May 3, 2017,

Shawn Shinneman and Will Anderson Austin Business Journal


If you're a company looking to do business with the state or local governments, it sure helps to be based in Austin.

Austin companies have won 80 percent of Texas' in-state IT staffing contracts through the Department of Information Resources since 2010. The contracts awarded were worth about $598 million, according to an in-depth analysis by Dallas Business Journal.

The Department of Information Resources is a middle man for government bodies looking to hire IT contractors. Mostly it finds contractors for state agencies and universities, but local governments and K-12 school systems also use DIR-contracted companies to find individual staffers that fit their needs.

Austin's contracting might can easily be seen in this database, which has 2,571 pages of Austin contractors but 143 pages for Houston and eight pages for Dallas.


To reveal Austin’s stronghold, the DBJ analyzed a Department of Information Resources database of about 95,000 IT staffing contracts for the past six years. That showed about 80,000 of the contracts went to staffers at companies based inside the state. Of the 80,000, about 64,000 — or 80 percent — went to companies located in Austin.

The proximity effect was felt in the Austin suburbs as well: companies in Cedar Park and Round Rock each received about 3 percent of the state IT contract money.

The contracts are for everything from a day or two of technology help to months-long IT projects.

Of the imbalance in contracts and money flowing into Austin versus other parts of the state, a spokesperson for the DIR told the Dallas Business Journal that decision-making power ultimately rests with its customers, i.e. state government agencies and institutions of higher education.

“DIR follows state procurement laws in competitively awarding the Staff Augmentation master contracts,” the spokesperson said in an emailed statement. “However, DIR does not have the statutory authority to regulate the use of these contracts by DIR customers, including monitoring statistics related to geographic location nor giving preference based on city or regional location.”

Go here to read the Dallas Business Journal's analysis of the issue.The DBJ found that some Austin companies have received more state money in the past six years than all of the contracts in Dallas combined.

Shawn Shinneman covers technology for the Dallas Business Journal.