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WA_WIC EBT_ InvestmentPlan_Final_

VIEWS: 15 PAGES: 31

									             Washington State
          Department of Health
                 WIC Program

WIC EBT Feasibility Study/ Cost Benefit
    Analysis & Investment Plan Project

                   INVESTMENT PLAN




   WA Contract Number: N15762
   Task/Deliverable ID:   Task 3
   Version:               2.0
   Date Submitted:        September 30, 2007
   Prepared for:          Washington State Department
                          of Health, WIC Program
   Submitted by:          MAXIMUS
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


                          DOCUMENT INFORMATION
                           Document Information
                           Document Title                       Investment Plan
                           Project Name                         WIC EBT Feasibility Study/ Cost Benefit
                                                                Analysis & Investment Plan Project
                           Deliverable/Task ID                  3
                           Submission Date                      September 30, 2007
                           Version                              2.0
                           Author                               Ellen Simon (Project Manager), Jon Haught
                                                                (EBT Subject Matter Expert)
                           WA Contract Number                   N15762
                           GA Agreement                         32100
                           GA Tracking                          18588
                           MAXIMUS Project No                   1040998 (Service Center Charges)
                                                                1040997 (Invoicing)
                           Creation Date                        September 4, 2007
                           Last Saved Date                      June 26, 2011
                           Date Accepted by Client              September 28, 2007




Document Information                                                                                      Page i
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


                          DOCUMENT REVISION HISTORY

                            Version          Date       Description
                                1.0        9/12/2007    Draft
                                2.0        9/30/2007    Final Version




Document Revision History                                                    Page ii
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


                          PURPOSE OF DOCUMENT
                          This Investment Plan has been developed by MAXIMUS to provide the
                          information necessary for the Washington WIC Program to obtain
                          Information Services Board (ISB) or Department of Information Services
                          (DIS) approval to move forward with a project to implement an Electronic
                          Benefits Transfer (EBT) system for the delivery of WIC benefits in the
                          State of Washington. This document contains the required information for
                          investment plans as described in the DIS document Information
                          Technology Investment Standards, Policy No: 201-S1, Effective December
                          2000, Revised January 2003.

                          Greater detail related to the project is found in the WIC EBT Feasibility
                          Study and Cost Benefit Analysis submitted to the State on September 4,
                          2007.




Purpose of Document                                                                          Page iii
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


                          TABLE OF CONTENTS
                          Document Information ................................................................... i
                          Document Revision History ......................................................... ii
                          Purpose of Document .................................................................. iii
                          Table of Contents ......................................................................... iv
                          Table of Exhibits ........................................................................... v
                          1     Investment Approval Request Form..................................... 1
                          2     Purpose of the planned investment ..................................... 3
                                 2.1    Business Problem to be Solved or Opportunity to be Gained ............ 3
                                 2.2    Background Information and Objectives ............................................ 3
                                          2.2.1     Program Metrics ..............................................................................4
                                          2.2.2     WIC EBT Vision ...............................................................................4
                                          2.2.3     WIC EBT Goals ...............................................................................5
                                          2.2.4     Desired Outcomes for WIC EBT ......................................................5

                          3     Business justification ............................................................ 7
                                 3.1    Investment Relationship to Agency IT Portfolio and Investment
                                        Support of Agency Business Plan ...................................................... 7
                                          3.1.1     Investment Relationship to the State's Technology Infrastructure ...7
                                          3.1.2     Alternatives Considered ..................................................................7
                                          3.1.3     Selected Alternative and Rationale for that Selection ......................8
                                 3.2    Risk ..................................................................................................... 9
                                          3.2.1     Risk Assessment .............................................................................9
                                          3.2.2     Quality Assurance Process............................................................ 14
                                          3.2.3     Conformance to the Technical Policies and Standards of the ISB,
                                                    DIS, and the Acquiring Agency ...................................................... 15
                                 3.3    Costs and Benefits ........................................................................... 17
                                          3.3.1     Description of Existing Agency IT resources to be Used ............... 17
                                          3.3.2     Description of IT Resource(s) to be Acquired ................................ 20
                                          3.3.3     Cost-Benefit Analysis .................................................................... 21
                                          3.3.4     Estimated Investment Cost ............................................................ 22

                          4     Acquisition Process/Approach ........................................... 24
                                 4.1    Acquisition Method(s) to be Used .................................................... 24
                                 4.2    Acquisition and Investment Implementation Schedules ................... 24




Table of Contents                                                                                                                        Page iv
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


                          TABLE OF EXHIBITS
                          Exhibit 3-1       Decision Criteria Matrix ................................................................ 8

                          Exhibit 3-2       Severity Level Assessment ........................................................ 11

                          Exhibit 3-3       Risk Level Assessment .............................................................. 12

                          Exhibit 3-4       Initial Risk Assessment .............................................................. 13

                          Exhibit 3-5:      Recommended Project Organization ......................................... 18

                          Exhibit 3-6:      Summary of Detailed Cost Analysis .......................................... 22

                          Exhibit 4-1:      Preliminary Schedule of Milestones ........................................... 25




Table of Exhibits                                                                                                             Page v
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


                1          Investment Approval Request Form
                                                             This space For DIS/MOSTD use only:

    Investment Approval Request                                          Department of Information Services
    For Information Technology Resources                                 Management & Oversight of
                                                                         Strategic Technologies Division

                                                                         360/902-2975
                                                                         MS: 42445

    1   Agency:                                                       Division: CFH/CWP/WIC
        Department of Health
        Community and Family Health                                   Phone No. and E-Mail:
        Community Wellness and Prevention                             (360) 236-3626
        Special Supplement Nutrition Program for Women,               (james.hammond@doh.wa.gov)
        Infants and Children

