Nebraska’s IT Transformation: Laying the Groundwork for Innovation in 2026
In 2025, Nebraska officials have embarked on a mission to reshape the state’s information technology landscape by investing in talent pipelines, advancing artificial intelligence (AI) implementation, and achieving cost efficiencies. Under the leadership of State CIO Matthew McCarville, these initiatives are aimed at modernizing the state’s IT ecosystem while simultaneously delivering savings to taxpayers.
A New Era of IT Leadership
Matthew McCarville took the reins of Nebraska IT in 2024 with a clear mandate: prioritize cost savings and improve technological capabilities. His perspective on diversity—seeing it as not just demographic but as a mindset—reflects his commitment to innovative problem-solving and attracting new talent into state government.
Under McCarville’s guidance, Nebraska’s IT framework is set for a significant transformation. Many of the state’s systems were reliant on an on-premise mainframe mentality. Recognizing the limitations posed by such architecture, McCarville has initiated a transition to a cloud-based environment, slated for completion in the upcoming calendar year. A vendor selection process is expected to occur in January, marking a pivotal step toward harnessing emerging technologies like AI.
Unlocking the Power of Data
Transitioning to a cloud environment is not just a strategic move; it opens new avenues for data utilization that were previously stymied by cost concerns. McCarville points out that running AI models on outdated mainframe systems is "cost-prohibitive." With cloud infrastructure, data can be analyzed and leveraged in fresh and innovative ways, paving the way for predictive analytics and more sophisticated AI applications.
Building the Talent Pipeline
The question of talent is formidable for Nebraska. Approximately one-third of state employees became eligible for retirement about a decade ago, creating a pressing need for skilled professionals equipped to tackle modern IT challenges. Recognizing this gap, Nebraska has established a Data and AI Center of Excellence in Omaha aimed at nurturing the upcoming generation of IT talent.
An exciting initiative tied to this center is the introduction of an internship program set to launch in January. This initiative is designed to bring in individuals who may lack prior experience with state government systems, thereby broadening the talent pool. Also on the horizon is Nebraska’s first statewide IT apprenticeship program, set for 2026. This program is GI Bill-qualified, meaning it will provide funding to train not only military veterans but also the general public in essential areas such as AI, data, and cybersecurity. The goal is to equip individuals with in-demand skill sets while encouraging them to remain in Nebraska.
Modernization through New Mindsets
Modernizing state IT isn’t just about new tools; it requires a paradigm shift in how officials think about technology and vendor partnerships. McCarville emphasizes the importance of moving away from legacy vendor agreements that may no longer serve the state’s best interests. By diversifying their technological partnerships, state IT officials can better adapt to contemporary challenges and pursue projects with the most cost-effective solutions.
However, this diversification comes with its challenges. Understanding a broader range of products necessitates a learning curve, but it ultimately allows for more effective project execution—positioning Nebraska to respond to technological needs more dynamically.
A Comprehensive Approach to Cybersecurity
Another major initiative has been the establishment of Nebraska’s first Joint Security Operations Center in 2024. This facility represents a collaborative effort to enhance cybersecurity across the state, effectively serving all 93 counties, their cities, and over 250 K-12 educational entities, among others. McCarville describes this approach as creating a "Field of Dreams" for cybersecurity—building the infrastructure necessary to attract organizations and encourage participation.
While concerns loom over potential changes to federal cybersecurity funding, McCarville remains pragmatic about reliance on sustainable funding sources. He suggests that while federal dollars can be beneficial, Nebraska must adopt a mindset of self-sufficiency when it comes to funding its cybersecurity needs.
Financial Prudence in IT Investments
Despite these ambitious initiatives, Nebraska’s leadership must navigate tight fiscal waters. With a projected $471 million deficit looming in the annual budget, state agencies have been tasked with cutting $500 million over the next two years. In this context, the Nebraska Office of the CIO (OCIO) stands out for its unique funding structure, where agencies pay for its services through their general funds.
To help lighten the financial burden on the state, OCIO has committed to reducing costs and is already on track to cut $2.5 million in annual recurring overhead, with a goal to reach $13 million. This proactive approach is not a mandate; rather, it’s a commitment to assist the state in coping with its budgetary constraints.
Balancing Cost and Innovation
Navigating this dual focus—modernizing technology while being mindful of budgets—poses a challenge. McCarville candidly states that slashing IT dollars isn’t always beneficial, yet he remains dedicated to finding innovative solutions that allow for modernization without escalating expenses. His strategy reflects the delicate balance of investing in the future while keeping an eye on the present.
In sum, Nebraska’s IT initiatives encapsulate a thoughtful and proactive strategy for modernization, talent development, cybersecurity, and fiscal responsibility, setting the stage for a ripple effect that could redefine how state government interacts with technology and its citizens.
