This and the response below point to text descriptions which basically say the same thing as the existing short description on the widget chooser. Still, it does not explain what "closed" means - Resolved, obviously, but it is all Resolved states, even non-completed (like Invalid or something such as that). I'm going to have to submit a PMR because with all these descriptions, it isn't what is being returned. Other data warehouse reports are working properly too, so I'm not sure what's going on.

Thanks Donna for your feedback - I've opened a work item against the RTC documentation team:
Improve report description for Team Velocity report (277861)

Hi Donna,

I am looking into this work item, and your question is related to the configuration of your project work items work flow. The "closed" state of work items depends on how the project workflow is defined for the "closed" group. You can find that out by going to the work item customization and clicking Work Items > Workflows. In the States section, the Group column identifies the group the state belongs in: Open, In Progress, or Closed. Following is an example of a work flow for user stories (since the Team Velocity report uses plan items, which include stories in this example). In this case, The "closed" group has three states in it: Closed-Deferred, Closed-Done, and Closed-Invalid:



You can check what states are in your "closed" group for the plan item types. If "invalid" is part of the "closed" group, it is considered a closed work item and will be used in the Team Velocity report.

Hope that helps,

Jenn

FYI: If you are not sure which work item types are categorized as plan items in your project, you can find that out by looking at the Process Configuration in the Eclipse client. Click Project Configuration > Configuration Data > Planning > Work Item Type Categorization, and see what plan items are selected. Here is an example: