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HPWREN Sustainability Plan

This plan outlines the steps to keep the HPWREN network sustainable by implementing a recharge-based funding mechanism. It includes developing a rate structure, transitioning existing users, and expanding the network through special projects and grants.

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HPWREN Sustainability Plan

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  1. HPWREN Sustainability Plan HPWREN User Group Meeting December 3, 2010

  2. Situation • Current NSF grant winds down late 2011; appears to be the final grant from NSF • Have not identified any other potential single source of funding • We believe sustainability will require collecting funds from multiple sources, and in varying quantities from each source • Within UCSD, a “recharge center” (fee for service) model is best solution as a funding mechanismfor basic operations1 • Projects / grants would be used to fund network expansion, new research, user-specific projects, etc. 1Gifts/donations from corporations or foundations is another possibility but this has not been pursued in any detail and we suspect HPWREN may lack a certain appeal or singularity of focus to be entirely funded from gifts.

  3. Funding Model Projects/grants for network expansion, new research, etc. Recharge-based funding for HPWREN infrastructure & operations • Recharge system provides a mechanism for purchasing capacity/access to the network • Projects and grants could include network access as a budget item (other direct cost)

  4. Objectives • Develop a plan to keep HPWREN sustainable over the long term and support current and future users • Determine minimum realistic level of support required • Initially, cover current operations and maintenance only • Enhance and expand the network through special projects/grants • Develop a plan to implement the recharge system as soon as possible in order to provide for an orderly transition as the NSF grant winds down

  5. Recharge Model • Fees are collected from users/participants in the recharge center • Rates are based on recovery of labor and non-labor costs to run the center (no profit, but equipment depreciation may charged to accumulate surplus funds for future refresh) • Indirect costs are applied depending on source of funding • IDC rate ranges up to 54.5% depending on source of funding • Rates are normally established for a 3-year period to provide some predictability/stability of funding

  6. HPWREN Cost Model • Total annual cost in year 1 estimated at $258,000. • Cost breakdown: • Costs cover operations and maintenance of existing network infrastructure • Provides for support during normal business hours only – after hours support may be purchased on an optional basis • Indirect costs (overhead) will be added as required by funding type and agency • Expansion, additions, or enhancement of network will be handled as separate projects

  7. Developing a Rate Structure • Current user needs are not easily characterized by typical measures of a telecommunications service, e.g., bandwidth, circuits, data transfer quantity, etc. • For example, some users consume a small amount of bandwidth but require extensive engagement from technical staff while other users consume relatively large bandwidth but require little support • A flat rate is one possibility, e.g., assuming 20 users, the rate would be $12,000 per year or $1,000 per month per user • Another possibility is a tiered rate structure; this seems to better address the disparate needs and ability to pay of the current user base

  8. Proposed Rate Structure1 1Based on direct costs

  9. Optional Services • After-hours support • May be pre-purchased in increments of 100 hours per year at a blended labor rate of $93.50/hour (i.e., $9,350 for 100 hours) • Special projects / consulting • Each project will be quoted on a Time & Materials basis • Labor is billed at cost ($127/hour for Chief Engineer; $60/hour for Field Engineer) • Equipment will be billed at UCSD’s cost • Other direct costs will be billed at UCSD’s cost plus applicable IDCs

  10. Example Budget for HPWREN Recharge

  11. Transition Plan • Needs to recognize that different users have different budget cycles and grant situations • Is advantageous to transition to recharge model ASAP because it may allow stretching current grant funding beyond August 2011 • Therefore: • All new users will be put on recharge effective Jan 1, 2011 • Will work with existing users to develop individual timelines for transition to recharge • Goal is to have recharge fully implemented by 1 Jan, 2012 • Having two Tier 1 users in place by Aug 2011 would have major impact in smoothing the transition and making the model sustainable

  12. Next Steps • Request your feedback by Dec 15 • Finalize plan by Jan 10

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