6609.12,20 Page 1 of 8 FSH 6609.12 - ADP TECHNICAL HANDBOOK WO AMENDMENT 6609.12-91-1 EFFECTIVE 9/3/91 CHAPTER 20 - REQUIRED ACTION AND DOCUMENTATION 21 - GENERAL. The extent and content of the documentation required to support an automated data processing technical approval request vary a great deal depending upon the item or service requested and its value. The primary purpose of the technical approval process, however, is the same in all cases. The process is intended to ensure careful consideration of the acquisition, from the standpoint of the need, to effectively meet overall Forest Service objectives. The wide range of actions and documentation required has often led to confusion by automated data processing (ADP) users. This chapter describes the various requirements systematically in a "building block" format based upon acquisition cost. Higher cost acquisitions must not only meet the requirements for that particular acquisition level, but also for all lower levels as well. The handbook has been designed so that, in most cases, the documentation requirements can be determined with a minimum amount of cross checking. Do not initiate acquisition of ADP equipment or services from commercial sources until you determine that it is not possible to obtain the required capability by using existing Federal resources. Screen the resources of other ADP units in the vicinity for their suitability in meeting the requirements on a shared basis. Also consider excess Government-owned automated data processing equipment (ADPE) before acquiring commercially available equipment. This stipulation applies both to new requirements and to the renewal of leased ADPE. The General Services Administration publishes an availability list approximately every 2 weeks to inform Federal agencies of available excess and exchange/sale ADPE. The availability list is distributed to Region, Station, and Area ADP coordinators, and is obtainable by request from the General Services Administration (KHEE), Washington, D.C. 20405. In the event that you locate excess ADPE that appears to satisfy the Unit's requirements, contact the Washington Office, Computer Sciences and Telecommunications Staff, for assistance in evaluating the suitability of the equipment. 22 - DOCUMENTATION REQUIREMENTS. The value and complexity of an acquisition dictate the level of technical approval as well as the associated documentation. The extent of the effort necessary to justify the acquisition depends upon the complexity of the application. A dollar value not exceeding 10 percent of the procurement cost is suggested as a rule for quantifying the scope of effort for feasibility studies and document preparation. Recognize that this rule is a rough average because some relatively low-cost acquisitions can be quite complex and require extensive preliminary analysis while the requirements for some expensive acquisitions may be straightforward and easily defined and justified. The following sections outline the documentation requirements based on the cost of the item or services being acquired. A summary of the documentation required is presented in exhibit 01. Within a cost range it is expected that higher cost acquisitions will require more thorough documentation than lower cost items. Exercise judgment in using the guidelines in each specific situation. Should the cost exceed the "Base" threshold as defined in Department Regulation 3130-1, Technical Approval for IRM Products and Services documentation must adhere to the requirements in that Regulation. These thresholds are: Category Base Threshold Equipment $100,000 ADP and Office Automation $100,000 Services Equipment Maintenance $ 50,000 Software Packages $ 50,000 ADP and Office Automation $100,000 Support Services 22 - Exhibit 01 Documentation Requirements for ADP Approval at Various Cost Levels System Cost FSH Ref. Required Documentation < $5,000 22.1 Letter describing request and cost/benefits ----------------------------------------------------------------- --------------------------------------------------- $5,000 - $25,000 Letter above, PLUS: 22.21 Management Summary 22.22 Alternative Systems 22.23 Functional Requirements 22.24 Telecommunications Requirements 22.25 Cost/Benefit Analysis 22.26 Analysis of Impacts on Department Computer Centers 22.27 Noncompetitive Procurement Justification ----------------------------------------------------------------- --------------------------------------------------- $25,001 - $50,000 All of the above, PLUS: 22.31 Feasibility Study 22.32 Alternative Systems 22.33 Cost/Benefit Analysis ----------------------------------------------------------------- --------------------------------------------------- $50,001 - $100,000 All of the above, PLUS: 22.41 Cost/Benefit Analysis >$50,000 Software or Maintenance only: See Department Regulation 3130-1 ----------------------------------------------------------------- --------------------------------------------------- >$100,000 22.5 See Department Regulation 3130-1 ----------------------------------------------------------------- --------------------------------------------------- The repetition of a category in the requirements for a higher value acquisition indicates that new requirements have been added to that category or that a major increase in the amount of justification is required. 22.1 - Requests Under $5,000. The documentation requirements for requests for products or services whose acquisition cost does not exceed $5,000 can be met by a letter which describes the request and its estimated cost and benefits. Explain the purpose of the request and identify a contact person should additional information be necessary. Requests requiring Washington Office, USDA, or GSA technical approval must be signed by the Regional Forester, Station or Area Director, or Washington Office Staff Director. 22.2 - Requests From $5,000 to $25,000. In addition to the requirements for under $5,000 requests, the following information must be supplied. The complexity and amount of documentation should be consistent with the complexity and total cost of the equipment, software, or services being acquired. 