        Contact: Jim Hammond
    2   Description of Resources: WIC is seeking to procure technology as         Resource to be Acquired
        necessary to support the delivery of WIC food benefits using
        Electronics Benefit Transfer (EBT) technology. As is discussed in         Type of Resource:
        the Investment Plan and the Feasibility Study, there are multiple             Equipment
        proven technology solutions available to the agency. Two of these             Software
        are in-house build and operate and the third is a fully outsourced            Purchased Services
        choice. Resources required will of course, vary depending on the              Personal Services
        selection. EBT is a complex undertaking involving a public / private      Telecommunications:
        partnership, real time distributed financial transaction processing,          Voice
        customer service, payment processing (settlement and reconciliation)          Data
        and administrative support functionality. The final product will make         Video
        use of all of the resources identified to the right, either acquired
        individually or wholly as a service provided by a third party vendor.
        Acquisition Method(s):                Request for Quotation (RFQ)        Request for Proposal (RFP)
    3                                         Request for Quotation and          Master Contract
              Check All That Apply            Qualification (RFQQ)                Inter-Agency Transfer
                                                                                          Inter-Agency Transfer
                                              DIS Technology Brokering            Interlocal Coop.
                                              Private Sector Strategic        Purchasing
                                              Partnership                     Agency #
                                              Sole Source                     Contract #

                                                                                                             1
    4   Investment Cost (see definitions on back):                              $ $863,000 to $7,090,000
                                                                                                                 1
        System Life Cycle Cost (see definitions on back):                       $ $11,553,000 to $16,442,000
    5   Agency Approval (Signature):                                            Date:

    6   ISB/DIS Approval (Signature):                                           Date:




1
 The wide variance results from the multiple options and the unknown degree of retailer participation. See plan for
details
Section 1: Investment Approval Request Form                                                                  Page 1
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

 7   (FOR DIS USE ONLY)
     Comments:




Section 1: Investment Approval Request Form                                  Page 2
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


              2           PURPOSE OF THE PLANNED INVESTMENT
                          WIC is seeking to upgrade its benefit delivery process from the current
                          paper based check system to Electronic Benefit Transfer (EBT)
                          technology such as has been implemented so successfully in support of the
                          Food Stamp program. .

              2.1         Business Problem to be Solved or Opportunity to be
                          Gained
                          The Federal administrative and oversight agency for WIC, the USDA
                          Food and Nutrition Services (FNS), has been promoting the use of EBT
                          for WIC benefit delivery and has a long term strategy for all States to
                          migrate benefit delivery to this more efficient technology. Washington‟s
                          (and FNS‟) interest in EBT is based on a fundamental improvement in the
                          quality of service.

                          The WIC food benefit redemption process, which is a purchase of
                          groceries in a retail grocer‟s check-out lane, is time consuming and
                          complex when using the current paper based benefit delivery product.
                          More significantly though, it is stigmatizing to the 103,000 Washington
                          households that rely upon WIC benefits as a vital source of nutrition for
                          their infants and children. The WIC checks are plainly identifiable during
                          the check-out process and immediately brand the shopper as a WIC
                          recipient which, in some people‟s minds, equates to being on welfare
                          (even though WIC is a health program). It is for this reason that many
                          eligible households do not participate in the WIC program. Federal
                          dollars not being spent in Washington and missed opportunities for
                          improving the health and welfare of one of Washington‟s most vulnerable
                          populations, its expectant mothers, infants, and young children, are a
                          direct result.

                          EBT is a major step forward is removing many of the negatives associated
                          with food benefit delivery and it provides a much more efficient and error
                          free payment process. The client uses a plastic card to complete the
                          purchase, making it essentially indistinguishable from the payment
                          process being used by many other shoppers in the store. An important
                          expected outcome of the move to EBT is an increase in program
                          participation. Further, it is believed that EBT will provide significant
                          program improvements for the agency, participant, and retailer.

              2.2         Background Information and Objectives
                          WIC is a federally funded grant program operated and administered within
                          the State as a part of the Washington State Department of Health, Office
                          of Community Wellness & Prevention (CWP), which includes programs
                          such as the State Cancer Registry, Breast & Cervical Health, Diabetes
Section 2: Purpose of the planned investment                                                  Page 3
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                          Control, Heart Health, and the Tobacco Control & Prevention Program.
                          Federal regulatory oversight and administration is provided by the USDA
                          Food and Nutrition Services.

               2.2.1      Program Metrics
                             The program brings approximately $110 million in Federal grant funds
                              into the State along with an additional $26 million in infant formula
                              rebates;
                             A monthly average of 163,000 participants living in 103,000 unique
                              households receive services from WIC;
                             The program provides services to over 265,000 individuals each year;
                             Every WIC dollar used to serve pregnant women saves $1.92 to $4.21
                              in Medicaid costs;
                             WIC reduces the rate of very low birth-weight babies by 44%. It costs
                              between $30,000 and $70,000 to raise a low or very low birth-weight
                              baby to normal weight;
                             Half of all of Washington‟s infants receive services from WIC;
                             WIC services are provided at approximately 240 clinic locations
                              throughout the State;
                             WIC food benefits are provided though a network of 706 authorized
                              retail grocers located throughout the State.

                          In January 2004, the Washington WIC Program was selected from among
                          four volunteer states by the United States Department of Agriculture
                          (USDA) to participate in an experimental project to explore the technical
                          feasibility of providing benefits to WIC clients through online EBT. This
                          “Demonstration” project was part of the USDA‟s five-year plan to
                          promote nationwide EBT use by WIC.

                          At its conclusion in November 2005 the USDA found that “the project
                          successfully met the project’s goal of demonstrating that WIC EBT
                          transactions can be completed in a retail environment2.” This project
                          positioned Washington State to move forward in pursuing EBT as a means
                          for significant program improvement for the clients, retailers, and the
                          agency.

                          The objectives for WIC EBT (from the FNS 5 Year Plan) are as follows:

               2.2.2      WIC EBT Vision

                          In line with current trends and the overall public acceptance and growing
                          expectation of doing business and receiving services electronically, the

2
    Exec Summary - FNS-WA Online WIC EBT Outcomes & Feedback Report.doc
Section 2: Purpose of the planned investment                                                    Page 4
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                          Special Supplemental Nutrition Program for Women, Infants and Children
                          (WIC) will continue its initiatives to successfully migrate from a paper-
                          based food benefit delivery system to an electronic benefits transfer
                          system.

              2.2.3       WIC EBT Goals
                             Include WIC as an integral part of the national strategy towards
                              modernizing and streamlining business practices through electronic
                              solutions.
                             Deliver WIC benefits and reconcile payments through an EBT system
                              that is affordable at the statewide operational level.
                             Enhance client services by improving access to prescribed WIC foods
                              and simplifying the retail point-of-sale transaction to reduce stigma
                              and improve shopping convenience.
                             Increase accountability and streamline program monitoring for WIC
                              State agencies.
                             Make WIC benefit redemption and payments more efficient for
                              retailers.

