>> Excellent..Good morning..It's a rare occasion I get to say good.morning from the eastern time zone,.and I feel that everybody is along with me..So unless you are out there in Iceland.or Germany, good morning to everybody..I want to welcome everybody to today's.edition of the Client Enrichment Series..My name is Eric Fulton..I will be the host of the Series.today, and we are going to talk.about what to expect from RWA fee reform..Before we jump into the content, I.want to switch to the next slide,.and I do want to take note.of a couple of resources.that GSA has available to our customers..As you can see and as we all know, these are.unprecedented and different times for us all..I myself am coming to you from my home office..Not the GSA headquarters as I.usually do, and I trust that many.of you are in similar situations..GSA has made available and put online.multiple resources to help our customers.and customer agencies handle COVID-19 both.in regard to cleaning and disinfecting,.frequently asked questions, purchase of.supplies, and as we enter different phases.of this situation, returning to GSA facilities..You can find links to these..We have them up on the screen here but you can.find as you go right to the homepage of the GSA,.www.gsa.gov, you will find links right down.in the homepage to our COVID-19 resources page.and the return to facilities website..Feel free to make use of them and.share them with others in your agency..So, moving on to today's program..As I said, my name is Eric Fulton, and I am the.national program manager for customer outreach.and communication at GSA.headquarters in Washington, D.C.,.and more importantly I am your host for today's.edition of the Client Enrichment Series..A couple of quick housekeeping items.to get out of the way up front..One, please be aware that we.are recording today's session..We do that because we archive past.Client Enrichment Theory's videos.on our YouTube channel..You can access more than 30 of our.past sessions any time of day or night..There's a link to our YouTube channel.at the end of today's slide deck..We're expecting a decent sized crowd today..For the optimal audio experience we highly.recommend that you choose the Listen Only option.when the broadcast the audio through your.computer speakers or connected headphones..It helps us save capacity, preserve some.of the bandwidth for the presentation..Understand not everybody has that ability..If you do you can disconnect and reconnect.through the audio button and click listen only,.but if you are joining us by the telephone.bridge line, that is fine as well..We've automatically muted.everybody's phone and audio and that is.to help us control the sound.quality of today's presentation..You will have the opportunity.to ask questions and interact.with our subject matter experts in the chat box..I'll go over that just a little bit later, and.just so everyone is aware, this is the second.of three identical sessions on the same topic..So, if you would like to come back and ask.some additional questions, learn a little more,.or you have a colleague who you think.would benefit from this presentation,.you can come back on Thursday, July 16th,.and you can register for that session..It's www.gsa.gov/css, and as I.mentioned, if you're unavailable that day,.we will post recordings of this.session online on our YouTube channel..Moving on..Today's presentation will be led by Steve Sacco..He is the national program manager.for our reimbursable divisions,.and he's a part of GSA's RWAC reform.team for the past several years..Steve oversees the data management.and process improvement team.which manages the eRETA application..Hopefully, if you handle RWA's or.have been in one of our sessions,.you're familiar with that application..At least just the impacting if not more..Additionally, his team provides data metrics to.senior leadership about the health and trending.of the reimbursable services program..So, prior to working with reimbursable.services, Steve spent seven years.as GSA's chief financial officer..He's a senior financial analyst and.also a financial management intern..He earned a B.F. in Meteorology and a B.F. in.Economics from the Pennsylvania State University.and later a Master's in Business.Administration from the University of Maryland..So, today's topic is what to.expect from RWA fee reform?.And it's actually kind of a.misnomer as several components.of GSA's RWAC reform effort.have already been put in place..Steve will review each of these components,.but then the majority of the time today.on the new RWAC fee structure which.will go into effect on August 1st, 2020..It's just about five weeks from today..This is GSA's first change to the.RWA fee structure in 25 years..Steve will introduce the new fee structure..He will demonstrate how the fee is.calculated, and he'll review what to expect.as that August 1st, 2020,.implementation date nears..So, before we turn over the presentation to.Steve, some additional housekeeping items..One more time, I do want to remind.everybody that we are recording this session..We do that so that we can post this along.with 30 plus other Client Enrichment Theory.presentations on our YouTube channel..The link to which is on the.last page of your slide deck..Speaking of that slide deck, all registered.attendees should have received a copy.of the slides by email; however, if you did not.or if you lost it, I'd like to introduce you.to the files pod that you see above your.chat pane, and what that has is copy.of today's presentation as a PDF, along.with some other documents that Steve mention.over the course of the presentation..So, once again, if you are connected through.your phone and you have the ability to listen.through your computer speakers.or connected headphones,.that way we do encourage you.to use the listen only option..You can switch your audio preferences by.hitting that telephone button up on the top.of your screen; however, you are also.welcome to use the conference bridge line.if you have a telephone in use and.unable to listen through your speakers..So, as I mentioned earlier, we do want.to encourage questions and interaction.with our subject matter experts today..Please make use of the chat feature..That's where you said good morning.and hello to me earlier today..At any time during today's presentation,.we have a handful of subject matter experts.who are monitoring the chat and will.address your questions as they come in..In some instances, we may ask Steve a.question to demonstrate on the screen..In large part, we're going to handle a.lot of the questions in the chat today..Now, any questions we don't get to today.will be pulled out of the chat along.with all the questions we did and.answers we gave, and we compiled them.into a more formal frequently asked.questions document which we make available.after the session and post online both.to our Client Enrichment series website.and our RWA website at www.gsa.gov/ces and /rwa..We'll be mentioning those.throughout today's presentation..One more note, if you want to get a better view.of the screen and what Steve is going over,.you can hit the four-headed.arrow at the top right..What that does, minimizes the chat.feature and maximizes your viewing pane..It gives you a good look.at what Steve is showing..If you have a question, you hit that four-headed.arrow again, the chat feature pops back up..Type your question into the chat..So, almost time to start the.presentation today; however,.we do want to get a little background.information on our attendees today..This helps us better tailor.this and future presentation..So, we do have two poll questions.that we are going to ask here..So, we'll bring the first one.on in, and this is about eRETA.which I mentioned earlier in the introduction..We want to know what access.you currently have to eRETA?.Having access to eRETA, is not mandatory.or necessary for this presentation,.but we are curious to know is, obviously,.eRETA and reimbursable services.go digital hand in hand..So, are you a data entry,.read-only, don't have any?.What is eRETA?.So, it seems as though 60% of the.folks responding are data entry users..That's fantastic and another.13% are read-only users..So, looking at maybe two-thirds to.three-quarters of the audience here.as all the results come in are either read-only.or data-entry users, but we do have about 20.to 30% who either don't have eRETA access.or don't know what it is, and you know what?.That is okay for the purposes of today,.but I think that if you are an eRETA user,.you'll have a deeper understanding of.how all of these roles are connected..So, we're going to get that.poll question out of the way..And we're going to bring in our second question..We're going to format that second question here..Maybe we're not going to format that..So, this one -- there we go..We were curious to know how you had heard.about the upcoming new RWA fee structure?.It looks like people are typing into.the chat here and we do appreciate that..So, obviously this information is helpful to us.as we better finetune our.communication processes..We will go over how we did communicate.this and where you can find all.of those archived communications.and that information..So, we do appreciate all of the feedback..There we go..Look at that..So, with checkboxes all along..So, we have people coming in..We did want to know did you.receive communication from eRETA?.Maybe if you're an eRETA user.you get those emails from eRETA..You got a quick tip probably this morning so.that half of you seem to have found it that way..It looks like about 19% heard from their.GSA national or regional client executive..That is the office that I'm with..So, I appreciate those who responded that way..And then we have another 35% who heard.about it through the CES web team here..Got an email from us..That's great..And then obviously there is some.others who got communications.from colleagues or just saw it on the website..About 12% who received it.forwarded from a colleague..Excellent..So, we're going to get that.poll question out of the way..And without further ado, I am going to hand.over the reins to today's presenter Steve Sacco..So, Steve, go ahead and take it away..