ITB 071I7000400
M E M O R A N D U M
TO: Kevin Dunn, Services Division Director
DTMB - Procurement
FROM: Lance Kingsbury, Buyer Specialist
DTMB - Procurement, Services Division
DATE: December 4, 2013
SUBJECT: Synopsis for RFP 071I3200049 – Electronic Payment Card – Including Debit/Direct Deposit
Background Information/General:
This is for Electronic Payment Card Services (EPC) to be used by multiple agencies within the State of Michigan to implement an electronic payment solution for the disbursement of warrants for Vendors, Payroll, Retirement, Income Tax, and Unemployment Insurance (UI) Benefits. The Department of Licensing and Regulatory Affairs (LARA), Unemployment Insurance Agency (UIA), will also be seeking electronic payments for Direct Deposit in addition to the EPC with this contract.
The objective of the State is to maintain the reduced cost and the efficiencies gained through its UI EPC program established in 2008, while also expanding the program to other agencies. The goal is to offer the EPC option to disbursement programs of all agencies (where appropriate) under the scope of services in the resulting contract. These additional EPC services might be offered through separate cards with separate terms of service, or through a single State-wide card.
Joint Evaluation Committee (JEC):
The JEC for this RFP consisted of the following individuals:
|Lance Kingsbury (Voting) |Sara Gross (Voting) |
|Department of Technology, Management and Budget |Michigan Department of Treasury |
|Debbie Ciccone (Voting) |John Henige (Voting) |
|Department of Licensing and Regulatory Affairs (UIA) |Department of Licensing and Regulatory Affairs (UIA) |
|Brenda Vincent (Non-Voting) |Julie Collins (Non-Voting) |
|Michigan Department of Treasury |Michigan Department of Treasury |
|Wayne Rourke (Non-Voting) | |
|Department of Licensing and Regulatory Affairs (UIA) | |
Bidders:
The RFP was posted on the internet March 12, 2013, and was available for 31 days with a published due date of April 12, 2013. The following Bidders submitted proposals in response to the RFP:
|Bidder |City, State |Michigan Business |CRO |SDVOB |
|Bank of America, N.A. |Charlotte, NC |Yes |No |No |
|JPMorgan Chase Bank, N.A. |Chicago, IL |Yes |No |No |
|Key Bank |Cleveland, OH |No |No |No |
|Xerox State & Local Solutions, Inc. |Fairfax, VA |Yes |No |No |
Evaluation Criteria:
The following charts represent the scoring of the particular factors:
Step 1 Scoring – Technical Proposal
| |Points Possible |
|1. |Statement of Work (Article 1) |55 |
|2. |Project Work Plan (1.041) |5 |
|3. |Company Information (4.011) |5 |
|4. |Prior Experience (4.012) |20 |
|5. |Contractor Roles (1.031) / Staffing (4.013) |15 |
|TOTAL: |100 |
Price Evaluation
(a) Only those proposals receiving a score of 80 points or more in the technical proposal evaluation will have their pricing evaluated to be considered for award.
(b) Evaluation of price proposals includes consideration for a Qualified Disabled Veteran Preference. 1984 PA 431, as amended, establishes a preference of up to 10% for businesses owned by qualified disabled veterans meeting the minimum point threshold for passing.
(c) The State reserves the right to consider economic impact on the State when evaluating proposal pricing. This includes, but is not limited to: job creation, job retention, tax revenue implications, and other economic considerations.
Evaluation Results for Technical Evaluation (100 points possible):
Bank of America
The JEC determined that Bank of America (BoA), based on a score of 87, could meet the requirements of the RFP. This determination was accomplished by evaluating their responses to the evaluation criteria noted in the table above.
1. Statement of Work (Article 1) Score: 48 / 55
The JEC noted the following deficiencies:
• BoA did not provide any State staff training materials.
• BoA did not provide their retention criteria for IP addresses or the minimum time needed to retrieve IP information.
• BoA did not comply with confidentially requirements per the confidentially exhibits.
• BoA did not confirm that the Confidentiality Agreement would be signed by each employee of the Contractor and Subcontractor.
• BoA does not provide an in-person identify verification and card activation through their branch or partner locations.
• BoA did not fully identify verification utilizing unique security keys from cardholder’s credit history. (NOTE: no points were taken off for this)
2. Project Plan (1.041) Score: 5 / 5
The JEC noted the following deficiencies:
• None.
3. Company Information (4.011) Score: 5 / 5
The JEC noted the following deficiencies:
• None.
4. Prior Experience (4.012) Score: 17 / 20
The JEC noted the following deficiencies:
• No costs provided.
• No volumes provided on two out of the three references.
5. Contractor Roles (1.031) / Staffing (4.013) Score: 12 / 15
The JEC noted the following deficiencies:
• Did not list the Implementation Manager as a key personnel or provide their resume.
• Project Manager’s resume does not exhibit relevant EPC experience.
