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FINANCIAL GUIDANCE FOR INFORMATION TECHNOLOGY (IT) PURCHASES

Date Signed: 8/22/2017
MARADMINS Number: 464/17

R 221334Z AUG 17
MARADMIN 464/17
MSGID/GENADMIN, USMTF, 2017/CMC PR WASHINGTON DC (UC)/F0002//
SUBJ/FINANCIAL GUIDANCE FOR INFORMATION TECHNOLOGY (IT) PURCHASES//
REF/A/IRM 5236-06A, INFORMATION TECHNOLOGY PROCUREMENT REVIEW AND APPROVAL SYSTEM (ITPRAS) LESS THAN 50K DOLLARS APPROVAL THRESHOLD EXECUTION GUIDELINES//
REF/B/DOD FMR VOL 2A CHAP 1//
REF/C/DON FMPM CHAP 3//
REF/D/IL (LF) MEMO OF 13 JUN 2014, GUIDANCE REGARDING THE CLASSIFICATION OF INFORMATION TECHNOLOGY INFRASTRUCTURE AND EQUIPMENT//
REF/E/MCO 7300.21B, MARINE CORPS FINANCIAL MANAGEMENT STANDARD OPERATING PROCEDURE MANUAL//
REF/F/MARADMIN 375/11, INFORMATION TECHNOLOGY (IT) FUNDING, APPROVAL, AND PROCUREMENT//
REF/G/MARADMIN 298/08, INFORMATION TECHNOLOGY (IT) PERIPHERALS ACQUISITION POLICY//
REF/H/MARADMIN 523/15, INFORMATION TECHNOLOGY (IT) CONSUMABLES POLICY//
POC/SHARI RITTER/CIV/UNIT: HQMC PR RFC/NAME: WASHINGTON DC/TEL: 703-614-0710//
POC/MITRA NYSTROM-NEWELL/CIV/UNIT: HQMC PR RFE/NAME: WASHINGTON DC/TEL: 703-695-5355//
GENTEXT/REMARKS/1.  THIS IS A HEADQUARTERS MARINE CORPS (HQMC), DEPUTY COMMANDANT FOR PROGRAMS AND RESOURCES (DC PR) MESSAGE.
2.  Background.  The Information Technology (IT) Procurement process ensures IT requirements support Marine Corps IT vision and strategy.  In April 2017, HQMC C4 deployed the new Information Technology Procurement Review and Approval System (ITPRAS) module, which is hosted in the Enterprise BMC Remedy IT Service Management Suite, and transitioned all existing ITPRAS users from the legacy system to the new ITPRAS module.  In order to better facilitate effective and efficient completion of IT procurement requests and reviews, the financial review of IT requests will be delegated to designated G-8/Comptrollers.  To date, HQMC C4 has released one Information Resource Management (IRM) manual that promulgates guidance for the new IT Procurement process per reference (a).  C4 plans to issue another IRM with detailed guidance for the ITPRAS process.
3.  Purpose.  To provide financial management guidance to assist G-8/Comptroller personnel in conducting IT Procurement Request (ITPR) financial reviews.  The primary role of the financial review is to ensure the correct appropriation(s) have been identified for each ITPR in order to mitigate potential Antideficiency Act Violations (ADA).
3.A.  Designated G-8/Comptrollers at the Major Resource Identifier (MRI) level, select Suballotment Resource Identifier (SRI) level, and several Work Center Identifer (WCI) within Headquarters Marine Corps are delegated to conduct a financial review of all ITPRs.  This will better support the review and approval of the requirement (conducted by the G-6) with the appropriate resources (G-8/Comptroller) to ensure the correct appropriation has been identified.  No further delegation is authorized.
HQMC DMCS (AR)          MARCENT         HQMC (C4)
HQMC (IL)               MARFORCYBER     HQMC (I) / MCIA
HQMC (MRA)              MARFOREUR/AF    MARFORSOUTH
HQMC (PR)               MARSOC          MCI EAST
HQMC (PPO)              MCICOM          MCI PAC
MARFORCOM               MARCORLOGCOM    MCI WEST
MARFORPAC               MCRC            MCSC
MARFORNORTH             TECOM           MCCS
MARFORRES                               HQMC (HH)
MCCDC                                   MCI NCR
I MEF
II MEF
III MEF
3.B.  Requirements for Financial Management (FM) Reviewers.  Each G-8/Comptroller office will identify and maintain at least two analysts to conduct the financial review as part of the ITPRAS workflow.  These analysts will meet the following qualifications:
3.B.(1)  All FM reviewers must complete the DON Principles of Appropriations Law course prior to reviewing any requests in ITPRAS.  This course is located on the ASN(FMC) PBIS website:  https:(slash-slash)fmbweb1.nmci.navy.mil/pbis/training/pbisweb_training.cfm.  The website requires DoD PKI/CAC and must be accessed from a .MIL network.
