IB 
Union Calendar No. 79 
115TH CONGRESS 
1ST SESSION H. R. 2227 
[Report No. 115–129, Part I] 
To modernize Government information technology, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 28, 2017 
Mr. HURD
(for himself, Mr. CONNOLLY, Ms. KELLY
of Illinois, Mr. 
CHAFFETZ, Mr. CUMMINGS, Mr. TED LIEU of California, Mr. KHANNA, 
Mr. KILMER, Mrs. COMSTOCK, Mr. YODER, Mr. TAYLOR, and Ms. 
GRANGER) introduced the following bill; which was referred to the Com-
mittee on Oversight and Government Reform, and in addition to the 
Committee on Appropriations, for a period to be subsequently determined 
by the Speaker, in each case for consideration of such provisions as fall 
within the jurisdiction of the committee concerned 
MAY 17, 2017 
Additional sponsors: Mr. MCCARTHY, Mr. HOYER, Mrs. DEMINGS, Ms. 
DELBENE, Mr. FARENTHOLD, Mr. ISSA, and Mr. RUPPERSBERGER 
MAY 17, 2017 
Reported from the Committee on Oversight and Government Reform 
MAY 17, 2017 
The Committee on Appropriations discharged; committed to the Committee of 
the Whole House on the State of the Union and ordered to be printed 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6652
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
A BILL 
To modernize Government information technology, and for 
other purposes. 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6652
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Modernizing Govern-
ment Technology Act of 2017’’ or the ‘‘MGT Act’’. 
SEC. 2. FINDINGS; PURPOSES. 
(a) FINDINGS.—The Congress finds the following: 
(1) The Federal Government spends nearly 75 
percent of its annual information technology funding 
on operating and maintaining existing legacy infor-
mation technology systems. These systems can pose 
operational risks, including rising costs and inability 
to meet mission requirements. These systems also 
pose security risks, including the inability to use cur-
rent security best practices, such as data encryption 
and multi-factor authentication, making these sys-
tems particularly vulnerable to malicious cyber activ-
ity. 
(2) In 2015, the Government Accountability Of-
fice (GAO) designated Improving the Management 
of IT Acquisitions and Operations to its biannual 
High Risk List and identified as a particular con-
cern the increasing level of information technology 
spending on operations and maintenance, making 
less funding available for development or moderniza-
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
tion. The GAO also found the Government has spent 
billions on failed and poorly performing information 
technology investments due to a lack of effective 
oversight. 
(3) The Federal Government must modernize 
Federal IT systems to mitigate existing operational 
and security risks. 
(4) The efficiencies, cost savings, and greater 
computing power offered by modernized solutions, 
such as cloud computing, have the potential to— 
(A) eliminate inappropriate duplication and 
reduce costs; 
(B) address the critical need for cybersecu-
rity by design; and 
(C) move the Federal Government into a 
broad, digital-services delivery model that will 
transform the ability of the Federal Govern-
ment to meet mission requirements and deliver 
services to the American people. 
(b) PURPOSES.—The purposes of this Act are the fol-
lowing: 
(1) Assist the Federal Government in modern-
ized Federal information technology to mitigate cur-
rent operational and security risks. 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
(2) Incentivize cost savings in Federal informa-
tion technology through modernization. 
(3) Accelerate the acquisition and deployment 
of modernized information technology solutions, such 
as cloud computing, by addressing impediments in 
the areas of funding, development, and acquisition 
practices. 
SEC. 3. ESTABLISHMENT OF AGENCY INFORMATION TECH-
NOLOGY 
SYSTEMS 
MODERNIZATION 
AND 
WORKING CAPITAL FUNDS. 
(a) INFORMATION
TECHNOLOGY
SYSTEM
MOD-
ERNIZATION AND WORKING CAPITAL FUNDS.— 
(1) ESTABLISHMENT.—The head of a covered 
agency may establish within such agency an infor-
mation technology system modernization and work-
ing capital fund (in this section referred to as the 
‘‘IT working capital fund’’) for necessary expenses 
described in paragraph (3). 