              2.2.4       Desired Outcomes for WIC EBT

                          The USDA Food and Nutrition Service is committed to maintaining the
                          integrity in nutrition benefit delivery while fostering positive outcomes for
                          WIC stakeholder groups, including participants, retailers, and WIC State
                          agencies. The following is a list of identified positive outcomes in WIC
                          EBT system solutions:

                          Participant Outcomes
                             Ability to purchase full food benefits within valid period
                             Unrestricted number of shopping trips
                             Convenient, easy and quick transaction
                             Single transaction for all items purchased
                             Secure transaction
                             Discreet and confidential transactions
                             Accurate listing of entitled/remaining benefits prior to and after
                              shopping
                             Increased time for nutrition education in clinic
                             Improved targeted nutrition education based on redemption patterns

                          Retailer Outcomes
                             Participant purchases only WIC authorized foods
Section 2: Purpose of the planned investment                                                       Page 5
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                             Ensures foods are not improperly substituted
                             Reduces cashier error and need for training
                             Secure transaction
                             Single transaction for all items purchased
                             Timely claims and settlement
                             Fast and easy operation
                             Numerous activity reports for WIC EBT
                             More trips to store by participant equals increased purchases
                             Reduces paperwork by eliminating paper food instruments
                             National standards for WIC EBT process

                          WIC State Agency Outcomes
                             Ensures participant receives prescribed foods
                             Provides data on type and amount of foods purchased
                             Allows for accurate rebate billing on infant formula purchased
                             Ensures that retailer claims are no more than shelf price
                             Secure transaction
                             Timely and accurate claims
                             Reduces the amount of time and effort spent on retailer compliance
                              activities
                             Reduces the amount of time and effort in monitoring and reconciling
                              retailer overcharges
                             Reduces forgery and fraud opportunities
                             Increases accountability
                             Reduces paperwork
                             Enables numerous reports on EBT activity to improve administrative
                              efficiencies
                             Streamlines clinic operations; increases time for nutrition education




Section 2: Purpose of the planned investment                                                    Page 6
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


               3            BUSINESS JUSTIFICATION
               3.1          Investment Relationship to Agency IT Portfolio and
                            Investment Support of Agency Business Plan
                            The implementation of an EBT system for the delivery of WIC benefits
                            will enhance the Agency IT Portfolio. Delivering benefits using an
                            electronic method, thereby streamlining issuance and redemption
                            processes is in line with Agency and Department objectives and goals.

               3.1.1        Investment Relationship to the State's Technology
                            Infrastructure

                            As discussed below, there are several different approaches to
                            implementing EBT. However, regardless of the alternative selected, there
                            should not be a significant impact on technological capabilities. The
                            Department of Health already operates a major data center that serves
                            many clients, including the current WIC MIS application. To add EBT, a
                            few additional servers may be needed but it is not technology with which
                            the State is unfamiliar. The State also boasts a significant
                            telecommunications infrastructure that can be leveraged for this project.
                            And finally, WIC has strong IT capabilities that can help manage, design,
                            construct, and operate an EBT solution.

                            One of the alternatives for EBT is an outsourced solution. It is believed
                            this choice will have minimal effect on infrastructure since a contractor
                            will be supplying, managing and maintaining the required technology at
                            their offsite facility.

                            The other alternatives are in-house solutions that, for the most part, will
                            conform to the Department standards. The primary change, for an online
                            WIC EBT solution, will be the increased service levels required for the
                            7x24 high availability processing needed for WIC EBT transactions from
                            retailers. Consequently, to operate the WIC EBT system, WIC may
                            require additional support and space from the Department Data center,
                            including additional fail-over processes and equipment to ensure 100%
                            availability. However the overall infrastructure should not be significantly
                            altered.

               3.1.2        Alternatives Considered

                            Using EBT for the delivery of WIC food benefits is the purpose for this
                            Investment Plan. There are multiple functionally similar and equally
                            proven technical approaches by which this objective may be achieved. In
                            the course of developing a feasibility study for EBT, three primary
                            solutions were analyzed:


Section 3: Business justification                                                                Page 7
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                    1. Offline in-house: This is a “smart card” approach that would rely
                                       upon a working solution ported from New Mexico / Wyoming as
                                       its basis. The State would customize the solution to its needs and
                                       would provide the system processing in-house at the Department
                                       of Health (DOH) data center facility. Some specialized services
                                       may be contracted as needed such as “Smart Card” expertise.

                                    2. Online in-house: This is a magnetic stripe card approach that
                                       would rely upon a system ported from Kentucky as its basis. The
                                       State would customize the solution to its needs and would provide
                                       the system processing in-house at the DOH data center facility.
                                       This solution does require the State to step up to being a 7x24 high
                                       availability online data center.

                                    3. Online outsource: This is a magnetic stripe card approach that
                                       would be wholly outsourced to a third party vendor that has
                                       credentials and a working WIC EBT system in place. The State
                                       would still have to make some modifications to its WIC
                                       management information system (MIS) but generally, all work
                                       effort (and risk) would shift to the contracted vendor.

               3.1.3        Selected Alternative and Rationale for that Selection

                            A decision matrix was developed to support a comparison between the
                            three EBT alternatives and the current paper based alternative. Twelve
                            criteria were used for the evaluation.

