E-Gov on the Cheap

What does it cost to launch a government Web site? It's a question that makes some governments uncomfortable, fearing apples-and-oranges comparisons with other jurisdictions. Governments budget for their Web sites in different ways, some including staff time and maintenance time, some paying from a central IT office, some paying through individual departments, some outsourcing, some building in-house.
by | September 2001

What does it cost to launch a government Web site? It's a question that makes some governments uncomfortable, fearing apples-and-oranges comparisons with other jurisdictions. Governments budget for their Web sites in different ways, some including staff time and maintenance time, some paying from a central IT office, some paying through individual departments, some outsourcing, some building in-house.

And no two government Web sites are the same. Two jurisdictions of a similar size may have very different ambitions for their online portals, ranging from a simple informational site to one offering dozens of sophisticated online services.

Anecdotally, of course, there are numbers. Massachusetts recently awarded a $949,000 contract to develop the foundation for an enterprise portal. For $2 million, California, with the help of an integrator, developed a portal that can be customized and offers citizens the ability to do about a dozen new transactions. Pennsylvania's new portal cost about $200,000 to $300,000 for software for a gateway that essentially provides links to state agencies' Web pages. Oakland County, Michigan, is paying close to a million dollars for revamping its site so users can navigate by their needs rather than by department.

Minnesota was quoted prices from vendors ranging from $860,000 to $6.4 million for a contract to upgrade its Web site. And a single agency in Minnesota, the Department of Children, Families and Learning, developed a powerful, interactive Web site for $3.7 million that allows school and day-care officials to order supplies, submit reimbursement claims and do other forms of record-keeping.

Some governments are paying outright to launch and operate their new sites; others are repaying vendors through transaction or subscription fees. But it's next to impossible to compare what states and cities have built and what it has cost.

NO WEBMASTER NEEDED

What is easy to see is how those price tags in the millions can frighten off smaller cities and counties. Yet new twists in the marketplace mean prices can be much lower than expected. Both the International City/County Management Association and the National League of Cities have partnered with companies to offer low-cost Web sites for jurisdictions as small as 500.

ICMA's project began with the League of Minnesota Cities, which issued an RFP for a Web site development product for its own cities. "We found in the general market that it was horrendously expensive," says Gary Doty, mayor of Duluth and immediate past president of the league. "The cost was preventing small cities from having a decent Web site," despite the fact that smaller governments typically don't need all of the online services larger ones do, such as a parking-ticket application.

Avenet, the company that created GovOffice.com for the Minnesota league, is now offering customized Web sites through ICMA for governments with populations of up to 60,000. No software has to be installed; governments simply need a computer, an Internet connection and a Web browser. They choose functions and features they'd like, such as whether to have a parks and recreation sign-up service, or a complaint service for potholes and broken streetlights, or a way to conduct online polls with citizens. "We did some test groups with cities," Doty says. "It was so simple, even a mayor could do it."

For a city of fewer than 500, it costs just $200 for a one-time license fee and $20 a month for site hosting. Prices rise on a sliding scale by population, and each optional service adds to the cost. Since the launch in June, more than a hundred cities have committed to getting a Web site from the company.

CHOICE AND COMPETITION

The National League of Cities entered into a collaboration with IBM Corp. in December, and in March started pilot-testing Web development. NLC is working with 12 state municipal leagues. Thirty cities have been testing the Web sites. Prices were not set as of early August, but they were expected to be in the range of $200 to $300 for a sign- up fee and less than $50 a month for hosting. Prices will be set, rather than based on a sliding scale by population, but since cities will go through their state municipal leagues, the leagues could end up subsidizing some smaller cities' Web sites, says Christine Becker, deputy executive director of NLC. The rollout was expected to begin last month.

NLC was looking at three components when it chose a vendor: a basic e-government solution, a company willing to listen to its input during development and the opportunity for governments to receive training on the product. "We've been involved with shaping the product and choosing programs we think should be offered first," Becker says.

The fact that localities are able to choose between offerings from the two different associations does not seem like a bad thing to Becker. "The competition is nice," she says. "A lot of companies want this market."

Ellen Perlman
Ellen Perlman  |  Former columnist
mailbox@governing.com  | 

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