“I have been brought in to look at the IRS’ modernization program, in particular, as well as the operations and maintenance budget. I really care a lot about this country, and this is a huge program that is currently 30 years behind schedule and it’s already $15 billion over budget.”
“The goal is to take——the IRS has some pretty legacy infrastructure——It’s actually very similar to what banks have been using. It’s old main frames running COBOL and assembly.”
“The challenge has been, how do we migrate that to a modern system. Virtually every bank has already done this, but we’re still using a lot of those same systems.”
“Typically, in the industry this takes a few years, maybe a few hundred million dollars, and we’re now 35 years into this program.”
He’s pulling the mask off, and it’s wild.
1]. IRS’ Massive IT Dept. Outstrips Midsize Banks by 175x Budget and 40x Staff
“A typical midsize bank will have somewhere between 1 and 200 people in IT and they have an operations and maintenance budget in like the $20 million a year range. We have 8,000 people in IT, and our operations and maintenance budget is $3.5 billion a year. I don’t really know why yet.”
2]. Contractors Eat Up 80% of IRS’ Massive Operations Budget
“I will tell that you 80% of that budget goes to contractors and licenses——We cannot perform the basic functions of tax collection without paying a toll to all these contractors.”
3]. IRS’ Modernization Is a $3.7 Billion Money Pit
“We have a $3.5 billion operations maintenance budget. We have $3.7 billion modernization effort within it. That’s a lot of budget and way beyond any reasonable cost for what you would expect at a private company for this.”
4]. Ghost Contracts Bleed Millions With No Accountability
“You find contracts that are 10, 20, 30, $50 million and you just ask like, why are we doing this? And everyone’s just like, meh, I don’t know. And then you cancel it and then nothing happens. It’s just inertia, has just taken over.”
Overton