Total Score: 87 / 100
JPMorgan Chase
The JEC determined that JPMorgan Chase (JPM), based on a score of 91, could meet the requirements of the RFP. This determination was accomplished by evaluating their responses to the evaluation criteria noted in the table above.
1. Statement of Work (Article 1) Score: 46 / 55
The JEC noted the following deficiencies:
• JPM did not provide any State staff training materials.
• JPM did not provide their most current audit report or certification of their Automated Clearing Hours (ACH) processes required by National Automated Clearing House Association (NACHA) Rules that the audit has been performed.
• JPM did not agree to purge in accordance with State directives.
• JPM did not confirm they will provide all information requested on a subpoena in a State approved electronic file.
• JPM did not provide their retention criteria for IP addresses or the minimum time needed to retrieve IP information.
• JPM does not provide an in-person identify verification and card activation through their branch or partner locations.
• JPM did not define procedures and timeframes needed to prevent card transactions based on specific demographics.
• JPM will not provide summary data on the count and amount collected for each type of fee charged to cardholders on a monthly/annual basis.
• JPM did not fully identify verification utilizing unique security keys from cardholder’s credit history. (NOTE: no points were taken off for this)
2. Project Plan (1.041) Score: 5 / 5
The JEC noted the following deficiencies:
• None.
3. Company Information (4.011) Score: 5 / 5
The JEC noted the following deficiencies:
• None.
4. Prior Experience (4.012) Score: 20 / 20
The JEC noted the following deficiencies:
• None.
5. Contractor Roles (1.031) / Staffing (4.013) Score: 15 / 15
The JEC noted the following deficiencies:
• None.
Total Score: 91 / 100
Key Bank
The JEC determined that Key Bank (Key), based on a score of 32, could not meet the requirements of the RFP. This determination was accomplished by evaluating their responses to the evaluation criteria noted in the table above.
1. Statement of Work (Article 1) Score: 25 / 55
The JEC noted the following deficiencies:
• Key did not provide a timeline or description of how the initial conversion and Card issuance process will work.
• Key did not provide any samples of training or instructional materials for State staff on the use of the proposed system.
• Key did not provide a schematic with locations of all ATM’s or direct teller sites inside the State of Michigan that offer fee free transactions.
• Key did not provide a listing of current ATM sites and any changes anticipated.
• Key did not address returns, only reversals, of entries initiated into the ACH system.
• Key did not submit an electronic file of the returned items or Network Operations Center (NOC) changes, only provided in the Client Activity Report.
• Key did not provide velocity limit details.
• Requirement states: “Unless authorized by the agency, there must be no specific disallowed transactions provided the transaction is performed at a merchant or ATM displaying the network logo found on the reverse of the card and there is sufficient balance in the account for the transaction amount requested.” Key response: “Key will decline a transaction only when the cardholder balance is not sufficient.”
• Key did not confirm they must not charge the Cardholder a monthly account fee.
• Key gave examples of transactions for which an account can go negative, when the requirement states: “The operating network must disallow any transaction that causes the Cardholder to overdraw the account.”
• Key did not acknowledge that the State must have final approval of all materials.
• The JEC could not find the attached SSAE 16 that was said to be attached.
• Key did not address lead in time to obtain data from the archive.
• All data transmissions/interfaces must meet the DTMB’s encryption standards and Key states they would be compliant in 2014.
• Key did not fully comply and acknowledge that each employee of the contractor and subcontractor must understand and agree to follow the guidelines for an authorized representative of the State.
• Key did not describe the information to be utilized to verify cardholder identity.
• Key did not provide a detailed listing of the physical locations available for cardholder identity verification as they do not have an in-person card account identity verification and activation process.
• Key does not offer multiple options of contacting them for a replacement of a lost, damaged, or stolen card.
• Key states they “will receive a daily file containing new debit card account numbers from the State”; requirement states the State must receive from the contractor.
• Key did not confirm the State will receive a file containing ACH returns on a daily basis.
• Key’s response to the following requirement lacked detail: “The Contractor must provide daily and monthly activity reports for each payment type (e.g., Vendor, Income Tax, Payroll, Unemployment, and Retirement) and make these reports accessible electronically to the CCI, or designee, via File Transfer Protocols.”
• Key did not provided samples of their online reports.
• Key did not confirm that funds deposited to an inactive account will be returned to the State.
• Key states: “Fraud reports have been attached for your review.” The JEC could not locate these reports.
• Key did not confirm they will conduct unannounced reviews of employee’s compliance with work processing procedures and established internal controls.
2. Project Plan (1.041) Score: 0 / 5
The JEC noted the following deficiency:
• The JEC could not locate Key’s Project Plan.
3. Company Information (4.011) Score: 4 / 5
JEC noted the following deficiency:
• Key did not provide financial information.
4. Prior Experience (4.012) Score: 0 / 20
The JEC noted the following deficiency:
• Key did not provide any relevant prior experiences or references.
