Mining for Data—and Dollars

By Dennis McCafferty  |  Posted 2009-04-13 Print this article Print

All levels of government are using green IT, Web services and data management to better serve citizens and, hopefully, save money in the process.

In recent years, agencies have been increasing efficiency and freeing up significant budget dollars by making more effective use of something they already had: data. Today, a number of data management tools are allowing public-sector customers to do just that.

The city of Charlotte, N.C., for example, is using a product from Tableau Software that can analyze trends and patterns in staff responsiveness to citizen requests, based on detailed information that’s stored in everything from data warehouses to Excel spreadsheets. This improves the ability of city employees to address these requests.

And the state of Missouri has found gold in data mining—almost literally, as its tax department is saving millions of dollars by using improved IT data analysis tools to catch tax dodgers. Using an enterprise data solution from Teradata, the state has recovered an astonishing $51.8 million from noncompliant tax filers. This revenue would have otherwise been lost due to unpaid taxes or underreported incomes on the part of citizens and businesses.

Essentially, the solution brings together tax-related databases from a variety of resources within the state Department of Revenue. These include databases that deal with individual tax filings, sales taxes, employer withholding, and corporate and franchise taxes.

The system is able to cross-check this data with data from other state departments, such as business license applications. It can even cross-check with data reported to the Internal Revenue Service, to see if there are any discrepancies with what was reported to the state.

Through complex search queries, the solution allows Missouri revenue employees to discover, for example, whether someone has held a state license for a 10-employee construction contracting business but has been reporting revenues more in line with a single-contractor shop.

“We get great leads and information,” says Lesa Morrow, compliance director at the Missouri Department of Revenue. “We know who these noncompliant people are, and we know why they’re noncompliant. So when we sit down with these people, we can go over specifics as to why we’re contending that they are not compliant.

“For example, if someone tells us they’ve just started their business, we can document that they’ve actually been running it for three or more years—because that’s how long they’ve been filing unemployment tax reports with our Department of Labor. In the past, we never had the ability to share and make use of this kind of data.”

Dennis McCafferty is a freelance writer for Baseline Magazine.

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