998 if the bundling of applications into suites affected their software purchasing decisions. The responses indicated that 67 percent of the respondents' purchasing decisions had been affected in some way by the existence of software suites. More specifically, approximately half of the respondents indicated that they had changed one of their software application choices, such as word processing or spreadsheet, in order to take advantage of software suite pricing and integration.

Almost all software ran using some version of the Windows operating system. By 1998, Windows 3.X, Windows 95, and/or Windows NT were reported in use - either singly or in various combinations - by 92 percent of respondents. Governments using DOS decreased from 86 percent in 1995 to 57 percent in 1998.

Networks

Although the vast majority of financial reporting systems of local governments continue to run on mainframe or minicomputer hosts, a steady increase in the construction and use of computer networks was revealed by the survey. Exhibit 6 shows that in 1995 approximately 62 percent of all respondents had or were planning a local area network. By 1998 that number had grown to 80 percent. Shared Internet access, intranet applications, file and printer sharing, e-mail, and group software all provide compelling reasons for local governments to construct local and wide-area networks.

Both 1995 and 1998 surveys indicate that Novell NetWare is the most heavily used network operating system [ILLUSTRATION FOR EXHIBIT 7 OMITTED]. However, Windows NT and Windows Peer-to-peer networking represent the most rapid growth areas for network operating systems.

Another trend indicated by the data is the movement toward heterogeneous network systems. Much more so in 1998 than 1995, municipalities reported that their network was a mixture of various network operating systems, all cooperating on the same network. The heterogeneous nature of these networks also was reflected in other survey areas. For example, many governments reported they supported multiple e-mail programs for computer workstations connecting to the same Internet mail server. Also, while most networks were Ethernet based, they varied in their speed, layout, and cable plant.

Internet

Local governments are now very much involved with the Internet and the World Wide Web, with 75 percent of participants in the 1998 survey reporting they have functioning Web sites. Exhibit 8 reports the type of information and services provided on government Web sites. Essentially all respondents (98 percent) indicated that their Web sites provide information to citizens about government services. Almost one-third also provide Web pages with budgetary information for citizens to review. In addition, 11 percent of the Web sites host some type of interactive services for citizens, such as the ability to apply for a permit or pay a tax bill over the Internet.

Only 15 percent of local governments have developed Web applications for internal use, such as for paperless storage and retrieval of information. These intranet applications provide a variety of internal information to employees using Web browsers. The most common types of intranet applications implemented by respondents were phone directories, policies and procedures manuals, internal forms, human resource information, and internal newsletters. Two-thirds of respondents indicated that less than 10 percent of their employees had Internet access from their desks.

The 1998 survey collected data on how local governments were connected to the Internet and where their Web pages were stored. The responses reveal that 55 percent of local governments use Internet service providers (ISPs) to host their Web pages; 20 percent use their own servers for this task. This may be due to the lower-speed connections that most local governments report having to the Internet. Sixty percent of all respondents were using modems to connect to the Internet, with only two in that group indicating they hosted their own Web site. The other local governments that hosted their own Web sites were using a faster, more persistent method of connecting to the Internet. Faster connections are needed to respond quickly to the thousands of data requests that a Web server would typically receive per day.

Summary

Municipalities in Virginia report a significant and growing investment in information technologies. Internet applications are an area of rapid growth which most local governments already have embraced. Steady growth has also been reported in the construction and maintenance of local area networks as well as the use of host-based systems for running core financial applications.

Survey respondents showed a significant shift toward Microsoft application programs for word processing, spreadsheet, and desktop database applications. This is at least partially driven by the success of office suite software that has significantly affected software purchasing decisions. It may also be due to the influence of Microsoft's Windows operating system that is reported in use by more than 90 percent of survey respondents.

More complete survey results can be found at http://www.vgfoa.org, the Web site for the Virginia Government Finance Officers Association.

ROBERT H. PHILLIPS is Associate Professor of Accounting and Information Systems at Radford University, Radford, Virginia. He also chairs the university's Information Technology Resources Committee. BRUCE W. CHASE is Associate Professor of Accounting at Radford University. He also serves as Director of the university's Center for Governmental and Nonprofit Accounting.
COPYRIGHT 1998 Government Finance Officers Association
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1998 Gale, Cengage Learning. All rights reserved.

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Author:Philips, Robert H.; Chase, Bruce W.
Publication:Government Finance Review
Date:Aug 1, 1998
Words:1444
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