# CAPITAL INVESTMENT REVIEW

**NAO Overview:**

All proposed major investments shall be assessed by the NOAA Facilities
Investment Management Board (FIMB) against the following selection
criteria:

-   alignment with and support of NOAA's Mission, Goal, and Strategic
    Plan Objectives;

-   positive return-on-investment (qualitative/quantitative benefits at
    acceptable costs within acceptable timeframes); and

-   risk assessment (at an acceptable level of risk).

The Capital Investment Review concludes with inclusion in the NOAA
Program and DOC Step One Notification.

**NAO Responsibilities**

**CAO:**

-   Makes capital investment recommendations to the FIMB as part of the
    PPBES process

-   Updates the OMB Exhibit 300, as necessary, to reflect latest cost
    and schedule information

-   Prepares analyses and briefing materials for the FIMB

-   Schedules and coordinates the FIMB decision point briefing

-   Prepares the DOC Step One Notification package

-   Seeks and obtains DOC and OMB approvals

-   Performs Risk Assessment in conjunction with the Senior Project
    Manager and the LO Client Representative

-   Performs economic analysis using The Automated Prospectus System
    (TAPS) or equivalent

-   Performs OMB Circular A-11 Capital Lease Scoring Analysis, as
    required

-   Oversees the development of macro-level requirements

-   Forms the Integrated Project Team

-   Maintains the official project file containing FIMB, DOC, and OMB
    approvals

**Line Office:**

-   Provides input to the OCAO for developing macro-level project
    requirements

-   Assists the CAO in briefing the FIMB

-   Ensures AA-level approval in accordance with LO policy

**Facility Investment Management Board:**

-   Provides initial review of proposed investment priorities

**Table 2-1 Steps:**

CIR-1 Develop Initial Functional Requirements

CIR-2 Develop Initial Schedule

CIR-3 Update Initial Project Cost Estimate

CIR-4 Prepare A-E Programming Study SOW

CIR-5 Task A-E and Issue Notice to Proceed

CIR-6 Approve Programming Study

CIR-7 Identify Alternatives

CIR-8 Analyze Alternatives

CIR-9 Perform Economic (TAPS) Analysis

CIR-10 Update PDRI (if used)

CIR-11 Update OMB Exhibit 300

CIR-12 Conduct Independent Review

CIR-13 Draft Interagency MOA/MOUs, as necessary

CIR-14 Prepare for and Conduct FIMB Review

CIR-15 Prepare for and Conduct DOC RPRB Briefing

CIR-16 Approval to Proceed to Scoping

## Initial Functional Requirements

3.1.1 Feasibility Study or Equivalent. One of the optional steps prior
to determining initial functional requirements is to examine the issues
that will make the project feasible or unfeasible, and in some cases to
determine the best strategy for proceeding with the project. The
following may be addressed in a Feasibility Study:

-   Needs assessment: identify agency requirements, reference space
    standards, and planning considerations. This assessment is used to
    articulate changing client mission, changing client housing
    requirements, deterioration in asset condition, and decline in asset
    financial performance. It should be performed in sufficient detail
    to clearly define a goal/required outcome. What are the expected
    benefits of the proposed facility?

-   Budget and scope of the project: whether or not the proposed project
    work can be accomplished at the target budget.

-   Site analysis: Is the site chosen suitable? Is it zoned for the
    project? Are there sufficient parking, utilities, etc.? Must the
    facility be in a particular location, and if so why? What is the
    relationship to existing or proposed facilities?

-   Strategy for developing the project on a given site.

-   Optimal size and type of building.

-   What will be required in the way of soils tests, seismic upgrades,
    etc.?

-   How will other site considerations, such as sound levels, traffic,
    etc., affect the project?

-   Are there any toxins or hazardous materials to be dealt with?

-   What other cost, planning, schedule, and design constraints might
    the project run into? What milestone dictates the need for this
    capability in the requested fiscal year? What is the impact of
    delay?

-   Preparation of a report which documents all of the findings of the
    study and makes recommendations for proceeding with the next steps
    of the project.

3.1.2 MOUs/MOAs. See Appendix B for Sample Formats.

## Program of Requirements

### Programming

\[Program of Requirements\]

\[Programming Study\]

##### The Program of Requirements Document expands upon the Facility Concept Study, emphasizing the detail project description by room/area. This document includes the results of any studies that have been completed and provides detailed criteria (e.g., size, location, environmental) for each of the rooms, activities, or functions included in the facility. The project's PDRI documentation is also included in the Program of Requirements. {#the-program-of-requirements-document-expands-upon-the-facility-concept-study-emphasizing-the-detail-project-description-by-roomarea.-this-document-includes-the-results-of-any-studies-that-have-been-completed-and-provides-detailed-criteria-e.g.-size-location-environmental-for-each-of-the-rooms-activities-or-functions-included-in-the-facility.-the-projects-pdri-documentation-is-also-included-in-the-program-of-requirements. .unnumbered}

Programming is the process used to arrive at the set of criteria on
which the design is based, and by which it is later evaluated. The
programming phase is where the project is built---not brick by brick,
but decision by decision. This is the time when a common vocabulary for
the project is created, and preferences and requirements are determined
and built into the overall picture before time is invested in design.\
\
One of the most important purposes of the program is to reduce the need
for later backtracking and redesign. A thorough programming process is
essential for maintaining an orderly and cost-effective design process
later in the project. PPMD goes through a detailed list of criteria with
the client, looking for program needs that translate into square footage
or other design requirements.