3.B.(2)  A fiscal/appropriations law refresher course must be taken at a minimum of every three years to ensure all parties are well versed in the laws and rules for spending federal appropriations.
3.B.(3)  FM Reviewers must obtain and maintain an ITPRAS Remedy account and complete all required training to work within the Remedy system.  All required training certificates and documentation listed in 3.B.1 through 3.B.2 will be uploaded in Remedy when the user account is requested.  Changes in personnel conducting the financial review will be submitted to the Unit Command Coordinator (UCC) in the local G-6 office who will coordinate the update with the HQMC C4 IT Procurement Branch.
3.B.(4)  It is recommended that FM Reviewers be 0500 series civilian employees/34XX series military members that hold a minimum Level 1 DoD Financial Management (FM) certification and/or worked in DoD financial management for a minimum of two years.
3.C.  Financial Management guidance, per references (b) through (e), is clarified and updated by this MARADMIN, as it directly relates to the purchase of IT goods and services using Marine Corps appropriated funds.  PR will provide financial review training to commands and the individuals identified in 3.B.  Transfer of responsibility to commands will commence upon completion of financial review training.
3.D.  Cancels Para 10 of MARADMIN 375/11 (Reference (f)).
4.  Definitions.
4.A.  Information Technology (IT):  Any equipment or interconnecte system or subsystem of equipment used in the automatic acquisition, storage, manipulation, management, movement, control, display, switching, interchange, transmission or reception of data or information, including computers, ancillary equipment, software, firmware and similar services and related resources whether performed by in-house, contractor, other intra-agency or intergovernmental agency resources/personnel.  Both system and non-system IT resources including base level units (communications, engineering, maintenance and installation) and management staffs at all levels are included in IT resource reporting.
4.B.  System:  A system shall be considered to exist if a number of items are a part of a function within the context of a whole to satisfy a documented requirement.  The term "system unit cost" is the aggregate cost of all components (e.g., equipment, integration, engineering support and software) that are part of, and function together, as a system to meet an approved documented requirement.
4.C.  Centrally Managed System (CMS):  Centralized Item Management and Asset Control is in the central supply system or a DoD-wide or Service-wide acquisition and control system in which the manager has the authority for management and procurement of items of equipment.  Asset control includes the authority to monitor equipment availability and take such actions as necessa4ry to restock to approved stockage levels.  Items that are centrally managed (not just centrally procured) are investment items regardless of the unit value.
4.D.  Program of Record (POR):  An officially designated acquisition program or project executed as a directed POR action (e.g., Marine Corps Common Hardware Suite (MCHS), Marine Corps Software Enterprise License Management System (MCSELMS)) or centrally managed strategic sourcing initiative (e.g., Next Generation Enterprise Network, Secure Operational Infrastructure and Communications (SONIC)) under direction of an appropriately designated milestone decision authority.  Marine Corps Systems Command (MCSC) POR program and product managers are assigned and responsible for providing initial development, testing and fielding to allowance levels, initial sustainment for the initial procurement years and resourced appropriately to accomplish modernization and technology refresh over the IT systems life cycle.
4.E.  IT Infrastructure:  IT materials that are determined to be Real Property assets, which encompass accessory equipment and furnishings that are not intended to be movable, are required for operation, and are permanently affixed as a part of the real property facility.
4.F.  Technology Refreshment:  The periodic replacement of Commercial Off-The-Shelf (COTS) components (e.g. processors, displays, operating systems), commercially available software (CAS) within larger DoD systems to assure continued supportability of that system through an indefinite service life.