(2) 
SOURCE
OF
FUNDS.—The 
following 
amounts may be deposited into an IT working cap-
ital fund: 
(A) Reprogramming and transfer of funds 
made available in appropriations Acts subse-
quent to the date of the enactment of this Act, 
including transfer of any funds for the oper-
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
ation and maintenance of legacy information 
technology systems, in compliance with any ap-
plicable reprogramming law or guidelines of the 
Committees on Appropriations of the House of 
Representatives and the Senate. 
(B) Amounts made available to the IT 
working capital fund through discretionary ap-
propriations made available subsequent to the 
date of the enactment of this Act. 
(3) USE OF FUNDS.—An IT working capital 
fund established under paragraph (1) may be used, 
subject to the availability of appropriations, only for 
the following: 
(A) To improve, retire, or replace existing 
information technology systems in the covered 
agency to enhance cybersecurity and to improve 
efficiency and effectiveness. 
(B) To transition legacy information tech-
nology systems at the covered agency to cloud 
computing and other innovative platforms and 
technologies, including those serving more than 
one covered agency with common requirements. 
(C) To assist and support covered agency 
efforts to provide adequate, risk-based, and 
cost-effective information technology capabilities 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
that address evolving threats to information se-
curity. 
(D) To reimburse funds transferred to the 
covered agency from the Technology Moderniza-
tion Fund established under section 4, with the 
approval of the Chief Information Officer of the 
covered agency. 
(4) EXISTING FUNDS.—An IT working capital 
fund may not be used to supplant funds provided for 
the operation and maintenance of any system within 
an appropriation for the covered agency at the time 
of establishment of the IT working capital fund. 
(5) PRIORITIZATION OF FUNDS.—The head of 
each covered agency shall prioritize funds within the 
IT working capital fund to be used initially for cost 
savings activities approved by the Chief Information 
Officer of the covered agency, in consultation with 
the Administrator of the Office of Electronic Gov-
ernment. The head of each covered agency may re-
program and transfer any amounts saved as a direct 
result of such activities for deposit into the applica-
ble IT working capital fund, consistent with para-
graph (2)(A). 
(6) RETURN OF FUNDS.—Any funds deposited 
into an IT working capital fund shall be available 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
for obligation for three years after the last day of 
the fiscal year in which such funds were deposited. 
(7) AGENCY CIO RESPONSIBILITIES.—In evalu-
ating projects to be funded from the IT working 
capital fund, the Chief Information Officer of the 
covered agency shall consider, to the extent applica-
ble, guidance issued pursuant to section 4(a)(1) to 
evaluate applications for funding from the Tech-
nology Modernization Fund established under that 
section that include factors such as a strong busi-
ness case, technical design, procurement strategy 
(including adequate use of incremental software de-
velopment practices), and program management. 
(b) REPORTING REQUIREMENT.— 
(1) IN
GENERAL.—Not later than one year 
after the date of the enactment of this Act, and 
every six months thereafter, the head of each cov-
ered agency shall submit to the Director the fol-
lowing, with respect to the IT working capital fund 
for the covered agency: 
(A) A list of each information technology 
investment funded with estimated cost and 
completion date for each such investment. 
(B) A summary by fiscal year of obliga-
tions, expenditures, and unused balances. 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
(2) PUBLIC AVAILABILITY.—The Director shall 
make the information submitted under paragraph 
(1) publicly available on a website. 
(c) COVERED AGENCY DEFINED.—In this section, 
the term ‘‘covered agency’’ means each agency listed in 
section 901(b) of title 31, United States Code. 
SEC. 4. ESTABLISHMENT OF TECHNOLOGY MODERNIZA-
TION FUND AND BOARD. 
(a) TECHNOLOGY MODERNIZATION FUND.— 
(1) ESTABLISHMENT.—There is established in 
the Treasury a Technology Modernization Fund (in 
this section referred to as the ‘‘Fund’’) for tech-
nology-related activities, to improve information 
technology, to enhance cybersecurity across the Fed-
eral Government, and to be administered in accord-
ance with guidance issued by the Director. 
(2) ADMINISTRATION OF FUND.—The Commis-
sioner of the Technology Transformation Service of 
the General Services Administration, in consultation 
with the Chief Information Officers Council and 
with the approval of the Director, shall administer 
the Fund in accordance with this subsection. 