Programming usually involves a meeting or series of meetings. In the
programming meetings, the client's specific goals, priorities, and uses
for the spaces are discussed in detail. PPMD encourages the client to
consider all important issues up front, help the client understand the
ramifications of their decisions, and make recommendations based on past
experience and professional knowledge. All of the requirements of the
project are then put into a clearly-organized written program which will
be a reference throughout the design process.\
\
If, however, the client would like to play a less active role in
establishing the program, PPMD can develop a complete project program
for the client's review based on our experience designing numerous NOAA
facilities.\
\
Items specifically analyzed in the programming phase typically include
the following:

-   Goals, needs, limitations, expectations, aesthetics.

-   Scope of work: the number of occupants; size of the building; number
    of rooms; room adjacencies.

-   Activities to occur in each room and outdoor area.

-   Safety and security requirements.

-   Existing and new utility locations and requirements.

-   Site context: Weather, noise, solar access, vehicular access,
    handicap accessibility, sense of entry, site analysis.

-   Codes and regulations.

-   Budget and priorities: Preliminary cost analysis usually based on
    area and/or volume, to be refined later.

-   Project Scheduling.

-   In the case of reusing an existing building: Carefully document and
    evaluate present building and its conditions. Determine what can be
    reused, what must be discarded, what must be rebuilt.

The A/E shall collect detailed technical, spatial, and programmatic
requirements for interior and exterior facility spaces, including
architectural and engineering needs; analyze program functions,
access/circulation, security; project budget estimates; preliminary
assessment for LEED certification (checklist); presentation of findings
and recommendations; providing and evaluating spatial relationships of
program elements with block diagrams, stacking diagrams,
circulation/space flow diagrams, adjacency diagrams, space plans and
other analyses prior to design. Other specific requirements for
submissions and presentations may be further defined in the Program of
Requirements SOW.

## Economic (TAPS) Analysis or Equivalent

3.3.1 Requirement. OMB Circular A-94 requires a formal economic analysis
of government programs and projects.

TAPS was developed for GSA as a model to perform consistent present
value cost analysis of alternative procurement methods to meet the space
and facility requirements of the government. Because TAPS is one of a
few readily available off-the-shelf applications which can be tailored
to meet A-94 requirements, it has been recommended for use by DOC.
However, in many cases, the added features embedded in the TAPS model do
not apply to the NOAA alternatives. CAO has therefore developed internal
formats to handle such cases.

3.3.2 Differences between TAPS and CAO Analyses.

Cases vs. Alternatives. TAPS allows selection of up to six Prospectus
Types: Lease, Construction, Repair and Alteration (R&A), Purchase, Lease
with an Option to Purchase (Lease-Option), or Construction-Leaseback.
Four different alternatives (or scenarios) for each of the Prospectus
types are allowed, for a maximum of 24 cases.

-   Interim Housing. TAPS accommodates interim housing within a case
    through its irregular housing module.

-   Building Reversion. Building reversion, if and when applicable, is
    automatically calculated within TAPS. However, reversion apparently
    cannot be removed from a Build or Repair & Alteration case.

-   Depreciation and FFE. TAPS-XL calculates accelerated depreciation
    and tax savings on furniture, fixtures and equipment or any other
    personal property provided by the lessor. Given that NOAA provides
    all FFE for its owned and leased facilities, depreciation of FFE
    does not apply. The TAPS-XL model can accommodate non-depreciation
    of FFE by either not entering a value in the FFE data entry cell, or
    changing the FFE depreciation rate. However, it is simpler not to
    address depreciation at all outside the TAPS model.

-   Lease Escalation. TAPS applies the general rate of inflation to the
    Net Net Rent on an annual basis. However, TAPS cannot accommodate
    any periodic increases in Rent within the same case. It is possible
    that TAPS could accommodate rent increases by creating a separate
    case; however, the two cases would need to be added together in some
    manner, possibly outside of TAPS. It is therefore easier to apply
    periodic rent increases outside the TAPS model.

-   One time costs. One time costs other than those identified by TAPS
    data fields are difficult to handle. Demolition, for example, can be
    handled in a variety of ways, but does not retain its label in TAPS.

-   Summary Sheets. Within TAPS, the output summary sheets are static --
    there are no formulas. One can copy the output into a new
    spreadsheet and attempt to reverse engineer the solution, but such
    an approach is very time consuming and ineffective.

-   Sensitivity Analysis and Viewing Results. In TAPS, one must enter
    the change on the data entry sheet and populate the case in order to
    see results. While doable, this approach is somewhat unwieldy.

## Independent Review

For extremely complex and/or large projects, an Independent Review Panel
may be convened at the direction of the CAO. During the Capital
Investment Review segment, the project requires an independent review of
program, functional, and facility requirements. Once selected and
convened, the independent panel will verify the mission need; validate
the programmatic and facility requirements; validate technical, cost,
and schedule baselines; and assesses the overall status of project
planning resources to execute the project.

In the absence of, or inconsonance with an Independent Review, the PDRI
will still be used. See Section 1.6 for a detailed discussion of the
PDRI.

## Facilities Investment Management Board (FIMB)

The NOAA Executive Panel (NEP) fulfills the role of the FIMB. On an
annual basis, the NEP will be briefed on the Facilities Modernization
Plan update at the end of the PPBES Planning Phase to meet the
requirements of OMB Circular A-11 with regard to Agency oversight and
approval of projects selected for advancement.

OMB Exhibit 300s will be prepared for projects advancing from the
Programming Phase to the Budgeting Phase.

## DOC Real Property Review Board (RPRB)

See Appendix A.