Estimate of Telecommunications Cost Recovery for Fiscal Year 2001

In Reply Refer To: 
Office of 
Information                                                                
                                     
Mail Stop 440                                     


                                                                           
                          MEMORANDUM 

                                                                           
                                                                           
                                                  March 30, 2001 
                
To:       Senior Staff and Office Chiefs 
          District Chiefs 
          Administrative Officers 
          System Administrators 

From:     Stephen F. Blanchard   /signed/ 
           Acting Chief, Office of Information, Water Resources Discipline 

Subject:  Estimate of Telecommunications Cost Recovery for  Fiscal Year 2001 

The purpose of this memorandum is to provide you with an estimate of 
telecommunication charges to be cost recovered from WRD Offices for Fiscal 
Year 2001.  In past years, the DIS Program Office combined proprietary 
software charges and telecommunications charges in one cost recovery memo 
that was released in the spring.  Unfortunately, this year the actual 
telecommunication charges have not been determined and may not be 
finalized until summer.   The proprietary software cost recovery will be 
announced separately in the near future.   Even though this memorandum 
provides no concrete costs for 2001, we felt that the potential for 
significant increases should be brought to your attention. 
  
The current estimate of telecommunications costs reflects average 
increases of 20 to 50% over last fiscal year's telecommunications charges 
between the best and worst case scenarios.  WRD has not received any MCIW 
bills yet, nor do we have any idea of what the USGS shared network cost 
will be.  While the DIS Program Office is doing everything possible to 
keep our private network costs down, much of the shared backbone costs are 
out of our control.  We urge you to plan for at least what is in the worst 
cost scenario on the spreadsheet referenced below.  Costs in the 
spreadsheet are based only on costs that could be identified to-date for 
the WRD private network plus "best guess" estimates for potential USGS 
shared network cost yet to be determined.  I must emphasize that there is 
a small chance that the final cost could be still higher than what is 
listed in the spreadsheet. 

Much of the known cost increase is due to added demands from the field for 
improved networking.  In addition, the USGS is converting its network from 
FTS2000 AT&T to FTS2001 MCIW this fiscal year.  As a result of the 
conversion, there are considerable transition costs with having to 
maintain two networks (both AT&T and MCIW) and, due to the delays and 
drawn-out installation of the new MCIW network.  We are still uncertain 
how much of the transition cost will be recovered from GSA and when/how 
expected year-end discounts from MCIW will be applied.  While the new MCIW 
networking is comparably cheaper than AT&T, higher networking 
demands/requirements have pushed us into a new level of network services 
and corresponding costs.  In addition, most of the real savings with 
moving to the FTS2001 MCIW contract may not be realized until the later 
years of the contract. The uncertainty and wide range in the scenarios 
with the shared backbone cost is due mainly to the breakup of the old 
DOInet network and uncertainty in the distribution of cost for the new 
USGS shared backbone network. 

The following table includes, by office, the full-time-equivalent (FTE) 
numbers that we will use to calculate cost recovery telecommunication 
charges.  The numbers in the spreadsheet were based on final FY2000 FTE 
numbers for each location.  This table is derived from information in 
AIS.  This is the same table that is being used for the proprietary 
software cost recovery for FY 2001: 

    http://wwwqvarsa.er.usgs.gov/fy01cost/ftecnt_2000.html 

The following table includes the current best guess estimate of your best 
case and worst case Fiscal Year 2001 Telecom cost recovery charges based 
on the FTE numbers in the table above: 

    
     http://wwwqvarsa.er.usgs.gov/fy01cost/telecom_estimate_fy01.html
      

The final Telecommunications cost recovery will be sent to you by way of 
email as soon as possible.  If you have questions, please contact Bob 
Wakelee of the DIS Program Office by email (rwakelee). 


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Steve Blanchard                                        National Center, 
MS409
Acting Chief,  Office of Information        Reston, VA 20192
U.S. Geological Survey                          Phone: 703-648-5629
                                                                       
Fax:     703-648-5002
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