eGovernment Saves Utahns Time and Money

U study documents $46 million in savings over five years

A study from the University of Utah released today shows that the State of Utah spent $46 million less over five years by delivering services online than it would have by providing the same services “offline”—through government offices, by phone or mail.

The study was conducted by the U’s Center for Public Policy & Administration for NIC, Inc., a company that provides online services for governments nation-wide, including Utah.

“Utah is among the most-wired states and our tech-savvy citizens increasingly demand state service online,” says Mark VanOrden, chief information officer and executive director of the Utah Department of Technology Services. “We’ve responded with over 1,000 online services. Registering a new business or renewing a car registration is not just easier and more convenient for our consumers, it also saves money for the state. This study shows that making the state’s services available online is just smart business.”

The study was designed to quantify the financial benefit of delivering services online and used cost avoidance as the measurement. Cost avoidance is the difference between the costs of providing a service online and the costs for providing the same service through offline means. Data were available for researchers to evaluate costs for a number of high-demand services over a five-year period between fiscal years 2007 and 2011. The average cost per transaction for providing a service online was $13.20 lower than the offline costs. When multiplied by the number of online transactions for the services studied, the state saved $46 million by offering an online option for its users.

“Considering the hundreds of services the state offers online, this is an impressive finding,” says Jennifer Robinson, director of the center that conducted the analysis. “In addition, because taxpayer dollars are not used to build or maintain the site, that provides further cost efficiencies.”

The state uses a “self-funded” model to provide services online. Utah agencies work with an independent contractor that incurs the direct costs for building, managing and maintaining the Utah.gov portal. While some services require modest user or transaction fees to cover expenses to operate the site, other services, such as voter registration, are offered free of charge. This model allows the state to offer a growing number of services online without upfront investment of taxpayer dollars.

“We found that by relying on the self-funded model, the state saved an additional $15 million in costs,” concludes Robinson.

This is the first of a series of studies designed to compare offline and online service delivery. Another survey of customer satisfaction is planned for the spring.

ABOUT THE CENTER FOR PUBLIC POLICY & ADMINISTRATION

The Center for Public Policy & Administration at The University of Utah is home to vibrant education programs and top-quality research. The Center’s professional staff works with governments, nonprofits and businesses to examine and solve real-world problems. Coupled with extensive research, the Center’s two graduate degree programs – Masters of Public Policy and Masters of International Affairs and Global Enterprise – provide a stimulating intellectual environment to prepare students for a variety of positions in the public, private and nonprofit sectors. More about the Center is available online at http://cppa.utah.edu.

ABOUT THE UNIVERSITY OF UTAH:

The University of Utah, located in Salt Lake City in the foothills of the Wasatch Range, is the flagship institution of higher learning in Utah. Founded in 1850, it serves more than 31,000 students from across the United States and the world. With more than 72 major subjects at the undergraduate level and more than 90 major fields of study at the graduate level, including law and medicine, the university prepares students to live and compete in the global workplace. Learn more about all the U has to offer online at http://www.utah.edu.

Media Contacts For This Story

University of Utah Communications
Office Phone: 801-585-6861
Cell Phone: 801-403-3128
Email address: v.dowell@utah.edu
 
researach associate, Center for Public Policy & Administration
Office Phone: 801-587-7807