 Exhibit 3-1        Decision Criteria Matrix

                                       Implementation Alternatives

 Criteria               Weight                               Offline         Online mag       Online mag
                                        Baseline Paper
                                                           smartcard         stripe card      stripe card
                                           Checks
                                                           (in-house)        (in-house)      (outsourced)
                                        Raw      Adj.     Raw      Adj.      Raw    Adj.     Raw     Adj.
 Start up cost               1            5       5        1        1         2       2       4       4
 Operations costs            2            4       8        5        10        3       6       1       2
 Program
                             3            1       3        4        12        4      12       4       12
 objectives
 Participant
                             3            1       3        4        12        5      15       5       15
 friendly
 Retailer
                             3            2       6        3        9         3       9       3       9
 acceptance
 Client service &
                             3            1       3        3        9         5      15       4       12
 convenience
 Technology                  2            5       10       3        6         3       6       4       8

Section 3: Business justification                                                                    Page 8
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


 Exhibit 3-1        Decision Criteria Matrix

                                    Implementation Alternatives

 Criteria               Weight                               Offline         Online mag     Online mag
                                    Baseline Paper
                                                           smartcard         stripe card    stripe card
                                       Checks
                                                           (in-house)        (in-house)    (outsourced)
                                     Raw       Adj.      Raw       Adj.      Raw    Adj.   Raw     Adj.
 compatibility
 Technology risk             2        4         8         2         4         3       6     4       8
 Implementation
                             1        5         5         3         3         3       3     4       4
 risk
 Clinic process              2        3         6         4         8         4       8     4       8
 Program
                             2        2         4         5         10        5      10     5       10
 management
 Growth &
                             2        1         2         5         10        4       8     3       6
 enhancement
              Totals                 36        63         42        94       46     100    47       98

                            A complete methodology including a rationale for the scoring is found in
                            the WIC EBT Feasibility Study.

                            As can be seen, based on evaluation of the full set of the objectives, all
                            three of the EBT solutions scored significantly higher than the check
                            process. Among the EBT alternatives, the results were close; there was no
                            obvious choice.

                            EBT is the preferred alternative. Which technical solution remains an
                            open question. An important contributor to this decision is the WIC retail
                            community. The State will be asking this important group of stakeholders
                            to make significant financial and resource commitments to implement
                            EBT in their stores and should consider seriously their preferred direction
                            for the initiative.

               3.2          Risk
               3.2.1        Risk Assessment

                            A risk assessment of the EBT implementation project was performed
                            following the guidelines outlined in the Department of Information
                            Services, Information Technology Portfolio Management Standards
                            document. MAXIMUS, WIC and DIS staff met on August 15, 2007 and
                            walked through the risk assessment process. The group determined based
                            on the severity level and risk level selections that the EBT implementation
                            project is categorized as a Level 2 project. The completed severity and
                            risk criteria tables have been provided in the following section.
Section 3: Business justification                                                                  Page 9
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                            Levels are assigned to determine the appropriate level of oversight.
                            Oversight for a Level 2 project is described as follows:

                                    DIS oversight of investments at this level is performed by DIS
                                    MOST staff, as appropriate. The specific activities required of an
                                    agency and the extent of DIS MOST staff involvement under Level
                                    2 oversight are determined collaboratively between the two
                                    parties. These typically depend on several factors, including, but
                                    not limited to: the experience of the agency with similar
                                    investments; the effect of legislative or public opinion in the event
                                    of negative media coverage; the interest of specific ISB members
                                    (e.g., effect on an ISB legislative member’s district); essentially,
                                    the criteria contained in the severity/risk matrix.
                                    For all Level 2 investments, the agency shall develop the
                                    appropriate type and quality of project management
                                    documentation and materials commensurate with the project’s
                                    severity and risk. Should the agency and DIS MOST staff
                                    determine that the project requires DIS oversight, at a minimum,
                                    the agency shall provide copies of the project status reports, and
                                    key project documents and materials to its MOST consultant and
                                    invite the consultant to attend all steering committee and key
                                    project status meetings. The agency shall include all Level 2
                                    investments in its IT portfolio, whether or not the projects are
                                    under DIS oversight.

                            Severity and Risk Matrices

                            Severity Level Criteria

                            The severity matrix assesses the proposed project‟s impact on citizens and
                            State operations, its visibility to stakeholders, and the consequences of
                            project failure.

                            The non-shaded cells identify the criteria the assessment group agreed was
                            appropriate for this project.




Section 3: Business justification                                                                  Page 10
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


 Exhibit 3-2        Severity Level Assessment
               Categories
               Impact on                  Visibility                  Impact on State             Failure or Nil
 Levels        Clients                                                Operations                  Consequences
 High           Direct contact with       Highly visible to          Statewide or multiple      Inability to meet
                 citizens, political        public, trading             agency involvement /        legislative mandate or
                 subdivisions, and          partners, political         impact.                     agency mission.
                 service providers –        subdivisions and           Initial mainframe          Loss of significant
                 including benefits         Legislature.                acquisitions or network     federal funding.
                 payments and              Likely subject to           acquisitions.
                 transactions.              hearings.
                                           System processes
                                            sensitive /
                                            confidential data
                                            (e.g. medical, SSN,
                                            credit card #’s).
 Medium         Indirect impacts on       Some visibility to the     Multiple divisions or      Potential failure of
                 citizens through           Legislature, trading        programs within             aging systems.
                 management systems         partners, or public the     agency.
                 that support decisions     system / program
                 that are viewed as         supports.
                 important by the          May be subject to
                 public.                    legislative hearing.
                Access by citizens for
                 information and
                 research purposes.

 Low            Agency operations         Internal agency only.      Single division.           Loss of opportunity
                 only.                                                 Improve or expand           for improved
                                                                        existing networks or        service delivery or
                                                                        mainframes with             efficiency.
                                                                        similar technology.        Failure to resolve
                                                                                                    customer service
                                                                                                    complaints or
                                                                                                    requests.




                            Risk Level Criteria

                            The risk matrix measures the impact of the project on the organization, the
                            effort needed to complete the project, the stability of the proposed
                            technology, and agency preparedness.

                            The non-shaded cells identify the criteria the assessment group agreed was
                            appropriate for this project.




Section 3: Business justification                                                                                   Page 11
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


