PERSONAL AND PROFESSIONAL EXCELLENCE. Critical System ITN 50 TH ANNUAL CONFERENCE MAY 24-27, 2017 ORLANDO, FLORIDA

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1 PERSONAL AND PROFESSIONAL EXCELLENCE 50 TH ANNUAL CONFERENCE MAY 24-27, 2017 ORLANDO, FLORIDA Critical System ITN Presented by: Denise K Schneider, CPPO, C.P.M., CPPB, CM

2 HOW TO GET THE BEST SERVICE PROVIDER AT THE BEST VALUE FOR YOUR ORGANIZATION ITN Process Evaluation Process Negotiations Process

3 BACKGROUND The Baggage Handling System was originally designed to accommodate 24 million passengers a year, and as the capacity has grown to over 42 million passengers a year, the system has been updated and added to many times over the past 30 years. This system is critical to the Airport and to the Airlines to ensure that baggage is handled efficiently and that planes can fly on schedule. The Baggage System has over seven miles of conveyors and as you can imagine, takes a lot of time to maintain and repair and still keep the system running. There are 93 Passenger Bridges. Some have been updated and replaced, but most have been on property for a number of years, and need to be maintained and updated regularly to be kept in working order. Every bridge has ground power equipment attached to it, and that equipment also needs to be maintained.

4 BACKGROUND-CONTINUED The Authority had previously issued an Invitation to Bid for Baggage Handling and Passenger Boarding Bridge and Ground Support Equipment Maintenance and Repair. Three bids were received, one way above budget, one under budget so much that if awarded would have put the Contractor out of business, and one from the current contractor who was being audited by Internal Audit due to records issues (ie: two jobs by the same technician in difference locations at the same time and not maintaining the system properly-yet still billing for maintenance). A specialized team had been hired to get the Baggage Handling and Passenger Boarding Bridges back into a regular schedule of maintenance. It was determined to not renew the contract with the current provider and to issue an emergency contract to the team hired to bring the systems back into compliance. It was approved to issue an Invitation to Negotiate for this contract.

5 ITN PROCESS Purchasing and the Operations department determined that more control was needed, and that the Authority should be able to add staff to ensure that the Baggage Handling and Passenger Board Bridge and Ground Support Equipment Maintenance and Repair contract maintain at least a 99% running rate as both of these systems are critical to running the airport. Under a low Bid scenario this would entail an amendment to the contract to add staff and the Contractor would use the lack of staff as a reason not to be assessed penalties for equipment not being properly maintained and not available for use. It was determined that an Invitation to Negotiate which incorporated a Management Fee and a Reimbursable portion of the contract would be the best way to go out for proposals. An ITN was issued with a base period of three years, with two (s) three year options. Two envelopes were requested with the responses; Envelope A with all of the required documentation and Envelope B with the pricing sheets and the MWBE and LDB participation requirements. Price was NOT a factor in determining short list or ranking.

6 ITN DOCUMENTATION The ITN was laid out as follows: Instructions to Proposers (which included all of the required submittals, pricing pages, MWBE and LDB forms and minimum qualification) General Conditions (the Authority Terms and Conditions) Delineates what is under Management Fee and what is under Reimbursable Fee and includes position descriptions Contract Section which includes the Bond or Letter of Credit Information Specifications which includes performance measurement and deductions for non-performance. Divided into three sections, Baggage Handling System requirements, Passenger Boarding Bridge requirements and Ground Power equipment requirements Attachments which included over 4700 pieces of equipment just for the Baggage Handling System Total ITN package over 2300 pages. Multiple addenda issues, over 250 questions answered via addenda

7 ITN PROCESS-MINIMUM RESPONSIBILITY- REQUIRED DOCUMENTATION Through references or otherwise: Proposer is currently engaged in the business of providing: (i) baggage handling system, operation, maintenance and repair services and (ii) passenger boarding bridges and associated ground support equipment and maintenance and repair services, addressing experience with baggage handling systems, passenger boarding bridges and associated ground support equipment; Proposer has performed services in: (i) loading and unloading of conveyors, baggage alignment, and the clearing of bag jams on the conveyor systems, manual bag recoding/sorting functions; and (ii) ground support equipment maintenance and repair services, Pre-Conditioned Air, 400 Hz Ground Power units.

