States Save Millions With AI and Smart Government Redesign

When Colorado residents called about unemployment claims in January 2025, they waited 37 agonizing minutes on hold. By October, that wait dropped to just 15 minutes, and the state did it without hiring an army of new workers.

The secret? Colorado discovered that over half of 30,000 monthly callers just wanted claim updates, so they launched an AI assistant to answer those questions instantly. Add 18 bilingual agents and better online tools, and suddenly frustrated residents could get help fast.

It's one example of how states nationwide are racing to make government work better while spending less. From Florida to Washington, officials are streamlining services, cutting red tape, and finally bringing government technology into the modern age.

Maryland found gold in the simplest change imaginable. State employees were wasting money on expensive shipping because they didn't know a cheap statewide contract existed. Just making workers aware of this option and helping them access it will save $800,000 every year.

"It's behavior change, but it starts with conversations in the field, understanding the blockers, working through them and then creating new protocols," said Asma Mirza, Maryland's chief performance officer. Sometimes the best innovation is just talking to people about what's not working.

Colorado's success comes from its Digital Service team, which brings tech experts inside government instead of relying on expensive outside vendors. These product managers, designers, and engineers work directly with agencies to solve real problems and keep improving over time.

The approach is spreading fast. More than a dozen states now have digital service teams, and a $120 million national fund is helping even more states build this capacity. Arizona, Maryland, and Pennsylvania all launched teams in the past three years.

The Ripple Effect

When government works smoothly, something remarkable happens: people start trusting it again. Public trust in government has fallen to near-record lows, but states are proving they can turn that around with better service.

"When city and state officials fulfill people's expectations, they create small increments of trust which aggregate to more total trust in the way government operates," said Stephen Goldsmith, professor of urban policy at Harvard's Bloomberg Center for Cities. Every reduced wait time and streamlined process chips away at cynicism.

The timing couldn't be better. Generative AI and other technologies are making efficiency goals that once seemed impossible suddenly achievable. States are moving from throwing money at problems to actually solving them smartly.

Colorado reduced its office space footprint, created public dashboards for accountability, and made permits and licenses easier to access online. "Good government is what Coloradans expect from their leaders," Governor Jared Polis said.

The results speak louder than any political promise: shorter wait times, lower costs, happier residents, and proof that government can actually work in the 21st century.