 Exhibit 3-3        Risk Level Assessment
               Categories
               Functional Impact on         Development Effort &      Technology                  Capability &
               Business Processes or        Resources                                             Management
 Levels        Rules
 High           Significant change to       Over $5 million.         Emerging.                  Minimal executive
                 business rules.             Development and          Unproven.                   sponsorship.
                Replacement of a             implementation           Two or more of the         Agency uses ad-hoc
                 mission critical system.     exceeds 24                following are new           processes.
                Multiple organizations       months.*                  for agency                 Agency and/or vendor
                 involved.                   Requires a second         technology staff or         track record suggests
                Requires extensive and       decision package.         integrator, or are          inability to mitigate risk
                 substantial job training                               new to the agency           on project requiring a
                 for work groups.                                       architecture:               given level of
                                            * Clock starts after        programming                 development effort.
                                              feasibility study or      language; operating
                                              project approval          systems; database
                                              and release of            products;
                                              funding.                  development tools;
                                                                        data
                                                                        communications
                                                                        technology.
                                                                       Requires PKI
                                                                        certificate.
                                                                       Complex
                                                                        architecture –
                                                                        greater than 2 tier.
 Medium         Moderate change to          Under $5 million but     New in agency with         Executive sponsor
                 business rules.              over agency delegated     3rd party expertise and     knowledgeable but not
                Major enhancement            authority.                knowledge transfer.         actively engaged.
                 or moderate change          12 to 24 months for      One of the                 System integrator
                 of mission critical          development and           technologies listed         under contract with
                 system.                      implementation. *         above is new for            agency technical
                Medium complexity                                      agency development          participation.
                 business                                               staff.                     Agency and/or vendor
                 process(es).               * Clock starts after                                    record indicates good
                Requires moderate             feasibility study or                                 level of success but
                 job training.                 project approval and                                 without the structure
                                               release of funding.                                  for repeatability.


 Low            Insignificant or no         Within agency            Standard, proven           Strong executive
                 change to business           delegated authority.      agency technology.          sponsorship.
                 rules.                      Under 12 months for                                  Agency and vendor
                Low complexity               development and                                       have strong ability
                 business process(es).        implementation.*                                      to mitigate risk on a
                Some job training                                                                  development
                 could be required.                                                                 project.
                                            * Clock starts after                                   Project staff uses
                                               feasibility study or                                 documented and
                                               project approval and                                 repeatable
                                               release of funding.                                  processes for
                                                                                                    tracking status,
                                                                                                    problems, and
                                                                                                    change.
                                                                                                   Agency or vendor is
                                                                                                    CMM Level 3
                                                                                                    equivalent or above.




Section 3: Business justification                                                                                    Page 12
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                            Risk Analysis

                            The following table describes the initial risks identified for this project.
                            Risk management is an ongoing activity; as the State moves forward with
                            future phases of this project, this initial risk analysis can be used as a
                            baseline and updated as the project progresses.

 Exhibit 3-4        Initial Risk Assessment

                                                      Impact
 #      Risk Event or Assumption                                  Mitigation Strategy
                                                      Area(s)
 1.     Availability of DOH Resources                 Time,       The number of resources is dependent on
        Successful completion of this project         Cost,       whether an in-house or outsourced solution
        will require support from DOH technical       Quality     is selected. Once that is known, the state
        and program staff.                                        should begin to define the resources
                                                                  required to support the implementation
                                                                  and create a plan that identifies those
                                                                  needs and how best to fill that need (for
                                                                  example it might be better to contract for
                                                                  planning, quality assurance, or other
                                                                  project support).
                                                                  Regardless of the solution, the State will
                                                                  need resources for project management.
                                                                  Once the decision is made to move
                                                                  forward, a dedicated project manager
                                                                  should be assigned.
 2.     Retailer Buy-in                               Time,       Once a decision has been made to move
        WIC EBT is a public / private sector          Cost,       forward with EBT, the State needs to begin
        endeavor. Without acceptance of the           Quality,    engaging the retailer community. This
        WIC EBT program by the vendor                 Scope       project has made an initial step toward that
        community, it will be very difficult to                   goal through the retailer survey. The State
        implement.                                                needs to continue that work through
                                                                  retailer forums and communication with
                                                                  retail associations and industry groups.
 3.     Emerging Industry                             Scope,      This study is the first step in whittling down
        There is no established norm for how to       Cost,       the State’s alternatives. Out of this study
        implement WIC EBT. It is important            Time        three distinct alternatives have been
        that the State does not get lost in a                     identified. Additionally, regardless of the
        myriad of alternatives, service and                       solution there are two approaches to the
        implementation options and partnership                    retail implementation of WIC EBT. The
        arrangements.                                             next step for the State is to begin engaging
                                                                  the retailer community in order to better
                                                                  identify the alternatives that will be best for
                                                                  all stakeholders.




Section 3: Business justification                                                                         Page 13
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


 Exhibit 3-4        Initial Risk Assessment

                                                        Impact
 #      Risk Event or Assumption                                  Mitigation Strategy
                                                        Area(s)
 4.     Competing Technologies                          Scope,    The outcome of this project will be the
        There are strong proponents (and                Cost,     identification of three alternatives (two
        detractors) for the two major competing         Time      online and one offline). Again, the next
        technologies – online and offline.                        step for the State is to begin engaging the
        Currently, the choice is not clear.                       retailer community in order to better
                                                                  identify the alternatives that will be best for
                                                                  all stakeholders.
 5.     Program Policy                                  Scope,    The new food package regulations are
        FNS is in the process of some major             Cost,     expected to be released near the end of
        changes in WIC administration including         Time      this project. Adjustments to foods should
        new food packages, cost containment,                      not significantly impact EBT as the cat/sub
        fresh fruits and vegetables, and an                       cat can be adjusted to accommodate. It is
        update to the FReD to include EBT                         expected that FNS will begin to define
        Readiness. Shifts in Federal policy                       federal regulations or policy regarding WIC
        could impact Washington’s business                        EBT, but it is likely to be consistent with
        model.                                                    how states are currently operating their
                                                                  EBT systems. Washington should look to
                                                                  other states and follow an established
                                                                  model of operation.
                                                                  The State should continue to work closely
                                                                  with the FNS representatives at the region
                                                                  and headquarters and other state WIC
                                                                  agencies as well as stay active in forums
                                                                  such as the WIC EBT Users’ Group and the
                                                                  EBT Next Generation Conference to remain
                                                                  abreast of the latest activities in the WIC
                                                                  EBT arena.
 7.     Program Funding                                 Cost,     The State needs to stay abreast of funding
        There is no Federal mandate to move to          Time,     opportunities and continue to submit grant
        WIC EBT (although there may be a                Scope     requests to FNS to further EBT efforts. The
        desire) and consequently, no pot of                       State may also want to consider alternate
        money to fund these projects. It is                       funding sources or funding strategies.
        unclear at this time if EBT is less costly
        than paper.

