TxDOT Draft LAR Includes $391M IT Capital Budget

The Texas Department of Transportation’s (TxDOT) draft Fiscal Year 2028-29 Legislative Appropriations Request (LAR) includes about $391 million in IT-related capital budget items — a decrease of about $3 million from the last biennium.

The draft request was reviewed during the July 30 Texas Transportation Commission meeting, with staff seeking commission direction before a final request is brought back for adoption in August. The request will help shape the department’s funding proposal for the 2028-29 biennium ahead of the 2027 legislative session.

The draft capital budget includes about $170 million for data center consolidation, $166 million for acquisition of information resource technologies, $27 million for the Centralized Accounting and Payroll/Personnel System, $20 million for legacy modernization and $8 million for cybersecurity.

The proposal is slightly lower than the agency’s IT capital budget proposal for the previous biennium. TxDOT’s 2026-27 LAR included a $394 million IT-related capital budget, with $167 million for information resource technology acquisitions, $140 million for data center consolidation, $36 million for cybersecurity, $31 million for the Centralized Accounting and Payroll/Personnel System and $19 million for legacy modernization.

Compared with that proposal, the new draft would increase the proposed amounts for data center consolidation and legacy modernization while reducing proposed funding for cybersecurity, acquisition of information resource technologies and the Centralized Accounting and Payroll/Personnel System.

The draft also includes narrative language around continued technology modernization. TxDOT says it plans to continue replacing legacy systems, modernizing decades-old planning and letting technology, improving network capacity and adding safeguards for end-user devices and connected infrastructure.

The department also identified a technology-adjacent exceptional item for advanced air mobility. The $5 million proposal would support operational integration architecture, vertiport schematic design and engineering and economic and multimodal corridor delivery plans.

The request is being developed under statewide budget instructions that require agencies to reduce base appropriation request levels by 3 percent as the starting point for budget deliberations. The July 14 policy letter from Gov. Greg Abbott, Lt. Gov. Dan Patrick and House Speaker Dustin Burrows says funding requests above baseline levels may be submitted as exceptional items, and agencies requesting exceptional items should be prepared to identify lower-priority programs or savings to help offset costs.

The TxDOT materials offer one of the more detailed early looks at a large agency’s technology priorities for the next budget cycle. The draft identifies continued demand around infrastructure acquisition, data center services, financial and personnel systems, cybersecurity and legacy modernization.