8 ITN PROCESS-MINIMUM RESPONSIBILITY-REQUIRED DOCUMENTATION CONTINUED Proposer has been actively engaged in such business for at least the two (2) years immediately preceding the date of Proposer s response to this Request for Proposals; Proposer has performed services in an airport including handling a minimum of twenty-five thousand (25,000) outbound bags per twenty-four (24) hour period; Proposer must presently have, or have had within the past five (5) years, at least one maintenance and repair Contract at one (1) airport where the total number of feet of conveyor line maintained is at least twenty-thousand (20,000) linear feet;

9 ITN PROCESS-MINIMUM RESPONSIBILITY-REQUIRED DOCUMENTATION CONTINUED Proposer must presently have, or have had within the past five (5) years at least one (1) maintenance and repair Contract where the Contractor maintained and repaired a system that has multiple In-Line EDS machines at one (1) airport; and Proposer must presently have, or have had within the past five (5) years, at least one (1) maintenance and repair Contract where the Contractor provided ground support equipment maintenance and repair services to include at least fifty (50) passenger boarding bridges and associated ground support equipment. Minimum Responsibility Criterea done via references. Pass or Fail.

10 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.1 Tab 1 Proposer s Statement: Each Proposer shall provide with its Proposal the following information: Contact name and resume of individual responsible for account (Corporate Executive) Address of office that will handle account (the Submitting Office) Telephone number of the Corporate Executive that will handle account Facsimile number of the Corporate Executive that will handle account address of the Proposer s Corporate Executive Type of organization (corporation, sole proprietor, partnership, other) Federal employer identification number.

11 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION Federal employer identification number Proposed On-Site Manager and resume which should include the number of years of experience as a manager and specific experience in an airport or similar regulated transportation environment and any other information that verifies that the Manager meets the minimum qualifications as stated in Section of the Specifications. 3.2 Tab 2 Experience and Qualifications of the Proposer: Each Proposer shall provide a statement of qualifications including the following information: Details of current and past engagements with baggage handling system operations, maintenance and repair services and passenger boarding bridges and associated ground support equipment and maintenance and repair services, addressing experience with baggage handling systems, passenger boarding bridges and associated ground support equipment.

12 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION Details of related experience of Proposer and On-Site Manager, including services to airports, that demonstrates the ability to perform this service successfully Provide a listing of Contracts for airports for which the Proposer has provided baggage handling systems, passenger boarding bridges and ground support equipment maintenance and repair services within the last six (6) years and describe those services.

13 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.3 Tab 3 References and Client List: Each Proposer shall provide a minimum of three (3) references for Baggage Handling System (BHS) Operations, Maintenance and Repair Services, Passenger Boarding Bridges (PBB) and Associated Ground Support Equipment Maintenance and Repair Services. At least two references must be with an entity that provides services to a large hub airport, or a large public transportation facility or commercial facility where you are providing similar services.

14 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION Description of services provided Status (current or past client) The Proposer shall provide a listing of clients, including private, governmental entity and airport clients for whom the Proposer has provided Baggage Handling System Operations, Maintenance and Repair Services, Passenger Boarding Bridges (PBB) and Associated Ground Support Equipment Maintenance and Repair Services at any time on or after January 1, 2008, and the existing status of each client. If any services were terminated prior to the end of the Contract, the Proposer shall explain why. Please provide client name, contact person, phone number and address for each client.

15 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.4 Table 4 - Organization, Qualifications Of Key Personnel: Provide an organizational chart that includes identification of the Corporate Executive and On-Site Manager that will perform on-site work for this service Describe the structure of the role of each key member of the proposed personnel. Include resumes of the key personnel. Each resume shall include a description of experience relevant to the scope of services described in this ITN.

16 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.5 Tab 5 Operation and Staffing Plan: Each Proposer shall provide with its Proposal an existing copy of the Proposer s operation and staffing plan currently utilized or have utilized within the last three (3) years at another airport or public facility similar in size to this Airport. 3.6 Tab 6 Customer Service Plan: Each Proposer shall provide with its Proposal a detailed customer service plan including how employees are trained and how customer service is gauged and addressed.

