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Memorandum of Understanding

Between the 

Department of Energy

Managing Partner

Financial Management Line of Business

And

Nuclear Regulatory Commission

I. Purpose

The purpose of this Memorandum of Understanding between the Nuclear Regulatory Commission

(NRC) and the U.S Department of Energy (DOE) is to support the continued maintenance of a Project

Management Office that provides end-to-end project management support to the Financial

Management Line of Business (FM LOB) initiative. The FM LOB is a Federal Government -wide EGovernment initiative charged with the implementation of a business-driven, common solution

developed through architectural processes.

II. Authorities 

Economy Act of 1932, 31 U.S.C. 1535

Section 204 of the E-Government Act of 2002 (44 U.S.C. 3501 note)

Federal Property and Administrative Services Act of 1949

This MOU is authorized in accordance with the general cooperative authority provided under the

Economy Act of 1932, 31 U.S.C. 1535. The authority for DOE to provide products and services for

Executive Agencies is in accordance with 40 U.S.C. Section 501. The funding authority for the

Nuclear Regulatory Commission to make funds available to DOE is in accordance with the Federal

Property and Administrative Services Act of 1949, as amended.

III. Background

In January 2003, the Vice-Chair of the Federal Chief Information Officers Council (CIO-C) along with

the Associate Director of Information Technology at the Office of Management and Budget (OMB),

and the Acting Chair of the CIO-C, became responsible for establishing and guiding the

implementation of the CIO-C’s vision and mission. One of the Vice-Chair’s key goals is to assist the

Office of Management and Budget (OMB) in the formulation of IT policy, specifically in support of the

President’s Management Agenda mandates. The President’s Management Agenda vision for

Government reform is guided by three principles - Government should be citizen-centered, resultsoriented, and market-based. Effective implementation of E-Government is a crucial requirement in

making Government more responsive and cost-effective. As a part of the E-Government program,

significant information technology investments have been identified supporting the line of business

planning, development programs, and steady state operations.

OMB established LOB Task Forces which are focused on a business-driven, common solution

developed through architectural processes. OMB formed the FM LOB task force to guide the financial

management consolidation effort. OMB identified 9 agencies to participate in the FM LOB task force,

including the Department of Energy, Department of Labor, Department of Homeland Security,

Department of the Interior, Department of Justice, Environmental Protection Agency, Department of

Health and Human Services, Department of Agriculture, and the Department of Housing and Urban

Development. In Phase I of the FM LOB initiative, the task force developed a business case and

target architecture for the common solution. The common solution was identified through alternatives
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analysis as a consolidated financial management services model utilizing best practices through

Centers of Excellence (COE).

In an effort to fulfill the President’s Management Agenda to expand E-Government, the Department of

Energy (DOE) and the Department of Labor (DOL), managing partners of the Financial Management

Line of Business (FM LOB) are continuing its efforts to provide streamlined financial management

services across the Federal Government. Through the FM LOB, partner agencies will use enterprise

architecture (EA)-based principles and best practices, proven through the E-Gov initiatives and

Federal Enterprise Architecture (FEA), to implement financial management Centers of Excellence

(COEs) and standardize core financial business processes and data elements across the Federal

Government. The consolidation of each agency’s financial systems into centralized COEs will

decrease system redundancy while driving cost savings through FTE re-deployment, DM&E and O&M

cost reductions, and process standardization. The end result of the FM LOB efforts will be to save

taxpayer dollars, reduce administrative burdens, and significantly improve financial management

services across the government.

More significantly, the FM LOB efforts will result in improved financial management practices that will

leverage time saving industry best practices and streamline core financial business processes in a

way that will allow Federal Agencies to collaboratively work smarter and more efficiently. The FM

LOB managing partners recognize the crucial role committed participation of the FM LOB community

will play in making this initiative a success. As Federal Agencies continue to provide their support

through funds and other valued resources to this effort, the managing partners with guidance from the

Office of Management and Budget will ensure an open yet organized forum for managing COE

implementation, Agency migration and the development and implementation of improved financial

management processes and practices.

To date, the public-sector COEs have received initial approval from OMB and the FM LOB team has

provided a recommendation to OMB for the governance of the Lines of Business initiatives, begun

project planning for FY 05, and written a communications plan for the initiative. As the initiative

moves further into implementation, the FM LOB will require increased participation from all affected

agencies and strong PMO support.

IV. Vision and Goals for the Financial Management Line of Business

The overall vision and goals for the Financial Management Line of Business Initiative are:

Vision: A Government-wide financial management solution that is efficient and improves

business performance while ensuring integrity in accountability, financial controls, and mission

effectiveness. 