>> All right..Thank you, Eric, and thank you.everybody for joining us this morning,.and thank you for answering those.poll questions we had at the top..It gives myself and my team a sense.of who we have attending here today..I am impressed..Some of the responses indicated.they hadn't heard anything.about the fee reform communications,.but you managed to make it here..So, I don't know how that happened,.but I'm glad you're here, so welcome,.and let's jump into this stuff today..Some of you might not be following along.or might not be able to see my screen..I know we had that issue with the.last fee reform session last week..With that said, if you have the slide deck that.we sent out in advance of today's presentation,.I will do my best to indicate.which slide I am referring to..So, right now I am on slide number four so.that you can kind of follow along with me..So, the topics we will cover today, as you.can read for yourself if you haven't already,.we'll talk about the fee reform resource page..So, where we have some resources for.you to go and look at more details.or really repeat details of what we're about to.discuss today for you to look at or maybe one.of your colleagues who cannot make today's.call, you can refer them to our website.where there's more information on.where all this information is archived.out there for future reference..We'll talk a quick history.about interagency fees..It's not just an RWA thing..So just in case you thought RWA's was the.only program the entire federal government.that charged fees to other federal agencies,.we want to let you know that that is a myth..We are one of many and we are required by law..So, we'll talk about that a little bit.just to give you a quick understanding..Then we'll get into the components.of fee reform as Eric mentioned..There's more than just the.fee structure change itself..We'll look at the old fee structure.which most of you are familiar with..Look at the new fee structure and.then we'll have an added bonus.that we didn't have in last week's presentation..We'll show you some examples.of how the fee is calculated..It became abundantly clear.to us last week that some.of you weren't really sure how the fee.was calculated in the first place today..So, we'll go through some examples to make sure.it's much clearer to you how it works both today.and how the new fee structure will work.which will function very similarly..And then just to kind of highlight it.right up front on the introductory slide..Some of the most important takeaways today.is that the new fee change will apply.to every single RWA starting on August 1st and.beyond, and that includes overtime utilities..The RWA acceptance date is the key driver.of which of the two fee structures apply?.So, we'll talk about that..We'll redefine the acceptance day.or kind of repeat what the acceptance.date is and how it's defined..And more specifically, that third symbol.up there is how the RWA acceptance.date is defined based on the services..If it's a federal service, we define it one way..If it's a non-federal service we define.that acceptance date a different way..So, that's a very important.distinction to understand..And then lastly, we'll go through some.screenshots of the eRETA summary cost estimate.in the RWA just so you have a visual of where.to look for these dates and know, okay, hey,.the fee structure or the old fee.structure will apply given the date.and this particular location on my estimate..And last, we will close it out with.something totally unrelated to fee reform,.but just a reminder of our.FY2020 year-end deadline..So, moving on to slide number five here..So, this is just a quick recap..Some of you or many of you had indicated.the majority in that second poll,.that you had been made aware of fee reform.through communications that we sent out,.and as many of you probably saw, you received.a new communication, albeit about eRETA.and not about fee reform, but we sent a.new communication out just a few hours ago..The monthly June 2020 quick tip.regarding on eRETA specifically.on treasury symbols and multiple.accounting lines..So, if you got that email today, that's a good.sign because we send out emails about fee reform.to the exact same group of individuals..So, if you got that email.you're already on our LISTSERVE..If you did not, as a quick sidebar, shoot.us an email at firstname.lastname@example.org to say "Hey..We got to talk about these notifications in.the theory form today but I don't get them..Can you add me to the list?".So, just shoot us an email, and we'll make.sure we add you to our list moving forward..So, this is a recap of the communications.we have sent to date dating all the way back.to November when we first announced the new.fee structure, and then as you can see here,.there's been a few additional.notifications in January, February,.and then one most recently a.few weeks ago this month of June.where we announced the registration for these.fee reform sessions which I would think most.of you got if you're here registered.today attending and listening..And in that one, we also had a helpful.handy dandy Excel fee comparison calculator..And that fee calculator which I'm going.to show you here in just a second,.just to kind of give you a quick sense of.it, is also available from this meeting..If you go up to the files pod..What to expect from fee reform is at.the top of your screen about the middle..There's three files in there and you could.see the fee calculator is one of those files.which you can download directly.from this meeting..But, just to kind of go off script.here if you will, I'm going to show you.that fee calculator here really quickly..So, let me stop sharing this particular.screen, and I'll share a different screen here..So, this is the fee comparison calculator.that is available on our website..We emailed that out in that June communication.as I mentioned, and it's also available.for download from this presentation.today in that file pod.at the top center, and this.is what it looks like..It's just a basic calculator..On the left-hand side here in red,.this is the current fee structure..The 4% fee plus the sliding scale fee,.and then over here on the right-hand side.in green is the new fee structure..So, for example, if I type in a number here..Let's say under the old fee structure I.estimated my construction costs to be,.let's say, half a million dollars..So, let's type in $500,000..And I plug that number in, and it automatically.calculates for me the 4% fee, which is $20,000,.and the sliding scale fee.which is an additional $15,000..Total fees, 35,675..On the other side of the black line.here on the green, new fee structure,.that 500,000 automatically populated for.me just to give me a quick comparison..We can see the total fee structure.of the new fee is $40,000..So, there you get a quick comparison..The new fee and the old fee..The new fee as you'd expect is a little bit.higher, but this is just a simple basic tool.to give you a quick comparison of what the.RWA would cost today in the old fee structure.or the current fee structure I should.say, and what the RWA would be tomorrow.in the new fee structure after August 1st..So, anyway, that resource is out there.for you all to play with on your own time..I just wanted to give a quick.demonstration of it..So, let me go back to the slides here..And before I move on from slide five just.to draw your attention to the final bullet,.this is the location where you.will find all of these resources..That fee calculator, the past communications,.any future communications we might send.out which we will be sending,.at least a few more between now.and August 1st and even beyond August 1st..So, if you want to bookmark this website.if you have not already, www.gsa.gov/rwa,.and then more specifically when you get to.that website, if you click on the policy.and guidance tab in the left-hand.pane, that will take you.to where the RWA fee reform section is.and where all these past communications,.this fee calculator, all the.past resources we've sent.out are archived for your review again..So, moving onto slide six and then slide seven..We're going to talk about a little.bit of historical background on fees.and the federal government in general..It's not just an RWA thing, but specific to RWA.first and foremost just to give you the history.within GSA, back in 1995, and I'm sure many.of you might have not been working or working.with GSA I should say or even at GSA.depending on who you work for, at that time,.but just to give you that background..In 1995, an OIG audit internally.indicated that or found.that GSA was not recovering our.in-direct cost related to the RWA program..In a nutshell, we weren't charging.anything at the time in 1995,.and the IG said you have to charge something..You have to recover your overhead charges.related to contract award, administration,.data processing, legal, accounting,.et cetera, et cetera, et cetera..And at this time, back in 1995, the IG.estimated that that cost of running the program,.it counted for roughly $25,000,000 per year..So, this was back in 1995 now..Twenty-five years ago..The IG went on to say in the second.bullet as we're following along,.by the fact that we were not charging.any fees at the time for the RWA's.and we were not recovering our indirect costs,.we were effectively subsidizing the.appropriations of other agencies.at the expense of GSA's own appropriation..So, that was why the fee.structure needed to be put in place.to make sure we were not subsidizing.other agency appropriations..So, the result of that was that the OIG mandated.we come up with a fee structure and in 1995,.we did deploy the sliding scale fee.structure in response to this OIG audit..So, now moving on to slide eight..Expanding out not just thinking of GSA,.fee structures are a thing used.throughout the federal government.where other agencies charge a fee or where.agencies charge a fee to other agencies.for a service or some rendering.of a service or a good..Now thinking of just an example of.some other agencies that charge fees..Our sister organization on the.federal acquisition side, FAS,.the assisted acquisition service,.AAS, charges fees for their services..The Department of Interior