5.  Policy.  The correct appropriation for an IT requirement is dependent on the activity and the underlying tasks that make up the IT requirement.  All IT Procurements require an approved IT Procurement Request (ITPR) processed through the HQMC C4 IT Procurement Review and Approval System (ITPRAS) prior to obligation and contract award.  Multiple appropriations required for a specific IT requirement must be submitted in a single ITPR.  Requirements may not be fragmented in order to circumvent the investment threshold as defined below in 5.A.(1).  PR will provide an IT Funding Decision Matrix to assist financial managers with making the appropriation determination for ITPRs via separate correspondence.  The following is basic policy for making funding determinations, but should not be the sole reference for determining the correct appropriation:
5.A.  Expense-Investment Criteria.
5.A.(1)  Expense-Investment Threshold:  The dollar threshold for expense and investment determinations for non-centrally managed programs is 250 thousand dollars per unit/system.  When the ‘system unit cost’ is less than 250 thousand dollars, it is generally classified as an expense.  A unit/system equal to or greater than 250 thousand dollars is classified as an investment.
5.A.(2)  Costs budgeted in the Operation and Maintenance (O and M) appropriations are considered expenses.  Costs budgeted in the Procurement appropriations (e.g. Procurement, Marine Corps (PMC)) are considered investments.  Costs budgeted in the Research, Development, Test and Evaluation (RDTE) appropriation includes both expenses and investments.
5.A.(3)  Items procured from the Navy Working Capital Fund (NWCF) will be treated as expenses in all cases except when intended for use in weapon system outfitting, government furnished material (GFM) on new procurement contracts, or for installation as part of a weapon system modification, major reactivation, or major service life extension.
5.B.  Expenses.  The costs incurred to operate and maintain the organizations, such as personal services, supplies and utilities.
5.B.(1)  Operations and Maintenance, Marine Corps/Reserves (OMMC/R).  IT Requirements with a system unit cost less than 250 thousand dollars, are generally classified as expenses.  Expenses incurred for continuing operations and current services are budgeted in the O and M appropriations regardless of cost.  Modernization/modification/improvement costs under 250 thousand dollars are considered expenses, as are one-time projects such as developing planning documents and studies.  OMMC/R funding is also required to purchase all licensing fees associated with COTS software requiring annual license renewals.
5.B.(2)  Examples when O and M is required for purchasing IT requirements:
5.B.(2)(a)  Annual fee licenses/software
5.B.(2)(b)  Peripherals per reference (g)
5.B.(2)(c)  Consumables per reference (h)
5.B.(2)(d)  Support Services for operational and maintenance purposes.
5.B.(2)(e)  Website subscriptions
5.B.(2)(f)  Minor Military Construction projects cover work to build a new facility, or alter an existing facility falling below the MILCON threshold, currently 1 million dollars.
5.C.  Investments.  The costs resulting in the acquisition of, or an addition to, end items.  These costs benefit future periods and generally are of long-term character such as real property and personal property.  Investments generally provide new or additional military capabilities or modernize existing capabilities.
5.C.(1)  Centrally Managed.  IT that is procured and fielded by a MCSC CMS / POR must use PMC funding for initial procurements and all associated IT equipment refresh, regardless of cost.
5.C.(2)  ‘System unit cost’ applies to equipment items being acquired in the following ways:
5.C.(2)(a)  A new system, i.e., the items are a part of a function within the context of a whole to satisfy a documented requirement.  In this case, “system unit cost” applies to the aggregate cost of all equipment items being acquired as a new system.
5.C.(2)(b)  Additions to or replacements within an existing system to address validated deficiencies or improve system performance (modifications).  In this case “system unit cost” applies to the aggregate cost of all new system equipment items being acquired in the same manner as a new system procurement.
5.C.(2)(c)  Stand-alone items, or as additions to or replacements within an existing system, but the items themselves are not characteristic of a system as described above.  In this case, the expense/investment threshold of 250 thousand dollars applies to the individual equipment item.
5.C.(3)  For modification efforts, only the cost of the upgrade (e.g., and new hardware, and associated technical assistance) is counted towards the expense-investment threshold.  IT that is procured and fielded by a MCSC CMS / POR must use PMC funding for all associated IT equipment refresh.
5.C.(4)  Proprietary software is an investment, subject to the expense-investment criteria, unless it is financed on an annual fee basis which is an expense.
5.C.(5)  Procurement, Marine Corps (PMC).  PMC funds personal property equipment with a system unit cost greater than or equal to the current expense-investment threshold (currently, 250 thousand dollars), as well as centrally managed items.
