US federal agencies may find it hard to receive additional funding for data center consolidation projects, mandated under a White House-led initiative. A legislative committee that reviews budget proposals from federal agencies has recommended that a fund for electronic-government projects, which would finance the initiative, be reduced by $14m for the upcoming fiscal year from its present budget.

The Senate Appropriations Committee recommended that the Electronic Government fund receive $20m for FY2011, down from $35m requested by the Office of Management and Budget, which oversees the fund. The fund received $34m in FY2010.

A report from the committee sites "funding constraints" and lack of clarity in OMB’s spending requests, specifically regarding the data center consolidation initiative, announced by federal CIO Vivek Kundra in September 2009.

"The committee is concerned that the electronic government initiative does not provide sufficient guidance regarding consolidation of federal agency data centers into data facilities with multiple federal tenants," reads the report, issued in July.

The committee has requested that the General Services Administration, which oversees a lot of infrastructure and facilities projects for the federal government, report back on feasibility of the initiative by the end of November.

Angie Petty, principal analyst at Input, a firm that provides research and consulting services to help private companies develop business with the public sector, says if the committee’s recommendation becomes law, agencies will find themselves with the challenge to consolidate data center infrastructure with their existing budgets.

Input recently released a new report, assessing the consolidation initiative and making recommendations to contractors looking to bid on projects to implement it.

The company interviewed more than 30 federal employees, including data center managers and CIO-level executives, in the process of collecting data for the report. While high-level execs seem to be completely on board with the consolidation effort, those working in federal data centers are more apprehensive, Petty says. There are cultural issues, including "server hugging" and fear of job loss.

The latter issue may have an indirect effect on financing the E-Gov fund finally receives, potentially making consolidation a political issue. The final budget has to go through the congressional approval process and many legislators may not stand behind an initiative perceived to cause job losses in areas they represent, Petty says.
 

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