has a.similar assisted acquisition service..Also charges a fee for that service..NASA has this government-wide.acquisition contract program..Also charges a fee for other.agencies that utilize that..So, these are just some examples..This is not an exclusive.or an all exhaustive list..And this diagram you see on the left-hand.side of slide eight comes from a GAO report.in 2011 called "Reports To.Congressional Committees.".Or it was reported to congressional.committees that was named Improvements Needed.in Setting Fee Rates for Selected Programs..And more or last, it analyzed the five programs.in the federal government that charged fees..The RWA program was not one of the ones they.analyzed but essentially the same umbrella.of organizations, and said that.effectively we want to look at --.we want to identify and track.your costs of running the program..You need to forecast future costs and revenues..You need to manage the reserve.contribution of balances now.that the upper right bubble.doesn't apply to RWA..So, we don't really consider that.one when we were doing our analysis..And then we set the fee rate.to recover those costs..But before we can implement that.fee rate, that very bottom bubble,.says we need to obtain approval for those.fee rate changes, and we did that very thing..We went to OMB and we worked with them for.almost 12 months to get their final approval.on a fee structure we are now going.to implement later this summer..So, why are we changing our fee?.Well, one of the biggest reasons is that,.again, based on that GAO report and how we have.to analyze the program, our takeaway from that.GAO report on the last slide that I showed was.that effectively GAO suggests that every program.that charges a fee should be.breaking even over a five-year period..So, it's in some years, you're.profiting so to speak..You're making your recovery too.much money, but then in other years.in that five-year window you're losing money..You will not recover enough..As long as over a five-year window.you're effectively breaking even,.they deem that as an appropriate fee structure..Well, looking back over the years, GSA has.not been breaking even on the RWA program..We've been losing money on the RWA program..So, in accordance with the IG audit and.in accordance with GAO's report and then.in accordance with OMB's.approval that we've gotten,.they all agree that we should be increasing the.fee to make sure we get closer to breaking even..And these are some of the reasons, the in-depth.analysis our fee reform team did to find.out why we might have not been.recovering our costs in modern times..So, first and foremost, the.initial fee structure.as I mentioned was implemented in 1995..So, if you look at that second bullet here,.the RWA program has grown tremendously of 540%.since that 1995 time period when we did.about $332,000,000 in work in a given year..Compare that to 2017 where we did over.1.8 billion dollar's worth of work,.and that 1.8 billion dollar number.is still accurate for FY18 and FY19..It's just we base the fee reform, the fee.reform team, based their analysis as of FY17.when they did all their analytics..Furthermore, a growing portion.of our direct costs were those.that did not recover the 4% fee..So, as we mentioned, the 4% fee.is only applied on some expenses,.and we'll elaborate on that a little bit..So, even though we were doing more and.more work that was not 4% fee related,.we are effectively delivering that.work but not charging a fee on it..So, the gap between what we needed to recover.and what we should have been.recovering was widening..And in the last bullet and in sub-bullets.kind of give you a general sense..The large majority of our costs, indirect.costs that the fee is meant to recover,.are salary of GSA folks delivering the RWA.program whether it's the individual you see.on a day to day basis..Like project managers..There's a lot of back office folks who are.doing stuff for RWA such as acquisitions,.budget analysts, and other support staff,.and the cost of salaries have.gone up as you would have guessed..In 1995, for example, a GSA 12.salary was about $41,000 a year..In 2017 that same GSA 12 individual was.making $62,000, almost $63,000 a year..That's a 53% increase in salary.expenses alone which make up the majority.of GSA's interim costs, but again, our.fee hadn't been changed at all to keep.up with the pace of salary changes..So, let's move onto step.10 or slide 10, excuse me..And what this GSA personnel and.services do your fees pay for?.So again, to recap..What are the fees meant to recover?.Effectively, they are meant based.on the OIG audits back in 1995,.they were meant to recover any and everything.that's utilized in order to deliver RWA's..So, that's a mix of things that you guys see.on a day to day basis like a project manager..Like a cost estimator..But then it also includes all of these other.support functions that are behind the scenes.that you don't interact with directly that are.still critical to delivering your RWA project,.and probably that biggest.one is the third bullet,.GSA's contracting and acquisitions staff..They execute over 65,000 contracts.every single year for RWA's..That's a lot of procurement in contracting.that your agencies don't have to do,.but the benefit of it is we do all that work.for you and your agency sends your fund in.and also gets all the credit.for those contracts..So, even though the GSA acquisition officer.or contracting officer cutting the contract.for RWA, your agency gets the credit if that.contract goes to, say, a small business,.a minority owned business, a women owned.business, a veteran owned business..All those small business.administration objectives that we try.to meet each year, you get credit for that..Not GSA. When it relates to an RWA..And then we have a whole.host of other support staff..Regional CFO staff, the billing and collections.team that handle your billing, your collections,.your chargebacks, your rebilling,.all that stuff..The folks on today's call customer.engagement and your regional RWA managers..IT application like RETA and eRETA and.your VCSS system to look at your bills..Legal counsel has a little bit of a.hand in everything to make sure none.of us are doing anything illegal.and not getting into trouble..So, there's a lot of moving parts..A lot of individuals that touch the RWA program..Some them 24/7..Some of them just a little bit at.a time, but overall the fee has.to recover all of these individuals..Now some of you might be saying I.can already picture the chat window..I'm not reading it, but I can picture.what some of you might be saying..Well, we feel like we don't get enough.support today or we never can get a hold.of a project manager, and that's partly to.blame because the fee was not changed earlier..We don't have the ability to hire more.project managers because we can only hire them.with the fee recovery we're getting..Now making this change with.increasing the fee we might be able --.we will be recovering more costs.for the appropriate number of costs.and that means we could essentially be.able to hire additional project managers.to give you more support and have.project managers not spread so thin..So, it's kind of a double-edged sword, right?.You feel like you're not getting.enough now, but we don't have --.we're not recovering enough funds to be able to.hire more PM's to make you have more of a one.on one relationship and not.spread our PM so thinly..So, by increasing the fee and recovering.more and be able to hire more PM's,.we can actually potentially be able to.provide a more personalized service..We weren't able to before..So, some FAQ..Just slide 11 I'm on right now.before we get into the fun stuff..I'll try to, kind of, go through.this a little faster here..Some of you have asked, well, how.will this fee change impact RWA's.that have already been accepted?.And the simple answer is it will not..The fee structure which we'll.get into in a little bit,.is going to be based on the RWA acceptance date..So, if you have an RWA that we accepted today.or yesterday and that RWA is clearly going.to extend past August 1st, that RWA.because it was accepted today will always.and only charge you the current fee structure..Even if you amend it two years from now,.the fee structure that will apply will always.be the 4% fee and the sliding scale fee..We will never transition any single.RWA from charging one fee structure.to eventually charging a.different fee structure..The RWA will only charge one of the.two fee structures for its entire life..It will not switch back and forth..The next FAQ which we've kind of gone over.or we have gone over, I showed the example,.is there a fee calculator I can.use before the fee is implemented?.Of course..It's that Excel calculator we.just showed a little while ago..It's available, again, on our website..It was available in the June 2020.communication we sent out a few weeks ago..It's available in this very presentation today.and that file pod in the.top center for download..So, progressing onto slide 12 and then 13..Let's talk about the components.of fee reform very quickly here..So, fee reform as many people.have maybe misunderstood it,.not just the fee structure change..In fact, when we started doing this.effort to review the RWA program,.review the fee structure, senior.leadership and OMB for that matter,.said are there ways we can drive down our costs?.I.e., find efficiency..So when the costs are lowered therefore.the fee increase can be lowered, and or,.are there other ways to recover.costs besides the fees?.So, we've implemented these three additional.components of fee form that you see.on the screen besides just the.fee structure change itself..So, two of those items that.will lead to reduced costs.and therefore lower fees are the mandatory.use of eRETA, which you have all been doing.since October 1st of this fiscal year..That is reducing our data entry burden because.now you're entering information directly.into this system as opposed to putting.it on the paper which means GSA then has.to reenter everything from.paper into the system..Now we're reducing that or.limiting that redundant data entry.and the express menu of services..Some of you may have