Goals: Define, analyze, and implement options that:

· Achieve or enhance cost savings in the acquisition, development, implementation, and

operation of financial management systems through shared services, joint procurements,

consolidation, and other means;

· Provide for standardization of business processes and data elements;

· Promote seamless data exchange between and among Federal Agencies ; and

· Strengthen internal controls through real-time integration of core financial and subsidiary

systems. 
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To achieve these goals, FM LOB chose a market-driven approach based on a shared services model

that will maximize economies of scale, scope, and skill, while benefiting from the use of both

government and industry best practices and technologies. The investment utilizes COEs to provide

information technology hosting, while leveraging Government-wide standardized business processes. 

V. Government-wide Financial Management Solution

COEs will consist of some combination of Federal Agencies and/or private sector contractors

supporting a JFMIP-compliant financial management solution. The COE will be engaged in tasks

such as project management, system migration, system implementation, change management,

training, independent validation & verification, certification & accreditation testing, help desk, and

other functions. Over time, market demand may suggest that COEs offer additional value-added

services to agencies, such as core financial operations support, and/or hosting and processing for

subsidiary systems such as procurement, fixed asset management, real property, fleet management,

and investment management. 

The key to the Centers of Excellence approach is buying financial management services as a

commodity through competitive procurements. As agencies move to COE’s current redundancies will

be reduced. The migration would occur in a phased approach and follow the system development life

cycle for FM. Agencies that are planning to purchase a new financial management system or

planning a significant upgrade to an existing system in FY05 and beyond would instead be directed to

the common solution. Special emphasis on systems reporting non-compliance audit results related to

their current system solution will be included in the migration planning.

Initial standardization of core business processes would occur for each agency as they are converted

to the new systems. Standardization will improve over time through on-going operation and

maintenance of the common solution at COE’s.The FM LOB is taking a collaborative, crossgovernment approach to developing standard business processes. Target business processes will be

developed as a model for standardization and integrated across the government. The definition of

standard data elements, data definitions, nomenclature, etc., and the creation of standard

interoperability among core FM and subsidiary systems including other lines of business and EGovernment (E-Gov) efforts such as E-Travel, E-Payroll and the Integrated Acquisitions Environment

(IAE) will promote seamless data exchange and improve internal controls. 

The development and implementation of standards will, by themselves, improve the integrity of

financial management at both the individual agency and government-wide levels and will ensure

compliance with financial management laws and regulations such as the Federal Financial

Management Improvement Act (FFMIA). However, there are additional benefits. Standardization will

also allow the development of additional systemic internal controls (business rules) through the

development of required relationships among processes and data. 

Since the FM workforce will use, perform and manage financial information in a new manner, the

management of change will be crucial to the entire effort and will be introduced at the very beginning

of the process and managed throughout its entirety. Finally, one of the biggest faults with current FM

systems would be remedied – Agencies’ inability to retrieve reliable, pertinent financial information on

a real-time basis. A key task in accomplishment of the FM LOB goals is that timely and accurate

management information is relayed to Agency decision makers without the need for laborious data

calls. 
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The common solution represents a major step in developing a Federal Government -wide approach to

resource management rather than the current department/agency-centered model. The initiative

equips Agencies with the critical business information and management environment necessary to

improve decisions and service delivery (both operationally and strategically). As such, the solution

eliminates “stovepipes” between components as well as within components and identifies

opportunities to further refine common business practices and architecture. Standardization will

enable Federal Agencies to further automate internal processes and therefore reduce costs. 

Additional areas where Federal Agencies will realize cost reduction and cost avoidance are as

follows:

1. Public/private partnerships leverage commercial IT outsourcing efficiencies and reduce

deployment costs by centrally maintaining solution assets and reusing Federal and

commercial subject matter expertise, thus creating “economies of skill” 

2. Costs reduced in IT infrastructure, application acquisition, interface development and

application management

3. Economies of scale are leveraged in hardware, software and business process management 

4. Centers of Excellence provide for efficient maintenance of solution assets and implementation

expertise

5. “Centers of excellence” deliver repeatable, proven transformation approaches and

methodologies through predictable cost structures

6. Redundancies in performing common business functions are reduced

7. Competition is encouraged

8. Software and hardware maintenance upgrades are centralized

9. Software license fees are paid just once to a vendor

10. Interfaces to other systems are centralized

11. Hardware and software is reused by many agencies

12. Audit costs are minimized

13. Overhead achieved by decreasing the amount of IT sites supporting financial functions

14. FTE is reduced

VI. Governance

Per budget year 2006 passback guidance, Federal Agencies were directed to contribute funds

towards the FM LOB. The general governance structure of the FM LOB is presented below.

