Self-funded Model

Self-funded means that we do not charge state agencies any start-up fees for developing online government services. Rather, VIC generates revenue by adding a nominal convenience fee to most customer transactions which have statutory fees.  For example, a service that we launched in 2011 is Property Transfer Tax Returns.  Because this extremely complex service required over 2000 hours to develop, the Department of Taxes decided to add a $5 convenience fee to transfers processed through the service in order to allow VIC to recover its return-on-investment in a few years.
 
The advantage to the State of this type of business model is that VIC only earns revenue from services that work well and that people want to use – therefore our services are guaranteed to work well or we won’t recover our costs. Additionally, the self-funded model is responsible for all of our free services to the State as well - some 78% - several of which we have won kudos and recognition for providing. 
 
Even though the self-funded model means that VIC doesn't accept taxpayer funds, our online service fees are reviewed and approved through a 3-step process: a 10-member oversight committee comprised of high-ranking officials from across state government, the Governor’s office, and the Joint Fiscal Committee of the Legislature.
 
To learn more about how the self-funded model works in other NIC states, visit: http://www.egov.com/Insights/BestPractices/Pages/ReducingCosts.aspx