heard of this..It's still being rolled out, but.effectively what the expressed menu.of services is is it's a -- we've identified a.lot of items that we typically procure in RWA's.for a lot of different customers,.and we said, why don't we go ahead.and put contracting vehicles into place in.each region that says that if you need one.of these items that we've purchased,.oftentimes we can just go and procure.that immediately off this express menu..Think of a restaurant..I just go and pick something off.this menu, and it's already listed..There's a price or a price range listed for.that item, and we procure that much quicker.and much cheaper than having to go out and.contract or procure the item each time..One at a time..One at a time..One at a time..Now we can just take it off the.menu and the price is already known..So, that'll save us some money.and save us some time to procuring.that so we can deliver your RWA faster..The final bullet there on fee form.components is more consistent direct charges..Now this has always existed..It just hasn't really been implemented.consistently across the country..And effectively, this is a way when we have some.RWA projects that are very unique and custom.and specific, and the customer might need.a little bit more handholding than others,.we direct charge for some GSA.personnel's time to do that stuff..So, one of the easiest examples to explain.is let's say you have some design work..You're building out some new space..We could contract out to an AE firm,.an architect, an engineering firm,.or we have some architects in GSA..We can do the design in house, the GSA.architect could do the design themselves,.and instead of paying the firm and all.of their additional fees and overhead,.we are just charging you for.the architect's time directly..And this is a way that we can apply.those additional fees, additional costs,.the unique costs of this specific project.directly to that RWA as opposed to rolling.that cost up into the bigger.picture of the whole program,.and applying that fee to everybody..So, this way we charge only the.specific customer as opposed.to making every single RWA.customer pay a little bit of that..And so, all these together, have helped.us make this new fee change increase not.as dramatic as it otherwise could have been..If we didn't do any of these other.things, these other components,.the fee increase would have been.even higher than it already is..So, these things have helped us to keep that.fee reform, or excuse me, keep the fee change.down more than it otherwise would.have been if it were done by itself..So, slide 14, what are the.components of fee reform?.I just kind of -- I talked through this.so I'm not going to go over it all again..I'll leave this slide 14 up here for just.a few seconds so you can kind of reread it.if you want, but more or less, everything.I just mentioned was on this slide..So, it should have -- I guess.I should have waited to talk.about this slide until I got here..The one thing I will mention if you will.draw your attention to the very bottom.of this slide 14, the new fee structure..The new fee structure which we're about.to talk about and how it's broken down..We simplified it..So, there's no more 4% fee and sliding scale..There's just one single fee structure..When we fact-tested this new fee structure.to actual activity in FY15 through FY17.and then again in FY18 as well, we found.that it was equitable to all customers..So, the new fee structure didn't unfairly.say customer ABC is going to be paying 25%.of the new fee structure, and then the other.350 customers will split the other 75%..We didn't see any one customer that.was going to be paying a lion share.or an unreasonably higher proportion.of the fee structure than anybody else..In fact, as you can see in parenthesis,.when taking on an RWA by a RWA basis,.the new fee structure increases fees.on average by only 1.3% per RWA..So, on an average, it's a very nominal interest..So, let's move onto slide 15 and then slide.16 to give you a comparison of the old fee,.or I guess the current fee.since it's not really old..It's still in place..In the new fee structure that.goes into effect on August 1st,.and then we'll go through some examples.about how the fee is calculated on the bills,.because this was a question.that we got a lot last week..So, we'll go through some examples.there to give you a refresher.on how the fee is calculated today..So, here's the old fee structure..Again, I'm not going to spend a.lot of time talking about this..I think many of you are familiar with it..There's a 4% fee..There is a sliding scale fee..The sliding scale is capped at $30,000 per.RWA, but there was no cap on the 4% fee..Just for your own information, it doesn't.really help you in any way, shape, or form,.but the fourth bullet there is.indicating that the 4% fee went.to the cross recovery for the region..So, those project managers in the region, cost.estimators in the region, the acquisition folks.in the region, budget analysts in.the region, et cetera, et cetera..The sliding scale overhead was meant.to cover essential office costs..So, the client engagement group, legal.counsel, the cost of RETA and eRETA.and the portion of the billing system..So, all the systems cost are.at the central office level..So, that's how the breakdown happened..Those two fees went to different areas.of the organization to offset costs..And then jumping down to.the final bullet in yellow..It's not highlighted yellow for any reason..It's just meant to distinguish that this is for.recurrent RWA's, for recurring RWA's R types..We charge a flat $100 per R type as.you know today, or for those of you.that have bundled estimates, we charge.$100 per estimate for bundled R-type RWA's..Moving onto slide 17 here..So, this is a new fee structure..So, this is a single fee structure now that.implies on top of every single RWA costs.with the exception of some very.limited personal property costs..Now what does that mean?.So, OMB, as part of our agreement within when we.were proposing this new fee structure to them,.they said the fee structure should not be.applied on top of some personal property costs.like furniture, like equipment, like software..There's a few other things but those are by.far the most frequently purchased things in RWA.that we found, but they make.up a very small percentage..So, on an annual basis, we.showed a few slides ago,.we did about 1.8 billion.dollar's worth of work in FY17..Out of that 1.8 billion only 2.2% of those.were made up of these personal property items.like furniture, equipment, and software..That second set bullet, direct.labor should be estimated though..So, our pricing policy desk guide does indicate.that even though there might not be a fee.charged on top of procuring furniture,.equipment, or software, the time and effort.of a GSA individual managing, purchasing,.or installing, or whatever the case.might be, for furniture or software,.should still be factored.into those cost estimates..So, how's the new fee structure.organized and the new few slides will show.that a little bit better than these.bullets, and let's just go to that right now..So, moving onto slide 18..You have a before and after -- or not.a before and after, but a comparison..So, on the left-hand side is the sliding.scale overhead rate and the tiers.and the dollar ranges that apply..Now this is just the sliding scale..The 4% fee is not integrated into.this calculator so just realize that..In most of your RWA's, there's a 4% fee applied.and the sliding scale fee applied as well..Moving your attention to the right-hand side,.now there's not the 4% fee.and a sliding scale fee..There's just one single fee all.merged together into one fee structure.and you see we have 18 tiers now, and more.specifically at the very lowest dollar ranges..So, any RWA between zero and $2000,.we will just charge a flat $500 fee..And then moving on, you can see some of the.smaller dollar amounts have larger fees on them.than they used to, and then going all the.way down to the multi-million dollar projects.which have lower fees and.even lower than they do today..Now the finding here was that we were.losing essentially a lot of money.on these very small dollar RWA's..That's for every RWA, there was a fixed.level of effort that we had to do..We had a cost estimator doing work..We had a project manager managing the project..There is a certain number of contracts.our acquisition office still had to cut.for this with a certain number of bills..We still had to manage and.collect and rebuild for corporate..So, there's always a fixed number of costs that.happen whether an RWA was $3,000 or $300,000..There's still some level of effort, and so, the.fee structure was increased more aggressively.on these lower dollar amount RWA's to get.closer to recovering our costs on those RWA's..Now near the end of today's.presentation, we will show you some ways.that you can effectively bundle or.otherwise not have to send us small RWA's..You can kind of bundle some.of those into a single RWA..We'll show you that, if it applies,.near the end of today's presentation..So, be on the lookout for that..We'll get to that in just a moment..Moving onto slide 19..This is just a graphical.representation of what we just showed..So, on the left-hand side, the sliding.scale overhead just shows you kind.of a gradual decline in the fee rate charged.as the dollar amount gets.higher and higher and higher..On the right hand side, you see a similar trend,.but you can see it's a little bit more jagged,.and this is where the step fee structure.gets its name because when you graph.out the step fee structure, it.looks like a set of staircases..Mind you in this case, not a very safe set of.staircases, but still you get the general sense.of the step down, step down, step down..So, that is what the step or that is how.the step fee structure gets its name..So, let's move into an example here, and I'll go.through these two examples and I'll take a break.for a little bit to see if there's.any questions I can answer out loud..So, let's take an example..In this particular example, we're going to look.at a non-recurring RWA that's above the $2,000..So, something that's not in.that