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AI Rising, Budgets Falling: The 2025 NASCIO Annual Story

Last updated: October 19, 2025 2:50 pm
Published: 6 months ago
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Charles Dickens opens A Tale of Two Cities with these words: “It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of light, it was the season of darkness, it was the spring of hope, it was the winter of despair.”

Add in a few words about state budgets, and this famous description accurately portrays the prevailing sentiment as state leaders headed home from the 2025 National Association of State CIOs (NASCIO) Annual Conference in Denver this week.

Starting with a Sunday afternoon NASCIO Corporate Member Exchange, which was accurately described as “State CIOs Unfiltered,” the dichotomy in state budget situations was stark. CIOs described needing massive funding cuts to balance state budgets or lose staff to address shortfalls. Some states painted rosier pictures, but it was a mixed bag.

But while the budget and staffing situations appear to be vastly different across the country, the need for modernization, digital transformation and the use of artificial intelligence in different forms was a common theme across the country. Indeed, big projects, systems replacements, new ways of conducting business and better, more efficient services for constituents were areas of common focus.

And cybersecurity, the first topic each CIO raised, remains a top priority as cyber threats, including ransomware and electronic fraud, continue to increase to historic levels. Of course, federal budget cuts and challenges with grants and the federal government shutdown were also mentioned, with varying levels of concern.

In my opinion, that first session summed up the major themes for the conference: Budgets and staffing are tight in many states; AI is showing up everywhere, from cyber to health care to road projects; we need partners to dig deep (and cut prices); the tech opportunities have never been greater; and the pressure and stakes have never been higher as we head into the midterm elections next fall 2026.

Throughout the past week, Government Technology has published a series of articles on a wide variety of related topics from the 2025 NASCIO Annual Conference. Here are a few of those articles:

“NASCIO Survey: CIOs Look Ahead With Accessibility, AI”

“With compliance deadlines looming and technologies such as AI constantly evolving, CIOs are focused on matching the pace of change to deliver services to customers — both residents and state agencies.

“The State CIO Survey released during the National Association of State Chief Information Officers (NASCIO) 2025 Annual Conference explored CIOs’ sentiments on a range of topics, from accessibility and AI to modernization and data governance. The overarching theme is that technology is advancing rapidly, and officials must evolve their IT products, policies and practices to match the pace.

“Accessibility was top of mind Monday morning as a panel of CIOs discussed results of the NASCIO survey. Even with progress already made, their comments made clear that much work — and much uncertainty — remains. For starters, state tech leaders are unsure how the federal government might enforce the upcoming rules for accessibility.”

You can download the full report from the NASCIO website.

“NASCIO Panelists Offer Keys to Better Public Procurement”: “At the annual gathering of state CIOs, public-sector tech leaders offered tips about better procurement, including more use of master contracts. They also detailed what they are doing better.”

As I reiterate every year, the NASCIO Awards program is top notch, and federal, state and local governments can learn a lot by reviewing the best-practice materials at the awards library. I strongly encourage readers to take time to review all the finalist nominations in the areas that interest them within government. Nevertheless, here are the award winners for this year (with more details available from the NASCIO press release):

Artificial Intelligence

State of Minnesota: AI Tool Revolutionizing Legislative Review

Cross-Boundary Collaboration

State of Minnesota: State Agencies Unite to Feed Minnesota’s Children

Cybersecurity

State of Ohio: Ohio’s Defense-in-Depth Approach to Fraud Prevention

Data Management, Analytics and Visualization

Commonwealth of Massachusetts: Emergency Shelter Response: Shared Data Enabling Smarter, Compassionate Support

Digital Experience: Agency/Program Solutions

State of Kansas: Kansas Department of Labor: Taking Kansas Unemployment Insurance from Disco to Digital

Digital Experience: Enterprise Solutions

State of Connecticut: Smart Scheduling: Elevating the DMV for a Smoother Experience

Enterprise Technology Management

State of Washington: Disrupting the Norm: How Washington Turned Procurement into a Platform for Innovation

Information and Communications Technology

State of North Carolina: Next Generation 911: Validating the Implementation of Next Generation 911

Operational Efficiency:

State of Arizona: SOLVE AI: Smart Operational Learning for Vulnerable Engagement

State CIO Office Special Recognition

State of Washington: Modernizing the Mission: Washington’s Innovation and Modernization Program Paves the Future of Statewide Services

Other individual awards were announced including the NASCIO State Technology Innovator Award to three officials who advanced innovative, resident-facing technology. Here are excerpts from GT’s coverage:

Additionally, Ohio CISO Holly Drake won the 2025 Thomas M. Jarrett State Cybersecurity Leadership Award.

The two morning keynotes on Monday and Tuesday were both inspiring presenters who challenged the audience to take practical steps to improve their careers, influence, service and more. I found the Tuesday morning presentation to be helpful in describing, analyzing and resolving relationship challenges with young men and women in Gen Z.

In Monday’s opening keynote, Jamie Clarke described his many problems and challenges growing up, but his can-do, hard-working, positive attitude, along with a driven sense of purpose, led him to ultimately achieving success in climbing Mount Everest after multiple tries. His leadership principles and can-do, funny approach can be seen in this video.

Read more on Government Technology

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