Subcommittee on Technology Modernization Oversight Hearing

House Subcommittee on Technology Modernization

2025-05-19

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Source: Congress.gov

Summary

The meeting addressed the significant challenges the Department of Veterans Affairs (VA) faces in managing its software licenses, an issue highlighted by annual spending exceeding a billion dollars and persistent inefficiencies. Members expressed deep concerns about wasteful spending, a historical lack of accurate data, and the potential impact on veterans' services, while also acknowledging VA's efforts to implement solutions [ 00:17:20 ]

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. The discussion sought to understand the root causes of these issues, VA's proposed remedies, and how Congress can support effective management .

Themes

Current State of Software License Management at VA

The VA annually spends over a billion dollars on software licenses but has historically struggled with managing this inventory efficiently, leading to potential waste [ 00:17:30 ]

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. GAO reports have consistently identified issues, including VA's inability to track whether purchased licenses are actually being used or to compare usage data with purchasing records to negotiate better deals [ 00:19:08 ]

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. A recent federal CIO request revealed that for tens of millions of dollars worth of licenses, the VA reported usage and quantities as "unknown" [ 00:20:10 ]

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. Ms. Carol Harris from GAO confirmed that VA lacks the foundational data to determine if it is over- or under-purchasing licenses and cannot verify vendor claims without its own tracking system [ 00:32:33 ]

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VA's Efforts to Improve Software Asset Management (SAM)

The VA's Office of Information Technology (OIT) has initiated a strategic Software Asset Management (SAM) program to tackle these long-standing problems . This program aims to centralize software procurement and oversight, establish a single source of truth for software usage data, and automate management tasks . OIT reports significant cost avoidance, estimated at $136 million, by improving visibility and management of its top 15 most used software titles . They are updating policies, including VA Directive 6008, to enhance CIO oversight and are implementing new guidance for product service codes and software components in medical devices . New tools, such as the $12 million Tachyon software, provide real-time usage data across VA's 600,000 endpoints, allowing for more precise tracking . Mr. Don Carter noted that a new Microsoft contract allows for renegotiation if usage falls below 10%, a significant improvement in cost control .

Challenges and Future Outlook

Despite progress, significant challenges remain, including addressing the historical legacy of decentralized purchasing and "Shadow IT" where local facilities made independent software acquisition decisions . The VA plans to consolidate requirements and move to an enterprise-wide approach to procurement, aiming to reduce the number of redundant software titles in similar product categories . There were concerns about President Trump's executive order to centralize federal IT procurement under the General Services Administration (GSA), with questions raised about GSA's capacity, especially given reports of budget cuts . Furthermore, the potential reduction in force for the VA's Business Integration and Outcome Service (BIOS) team, which handles stakeholder engagement, raised worries about continuity in consolidation efforts . The committee also pressed for transparency regarding external "DOGE" employees allegedly integrating AI-generated code into VA systems without clear governance or oversight .

Tone of the Meeting

The tone of the meeting was largely concerned and critical, with speakers consistently highlighting extensive waste and inefficiency in VA's software license management [ 00:17:40 ]

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. There was a strong urgent and demanding call for immediate action, accountability, and the timely implementation of GAO recommendations [ 00:20:13 ]

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. Despite the criticism, there was also a hopeful undertone, acknowledging VA's recent efforts to improve and a willingness from Congress to collaborate on finding solutions [ 00:19:27 ]

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. However, skepticism was evident, particularly regarding the viability of GSA's consolidated IT procurement given its reported budget cuts, and questions about the future role of critical VA internal teams . The discussion emphasized a collaborative yet accountability-focused approach, aiming to support VA's mission while ensuring responsible use of taxpayer dollars [ 00:20:51 ]

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Participants

Transcript

All right, good afternoon, everyone.  And thank you all for being here today.  Subcommittee will some the subcommittee will come to order.  We're here today to talk about software license management, an issue that affects every veteran who expects VA to function efficiently, securely and transparently, while also keeping costs in mind.  The VA spends over a billion dollars on software licenses every year and the department has never done a good job of managing it all or knowing how many they have.   Without good data, the VA has no way of knowing how much money they are wasting on duplicative or unnecessary licenses.  In some ways, software licenses are a lot like library cards.  Just like a library card allows you to check out a book from a library, a software license gives you access to the software product.  Each library represents a different software product, and VA purchases software licenses or library cards for their employees to use that product.   We would have used to call these blockbuster cards back in the day, but those are no longer applicable.  VA purchases hundreds of thousands of library cards for thousands of different libraries every year.  VA simply cannot make smart decisions about how many software licenses they buy if they don't have complete and accurate data.  At the fundamental level, VA needs to understand what licenses they own and whether they are being used.   GAO published a report last year with several alarming findings about the state of software license management at the VA.  VA could not explain what they paid for specific software products that are bundled into a single license agreement because the costs for each individual product are not broken down.  VA could not track whether the licenses they purchased for their most widely used software licenses are actually being used.  They can track some of them, but not all.   VA is not able to compare software license usage to purchase records so they can have the information they need to negotiate better deals and identify cost savings.  It's basic information that any organization needs to make sure they are buying the right licenses for the right number of people at a fair price.
I understand that VA has made some progress resolving these issues and I expect to hear more about that from our VA witnesses during this hearing.   GAO and other organizations have been calling out the federal government's problems with software license management for over a decade.  As long as this problem is unresolved, there will be wastes and inefficiencies to be realized.  Earlier this year, the federal CIO asked each agency to submit inventories of the software licenses they purchased from the five largest software vendors in the federal government.  I reviewed the VA's response last week.   For tens of millions of dollars worth of licenses, VA wrote that the license usage and quantities were unknown.  It's clear that VA still has a long way to go.  VA was supposed to produce a full inventory of all software licenses by the end of April, but we have not seen that yet.  I recognize that this problem wasn't created in one day and it won't be solved in a single day either.  I believe that the VA wants to get this right and I'm committed to working with the new administration to finding a solution to do that.   I applaud the Trump administration's effort to put a stop to this wasteful spending on software licensing by reviewing VA and other agency software inventories.  President Trump's executive order consolidating aspects of IT procurement into the General Services Administration is another step in the right direction.  Let me be clear, consolidation alone will not solve the problem.  Agencies must be responsible and accountable.   VA must maintain an accurate software inventory to keep track of what licenses are being used.  They must track license usage in real time, analyze performance data, and hold vendors accountable.  These aren't lofty ideals.  They are basic good business practices.   So today I want to focus on three things.  First, what is preventing VA from keeping a full and accurate inventory of their software licenses that has clear price breakdowns and tracks the usage by user?  Second, how has software mismanagement impacted broader technology and modernization efforts at the VA?
Lastly, what can Congress do to help make sure that VA is not wasting valuable resources on software licenses that could be spent on veterans?   At the end of the day, every unused or duplicative software license that VA pays for isn't just a line item, it's a waste of taxpayer dollars and a missed opportunity.  An upgrade that never happened, a fix that got delayed, a veteran waiting longer for the care they earned.  Let's change that.  And I can tell you, I know that this isn't a unique issue alone to the VA, but this is the committee that I have jurisdiction over and want to work with my committee members to fixing, and that's why we're here today working on the VA.   And with that, I yield to ranking member Bozinski for her opening statement.
Thank you very much, Mr. Chairman, and thank you for holding today's hearing about software licensing concerns at the Department of Veterans Affairs.  I do look forward to working with you   to address this issue and coming up with appropriate and common sense solutions for the employees of the VA and our nation's veterans.  We owe it to them and we do owe it to the American taxpayer.

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