22.21 - Management Summary. State the requirements of the proposed system, such as: new services, increased capacity, legislative and policy requirements, privacy, security, and audit controls. Be specific. This section must present a clear picture of what you want the system to do. The expected installation/completion date of the new system should be stated. Identify the major objectives of the proposed system, such as: reduced manpower and equipment costs, increased processing speed, increased productivity, improved management information services, improved controls over automated decision-making systems, or compliance with regulations. State the reasoning which supports the recommendation of the proposed system over alternative systems. Explain known constraints (budget, policy, etc.). 22.22 - Alternative Systems. At least two feasible alternatives, in addition to the recommended alternative, should be evaluated. One alternative must be continuing with the current system or operation. This alternative is used as the base line for measurements. One alternative will be the use of a Department Computer Center (DCC) when an application is being considered which could operate on a DCC, or equipment or service is being acquired to handle work currently utilizing a DCC. Identify the limitations of each system such as resource constraints or organization and policy problems. Also identify any other factors unique to this system. 22.23 - Functional Requirements. Identify the major functions of the proposed system such as communication with other computers, data base management, or financial analysis, and include a list of the hardware and/or software which will better illustrate the type of software and level of computing power required. This list is not considered a request for that specific hardware/software configuration unless so indicated in the request. Accompany all requests for specific hardware and/or software (specific make and model) with a Noncompetitive Procurement Justification (see section 22.27). The workload and its characteristics must be congruent with the products and services being requested. 22.24 - Telecommunications Requirements. Include this section if there is a need for data communications support. Describe the telecommunications requirements including which systems will be communicated with, data transmission speed requirements, and frequency of communications. 22.25 - Cost/Benefit Analysis. The cost/benefit analysis is to provide managers, users, designers, and auditors with adequate cost and benefit information to analyze and evaluate alternative approaches. The level of detail provided should be consistent with the size and complexity of the acquisition. The comparative cost/benefit analysis may be limited to an analysis that demonstrates that the benefits of acquiring the proposed system or item will outweigh the costs. At a minimum, this should include a table of anticipated costs and anticipated benefits over the system life. State these costs and benefits in terms that relate to organizational objectives, goals, missions, functions, and operating environment. Occasionally a legislative, executive, or judicial decree exists to do a job. The benefits, in these cases, must be omitted if there are none associated with the various alternative ways of doing the job. However, if the legislative history or other background information provides some measure of benefits, these must be used. 22.26 - Analysis of Impacts on Department Computer Centers. Summarize workload changes, processing location and priority, telecommunications load, storage requirements, data interchange requirements, etc., and their effects on other agencies and Department Computer Centers. 22.27 - Noncompetitive Procurement Justification. If an acquisition is proposed to be conducted on a noncompetitive basis, prepare a sole source justification. It shall be titled "Justification for Noncompetitive Procurement" and must be in accordance with Public Law 98-369, Section 303, the FAR, AGAR, and any Department Regulations which implement the FAR. The final decision whether an acquisition is to be noncompetitive rests with the Contracting Officer. This justification is required for acquisitions using: the only source which can provide the required item, an unsolicited proposal, modifications to an existing contract outside the contract's scope or options, nonmandatory GSA contracts where a chosen line item is more than $500 costlier than essentially the same item on another contract, or nonappropriated funds when competition is restricted. The essential elements of a noncompetitive justification are the quantitative description of how much cost can be saved, the details of why only one vendor's product or service is practical, and what steps are being or will be taken to make the next acquisition competitive. The full justification statement is not required for: contracts to be awarded to minority owned firms under the Small Business Administration's 8(a) Program and other minority and special Federal programs, work going to Federally Funded Research and Development Centers, and for interagency agreements. However, a statement is required which identifies who made the decision and when and generally why it was made. 22.3 - Requests From $25,001 to $50,000. In addition to the requirements for under $25,000 requests, the following must be supplied. For those information items already discussed in earlier sections, the level of detail provided should reflect the higher acquisition cost and be consistent with other documentation requirements for requests in this price range. 22.31 - Feasibility Study. Document all requests to show that the requesting unit has carefully planned the acquisition to achieve its mission responsibilities in a cost-effective manner. Present the assumptions and constraints of the study including operational life of the proposed system; interaction of the proposed system with other systems and organizations; input, processing, and output requirements; financial constraints; legislative and policy constraints; and availability of information resources. Identify how the study was accomplished and how the proposed system was evaluated. Summarize the general method or strategy employed. Describe the criteria employed in arriving at the recommended system. State the recommendation for the proposed system, including consequences of not taking action, and what delays can be tolerated. Outline a proposed schedule including detailed system design, programming, program test, conversion, and implementation. Identify major milestones and management decision points. Describe also methodology and impacts of the implementation. 