17 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.7 Tab 7 Training Plan: Each Proposer shall provide a detailed training plan that Proposer intends to utilize to train personnel in relation to Baggage Handling System (BHS) operations, maintenance and repair services including electrical systems and lockout tag out procedures and Passenger Boarding Bridges (PBB) and Associated Ground Support Equipment Maintenance and Repair Services. The training plan shall include, but not be limited to, an outline of the training and the type and number of hours of estimated training for each type of personnel, a list of training materials to be provided and how the Proposer will ensure the completeness of the subject matter, and the media through which the training will be provided.

18 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.8 Tab 8 Safety Plan: Each Proposer shall provide with its Proposal an existing copy of the Proposer s safety training plan currently utilized to reduce the risk and liability of workplace hazards and help implement preventative measures to minimize on-the-job injuries and fatalities. 3.9 Tab 9 Quality Control/Continuous Improvement Plan: Each Proposer shall provide a detailed quality control/continuous improvement plan that Proposer intends to utilize to keep the current systems and any new systems installed operating at % level. This plan shall include items that need to be checked, frequency, responsible person who will perform the process, the process steps performed, critical success factors and measures, and contingency plans when process failure necessitates.

19 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.10 Tab 10- Transition Plan: Each Proposer shall provide with its Proposal a Transition Plan describing how it plans to start operations and bring about a smooth transition of the work to be performed under this Contract, describing the manner in which it will distribute the required labor hours by location. Such plan should describe how the Proposer will handle problems which Proposer anticipates will be encountered to begin operations under the new Contract and should include the time period needed for hiring and training of employees, planned interface with the Authority, inventory, delivery of equipment, the processing of I.D. badges, uniforms, and site tours, etc.

20 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.11 Tab 11 Letter of Bondability: Each Proposer shall provide with its Proposal a Letter of Bondability on a surety company letterhead or a letter from a U.S. Bank for a letter of credit confirming that Proposer can obtain one or the other, in an amount equal to Five Million Dollars ($5,000,000) Tab 12 Minimum Insurance Coverage: Proposer shall provide: (i) a letter from a U.S. insurance/broker company letterhead confirming that Proposer can obtain the insurance coverage requirements as described in Section 5 of the General Conditions; and (ii) an affirmative statement in its Proposal that if Proposer is awarded the Contract, Proposer will:

21 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION Maintain in force at all times during the term of the Contract and services that are to be performed pursuant to the Contract, insurance as described in Section 5, Pages GC-6 through GC-10 of the General Conditions, including General Liability, Workers Compensation and Automobile Liability insurance with insurer(s) licensed to transact insurance in the State of Florida; Maintain insurance coverage applicable to the services performed for two (2) years after expiration of the Contract, if such coverage is on claim-made basis.

22 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.13 Tab 13 PRIOR OR PENDING LITIGATION, CONVICTIONS, INDICTMENTS, INVESTIGATIONS, AND CONFLICT OF INTEREST: Each Proposer shall provide a description of all prior or pending litigation, convictions, indictments, investigations and regulatory investigation, either civil or criminal that relate to conducting Baggage Handling System (BHS) Operations, Maintenance and Repair Services and Passenger Boarding Bridges (PBB) and Associated Ground Support Equipment Maintenance and Repair Services, in which Proposer or its affiliates, subsidiaries, parent company, directors, senior officers, senior regional officers have been involved within the last three (3) years or an affirmative statement that there are none. The Proposer must also describe any conflicts of interest with the Authority that the Proposer s firm has or may have and how that conflict of interest would be mitigated, or provide an affirmative statement that there are none.

23 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION 3.14 Tab 14 - Submitter s Warranty: Each Proposer shall provide with its Proposal a statement that the Proposer is willing to sign the Contract (which includes the General Conditions and Specification) set forth in this ITN, as amended, within ten (10) days after receipt of the Notice of Intent to Award. The Authority s goal is that the terms and conditions stated in the Proposal Documents will constitute the terms of the final Contract between the Authority and the successful Proposer, without significant or material change to such terms or conditions. If a Proposer desires any changes or modifications to the terms and conditions set forth in the Proposal Documents, the Proposer should submit these changes or modifications to the Authority in writing prior to the deadline for questions and comments about the ITN. The Authority will consider such requested changes or modifications to the Contract s terms and conditions and, if any such requested changes or modifications are acceptable, will modify the terms and conditions by Addenda to this ITN prior to the deadline for Proposal submission.

