OMB Updates Data Center Optimization Initiative


The new policy bans agencies from budgeting resources toward new or expanded agency-owned data centers without permission from the Office of Management and Budget.

After months of dialog with industry and a shutdown-induced delay, the Office of Management and Budget Tuesday released its updated Data Center Optimization Initiative, which replaces the previous policy of the same name released in 2016.

The updated policy establishes new consolidation and optimization metrics—and additional reporting requirements—for federal agencies, and attempts to align agencies’ data center efforts with the administration’s revamped Cloud Smart policy.

Among the key takeaways from the policy is a prohibition on agencies budgeting “any funds or resources toward initiating a new agency-owned data center or significantly expanding an existing agency-owned data center without approval from OMB.” The funding ban on data centers won’t apply to those designated as “key mission facilities for data management”—though they’ll need exemptions—but the policy update recommends consulting with OMB regarding any planned expansion or new data center construction.

As with the draft version of the policy released earlier this year, the new DCOI directs agencies to focus efforts on optimizing “larger dedicated data centers”—also called tiered data centers.

“On the other hand, agencies have seen little real savings from the consolidation of non-tiered facilities, small server closets, telecom closets, individual print and file servers, and single computers acting as servers,” the policy states.

The policy appears to concede the government has handled most of the “low-hanging fruit” in data center consolidation and “should not expect to see continued dramatic savings or large-scale closures” from ongoing consolidation efforts. Rather, agencies should look for “opportunities and investments that may yield long-term savings through energy efficiency.” In the policy, OMB promises to work with agencies to set “agency-specific goals” for data center closures and cost savings based on their current status and progress. The policy sets forth a goal to factor in the total cost of ownership of data centers and applications within them, rather than hosting and licensing costs.

The policy also adds and rescinds performance metrics, and clarifies that moving forward, OMB will focus performance metric measurements on agency-owned, tiered facilities. Updated metrics include virtualization, advanced energy metering and server utilization. Facility utilization and energy efficiency metrics have been removed. One new metric, data center availability, has been added to measure, for example, unplanned outages for data centers that run key citizen services or mission areas.

Agencies must continue reporting a variety of data to OMB, including annual inventories of data center facilities, annual cost evaluation of operating and maintaining existing facilities and quarterly progress toward their closures and metric target values.

OMB’s updated policy concludes by prioritizing the importance agencies should place on its key initiatives. Consolidation and closure is the top priority, followed by optimization, virtualization, availability, energy metering and server utilization.