               3.2.2        Quality Assurance Process

                            The project should have a quality management plan (which can be
                            incorporated into an overall project management plan). The quality
                            management plan should describe:

                                   Any standards that will be used or apply to the project
                                   What metrics and success criteria will be used
                                   How will quality will be measured

Section 3: Business justification                                                                         Page 14
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                   What actions are taken to prevent quality issues
                                   What actions are taken to resolved identified quality issues
                                   Roles and responsibilities of the project team and/or quality assurance
                                    team that will be involved in quality management activities
                                   Schedule of quality management activities or milestones

                            It is recommended that for this project an experienced EBT quality
                            assurance contractor be hired to provide quality assurance oversight of the
                            design, development and implementation phases of the project. Because
                            WIC EBT is technology with its own particular nuances and its
                            implementation affects a large number of stakeholders, it is important that
                            the State contract with a firm experienced in not only providing quality
                            assurance services, but has specifically provided these services for EBT
                            projects and has a strong understanding of the WIC program, systems and
                            operations.

                            The responsibility of the quality assurance contractor will be to ensure that
                            all product deliverables and services are complete and of the highest
                            quality consistent with federal, industry, and State standards. Additionally
                            they will monitor the project work plan; identify, and provide early
                            warning of deviations from the expected activities.

               3.2.3        Conformance to the Technical Policies and Standards of the
                            ISB, DIS, and the Acquiring Agency

                            Strategic Focus (Business and IT goals)

                            The State has a strategic vision for its information technology platforms
                            to:

                                       Foster improved program management;
                                       Provide for cost effective service delivery;
                                       Enhance user capabilities and experience;
                                       Allow for integration of information and services across program
                                        boundaries to create an environment for holistic client
                                        management.

                            EBT for WIC fits very well into this vision. Capabilities for improved
                            program management and an enhanced user experience are pervasive and
                            include:

                                       Better management of food costs
                                       Improved tracking of program utilization
                                       Greatly enhanced redemption process

Section 3: Business justification                                                                    Page 15
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                       Significant cost efficiencies in retailer store

                            By making the investment in EBT, the State can, for essentially the same
                            ongoing dollars it is now spending, provide far superior service delivery.

                            The WIC program is already vested in information and service sharing.
                            Vital Statistics, CDC, Medicaid, Food Stamps, Head Start, EPSDT, CSFP,
                            and Community Health are some of the partners with whom WIC
                            routinely exchanges data. Adding EBT as the delivery platform for WIC
                            even further opens the door for sharing. It has the potential to be a
                            platform that could accommodate delivery needs for multiple programs
                            (although this is outside the scope of the current concept for EBT).
                            Further, it enhances the quantity and quality of data available for program
                            management, a resource that may have possibilities for holistic
                            management of client services across the Department of Health.

                            Effect on Technology Infrastructure

                            The following items highlight areas in which an EBT implementation
                            project can take advantage of existing information, tools or standards
                            within the Department.3

                                   Processing and Balance Inquiry: Use of DIRMs lessons learned from
                                    production applications during the implementation of WIN-Server
                                    2003, Internet Information Services 6 and the Microsoft .Net product
                                    lines.
                                   Software Version Control: DOH uses a software version control
                                    package and WIC also has a software version package called Visual
                                    Source Save (VSS)
                                   Testing or report of problems: The agency has Test Track Pro (TTP)
                                    to which WIC also has access. For tracking help desk calls, WIC uses
                                    a software program called HEAT.
                                   Migration of SQL Server 2005 to New Equipment. WIC currently
                                    uses Sybase 9.2 which is about to be moved to new equipment. A
                                    service can be built to access the necessary information regardless of
                                    the EBT alternative selected.
                                   Customer Service: With some enhancements the Call Center could
                                    take the 7/24 requests, this would be part of the Client Services/Help
                                    Desk.
                                   Training: To assist in the training of the retailers and clinics WIC can
                                    take advantage of DOH Satellite Distribution System where training
                                    can be done from the staff‟s desk or the recorded broadcasts can be for
3
  The information in this section is based on the „Information Services Board Portfolio Management Policy, IT
Security Policy, Disaster Recovery/Business Resumption Planning Policy and Geographic Information System
standard‟ document.
Section 3: Business justification                                                                         Page 16
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                    later distribution or creation of training programs on DVD for
                                    distribution.
                                   IT policies and procedures: The Department has an established policy
                                    and procedure on how IT projects are selected and includes procedures
                                    for IT plans, acquisition process, and the review process.
                                   Technical Standard: Information Technology proposal are reviewed
                                    for adherence to State and Agency technical standard during the
                                    initiation phase of a project. Exceptions to standard are reviewed by
                                    the program manager, division Chief Administrator the IT standard
                                    Coordinator and the agency Chief Information Officer.
                                   Disaster/Recovery Project: This project will need to be included in the
                                    D/R project. Also, included in the alternate feed to DIS for SGN/PGN
                                    connections in the event of a regional disaster and don‟t forget
                                    Business Continuity.
                                   Data Integration Initiative: Sharing of Technology Knowledge with
                                    other programs.

               3.3          Costs and Benefits
               3.3.1        Description of Existing Agency IT resources to be Used

                            Technology Infrastructure

                            EBT will be operated out of the existing department data center. It will
                            leverage existing servers, operations capabilities, network services and
                            data communications links to the fullest extent possible.

                            Staffing

                            During the design, development and implementation phases of the project
                            there will be significant demands for experienced IT professionals in all
                            categories. The in-house versus outsourced choice will have a large
                            impact on the absolute level of staffing required. Washington WIC has
                            strong IT capabilities made up of a combination of in-house and
                            contracted staff. It is presumed that these resources would be used to
                            support the EBT initiative and would be augmented as necessary.

                            The following organization chart provides an overview of the recommend
                            WIC EBT DDI project team organization.




