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Internet Commercial Services Could Be Protected from Government Competition

March 06, 2002
By: Jon Ariztimuno
State Capital Bureau
Links: HB 1930, SB 1038

JEFFERSON CITY - State and local government would be blocked from offering Internet commercial services that compete with private enterprise under legislation filed in Missouri's House and Senate.

Committees from both the Senate and the House met last week for hearings about a bill that would establish the "Electronic Government Services Act."

"I think governments end too many businesses right now", said Sen. Ronnie DePasco, D-Kansas City, the Senate's bill sponsor.

The bill provides that "if the private sector provides electronic commerce services to the public, no government agency shall start or carry on any activity to provide or offer such services, expand similar services at government expense or provision."

The legislation does allow an agency to exempt itself from the restriction, if it posts a public notice of detailed information including why the agency was offering a competing service and the annual per-taxpayer and per-user cost.

The bill covers both state and local government, although DePasco said there was a revised version that would be limited to state government.

The sponsor of the House version -- Rep. Gary Burton, R-Jasper County -- said that government should not spend millions of dollars if there is private businesses willing to do it.

"In Missouri, they are trying to do their own program rather than utilize the software and hardware that is already available", he said.

At a recent Senate Financial and Governmental Organization Committee hearing, the only testimony for the bill came from Steve Ryan with The Computer and Communications Industry Association -- a national organization representing the electronic information industry.

"We are proponents of the private sector being the continue engine of competition and innovation", he said.

"When government agencies try to extend their mission through providing e-government services that intrude into electronic commerce, things can go wrong", he said.

Ryan argued that when government provides a service, it is a potential privacy problem.

He referred to information that could be collected on individuals calling up pages from the state's Revenue Department.

"Every key stroke is recorded. Nothing will keep the state to use that as the audit trial and decide how to use audit", he said.

Expressing concerns about the impact of the bill was the main lobbyist for the University of Missouri system, Jim Snider.

He expressed concern about the broad language used in the proposed ban. "I am asking for some clarifications", Snider said.

MU is the leading institution in a Missouri Research Network (MORNET) and provides Internet services for the four the four campuses, state departments and agencies and other organizations such as community colleges or public libraries within the state.

Snider says that MORNET activity is not in competition with private enterprise.

"No one is trying to provide those services currently", he said.

"If somebody can do it cheaper and with better quality, we would certainly step aside", he said.

But in a later interview, Burton said that the government should be contracting with a private company rather than other government agency.

"It is quite clear that the state has not created a very good e-government yet", he said.