flat $500 fee range..It's going to have a fee charged against it..So, the first grouping at the very top.here is just the general guidelines.of how the fee is calculated.and how it's applied..So, when we're trading the initial estimate,.so this is before we've even accepted the RWA,.before you've signed the.RWA, a GSA project manager.or cost estimator is calculating the estimated.direct costs into the summary cost estimate.or the overtime utility estimate..So, these are all the costs.like design, construction,.space planning, furniture procurement..Anything else IT or things of.that nature that might apply.to whatever the work is that you need done..They plug in those direct costs into our.fee calculator or the summary cost estimate.and now the total estimate amount is a.combination of those direct costs plus the fees.that are calculated on top of them, and those.two components, direct costs, step fees,.is what equals your RWA authorized amount..Now to back into the fee percentage, we take.the number of fees or how the dollar amount.of fees I should say, divided by.those direct costs and that equates.to the fee rate, the fee percentage..So, that's the fee rate..So, after we accept the RWA and then we begin.billing you, so it's focusing your attention.on that second grouping of bullets there,.the fee rate we calculated above is applied.on top of your expenses each month..So, as the project is delivered and expenses.are recorded, we charge you or we bill you.for those direct expenses plus the fees..And so, instead of looking at this,.let's just go into an example..I think it's going to make more sense..So, let's go into an example..Let's go to slide 21, and.let's take that example..So, let's say our cost estimator whatever.you needed done, construction, renovations,.design work, et cetera, et cetera,.let's say that all added up to $400,000..Now if you remember from a few slides.ago, I know you don 't memorize it,.but you can check me on this, but a few slides.ago if you looked up $400,000 in that grid,.that fell in the 9% rate to your range..So, $400,000 times 9% equals $36,000..So, that's the fee amount..So, the total estimate and therefore the.total authorized amount is $436,000, right?.It's $400,000 for the direct.costs plus $36,000 for the fees..That's the total authorized amount, and.you can do the math in the reverse order..Thirty six thousand dollars in fees divided.by $400,000 in direct costs equates to 9%..So, now let's go through a few examples.of charging or of the billing cycle..So, let's say, if you look in this middle.grouping specifically at the first bullet,.let's say in month one there.was no dollars in activity..We had nothing..We delivered nothing..There was no activity at all.therefore we had zero dollars to bill..We didn't bill anything..Not direct costs, and because there was no.direct costs, there's no fee to go on top of it..It was 9% times 0 is 0..Nothing to bill in month one..In month two, let's say we had.$23,000 in activity that month..So, looking at this second.bullet in this second grouping,.how do we calculate the bill in month two?.So, month two bill, it includes.the full $23,000..So, we need to be reimbursed.for the $23,000 we spent,.and we need to charge you the fee.for that amount of work so far..So, 9% times $23,000 is $2070..So, your total bill in month two.is that $23,000 plus the $2070.in fees equals a grand total of $25,070..So, that's the total bill..Direct costs plus fees charged that month..Now let's take an RWA amendment..How does that work?.What happens if you have to amend the RWA?.So, let's say in month three you.amend the RWA up to $505,000..So, before the RWA was $436,000..Now, it's $505,000..So, $505,000 happens to fall.into a lower fee tier..Not it's down to 8%..Not 9%, but 8%..So, what happens?.So, let's say in month three, we're.going to retroactively apply that 8%..Let's say month three you had no new activity,.so the only activity still to date in month one,.two, and three of this RWA was that.$23,000 that we billed you in month two..However in month three, when our billing cycle.runs, it's going to say, hey wait a minute..We've charged $23,000 to date..Twenty three thousand dollars.times 8% is only $1840 in fees..But wait a minute..We already charged $2,070 in fees last month,.and that's because the fee rate was 9%,.not 8%, so the fee rate was higher..So, in month three, even though.there's been no new activity,.the billing cycle looks up or picks up this RWA..We calculate the fee, but now based on.8%, not 9%, and it says, wait a minute..I charged $2,070 last month, but the.true fee that should apply thus far.on $23,000 of expenses is only $1,840..Therefore in month three, that difference.is actually credited back to you..We'll issue you a credit of $230.because we're recalculating the fee now.that we have an amendment in place, and.we've overcharged you so far to date.because the fee is 8%, so.we'll issue you that credit..So, the big thing I want to drive home.with amendments here is that the amendment,.so in this case the amendment.went from $436,000 to $505,000..We are not charging you a fee on.that roughly $70,000 difference..We're always and only looking.at the total authorized amount.and charging you the fee that equates to that..So, now that the RWA is $505,000,.8% applies to all future costs.but it also applies retroactively to.any costs we've already billed for..And that's why in this example, you got a.credit for $230 because we charged you less.in fees for this new authorized amount..Let's take one more example..I'm on slide 22 now before we take a break here..And let's, in this case, take.an example of a RWA below $2000..So, in this case, it's a.flat $500 fee for that RWA..And you could see that here..So, we estimated direct costs to be $1,200.therefore the total estimate is $1200.for direct costs plus the flat $500.equals a $1,700 authorized amount..In this case, there is no fee percentage..We're just going to charge a flat $500, so.we're not calculating a fee rate of any kind..And that takes us down here to RWA acceptance..The second grouping, the middle grouping..So, when you have an RWA below $2,000 and.the flat $500 applies, we are going to apply.that $500 in the very first.month no matter what..And this is similar to R-type..R-types have acted like this.for years and years and years..R-types in the past charged the flat $100 fee.in the very first month no matter what happens..Similarly today or in the new.fee cycle or fee structure,.R-types were charged a flat.$500 in the very first month..And now for the new non-recurring.RWA's below $2000,.they will also charge the flat.$500 in the very first month..So, taking this new example, let's say in.month one, we had $50 in activity in month one,.and in month two we had $1150 in expenses..So, in month one the bill is $550..That's because we're charging.the $50 in expenses.and the flat $500 fee in that very first month..Then in month two, we're going to.bill you for those $1150 in expenses,.but there's $0 in additional fees because we've.already 100% of the fees already in month one..Now let's take a look at an interesting example.for an RWA amendment for this below $2000 RWA..Now in this case, let's say in month three,.the RWA was amended from $1,700 to $2,500..So, now that is in $2500, the new.fee structure is not the flat $500..It's now 25%..So, similar to the example.we had in the previous slide,.we're going to retroactively.calculate the new fee structure..So, in month three again, let's assume there's.been $0 of new activity on this new RWA.and we say okay, well you have charged.$1200 so far in months one and two..Remember $50 plus $1150 is $1200..So, we've charged $1200 or we had.$1200 of direct expenses so far today..The billing cycle in month three says.okay, $1200 times 25% equals $300..Pegasus, the billing system then compares okay,.well previously we charged you $500 but really.as of today, as of the new fee.structure, the new fee rate,.you should have only been charged $300..So, in month three, we'll issue.you a credit of that difference..In that case, a credit of $200 would.be charged in month number three..So, those are examples..I wanted to go through those in depth, and even.though we use new RWA's, the new fee structure.as examples, the fee structure under.the current fee methodology, the 4% fee.and the sliding scale fee work exactly the same..They retroactively recalculated the.fee each month if the fee changes..So, this is nothing new..The only thing new with the new fee.structure is the fee percentages.that apply to different tiers..So, with that, I'm going to pause here on.slide 23 to take a sip of water, of course,.but also see if there are any questions out.there that you've been asking which I can answer.out loud which might be an answer.that more of you are interested.in than just the person who initially asked..So, Eric..>> Yes, Steve..Thanks for all of it so far, and we.actually do have a question we want.to read out for you here..Just getting it queued up for you..And so, we want you to ask.you then when closing an RWA,.if not all funds were spent,.are the fees recalculated?.>> Good question and the answer set is no..So, the only time this -- so this.answer first is broad for everything..Not just the closed RWA..The fee percentage is always.tied to the authorized amount..So, as the authorized amount.increases, the fee percentage decreases..As the authorized amount decreases,.the fee percentage increases..We saw that inverse relationships.on those charts..Now closure, let's say you had.$100,000 authorized amount RWA, right?.But let's say we only end.up spending $70,000 of that..We will not change the authorized amount from.100,000 down to 70,000 to match it at closing..Because we don't change authorized amount,.we just leave it at 100,000 at closing..The fee percentage will still.be based on $100,000 RWA..So, the fee rate will not change at closing even.if we did not spend the full.$100,000 in my example..>> Great. And we do have one other question..I mean you touched on this a little bit..Can you just explain now sort of why the.fee is higher for smaller dollar RWA's?.