a. Managing Partners

The Department of Labor and the Department of Energy have been identified as the

Managing Partners for the Financial Management Line of Business, with the Chief

Financial Officer, Department of Labor and the Chief Information Officer, Department of

Energy serving as Co-Chairs of the FM LOB initiative. As lead agencies, they are

responsible for the overall strategic direction of the initiative and reporting to OMB and

the President’s Management Council. 

b. Advisory Board

The Advisory Board consisting of CFO/CIO’s or their designees will work with and

advise the Managing Partners to facilitate achievement of the vision and goals of the

initiative. 

c. CFO Council Financial Systems Integration Committee 

The Chief Financial Officers Council, Financial Systems Integration Committee, and its
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two standing subcommittees shall assume the role and authority to recommend

standardization of business processes, data elements and alignment of Federal

Financial Systems with the Federal Enterprise Architecture. These key elements of the

common solution affect all Federal Agencies processing financial information; as such

agencies shall have at a minimum, one representative on the CFO Council Financial

Systems Integration Committee. The representative should be at a sufficient level to

speak for and making binding decisions on behalf of their agency and posses the

requisite technical skills to facilitate the development of financial systems standards

and enterprise architecture models.

Working teams shall be established on an as needed basis in support of the

Committee and or its subcommittees to provide work products necessary to facilitate

the success of the initiative. Each agency shall provide subject matter experts (FTE’s)

to participate on the working teams and serve to ensure each agency’s interests are

articulated and considered. 

d. Project Management Office 

The PMO shall be responsible for providing contractor support, management oversight

and ensuring that the resources are used to achieve the vision and goals of the

FMLOB. Achievement of the work shall be accomplished via the established CFO

Council Financial Systems Integration Committee and the subcommittees. These

activities will include but not be limited to; standardization of business process and

data elements and expansion of the core system requirements to include other widely

applicable requirements (e.g., budget formulation). 

The managing partners/PMO shall meet at a minimum on a quarterly basis. 

Key PMO responsibilities will include monitoring the progress of the working teams,

managing integration of the project plans from the CFO Council Systems Committee

into a single comprehensive project schedule, for the purpose of tracking resources

and funding.

The PMO will also be responsible for qualifying Centers of Excellence (COEs) against

the OMB approved due diligence checklist to ensure that they are fully prepared to

provide core financial management services to migrating agencies. The PMO shall

provide monthly progress reports to each agency that address issues associated with

the initiative. 

e. Support Contractors

Contractors shall be obtained to provide administrative, expert technical and analytical

support to the PMO Office, the CFO Council Financial Systems Integration Committee

and other functional areas of the initiative as required. Contractors shall be required to

sign a non-disclosure agreement if appropriate. Conflicts of interest will be governed

by Federal Acquisition Regulation subpart 9.5 - Organizational and Consultant

Conflicts of Interest.
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VII. Scope of Work and Responsibilities

The FM LOB in collaboration with the CFO Council Financial Systems Integration Committee shall

facilitate the development and implementation of the common solution. 

Each Agency shall:

· Participate on the FM LOB Advisory Board;

· Appoint an Agency Liaison to coordinate activities and serve as the main point of contact to

address any issues that may arise;

· Dedicate FTE’s and participate on the CFO Council Financial Systems Integration

Committee, working teams, and other committees as necessary;

· Support the operation of FM LOB and the PMO, by obligating and providing funding at the

levels indicated in Section XII of this document;

· Review and comment on project plans/actions and advise on priorities for the FM LOB; and

· Provide information and documentation to assist the FM LOB in meeting the goals and

objectives of the overall initiative. 

The Managing Partners shall:

· Establish the PMO and ensure effective management by the project manager(s);

· Provide periodic status reports to the Advisory Board; 

· Secure contractor support;

· Facilitate FM LOB communications via meetings, the FM LOB website, and other

communications vehicles; 

· Provide end-to-end project management support of the FM LOB objectives; and 

· Establish performance measures to indicate adherence to cost, schedule and performance

goals if required. 

VIII. Effective Date and Duration of Agreement

This agreement will remain in effect through September 30, 2005. The agreement supersedes

existing FM LOB MOUs and will remain in effect unless amended in writing by mutual consent of the

parties. Additional funding and/or resource requirements will be determined based on the Office of

Management and Budget passback to agencies or mutual consent of the parties and will be executed

through an addendum to this document. 