22.32 - Alternative Systems. For each alternative, describe the major processing/data flow. Specify the volume of work to be handled by the system and identify costs incurred in operating the system such as: manpower, equipment, space, support services, materials, and overhead. Identify the limitations of each system such as resource constraints or organization and policy problems. Also identify any other factors unique to this system. If other alternatives were considered, summarize each alternative and state the reason for non-selection. 22.33 - Cost/Benefit Analysis. A cost/benefit analysis is required for each feasible alternative. Describe the development and operation costs of each system. The analyses of pilot test or study projects may be somewhat limited, but they should show a reasonable expectation of benefit if the whole system being tested or studied is implemented. Present costs in a table format supplemented by a narrative describing how the costs were determined and discussing any assumptions upon which the costs are based. Include costs for ADP equipment, computer time and related telecommunications services, maintenance, software, and services such as software development, conversion, maintenance, and facility management and operations. Also include other non-recurring costs such as personnel costs of system developers, data entry clerks, operators; training and travel expenses; information collection burdens; overhead costs for management, secretarial, and support staff; space, environment, utilities, and supplies costs. Recurring costs for the items listed above should be estimated over the system life and included in the cost table. Often identifiable costs can be found but cannot be readily evaluated nor estimated. If no relationship can be established to gauge their magnitude, they should be described so they can be considered in the alternative selection decision. Describe non-recurring and recurring benefits which could be attained through the development of the proposed system. State benefits in terms that relate to organizational objectives, goals, missions, functions, and operating environment. 22.34 - Quantifiable Benefits. There are two kinds of quantifiable benefits. The first is hard dollar or real personnel position savings. This is where the organization can show a budget or staffing reduction due directly to some form of automation. These benefits include firm cost avoidance items that will accrue in the future. It is the hard savings that pay for or give a return on investment for new automation resources and processes. It is very important to explicitly identify these savings and to recognize that these savings must be reflected in planning, budgeting, and operations. The second kind of benefits are soft savings that do not translate into budget or staffing reductions. Though the soft savings do not normally pay for the automation, they often reflect improved service delivery to the public. They are an important element of the cost/benefit analysis. 22.35 - Non-quantifiable Benefits. Non-quantifiable benefits are those benefits which cannot be quantified in terms of direct dollar values, such as: improved service, reduced risk, improved information handling, and enhanced organizational image. Occasionally, some approximate, conservative relationship to dollar cost or benefits can be established. This relationship may be in the form of relative measures of costs and benefits. If relationships of this kind can be established, the dollar values should be tallied in the benefit or cost table. If no relationships are possible, they should still be listed for consideration in the alternative selection decision. 22.4 - Requests From $50,001 to $100,000. In addition to the requirements for under $50,000 requests, the following must be supplied. For those information items already discussed in earlier sections, the level of detail provided should reflect the higher acquisition cost and be consistent with other documentation requirements for requests in this price range. 22.41 - Cost/Benefit Analysis. Calculate the present value cost of the acquisition, the adjusted cost, and the present value of benefits by using a 10 percent discount rate for system life costs. Calculate the benefit/cost ratio by dividing the total present value of benefits by the adjusted cost. Instructions for performing these calculations can be found in FIPS PUB 64. A spreadsheet which will perform these calculations is available from the Washington Office, Computer Sciences and Telecommunications Staff. 22.5 - Requests Over $100,000. For all requests whose acquisition cost exceeds $100,000 and for requests which exceed the limits identified in section 22, all documentation requirements in Department Regulation 3130-1, Technical Approval for IRM Products and Services must be met. 22.6 - Form AD-835, IRM System and Service Security Certification. This form is mandatory for all requests which will store, process, or access sensitive data. Submit a copy of the form completed as far as possible with appropriate signatures. Retain the original. 23 - PILOT TESTS AND STUDIES. Occasionally, a task involves a pilot test or contractual assistance to study the feasibility or other requirements of some form of automation. In these cases, the actual need, workload, costs, and benefits, plus other information requirements are relatively unknown. They are in fact the object of the test, the consultant's work, or study. When this occurs, contractual or study products must include documents for the feasibility study as well as functional requirements, telecommunications requirements, cost/benefit analysis, and analysis of impacts on other agencies and Department Computer Centers. The feasibility study for these types of acquisitions will, of necessity, lack depth. However, the technical approval request must include an approximation of the total of both the system life cost and acquisition cost as if the whole system being tested or studied were implemented. It is the cost of the entire project, if implemented, not the cost of the pilot test or study which determines if technical approval thresholds have been exceeded.