>> Yes, and I kind of explained this, and.I'll repeat it here just to reemphasize it..So, when we did our analysis, the.fee reform fee did our analysis..We were losing lots of money..Lots of money to these small RWA's, and while.we're not meant to recover the cost on an RWA,.by RWA basis that's the objective of.the OIG audit back in 1995 and OMB is.that you recover your costs.on the programs as a whole..But our small RWA's were losing lots of money..We were spending way more delivering.them than we were recovering costs..In our large RWA's, those million.dollars, multi-million dollar RWA's,.while they were making more or recovering.more fees than they were costing,.they weren't sufficient to.totally have us break even..And so, we wanted to charge a.higher fee on the lower RWA..So, we have those RWA's come.close to breaking even..Even at these higher fee percentages,.those super tiny RWA's, that $200 RWA,.the fee we recover even though it's flat $500.is still usually not going to be sufficient.to fully recover the cost on that RWA all by.itself because of all the people involved..Project managers, estimators, acquisition,.et cetera that I mentioned earlier..It's still not going to recover the.costs in some of those super duper RWA's..But as a whole, this new fee structure does.recover our cost globally across all RWA's..But still, even still those small.RWA's are still money losers..But as I'm going to show you here.as we get close to the very end.of today's presentation,.I'll show you some ways..Some tools we have available to you.to maybe avoid giving up a $200 RWA..So, you don't have to pay.a flat $500 fee on that..So, stay tuned for that..There'll be some good answers to that small RWA.dilemma coming up later in this presentation..>> That's a nice tease for what's coming..That exists the questions that we had in the Q..The subject matter experts are doing a great job.in the chat as you can well imagine..So, I will turn it back to you..It looks like we're just now at.the top of the hour, 12:00 Eastern,.so we do have about a half hour more..So, Steve go right on ahead..>> So, from here we should be able.to snowball a little bit quicker..So, I just want to talk about the.implementation of the new fee structure,.and it's all based on this.start acceptance date..Now you've heard us talk about acceptance dates..You've heard us talk about start dates..They are synonymous..Just so you know..They are synonymous names..The start date used to be a name.we've had for many decades before..We have been transitioning the title of a.start date to really be the acceptance date..When did we accept the RWA.because that's more representative.of when the work could begin on an RWA..But throughout the rest of the presentation.today, just realize that start date.and acceptance dates are.meant to mean the same thing..There's the same field..You'll see throughout RETA and.eRETA, it also start/acceptance date..They are meant to be one and the same..So, let's go into it here..Slide 24. So, first and foremost, as is.the process we create an estimate first,.and then we get to the RWA second..That's the typical workflow.for this whole process..So, when we create the estimate first,.the estimated start date entered.on that summary cost estimate, SEE,.or overtime utility estimate OUE..We'll drive which of the two fee.structures is calculated in that estimate..Now up front looking at those two bullets in.the middle of the slide 24, the estimator,.the GSA estimator has to make the.determination is this estimate.for a non-federal service.or for a federal service?.So, let's start with the easier one first.which is several service, that second bullet..The acceptance date for a.federal service is simply equal.to the first date of a period in performance..So, federal service RWA's might include.overtime utilities, janitorial services,.maintenance, landscaping for example..So, when does that period of.performance going to begin?.Usually we have a pretty good idea where that's.going to be when we're creating the estimate..So, if that service is supposed to start July.31st, even though I'm putting my estimate today.in June, I will put June or I will put.July 31st as the estimated start date.on the estimate I'm creating; and.therefore, because I put July 31st,.that's before August 1st, my estimate.will calculate the existing 4% fee.and sliding scale fee structure..For non-federal RWA's that top row up there,.estimating the acceptance date gets a little.trickier because for non-federal RWA's,.the start date or acceptance date is meant to.be the date that the RWA is first accepted,.which happens after all digital.signatures are applied..And in this case, since GSA.signs last, it's really the date.that GSA applies our digital signature..Now when I'm putting the estimate,.I don't really have a great idea.of when GSA might apply our.digital signature on the RWA itself..So, it's more of a loose estimate, and.we'll talk about that here in a second..But for, just to give you a sense of what.non-federal RWA projects are, those are projects.like renovations, constructions,.studies, design, things of those nature..So, just be aware of the distinction.that non-federal start dates is estimated.at GSA signature or when GSA signature will.be applied whereas the federal service the.estimated start date is when the.period of performance will begin..So, that's a very important.distinction because that drives.which of the fee structures are calculated..So, I want to give you this sense..So, this is slide 25, are the.average days from each of these..From point A to point B, Point B.to point C, and so on and so forth..These are the average business days so far in.fiscal year 2020 for each of these components..For RWA's that have been accepted through eRETA..Since everything is funneled through.eRETA today, these are the average days..So, on average, it takes exactly two days from.the time you submit a work request from eRETA.to the time that GSA turns.around, the GSA region turns around.and assigns you a project manager..Now the biggest chunk of time from.there to acceptance is a second bullet..So, 20.6 days on average for the portion that.the customer has the project manager assigned.to the point in time where you submit the.RWA for GSA consideration for acceptance..Now this 20.6 days includes a huge chunk.of time which is that symbol up there.of requirements developed.with the PM cost estimates,.scheduled development, et.cetera, et cetera, et cetera..So, all that stuff that happens offline,.you're meeting with a project manager and.or his or her team on a regular basis..On average that portion of.requirement development takes 20.6 days..Once you've finished that, you've sent the RWA.to GSA in eRETA and said we're ready for this..We're going to fund it..We've provided our funding.information, et cetera..On average, it takes about 7.8 days.for GSA to review your information,.enter our own information into eRETA, and.then route the RWA for digital signatures..And then lastly, it takes about less than a.full business day, on average .8 business days.for both customer to digitally sign the.RWA and for GSA to digitally sign the RWA..So, all told, this whole process from the.date you first submit a work request to GSA,.to the date we accept the RWA, on average.has been 31.2 business days so far in FY2020..Now this is the average remind you..So, smaller RWA's, less complex.RWA's might take a lot less time,.but bigger more complex RWA's.might take more than this 31 days..So, just use this as a reference as the.average number of days for this to happen..Now why I mention this is important is.because this will impact those.non-federal service RWA's..Remember the non-federal.service RWA's aren't accepted.until this last part happens here, the .8 days..So, if you're up here getting the.estimate and let's say today is July 15th,.there's a good chance that July 15th plus.20 days plus 7.8 days plus 28 days is going.to push you past August 1st and therefore.that non-federal RWA will be accepted.after August 1st and therefore.the new fee structure will apply..So, moving onto slide 26, where do.I find this date on the estimate?.So, if you were to log into eRETA and.you pull up the summary cost estimate.on the screenshot here, the estimated RWA start.flash acceptance date is shown on the very.or near the very top of the screen on the STE..The same thing on the overtime utility estimate..I just don't have a screenshot of the overtime.utility estimate here, but you can see here.in this example August 9th,.2020, is the date entered..In this case, if I had entered that.date on my STE, as a GSA estimator,.the fee that would calculate.would be the new fee structure..So moving on to slide 27, this is just.another example of the same thing..If you did not go into eRETA directly and pull.up your estimates, if you got the PDF version.of the estimate that we emailed to.you or attached on the email to you,.you could open up that PDF and similarly.see the estimated start date here..You know the top of the PDF.also shows us August 9th..So, we know that in that case that the new fee.structure was calculated into this estimate..Again, August 1st or before..We'll use the 4% fee and sliding scale fee..August 1st or later, we'll.use the new fee structure..Let me say that again..Before August 1st, so July 31st and before,.we'll use the existing 4% fee.and sliding scale fee structure..A date of August 1st or later,.we'll use the new fee structure..So, I'm bringing up this slide again,.but this time with some highlights..So, when you've gotten that estimate which.we just showed on the past two screenshots,.your summary in between this green bar and this,.excuse me, this yellow bar and the screen bar..So, GSA has now created the estimate so.we're nearing the end or if we're not already.at the end of this 20.6 days on average..We've given you the estimate and now you've.submitted or now you can submit the RWA to GSA.and eRETA for us to consider for acceptance..So, whenever you finally have the.estimate in your hands, in your possession,.you're somewhere in between this.yellow bar and the green bar..So, now you're kind of in the home stretch, and.we only have on average, maybe 7.8 days left.for GSA review and an additional .8.days left for digital