Section 3: Business justification                                                                    Page 17
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0



                                                                            Steering                          Oversight
                                                                           Committee                           Entities




                                             Subject Matter                Project
                                                Experts                    Manager




                                 Quality                      Operations                  Technology                    Vendor
                                Assurance                      Manager                     Manager                      Manager




                                                   Policy                     Software                 Retail System
                                                                                                        Certification




                                                  Training                    Network                     UPC
                                                                                                       Maintenance




                                                 Customer                     System
                                                  Service                    Operations




                                                  Enabling                    Testing




                             Exhibit 3-5:       Recommended Project Organization


                            The WIC EBT project team should include the following capabilities:

                                       Project Manager: Provides daily operations management and has
                                        accountability and responsibility for the success of the project.
                                       Subject Matter Experts: Individuals available to the project
                                        manager to consult on specific areas of expertise needed to support
                                        the project.
                                           General EBT expertise to provide guidance and technical
                                            support to the project
                                           Smart Card expertise (if needed)
                                           Point of Sale systems development (if needed)
                                           Payment system transaction processing
                                       Quality assurance: Ensure that all product deliverables and
                                        services are complete and of the highest quality consistent with

Section 3: Business justification                                                                                          Page 18
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                        federal, industry, and State standards. Monitor the project work
                                        plan; identify, and provide early warning of deviations from the
                                        expected activities.
                                       Operations Manager: Responsible for ensuring the clinics and the
                                        State are fully enabled to implement EBT.
                                           Policy: Modify and implement program policy and business
                                            process changes as necessary to for EBT.
                                           Training: Ensure all State, agency and clinic staff, as well as
                                            clients, are properly trained for EBT.
                                           Customer Service: Manage the card issuance process,
                                            coordinate a help desk solution, manage development and
                                            distribution of documentation
                                           Enabling: Direction and coordination of hardware deployment,
                                            network setup, and training as necessary to enable the clinics
                                            and the participants.
                                       Technology Manager: Oversee all aspects of the technical delivery
                                        of EBT. Manage the acceptance process and productive
                                        implementation.
                                           Software: Develop, test and implement modifications to the
                                            CIMS application to be EBT capable; develop, manage, and
                                            implement modifications to the ported EBT host solution (if
                                            this is the State‟s direction). Manage any conversion of data
                                            necessary to support EBT.
                                           Network: Design and implement a network solution to support
                                            interfaces between CIMS and the EBT host, communications
                                            between the EBT host and the retail groceries, and
                                            communications between the clinics and the EBT host.
                                           System Operations: Design and implementation of all central
                                            hardware (computers and peripherals) necessary for EBT,
                                            development of operations manuals and procedures.
                                           Testing: Development and implementation of test plans and
                                            scripts as necessary to ensure that the EBT product meets all
                                            system requirements and is fully capable of providing the
                                            service for which it was designed.
                                       Vendor Manager: Responsible for the management and
                                        coordination of all activities required to get the vendor community
                                        enabled for EBT, including vendor communications, assistance
                                        with integration (or deployment of stand-aside equipment), testing
                                        and training
                                           Certification: All systems being used by retailers to participate
                                            in the Washington EBT project will require a state certification

Section 3: Business justification                                                                      Page 19
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                        to ensure they comply with program standards, requirements
                                        and transaction policy.
                                       UPC Maintenance: UPCs for authorized foods will need to be
                                        collected and added to the EBT database. The bulk of this
                                        effort occurs during implementation and rollout, but ongoing
                                        maintenance is required to add new UPCs when new items are
                                        approved or food packaging changes.

                            Decisions as to the specific make up of the design, develop, and
                            implement project team are somewhat dependent on the choice of solution
                            and the time availability of the resources.

                            However, it is believed that once EBT is implemented, it can be operated
                            easily within the current WIC staffing levels. The content of some jobs
                            may change but in general, the total level of work effort should remain
                            constant or even decrease.

               3.3.2        Description of IT Resource(s) to be Acquired

                            Technology Infrastructure

                            If an outsourced solution is chosen, there will be minimal new technology
                            infrastructure required. However, for an in-house solution, additional
                            computing capacity (servers) will be required. Depending on the
                            technology used (online or offline), additional telecommunications
                            capabilities will also be needed to support dial-up redemption transactions
                            and help desk calls. Help desk infrastructure such as ARU and ACD
                            capabilities may also be desirable and there may be considerations related
                            to infrastructure in support of businesses continuity requirements.

                            Technology in the form of stand aside POS systems and balance inquiry
                            devices may have to be supplied to the authorized retailers.

                            For the two in-house alternatives, it is assumed that an existing system
                            will be ported from another State WIC program to Washington where it
                            will be customized to meet Washington‟s needs.

                            Staff

                            A proposed project organization is provided above. It is unsure though at
                            this point in the planning as to what extent new staff will be required to
                            execute the project.

                            However, regardless of approach, it is suggested that the State will
                            contract for services in certain areas of expertise.



Section 3: Business justification                                                               Page 20
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                                   Quality assurance, independent verification/validation IV&V or
                                    implementation support that has experience and expertise in the
                                    design, development and implementation of EBT systems
                                   Project management during the DDI phase; this will be a full time job
                                    for someone with primarily good project management skills and
                                    secondarily (and optionally) with some WIC, EBT, and technology
                                    experience.
                                   Vendor relations: this will be a full time job for someone with a
                                    combination of public relations, marketing and technology skills to
                                    work with the vendor community in getting them on-board with the
                                    project and getting them EBT ready within the project timelines.
                                   Subject matter expertise (depending on solution) may be needed in
                                    areas such as Smart Card technology, online transaction processing,
                                    help desk configuration, or POS systems development and
                                    deployment.

               3.3.3        Cost-Benefit Analysis

                            A detailed Cost Benefit Analysis has been provided with the WIC EBT
                            Feasibility Study.

                            Based on purely financial incentives, an investment in WIC EBT would be
                            marginally justifiable. Once it is implemented, it is believed that it can be
                            sustained for about the same cost as the current check system. However,
                            implementation of EBT is expected to cost between $2.5 and $7 million
                            depending on the degree of retailer participation in the costs.

                            EBT, as has been mentioned previously, is about process improvement
                            and a greatly enhanced client experience. A major anticipated outcome
                            would be to increase program participation; enable more of Washington‟s
                            children to grow up healthy. There are, though, several elements where
                            WIC may stand to benefit financially, but these are soft in nature and
                            difficult to quantify.

                            WIC vendors will benefit enormously from EBT. The cost savings to the
                            vendor community as a whole is estimated to potentially exceed $150,000
                            per month. Unfortunately, these cost savings do not accrue to the State or
                            the WIC program.

                            EBT does offer a possibility for reduced food costs through improved and
                            more granular food management. This in turn opens the door to greater
                            program participation; more dollars would be available for additional
                            clients.

