City IT review identifies 24 initiatives and up to $142M in possible annual savings; verified contracts total $8.1M

Cara Kalachy, chief information officer and director of Austin Technology Services, and consultant Tony Veraldi presented a citywide application rationalization assessment on April 15 that inventories applications, maps contracts, and proposes 24 initiatives across a three‑year roadmap to reduce and consolidate overlapping software and cloud costs.

Veraldi said the study connected application inventories to contract records and identified roughly 3,000 IT‑related contracts associated with applications; the three‑year roadmap envisions retiring about 230 applications (just under a 20% reduction) through vendor consolidation, license optimization and cloud cost‑management. The team provided a conservative to aggressive annual savings range of $49 million to $142 million and explained the range reflects differences in execution confidence and negotiation outcomes.

Verifiable savings already identified include $8.1 million in annual savings tied to contracts in hand, $878,000 in immediate (ActNow) cloud optimizations, and $7.2 million in contracts that could be retired in the first year if departments adopt recommended consolidations. City staff said they are mobilizing to pursue quick wins this fiscal year and will present an update memo to the full council on how the rationalization work links with broader IT governance and organizational changes.

Councilmembers asked about sustaining savings and the need for governance changes to prevent re‑proliferation of applications; staff said the rationalization must be paired with governance and structural changes to lock in long‑term savings.