signatures..So, if you've gotten that estimate,.let's say, on July 15th for example,.and you know on average there's.only about a little.over eight days left before.everything else before acceptance,.if on July 15th GSA has given you an.estimate that has an August 9th date.like that example did, you.might say well wait a minute..Is that right?.Should that date be before August 1st.and therefore should it calculate the old fee.structure because on average it's only going.to take you another eight days to get.accepted, and if today is July 15th,.I think we could probably get this.signed before July 31st or by July 31st..So, those are just some things to keep.in mind when you're thinking about that..When you get that summary cost estimates.and you see that date and you know you're.in this final homestretch here, does.that date need to be reevaluated.by the GSA estimator or project manager?.And if he says no because we have.this, that, and the other thing,.I realize that on average it's 7.8 days, but for.this particular RWA it's going to be 18.8 days.for us to finalize, review or whatever the case.might be, if they can give you a justification.of why the August 9th date might still.hold true, then that is what it is..But just be aware, just think about.that when you get an estimate from GSA.that you're in this period of time here..You're in that homestretch and.you want to factor that in to see.if the estimated start date is in fact.sufficiently accurate or valid in your mind..Now mind you if this was a federal service.RWA, that the estimate was for federal service,.this date, these dates don't come.into play at all because the date.on a federal service RWA is.the period of performance..Not when GSA signed the RWA..So, none of this information is really valid.for federal service RWA because we could --.if the period of performance starts July 31st.on a federal service RWA, even if we don't sign.that RWA until August 5th, it doesn't.matter July 31st is the true start date.for that federal service..Moving onto slide 29 here, here's some.more just screenshots to show you..So, this is a screenshot of a PDF of a summary.cost estimate that has an August, or excuse me,.has a July 31st date or earlier, and as you.can see, has line 14 regional management fee..It shows you the standard 4% fee applies..The label here is of -- the second.part is called cost associated.with tenant personal property and furthermore.you can see line 27 is called overhead fee.and sliding scale fee..So, this is just a whole bunch kind of.things that you might see on the SCE,.summary cost estimate, that would suggest.the old fee or current fee structure applies..Now compare that to slide 30.and this is what the PDF looks.like for an estimate created.under the new fee structure..So, first and foremost, the label at the.top is now called additional project costs..A little bit more of a generic name..You can see line 14 now is not called 4% fee..It's just called move-to-remove coordination..That's because we removed a 4% line calculation..There is no 4% fee anymore..And line 23 is called the RWA management.fee with the RWA management fee calculation..So, those are just some of the.things that can draw your attention.or your attention will be drawn to you to help.you quickly distinguish between an estimate.with the old fee structure and an.estimate with the new fee structure..And I should point out here at the bottom,.of the new SEC we just repeat.the range of accuracy..The range of accuracy is on all of the SEC's,.but just one of the nuances with the new SEC.and the new fee structure is that we'll.repeat the range of accuracy down here again..So, that's another little thing to notice.to help you recognize is this an estimate.with the old fee structure or is this.an estimate with the new fee structure?.Moving onto slide 31, now let's say.we've gotten the RWA into eRETA..GSA's entering our half of the RWA..If you would have opened it up in.eRETA and navigate to over here,.you can see the PDF information tab is selected..Now mind you, you don't have.the ability to edit this tab.because this is a GSA only.tab, but you can still see it..So, you could visually go to it and.that'll help you distinguish hey,.is this a federal service RWA?.Yes or no..If this is selected yes as this example.is, that's the moment to say oh yes, okay..Federal service yes means that.the start acceptance date is based.on the period of performance..It's not based on when GSA.digitally assigned it..Alternatively if this is said no, then.we know it's a non-federal service.and therefore the acceptance start.date is based on digital signatures..So, that's just, again, another.way to look at that..Confirm which ones if it's.federal or non-federal and confirm.which of the two acceptance dates will apply..Moving onto slide 32 as we wrap things.up here is, again, moving down a few tabs.in the previous approval tab, you will see.the acceptance/start date of the RWA itself..Again, if it said federal was.yes on the previous slide,.then this state here will drive.the new fee or the old fee..So, in this case, August 31st, will stay.put because this is a federal service RWA.so therefore the period of.performance begins on August 31st.and the new fee structure will apply..Now on the flipside, let's say on that previous.slide, the federal service slide said no..This was non-federal, and you.said you went into this RWA.and GSA entered August 31st and.you're like, well wait, why?.Today is June 25th..Why would you enter August 31st?.You don't have to worry about that.because for a non-federal service RWA,.once we write up our signature, let's.say I got a customer signature today,.GSA also signed it today June 25th, this.August 31st date would be overridden.with the GSA signature date..So, this would now show as June 25th and.therefore the old fee structure or the 4% fee.and sliding scale fee would apply instead..So, even if GSA enters a wrong day here for a.non-federal service RWA, don't worry about it..Once we get digital signatures, the digital.signature date will override this date entered.here with the true digital signature date..So, let's close it out with.a few more FAQ's here..And some of these you might be asking.well, what if the estimated start date.on the estimate is different from.the actual start date on the RWA?.And in that case we do have a.problem but only temporarily..Because what that'll mean is that the.estimate calculated one fee structure.but the RWA is actually going to calculate.a different fee structure because whatever's.on the RWA actually trumps.what's on the estimate..Because when the RWA is accepted, it's sent.down to our financial management system,.aka our billing system and that instructs our.billing system which of the two fee structures.to calculate as those are.generated down the road..So, we will be monitoring this the whole time.as we get close to August 1st, on August 1st,.and after August 1st to say, "Hey,.do we have estimates with one date.and RWA's linked to them with different dates?".If so, we will reconcile those two.and make sure the dates are both.on the same side of August 1st..In some cases the date should both be on July.31st or earlier, but we'll reconcile that..In other instances, both dates of the estimated.RWA should be on the other side of August 1st..We'll reconcile that too in which case sometimes.the authorized amount may need to change,.and we may need to have you resign.the RWA for the true amount given.that the fee amount is either.higher or lower based on which.of the two fee structures is accurate..But if this happens to you, don't worry..You don't have to monitor that..We will monitor that for you, and we will.follow up with you as appropriate if it happens..So, here's what I was talking.about during the last break..The next two slides will.cover some examples of how.if you have typically let's say you gave.GSA a $200 RWA for something very small..What options do you have?.One of those options is an F-type RWA..F-types effectively allow.you, if you're not aware,.to execute multiple small.miscellaneous services,.sometimes you call them tasks, on a single RWA..There are some limitations to F-type.so the total authorized amount.of an F-type cannot exceed $250,000 for.RWA, and you can't have a single task.on that set F-type for more than $25,000..Furthermore, F-types are.limited to a single fiscal year..So, if you have a big construction project.that's going to span multiple years,.an F-type would not work.for that particular case..So, let's take a look at an.example to give you more insight..Let's say on a given RWA, you might.have a $600 task to change keylocks..A $22,000 task to replace damaged carpet squares.throughout the whole first floor of a building..And then a $350 tax to patch.a hole in a wall, et cetera..So, instead of giving us three separate.RWA's for those three separate tasks,.you could instead give us one.F-type, and all three of those tasks.and more could be all done.under that one F-type..So, how is that beneficial to you?.Well, the third bullet explains that..The fee rate charged on F-types were based.on the total authorized amount of the F-type..Not the dollar amount of each task..So, let's say that this F-type.we just did was $200,000?.That equates to an 11% rate..So, that $600 task we talked about a.little while ago for the keylock changes,.because that $600 task was done on this.one F-type, we don't charge you $66..That's 11% of $600 for that one task.versus a flat $500 fee had you given us.that $600 keylock as a standalone N-type RWA..So, that is the benefit of an F-type is.that the tasks can be done on one RWA..You've only given us one RWA and not many.small one, and we charge you a fee rate,.11% in this case, versus a flat $500 fee.had you done that $600 RWA all by itself..And just take note of the caveat here.at the very bottom is a disclaimer..F-type RWA's may only be used for small.miscellaneous services and must be completed.in the same fiscal year the RWA was accepted..F-types cannot be used for project-based work..So, F-types have existed for a long time..We have it all documented on our.website in our policy section..This is not something new we just.rolled out with a new fee structure..This has been a long-standing thing, but.F-types are one possible option for you.to utilize instead of giving us a bunch of small.couple of hundred dollars standalone RWA's..Option number two, moving to slide 35, is.the micro purchased allegation of authority..This was issued in January of 2015..So, also not something new.with a new fee reform..This has been out there for five years now,.and what this micro purchased delegation.of authority allows is that the cost of.work, so let's just say you have a small,.let's take that keylock thing for.example, from the last slide, for $600..If you have something like that that's.below the micro-purchase threshold,.which is $2000 worth construction or.