5. Contractor Roles (1.031) / Staffing (4.013) Score: 3 / 15
The JEC noted the following deficiencies:
• No resumes provided for any key personnel.
Total Score: 32 / 100
Xerox
The JEC determined that Xerox (Xerox), based on a score of 95, could meet the requirements of the RFP. This determination was accomplished by evaluating their responses to the evaluation criteria noted in the table above.
1. Statement of Work (Article 1) Score: 50 / 55
The JEC noted the following deficiencies:
• Xerox did not provide samples of training materials.
• Xerox did not mention that cardholders would have access to ATMs for review of their balance/transaction accounts.
• Xerox limits the three free transactions at ATM withdrawals to MasterCard branded ATMs.
• Xerox did not describe their in-person identify verification card activation through their branch or partner locations.
• Xerox did not confirm they will provide certifications of transactions upon request.
• Xerox does not use value load monitors to detect unauthorized deposits to cardholder accounts.
• Xerox’s response to providing the State Agency with summary data on the count and amount collected for each type of fee charged to cardholders on a monthly/annual basis stated: “…as allowable by card association guidelines, corporate governance, federal banking regulations, and Payment Card Industry (PCI) compliance.”
2. Project Plan (1.041) Score: 5 / 5
The JEC noted the following deficiencies:
• None.
3. Company Information (4.011) Score: 5 / 5
The JEC noted the following deficiencies:
• None.
4. Prior Experience (4.012) Score: 20 / 20
The JEC noted the following deficiencies:
• None.
5. Contractor Roles (1.031) / Staffing (4.013) Score: 15 / 15
The JEC noted the following deficiencies:
• None.
Total Score: 95 / 100
JEC Scoring Summary for Technical Proposal:
| |Points |BoA |JPM |Key |Xerox |
|Project Work Plan |5 |5 |5 |0 |5 |
|Company Information |5 |5 |5 |4 |5 |
|Prior Experience |20 |17 |20 |0 |20 |
|Contractor Roles / Staffing |15 |12 |15 |3 |15 |
|Total: |100 |87 |91 |32 |95 |
Pricing Summary:
Please see the details of original and second round pricing below for the five year base period of the contract.
Original Pricing:
Bank of America:…$280,000.00
JPMorgan Chase:.. $267,134.00
Xerox:…………….. $924,000.00
Second Round:
Bank of America:…$175,000.00
JPMorgan Chase:.. $201,834.00
Xerox:…………….. $924,000.00
Deficiency Report and Clarification Request (DR/CR)
A DR/CR was issued on October 30, 2013, to all passing bidders. The requirement in Section 1.022 Work and Deliverables; F. Debit Card Account Features; 2.a was changed to the following:
The Contractor must provide a Statewide ATM solution that offers three entirely fee free ATM withdrawal transactions per load to the State and the Cardholder (fee free includes, but is not limited to, the following: surcharge fees, convenience fees, network fees, interchange fees, and ATM operator/owner fees).
Bidders were also allowed to submit new pricing Attachments A and B due to this requirement change.
Summary of the DR/CR Responses:
Number of Network Unlimited Fee Free ATMs:
JPMorgan Chase (partner: MoneyPass):……………..998
Bank of America (partner: Allpoint):…………………1,202
Xerox (partners: Comerica Bank and Moneypass):…939
Pricing:
Bank of America:…$102,520.00
JPMorgan Chase:.. $201,834.00
Xerox:…………………$2,520.00
Award Recommendation:
The award recommendation is made to the responsive and responsible Bidder who passed Technical Evaluation and offers the best value to the State of Michigan.
The JEC recommends that Bank of America be awarded the contract for the Electronic Payment Card – Including Debit/Direct Deposit in the amount of $102,520.00.
Cost Savings/Avoidance:
Total savings after DR/CR: $177,480.00
Additional Information:
Bank of America offers the following Bonuses and Incentives:
• $150,000.00 for transition communications support. This will support mailings and all other communications necessary to maintain the State’s reputation as well as ensure a seamless benefit recipient experience.
• $150,000.00 to be expensed under State direction for IT and conversion support.
• $50,000.00 additional funds in year two for continued efforts needed in IT and/or conversion support.
• $50,000.00 bonus incentive for each year Bank of America holds both the P-Card and Electronic Payment Card Services contracts (Bank of America currently holds, and was just awarded, the P-Card contract).
• Total bonuses and incentives: $500,000.00 (up to $600,000.00 with P-Card two, one-year options being exercised).
Signatures:
Signature
Lance Kingsbury ________________________
John Henige ________________________
Debbie Ciccone ________________________
Sara Gross ________________________
Signature
Reviewed and approved by: ________________________
Reviewed and approved by: ________________________
Reviewed and approved by: ________________________
................
................
In order to avoid copyright disputes, this page is only a partial summary.
To fulfill the demand for quickly locating and searching documents.
It is intelligent file search solution for home and business.