                            Unfortunately, there presently is not enough experience with EBT to know
                            the full range of possibilities for enhanced food management and the

Section 3: Business justification                                                                     Page 21
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                            extent to which food costs could be reduced. However, while it is
                            anecdotal, Wyoming, the only State with a fully implemented EBT
                            system, also has the lowest food costs in the country. Whether or not
                            these two facts are related is unclear.

                            The important point is that EBT, for about the same money that is being
                            spent on checks, will offer a far superior benefit delivery process for all
                            stakeholders involved.

               3.3.4        Estimated Investment Cost

                            Financial models were developed to estimate the expected costs for
                            building and operating WIC EBT. In these models, the costs to enable the
                            State for EBT were separated from those costs related to enabling the WIC
                            Retailers for EBT. The reason for this approach is two fold.

                               1. There are multiple strategies by which the retailers may be enabled,
                                  each with a different cost;

                               2. Because the retailers stand to benefit financially from EBT, we felt
                                  it important to separate these costs so as to support any negotiation
                                  with the retailers related to financial participation in the cost of the
                                  project.

                            The following table is a summary of the expected costs..




                             Exhibit 3-6:   Summary of Detailed Cost Analysis


                            On the left it provides the enabling costs, both start-up and on-going, for
                            all three scenarios, for the State and under the two retail strategies. On the
Section 3: Business justification                                                                 Page 22
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0

                            right, it sums the costs into a total for that alternative. The baseline cost
                            for the paper solution is in the lower left. In the lower right are the
                            estimated financial incentives for retailers.

                            As an example, it is estimated that it would require $2.77 million to enable
                            the State to implement an in-house offline EBT solution. The State may
                            also have to spend an additional $3.18 to $4.33 million to enable the
                            retailers. However, it is hoped that the retailers will participate in the cost
                            of enabling their stores and consequently, this latter cost may be
                            negotiable. So, given these variables, it is estimated the State may spend
                            between $2.77 million (full retailer cost participation) and ($2.77 + $4.33)
                            = $7.1 million (minimal retailer cost participation) to implement EBT.

                            The lowest investment cost is for the outsourced solution. However, this
                            is not really a fair comparison with the other two alternatives because the
                            vendor is bearing the upfront costs and is passing them back to the state in
                            the form of higher operating costs.




Section 3: Business justification                                                                  Page 23
Washington State Department of Health WIC Program
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0


              4           ACQUISITION PROCESS/APPROACH
              4.1         Acquisition Method(s) to be Used
                          The acquisition process will differ based on the alternative chosen.

                          An outsourced approach for a full service EBT solution will result in a
                          multi-million dollar contract to the selected service provider. Presently
                          there are at least two providers of such a solution. Because of the size of
                          the procurement, Washington will most likely want to use a procurement
                          option such as an RFP that provides for competitive bidding, fully defines
                          the expected product delivery, and offers check points for oversight and
                          control.

                          For the in-house solutions, the expectation is that working software will be
                          ported to Washington and will be customized by the State to meet its
                          needs. In this case, it is believed that there may be several smaller
                          procurements for things like QA services and implementation support.
                          There may also be personnel service contracts for project management and
                          software development support. There are multiple organizations and
                          individuals that can provide these services to the State. Consequently, the
                          State should consider procurement options that are competitive and that
                          will provide the needed expertise and experience yet are efficient based on
                          the size of the procurement.

                          Because WIC is a federally funded program, the USDA Food and
                          Nutrition Services has, by statute, regulatory and oversight authority over
                          State programs. FNS will usually defer procurement decisions to State
                          rules and regulations, but does expect them to generally be open and
                          competitive according to its published rules and regulations.

              4.2         Acquisition and Investment Implementation
                          Schedules
                          Washington should realistically plan for a twenty-four to thirty month
                          effort to implement EBT. The following table presents a preliminary set
                          of milestone tasks that must be competed and it assigns a rough time line
                          for the work effort. A start date of Jan. 2008 is assumed. Of course, the
                          actual task list and time line will have some differences depending on the
                          alternative selected. For example, a fully in-house solution may be able to
                          eliminate some of the time allotted for development and execution of
                          procurement documents. However, this table is representative of what the
                          State can expect and should facilitate the feasibility discussion.




Section 4: Acquisition Process/Approach                                                          Page 24
                                                                   Washington

Washington State Department of Health WIC Program                  WIC EBT
WIC EBT Feasibility Study/ Cost Benefit Analysis & Investment Plan Project
Investment Plan, Version 2.0  Planning Schedule and Work elements




                                                                               Oct. 2008




                                                                                                       Apr. 2009



                                                                                                                   July 2009
                                           Jan. 2008
                                           Jan. 2008



                                                       Apr. 2008



                                                                   July 2008




                                                                                           Jan. 2009
                                                                                           Jan. 2009




                                                                                                                               Oct. 2009
                                                                                                                               Oct. 2009



                                                                                                                                           Jan. 2010



                                                                                                                                                        Apr. 2010
Planning Activities
 Concept dev’lp / alternative selection
 IAPD submission through approval
 RFP( s) Development
 RFP (s) WA. and FNS approval
 RFP (s) issuance through evaluation
 Vendor (s) selection through start work
Implementation Activities
 Requirements validation
 Concept and Architecture design
 Detail system design and approval
 System development and unit testing
 Telecommunications design
 Hardware planning and design
 Test planning and development
 Card design and procurement
 Stand aside POS procurement
 Retailer integration
 Hardware Implementation
 Functional and Integration testing
 Telecommunications implementation
 Vendor certifications / readiness
 System and Acceptance testing
 Clinic installations
 Staff Training
 Conversion and Go live (Pilot)
 State wide rollout


Exhibit 4-1:            Preliminary Schedule of Milestones


                                  One of the longer lead time elements, regardless of alternative, is to get
                                  the retailers enabled for EBT. If retailers are going to integrate EBT into
                                  their store cash register environments, significant lead time is required.
                                  The retailer survey demonstrated that retailers would prefer 18 months to
                                  2 years to prepare for EBT, but might be able to accommodate one year.
                                  The above schedule has this task starting as soon as an approval for the
                                  project is received. It is assumed that the retailers will be fully engaged
                                  during the planning stages of the project and can begin preparing their
                                  work efforts well before this time line so they can “hit the ground
                                  running” when project approval is received.




Section 4: Acquisition Process/Approach                                                                                                                Page 25

								
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