5.C.(6)  Examples when PMC is required for purchasing IT requirement/s:
5.C.(6)(a)  All desktop, laptops, tablets are centrally managed and will always be funded with PMC.
5.C.(6)(b)  The Initial purchase (i.e., outfitting) of a new system will include the laptop/desktop CPU and necessary peripherals (mouse, keyboard, docking station and monitor).
5.C.(6)(c)  Peripherals that meet the requirement of 5.C.(2)(c).
5.C.(6)(d)  Technology refreshments include, but are not limited to the CPU (desktop tower), laptop w/docking stations, switches, routers, repeaters and servers.  No peripherals are included in technology refreshments.
5.D.  Research, Development, Test, and Evaluation (RDTE).  In general, all developmental activities involved in bringing a program to its objective system are funded with RDTE.  Major upgrades increasing the performance envelope of existing systems, purchase of test articles, and conduct developmental testing and/or initial operational test and evaluation prior to system acceptance should be funded with RDTE.  Reaching the objective system, as defined in the requirements documents, is a critical determinate for funding.  Some software programs, particularly those following a spiral or incremental development pattern, may be approved for initial fielding even though the early capability is below the objective system requirements.  The follow-on development and test activities required to reach the objective system performance will be budgeted in RDTE.  The acquisition, operation and maintenance of IT systems that are used exclusively to support RDTE activities will be budgeted and funded within the RDTE appropriation.
5.E.  Execution of Marine Corps investment funds (PMC and RDTE) is the responsibility of Marine Corps Systems Command (MCSC).  In order to meet a new policy or directive which is outside the normal Program Objective Memorandum (POM), organizations requiring investment funding must coordinate their requirements with MCSC.
5.F.  Navy Working Capital Funds (NWCF).  Marine Corps Logistics Command is responsible for the execution of the Marine Corps portion of the NWCF.  IT systems developed and acquired using NWCF are funded in the capital budget if the system is 100 thousand dollars or more.  Systems costing less than 100 thousand dollars are funded through the operating budget.
5.G.  Non-appropriated Funds (NAF).  NAF is the primary funding mechanism for Marine Corps Community Services (MCCS) activities.  Command Comptrollers must abide by appropriation determinations detailed by this MARADMIN and all other financial management regulations when authorizing payments through the Uniform Funding Management (UFM) process.  NAF ITPRs are reviewed/approved by MCCS and are submitted into ITPRAS for tracking purposes only.
5.H.  Non-Marine Corps Appropriated Funds (i.e., Navy, Joint, National Intelligence Program, etc.).  IT hardware, software, and support services connected to Marine Corps systems, but procured using other service or department appropriated funds must be submitted to ITPRAS for tracking purposes.
6.  Roles and Responsibilities.
6.A.  Deputy Commandant, Programs and Resources (DC PR).  Provides financial management subject matter expertise, on an as needed basis, to ensure the correct appropriation is identified.  HQMC PR promulgates financial management policy for the Marine Corps.
6.B.  Director, Command, Control, Communications and Computers (C4)/Department of the Navy Deputy Chief Information Officer, Marine Corps (DDCIO(MC)).  The Director C4/DDCIO(MC) is the ITPR process owner.  The Director develops and promulgates IT procurement policy and guidance, provides ITPRAS training for submitters, reviewers and UCCs, and within the USMC Enterprise Service Catalog, maintains a list of IT assets meeting the definition of centrally managed/controlled items and/or can be found on acceptable Approved Product Lists (APL).
6.C.  Marine Corps Systems Command (MCSC).  As the programmatic review authority, MCSC determines if the technologies or services are centrally managed and must be procured through a POR.  MCSC manages enterprise purchasing vehicle(s) for IT hardware, software, services, and support, which must be used by acquisition PORs, operating forces, supporting establishment organizations, and field contracting offices.  MCSC provides contracting office support for IT hardware, software, and associated support services that must be procured with PMC or RDTE funds or as part of a MCSC-managed acquisition POR.
6.D.  Designated G-8/comptrollers.  The designated G-8/comptroller validates the correct appropriation used to procure the required hardware, software, or support services, in accordance with financial management policies/regulations.
7.  Release authorized by LtGen Gary Thomas, Deputy Commandant for Programs and Resources.//



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