Subject: Budget follow up after our call today
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked], [email-masked], [email-masked]
Date: Wed, 17 Oct 2001 08:59:41 -0700 (PDT)

After our phone call a few minutes ago this morning, I talked to Pickering and Beth Perlman.  On development capital and expense for 2002 for EA, they said Belden has agreed to a number and Will has agreed to a number and that they think they almost got Story on his.  They will also finalize Tommy Yanowski on his numbers this morning.  If you are hearing anything different from any of your EA team on development, call Mark Pickering ASAP.  
 
Also, we will get to you by 5 PM today the following seven ENW/EA numbers and we think that they will be real close:  
 
1.  EnronOnline expense in 2002 for EA in the cost based manner.  Whalley knows the $37.7 million total suggested 2002 number and has seen the cost based methodology.  However, we will work with all the business units going forward to try to get a fee/product/trade count system implemented in place of the cost based method but we have to juggle EA, EGM, EIM and EEL and getting agreement on that will be a real negotiation.
 
2.  Operations expense for 2002 for EA.
 
3. and 4.  Systems Development expense for 2002 broken in to two parts.  The first part will be 2002 systems development expense associated with operations/maintenance.  The second part will be new projects in systems development expense for 2002.  Mark has done a fantastic job with the team the last three days working with everyone getting these two numbers down to what is necessary and has agreement from Belden and Will and almost has Story done.  
 
5.  IT Infrastructure.  Wes and Faith and Kerry and Jenny met yesterday and agreed on a head count for EA and are meeting this morning on the entire EWS headcount.  Once Jenny has that right this morning and has the new EA 2002 development budget estimates, she will have a new number calculated for EA.  
 
6. and 7.  Capital for systems development and EnronOnline associated with EA for 2002.  As per the EA systems development expense above, Mark and the team have pulled the capital down for 2002 as well.
 
The key on the systems development budget for 2002 is making sure EA not only gets numbers that make sense, but understands exactly what projects and services they are buying/getting from those numbers.  Belden, Will and Story, working with Pickering and his team, will have that mostly completed today so that we don't have a disagreement later on what you will be getting in 2002.
 
The enitre ENW budget team across all EWS is meeting today at 4 PM to finalize all outstanding issues with any numbers.  We will have Kerry step out on or before 5 PM and send to you (or probably Faith) the seven draft numbers mentioned above.  We will work around the clock after that to get any marginal issues settled before Thursday morning.
 
We will get with you with you directly again late Thursday morning to finalize anything.  I will try to set this up today.
 
Thanks.

Greg Piper 
President & CEO 

Enron Net Works LLC

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