24 PROPOSAL CONTENTS-REQUIRED DOCUMENTATION In submitting any requested changes or modifications, a Proposer should state the specific terms or conditions in the Authority s Proposal Document which the Proposer wishes to change, and the desired language, terms or conditions. Proposers are requested to not substitute entire agreements or sets of terms and conditions but discuss separately each term or condition that they take exception to or desire to change.

25 SUBMITTALS ENVELOPE A QUALIFICATIONS Invitation To Negotiate (ITN) 03-16, Baggage Handling System Operation, Maintenance and Repair Services, Passenger Boarding Bridges (PBB) and Associated Ground Support Equipment Maintenance and Repair Services, at the Orlando International Airport. Sealed Envelope A shall include original, fifteen (15) additional copies of the Proposal plus an electronic USB Flash Drive of the Proposal, the signed Proposer s Warranty and the Proposal Guaranty in the amount of One Hundred Thousand Dollars ($100,000.00) (U.S.) shall be included in Envelope A. No pricing or MWBE/LDB forms shall be included in Envelope A.

26 SUBMITTALS ENVELOPE B PRICING AND MWBE/LDB FORMS ONLY Invitation To Negotiate (ITN) 03-16, Baggage Handling System (BHS) Operation, Maintenance and Repair Services, Passenger Boarding Bridges (PBB) and associated Ground Support Equipment Maintenance and Repair Services, at the Orlando International Airport. Sealed Envelope B shall include original, fifteen (15) additional copies of the Pricing and MWBE/LDB forms plus an electronic USB Flash Drive of the Pricing and MWBE/LDB forms shall be included in Envelope B. Sealed Envelope B shall include Pricing and MWBE/LDB forms only. Price not a factor in determining the ranking of the submitters. Negotiations would be held with the number one ranked firm and pricing information was just a starting point for the negotiations.

27 ITN-PROPOSALS REVIEWED-EVALUATION Six proposals were received. An internal team chaired by the Senior Purchasing Agent, members of the Operations Department who monitor the contract, the Operations Department financial analyst and the Assistant Purchasing Director reviewed all of the submittals and created a spreadsheet of facts to present to the Concessions/Procurement Committee (CPC) who will shortlist the proposals and request interviews with those firms shortlisted (first 5 day appeal period). At the first CPC meeting, the CPC members view the facts presented and all of the proposals to determine which companies are the most advantageous to the Authority and have met the minimum requirements. The CPC Committee shortlists the firms from six to three and request interviews. (No appeals received).

28 ITN-PROPOSALS REVIEWED At the second CPC meeting, each company has time during the interview to introduce their firm, their recommended Site Manager and go over their submittal. They are also asked to provide answers to specific questions, and then there is more time for additional questions and answers. Only the company presenting is allowed in the room. Once all of the companies have presented their information and had their question and answer period, all of the firms are invited back into the room to hear the CPC deliberations and the ranking of the firms. The CPC ranks the firms 1, 2 and 3 and then the pricing envelope was opened and read aloud. (second five day appeal period-no appeals received). No. 1 ranked firm-$50,000, No. 2 ranked firm-$52,000, No. 3 ranked firm-$46,000,000.00

29 ITN-PROPOSALS REVIEWED A Board memo is written and sent to the Authority Board requesting the Board to accept the ranking and authorizing staff to start negotiations with the number one ranked firm. If negotiations fail, the staff can then go to the second ranked firm, etc Once the negotiated price has been confirmed to and agreed upon, the Board receives a second memo with the request to approve the contract and authorize the funding. (last appeal period-no appeal received).

30 NEGOTIATIONS Pricing was broken down into two areas for discussion: Management Fee Reimbursable Fee Everything is subject to negotiation!

