Just how big a wagon is it? Merrill Lynch estimates that $15 billion will be spent on portal tools and services by 2002. No one knows what proportion of those billions will come from state and local governments, but the public sector will certainly contribute its fair share. Wendy Rainer, New Jersey's chief information officer, figures that the effort to migrate her state's legacy systems to the Web will far surpass Y2K in size and complexity, and presumably in cost as well.
In finding a way to meet those costs, some jurisdictions have taken the very traditional approach of tapping in-house resources: Oakland County, Michigan, for example, invested $1 million of its own funds in building its new Web site, and Ohio recently spent $200,000 on the initial development of its portal.
But many state and local governments are going to need--and are asking for--the help of the private sector. They are entering into arrangements with companies that promote pay-as-you-go financing: The companies build Web sites, using their own money and people. In return, they receive a long-term contract to operate the Web services and collect fees from citizens and businesses for conducting transactions electronically.
Over time, the companies hope to collect sufficient fees to cover the costs of their initial investments and make a profit. In some cases, they also reinvest a portion of the fees by building additional Web capabilities that automate other fee-generating government services. This results in a cycle of funding and Web development that can continue uninterrupted for many years.
These financing arrangements can be very controversial. They raise questions about the relationship between private industry and government and also about whether, since the funding is not from appropriations, legislatures have the necessary oversight of digital- government projects.
Such concerns are not unique to portals. Other government programs, such as child-support payments, tax collection and Medicaid claims processing employ myriad financing and business arrangements between industry and government.
The focus on financing masks a little-noticed reality: Most public portals--regardless of how they are funded--are quite conventional. Governments have not been daring enough and may be missing a real opportunity to change things.
Most state and local portal initiatives are focused almost exclusively on moving existing business and citizen services online-- services such as registering a car, reserving a campground site and searching for a corporate record. In the parlance of today's business schools, the states are using the Web to create new channels of distribution for existing government services. They are, in effect, picking the low hanging fruit on the digital government tree.
There is a huge untapped potential to use the Web--especially its powerful communications capabilities--as a medium for improving the overall quality of life for citizens and business. Some governments-- Virginia is a case in point--are beginning to use the Web to reach segments of the population that have little or no connection to government today. This is the difference between using the Internet to "do the right things" versus using it to "do things right." The real promise of a portal is to go beyond simply making government more efficient in doing what it has always done.
The opportunities to exploit the communications and information- sharing capabilities of the Web are endless. A starting point may be to create Web-based access to government databases for citizens and businesses. For example, by opening up access to educational performance databases, citizens could compare the educational quality of the schools in their state as easily as they do a Yahoo! search. Or, by allowing businesses to mine state permitting and occupational databases to uncover recent trends, businesses might become more competitive. Perhaps by allowing citizens to have online access to neighborhood crime statistics, they could determine where they want to live. And by allowing citizens to gain Internet access to environmental records, they could determine sources and levels of environmental pollution in their own back yards. Through such measures, citizens would be aware if environmental conditions or crime rates reach thresholds that are cause for alarm.
Not all states or localities will necessarily want to be this bold. It may be states such as Florida that are known for their open public- record laws will be the first to break this new ground. But these trails will be blazed in the very near future. And whoever leads the way is likely to become the Yahoo!, Amazon or eBay of the public sector.