(3) USE OF FUNDS.—The Commissioner shall, 
in accordance with the recommendations of the 
Technology Modernization Board established under 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
subsection (b), use amounts in the Fund for the fol-
lowing purposes: 
(A) To transfer such amounts, to remain 
available until expended, to the head of an 
agency to improve, retire, or replace existing 
Federal information technology systems to en-
hance cybersecurity and improve efficiency and 
effectiveness. 
(B) For the development, operation, and 
procurement of information technology prod-
ucts, services, and acquisition vehicles for use 
by agencies to improve Governmentwide effi-
ciency and cybersecurity in accordance with the 
requirements of such agencies. 
(C) To provide services or work performed 
in support of the activities described under sub-
paragraph (A) or (B). 
(4) 
AUTHORIZATION
OF
APPROPRIATIONS; 
CREDITS; AVAILABILITY OF FUNDS.— 
(A) 
AUTHORIZATION
OF
APPROPRIA-
TIONS.—There is authorized to be appropriated 
to the Fund $250,000,000 for each of fiscal 
years 2018 and 2019. 
(B) CREDITS.—In addition to any funds 
otherwise appropriated, the Fund shall be cred-
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
ited with all reimbursements, advances, or re-
funds or recoveries relating to information tech-
nology or services provided through the Fund. 
(C) AVAILABILITY
OF
FUNDS.—Amounts 
deposited, credited, or otherwise made available 
to the Fund shall be available, as provided in 
appropriations Acts, until expended for the pur-
poses described in paragraph (3). 
(5) REIMBURSEMENT.— 
(A) PAYMENT BY AGENCY.—For a product 
or service developed under paragraph (3)(B), 
including any services or work performed in 
support of such development under paragraph 
(3)(C), the head of an agency that uses such 
product or service shall pay an amount fixed by 
the Commissioner in accordance with this para-
graph. 
(B) REIMBURSEMENT
BY
AGENCY.—The 
head of an agency shall reimburse the Fund for 
any transfer made under paragraph (3)(A), in-
cluding any services or work performed in sup-
port of such transfer under paragraph (3)(C), 
in accordance with the terms established in a 
written agreement described in paragraph (6). 
Notwithstanding any other provision of law, an 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
agency may make a reimbursement required by 
this subparagraph from any appropriation made 
available subsequent to the date of the enact-
ment of this Act for information technology ac-
tivities, consistent with any applicable re-
programming law or guidelines of the Commit-
tees on Appropriations of the House of Rep-
resentatives and the Senate. An obligation to 
make a payment under a written agreement de-
scribed in paragraph (6) in a fiscal year after 
the date of the enactment of this Act shall be 
recorded pursuant to section 1501 of title 31, 
United States Code, in the fiscal year in which 
the payment is due. 
(C) PRICES
FIXED
BY
COMMISSIONER.— 
The Commissioner, in consultation with the Di-
rector, shall establish amounts to be paid by an 
agency and terms of repayment for use of a 
product or service developed under paragraph 
(3)(B), including any services or work per-
formed in support of such development under 
paragraph (3)(C), at levels sufficient to ensure 
the solvency of the Fund, including operating 
expenses. Before making any changes to the es-
tablished amounts and terms of repayment, the 
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS
Commissioner shall conduct a review and obtain 
approval from the Director. 
(D) FAILURE
TO
MAKE
TIMELY
REIM-
BURSEMENT.—The Commissioner may obtain 
reimbursement by the issuance of transfer and 
counterwarrants, or other lawful transfer docu-
ments, supported by itemized bills, if payment 
is not made by an agency— 
(i) within 90 days after the expiration 
of a repayment period described in a writ-
ten agreement described in paragraph (6); 
or 
(ii) within 45 days after the expiration 
of the time period to make a payment 
under a payment schedule for a product or 
service developed under paragraph (3)(B). 
(6) WRITTEN AGREEMENT.— 
(A) IN GENERAL.—Before the transfer of 
funds to an agency under paragraph (3)(A), the 
Commissioner (in consultation with the Direc-
tor) and the head of the requisitioning agency 
shall enter into a written agreement docu-
menting the purpose for which the funds will be 
used and the terms of repayment, which may 
not exceed five years unless approved by the Di-
VerDate Sep 11 2014 
23:05 May 17, 2017
Jkt 069200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H2227.RH
H2227
sradovich on DSK3GMQ082PROD with BILLS