IX. Resolution Mechanism 

In the event of any disagreement arising under this agreement, the parties shall, in good faith,

negotiate a resolution to the disagreement with assistance from the Office of Management and

Budget. 
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X. Agency Points of Contact 

The Nuclear Regulatory Commission will assign the following Advisory Board member to serve on the

FM LOB Advisory Board. The Agency Liaison listed below by NRC is the official FM LOB

representative and is authorized to act on the Agency’s behalf. This person is responsible for

providing FTEs to support FM LOB efforts. FTE support will be consistent with the importance of the

FM LOB effort to the overall financial management of the Federal Government, OMB direction, and

agency requirements. The FTEs should have substantial knowledge of Nuclear Regulatory

Commission financial management business processes and enterprise architecture. Detailed contact

information including phone number, mailing address and e-mail address of the selected FTE

resources shall be provided to the Managing Partners by January 19, 2005. Please use the table

below to provide this contact information. 

Advisory Board Member Name: Jesse L. Funches

Title: Chief Financial Officer

E-mail Address: JLF@NRC.GOV

Mailing Address: U.S. NRC, Washington, DC 20555

Phone Number: 301-415-7322

Fax Number: 301-415-4236

Agency Liaison Name: Michelle R. Curtis

Title: Senior Financial Systems Analyst

E-mail Address: MXC6@NRC.GOV

Mailing Address: U.S. NRC, Washington, DC 20555

Phone Number: 301-415-7607

Fax Number: 301-415-5545

FTE 1 – Business Process - Name: Leon Fleisher

Title: Senior Accountant

E-mail Address: LXF2@NRC.GOV

Mailing Address: U.S. NRC, Washington, DC 20555

Phone Number: 301-415-0242

Fax Number: 301-415-5545

FTE 2 – Enterprise Architecture -

Name: 

Michelle R. Curtis

Title: Senior Financial Systems Analyst

E-mail Address: MXC6@NRC.GOV

Mailing Address: U.S. NRC, Washington, DC 20555

Phone Number: 301-415-5565

Fax Number: 301-415-5545
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Managing Partner Points of Contact

Mr. Greg James 

Associate Deputy CFO

FM LOB Co-Project Manager

U.S. Department of Labor

200 Constitution Avenue, NW, Room S-4030

Washington, DC 20210

james.greg@dol.gov

Phone: 202-693-6800

 Mr. Lawrence Gross

E-Government Executive

FM LOB Co-Project Manager

Office of the CIO

U.S. Department of Energy

1000 Independence Avenue, SW

Washington, DC 20528

lawrence.gross@hq.doe.gov

Phone: 202-586-2000 / Fax: 202-586-7966

IX. Funding Provisions

As indicated in the Office of Management and Budget passback to agencies, funding for FY 05

activities of the FM LOB Project Management Office shall be provided by all affected agencies via

Interagency Agreements or Memorandums of Understanding as appropriate to execute transfer of

funding to the managing partner agency by January 19, 2005. 

Agency: Nuclear Regulatory Commission

Agency Location Code:

DUNS:

Total Dollar Amount: $0.00

Agency Financial Point of Contact:

E-mail Address:

Mailing Address:

Phone Number:

Fax Number:

Managing Partner Agency: Department of Energy

Agency Location Code: 89-00-0001

DUNS: 10642034

Agency Financial Point of Contact: M. Anne Warnick

E-Mail Address: Anne.Warnick@hq.doe.gov

Mailing Address: Office of the CIO

Office of Business and Information

Management

1000 Independence Ave

Washington, DC 20585

Suite 8H085

Phone Number: (301) 903-3056

Fax Number: (301) 903-6047
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XII. Approvals

The following officials agree to the terms and conditions of this MOU:

_____/RA/______________________

Rosita O. Parkes

U.S Department of Energy

Chief Information Officer

Date: _August 12, 2005__________

_____/RA/____________________

(Name) Jesse L. Funches

Nuclear Regulatory Commission

Chief Financial Officer

Date: _July 18, 2005__________

_/RA Timothy F. Hagan, Acting for/_

(Name) Jacqueline E. Silber

Nuclear Regulatory Commission

Chief Information Officer

Date: July 21, 2005_________
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XIV. Appendix

The following partner agencies have been directed via the FY 2006 Office of Management and

Budget passback to fund the Financial management Line of Business in FY2005 and 2006.:

· DoC (Commerce) 

· DoT (Transportation) 

· DoD 

· EPA 

· USDA 

· NASA 

· DoI 

· DoE (Energy) 

· DoJ 

· DoL 

· ED (Education) 

· HHS 

· HUD 

· NSF 

· State 

· Treasury 

· USAID 

· VA 

· DHS 

· SBA 

· SSA 

· GSA 

· OPM