The Office of Management and Budget is open to considering how it can strengthen and improve oversight of major federal IT projects, an OMB official said at a Senate hearing today.

Karen Evans, OMB administrator for E-government and IT, said she would consider asking agency inspectors general to take a broader role in ensuring that agencies are proposing solid business cases for their IT investments.

“I think it’s a wonderful idea,” Evans said Wednesday. “I’m willing to take that back to the IGs and see if they’d be willing to take that on.”

Evans made her comments at a hearing sponsored by the Senate Homeland Security Subcommittee on Federal Financial Management, Government Information and International Security.

Subcommittee chairman Sen. Tom Coburn (R-Okla.) said he held the hearing in light of a recent Government Accountability Office report that found that 253 out of 857 agency IT projects totaling roughly $12 billion for fiscal year 2007 were underperforming and in danger of being over budget.

“That we have 31 percent of these projects on the high-risk list says a whole lot about our IT management,” Coburn said in opening the hearing.

David Powner, director of IT management issues at the Government Accountability Office, suggested that agency IGs should perform random checks on agency investment and management review boards, the oversight committees that approve and develop business cases for potential IT investments.

Powner stated that OMB’s current means of monitoring high-risk projects—a two-track approach that includes both a management watch list, which the administration started in fiscal 2002, and its high-risk quarterly reports, in which agencies identify mission-critical IT projects that are behind schedule and over budget—are faulty and susceptible to inaccuracies.

Agencies routinely apply OMB’s requirements for both lists inconsistently, meaning that several projects that should be considered at-risk are being left off, Powner said. He particularly highlighted the Defense Department’s Defense Travel System, which since its 1998 award, has run well over budget and behind schedule.

“We concluded that the Department of Defense, as a whole, remains far from where it needs to be to effectively and efficiently manage an undertaking with the size, complexity and significance of its departmentwide business systems modernization,” Powner said. Yet this project was left off the at-risk list, he said.

During the hearing, Evans admitted that OMB could provide clearer instructions as to how projects should be considered at-risk. “I would say we need to provide better clarity on what should be on the high-risk watch list,” Evans said.

Evans also said that agencies are required to use earned-value management while overseeing IT projects. This tool lets project managers track money spent on a project almost in real time and measures that expense against milestones and deadlines, and should give agencies more control over their contracts, Evans said.

While applauding this, Coburn said there needs to be more accountability for agencies that do not produce accurate and reliable business cases.

To that end, he said he will be sending out a letter to every government agency seeking details on their high-risk IT contracts. Agencies must provide data on how the projects are progressing, if cost overruns are anticipated, and what vendor is providing the service.