$2500 for services, you have the ability.to utilize this micro purchased.allegation authority.and effectively do the project.yourself outside of an RWA and therefore.if you're not giving us an RWA,.there's no fees to pay on top of it..Now there are some caveats here..You as the agency have to receive.written concurrence from the GSA building.or property manager, or if you're in.a leased building, written concurrence.from the GSA lease administrator manager, the.LAM, and or the lease contracting officer..And you have to get this.approval each and every time..If you got approval for the.keylock thing three months ago,.you don't automatically have the authority.to do carpet square replacement today..You have to get the approval, the.written concurrence each and every time..But this allows you to then.procure your contractor yourself.and effectively do these small projects.on your own without paying GSA anything..Now, the authority to utilize this has initially.only been delegated from a GSA administrator.to the department heads in.your various agencies..Now in order for you to utilize this, the.agency administrator or the appropriate title.of the main person running your agency has to.have redelegated that downstream to other folks.in your agency in order for you to utilize it..If they have not, right now the only person.that can utilize this delegation is.the administrator, him or herself..They have to be delegated down.in order for you to utilize it..Again, to find out more about this go to.this website, gsa.gov/facilitiesmanagement,.all one word, and then click on.the facilities operations tab.and then you'll see a whole section called.micro-purchase delegation of authority..So, maybe something to read up.on as we head towards August 1st..I'm going to close things down here..We have 10 minutes left so.this is perfect timing..Just another plug for the.FY2020 year-end deadlines..Again, this is also not fee related..So, this is a fee deadline we do,.or excuse me, I just said fee..This is a year-end deadline.we do every single year..This is, again, not tied to the fee change..So, slide 37, recaps the.deadlines for this year's RWA's,.and we want to give you some good news..You've been hearing about new fees.and more fees, et cetera, et cetera..Well, we have some good news..As a result of using eRETA that you've all been.required to use starting this past October 1st,.we have noticed the turnaround time and.the efficiencies already showing themselves.and we are experiencing much.quicker turnaround times.and efficiencies because of your use of eRETA..So, if you recall in the past, the.year end deadlines you get us an RWA.so that we could hopefully accept it by the end.of September was usually.August 31st to August 30th..You have to give us everything, a.whole month in advance in order for us.to accept the RWA before the end of September..Well, because of the efficiencies we gleamed out.of the eRETA and the quicker turnaround times,.we've been able to move back that.deadline for fiscal year 2020, and so,.for property act RWA's, the deadline to get us a."fully executable RWA" has now been pushed.back to Tuesday, September 8th, 2020..And you might be wondering why it's Tuesday..Well, Tuesday, September 8th, is the first.business day back after the Labor Day weekend..So, that's what we pushed it after Labor.Day, so you have a whole additional eight.or nine days compared to past years to get.your RWA's into eRETA and for us to review them.in order for us to potentially.consider them for acceptance..Now again, this does not mean you.initially enter a work request.into eRETA on September 8th..This has to be fully vetted out..If you remember those slides from.the few, the average day is two days,.20.8 days, 7.8 days, that whole chart..That has to be where we have given you.an estimate essentially in order to --.we essentially have to have given you an.estimate by September 8th in order for your RWA.to qualify for potential acceptance..Economy Act review the RWA's..Again, they have an earlier.deadline, Friday, July 17th..This is a typical deadline..It's a little bit of a soft deadline..Not a hard deadline like September 8th.where we have some more flexibility.if you have Economy Act or DOD RWA's..And then, of course, as usual, emergency.RWA's or amendments can happen after both.of these deadlines on a case by case basis..So, with that said, I am done.with my part of the presentation..I'm going to turn it back over to Eric..I believe we have a few more.poll questions to ask you.and then we will wrap everything.up and close it down..So, Eric..>> We do, Steve..Thank you very much..I appreciate that..Before we get into the poll.questions, a quick announcement..We did notice a discrepancy in the slides.we sent to all registrants last night.versus what was shared today, and this.relates to some dates on slides 25 and 28..That's the timetable to acceptance and.he was just talking about in the file pod.that you can see above your chat window,.you can download the correct.version of today's slide deck..I just want to make everyone aware of that..So, what you got yesterday and maybe.even what you downloaded at the beginning.of the presentation, take another moment.and download that from the file pod..Now we will also send that around to.all participants after the fact just.so that we have everybody on.the same page with those dates..So, we just wanted to clarify that..We do have just a couple of more.minutes left in our time together,.and we do want to ask two quick knowledge.check poll question of our participants..So, we are now going to bring in.the first of our two poll questions..This is, depending on the value of your.projects, the 1000 or $1,000,000 question,.and that is, what date -- what does, I'm sorry,.when does the new RWA fee structure go live?.A couple of choices here..It could be August 1st of this.year that's just five weeks..We also -- no one's falling for it..So, I don't even know why I'm going.to bother with the other options guys,.and of course, it's August 1st, 2020..That is five weeks from today.is that implementation date..So, that it's not the date.of the year end acceptance..It is not the new fiscal year..It is five weeks from today..So, almost a 100% success rate..Great. So, we will get poll question.number two coming in in just one moment..And here we go..The next one might be a little.trickier, but we want to know what types.of RWA does the new structure abide to?.Is it only what those "project" RWA's?.Is it only service RWA's?.Is it all RWA's?.And once again, it's overwhelming..It seems that people have.been paying attention 96%..It is all RWA's..So, excellent..It looks like we were paying attention.to just at least the very basics.and hopefully a whole lot more today..So, we are going to swing.that poll question out,.and we are going to leave.this resource page up here..Quick plug for that website.www.gsa.gov/rwa that you see right there..If you have a question, if.you have forgotten something,.the chances are you can find the.information right there on that website..With that, coming to the.conclusion of today's presentation..So, I want to take a moment to thank.a few people first and foremost..I want to thank all of our customer attendees.for spending 90 minutes with us today..We hope that you enjoyed the conversation..I certainly want to thank Steve for a great.presentation and the subject matter experts.who are handling things in the chat and also the.Client Enrichment Series team members keeping.things moving behind the scene..So, thank all of you for.this good presentation today..As I mentioned, we are going to pull.out all the questions and answers.and even questions we didn't get to if we didn't.have the time, and we are going to turn them.around into a formal FAQ.document questions and answers..We are going to make them available.to you and we will post them both.on our Client Enrichment Theory.website as well as the RWA website..That URL that I was talking about earlier,.and those will be available shortly.after today's presentation.once we go through everything..As I mentioned earlier, we do have one more.session on this very same topic coming up..If you would like a refresher or if you know.a colleague who should really learn more.about what you heard today, you.can join us again on Thursday,.July 16th at 2:00 p.m. Eastern, and we will.be going over the same information again,.but you can bring different questions.for our subject matter experts..We did talk a little bit about eRETA..I know many folks here are eRETA users but.if you were among that subset that was not.and you realize, lightbulb.over your head, you should be,.you can come to our next eRETA Digest.training session that combines element.of our beginner and our advanced session..So, if you don't have access or you're just.trying to get used to what the functionality is,.you'll want to join us on Tuesday,.July 14th, at 1:00 p.m. Eastern,.and then we recur those the second.Tuesday of every month thereafter..So, you can learn more or register for any.of our sessions online at www.gsa.gov/ces..As always, the goal of the Client.Enrichment Series is to engage our audience.in workplace topics that contribute to your.mission's success and the effective management.of your real estate and workplace portfolios..Once again, on behalf of the.entire Client Enrichment Series.and Reimbursable Services Team today,.my name is Eric Fulton signing off..Thank you very much for a wonderful.session, and have a great rest of your day..