31 NEGOTIATIONS Prior to negotiations Contractor to provide list of on-site management positions, cost of health insurance plan, cost of 401 plan, cost of new equipment to be purchased, cost of bond, profit and overhead and any other costs that would be under the Management Fee portion of the Contract. In addition, a copy of all of their plans as submitted were requested and some recommended changes were addressed. Staff training including safety training was discussed and the number of hours of training for each employee was agreed upon.

32 NEGOTIATIONS Management Fee includes: All payroll and associated costs for: On-Site Manager Senior Assistant Site Manager BHS Senior Assistant Site Manager PBB Senior Assistant Site Manager PBB Projects Assistant Manager - BHS Assistant Manager BHS Operations (MWBE/LDB) Assistant Manager PCAir MWBE/LDB Human Resources Manager EAMS Maximo Database Administrator Finance/Inventory Manager/Warranty Parts, Logistic and Inventory Control Program Analyst Safety/Quality Assurance/Quality Control Manager Training Coordinator

33 NEGOTIATIONS Contractor overhead and profit Sub-Contractors Management Fee All required insurances as outlined in Section 5.7, Page GC-8 of the General Conditions Recruiting expenses Badges and keys Office equipment and supplies Vehicles, Lifts, Golf Carts, Lull and all other motorized equipment. Consumables Tools and equipment Cost associated with the all training

34 Non-resident administrative, legal, bookkeeping, executive personnel expenses and off-site general office expenses Costs associated with the cleaning services for the interior space of all office areas Health Insurance premiums for the positions in the Management Fee Health Insurance premiums in excess of $400 per month, per position for the reimbursable positions participating in the Contractor provided Health Care Plan All other costs associated with the performance of this Contract not listed in the Reimbursable Expenses section The Management fee will not change even if the number of assets adjusts up or down. As asset numbers are adjusted up or down the Contractor shall manage the staff necessary to perform required maintenance functions.

35 NEGOTIATIONS Reimbursable Fees (Budget set by GOAA): The Reimbursable Payroll Expenses shall be limited to the following BHS, PBB and Affiliated Equipment positions and associated costs: EAMS Maximo Specialist EAMS Maximo Data Entry Assistants Administrative Staff: BHS Supervisor positions Industrial Automation Technician (IAT) positions Industrial Mechanical Technician (IMT) positions Industrial Electrical Technician (IET) positions Industrial Electrician positions

36 NEGOTIATIONS Mechanic/Technician positions (including PCAir, Scale Calibration and Thermography ). Inventory Control Supervisors Inventory Control Baggage Support Personnel Contractor Coordination Center Personnel Contractor Coordination Center Personnel Performance Bond. Started in the management section of the contract (moved to reimbursable section) but will be reviewed at each renewal of the bond Uniforms. Must have a uniform program that provides sufficient clean uniforms to frontline staff Subcontracted Work (Excluding Participation)

37 NEGOTIATIONS Associated payroll taxes: Social Security, Medicare, Federal & State Unemployment Reimbursement for Health Insurance premiums for up to $400 per month per position for the reimbursable positions participating in the Contractor provided Health Care Plan Actual vacation and sick leave taken in accordance with Contractor s policy. The Authority will not reimburse Contractor for any accrued vacation or sick leave hours at the time of Contract expiration, at the end of any Contract Year, or upon employee termination for any reason. Contractor to provide PTO plan at start of contract. Up to three (3) pre-approved holidays will be reimbursed by the Authority, determined at the beginning of each Contract Year

38 NEGOTIATIONS-MANAGEMENT FEE-CONTINUED

39 NEGOTIATIONS-REIMBURSABLE EXPENCES- CONTINUED

40 BEST AND FINAL OFFER-AFTER NEGOTIATIONS

41 BEST AND FINAL OFFER-AFTER NEGOTIATIONS

42 BEST AND FINAL OFFER-AFTER NEGOTIATIONS

43 BEST AND FINAL OFFER-AFTER NEGOTIATIONS

44 BEST VALUE The original bid price as submitted was $50,279, The best and final offer after negotiations $45,288, Savings $4,990, The ITN process allowed the Authority to get the best value on a critical contract while still allowing for a reasonable contract cost and profit for the Contractor. WIN/WIN

45 QUESTIONS??? Thank you for attending this presentation. If you have questions down the road you can reach me at or by phone at