Everest J. Robillard, Deputy Director Security/Law Enforcement Division. Item 7(a) - Ratification of Contract Award for Security Guard Services

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1 Date: To: California State Lottery Commission From: Prepared By: Subject: Robert T. O Neill, Director Everest J. Robillard, Deputy Director Security/Law Enforcement Division Item 7(a) - Ratification of Contract Award for Security Guard Services ISSUE Should the California State Lottery Commission (Commission) ratify the award of contract #3124 for security guard services to All Phase Security, Inc.? RECOMMENDATION Staff recommends that the Commission ratify the award of a contract to All Phase Security, Inc. for security guard services. This contract has a term of five (5) years, from November 3, 2012 through November 2, Total expenditure authority for the five (5) year term is $7,000, BACKGROUND Since 1985, the California State Lottery (Lottery) has contracted to provide security guard services on a 24 hour, 7 day a week basis. These services include monitoring and controlling access to Lottery facilities, responding to alarms, escorting visitors, providing security services at special events, and protecting Lottery assets. The current contract expires on November 2, 2012, and in preparation for a new contract to become effective November 3, 2012, a Request for Proposal (RFP) was developed. On May 17, 2012, the Lottery released the RFP and posted it on the Lottery website for viewing and downloading. The Lottery sent notification letters to 31 vendors supplied by the Lottery vendor database. The Lottery published additional advertisements in the Small Business Exchange, Challenge News, Disabled Veteran Voice and the Department of General Services website - Bidsync.

2 Page 2 DISCUSSION The Lottery received 22 bids and evaluated them using a five-part process; mandatory submittal review, rated submittal evaluation, interview, price assessment and Best Value analysis. One of those bidders failed to meet the Mandatory Submittal requirements and therefore was disqualified. The remaining 21 bidders passed the mandatory submittal review and advanced to the rated submittal evaluation. The RFP defined three rated submittal categories. The Lottery Evaluation Team rated the Bidder s Security Plan significantly more important than the other two rated submittal categories which are equal in terms of importance: 1. Firm Experience and Capabilities 2. Security Plan 3. Firm and Project Team Organization Rated submittals were evaluated and rated using the following defined criteria: Superior (S) Proposal exceptionally exceeds performance or capability requirements; proposal demonstrates extraordinary strengths that will more than significantly benefit the Lottery. Significantly Exceeds (SE) Proposal significantly exceeds performance or capability requirements; proposal demonstrates exceptional strengths that will significantly benefit the Lottery. Exceeds (E) Proposal exceeds performance or capability requirements; proposal has one or more strengths that will benefit the Lottery. Meets (M) Meets specified minimum performance or capability requirements necessary for acceptable contract performance. Meets With Exception (MWE) Proposal demonstrates weak performance or capability standards necessary for minimum contract performance; proposal has one or more weaknesses that offset any strengths. Does Not Meet (DNM) Fails to meet specified minimum performance or capability requirements. Proposals with an unacceptable rating are not awardable. The Lottery notified Bidders of the results of the Rated Submittal Evaluation on August 7, The following Bidders received a minimum overall rating of Exceeds during the rated submittal review and advanced to the interview:

3 Page 3 Universal Protection Services All Phase Security Cypress Private Security The Lottery Evaluation Team conducted Finalist Interviews at the Lottery Headquarters on August 20, During the interview, The Finalist s responses were evaluated in accordance with the following criteria: Knowledge and understanding of current conditions as identified in RFP 3124, Exhibit G, Security Guard Issue Statement. Convincing and sound methodologies to establish and implement Random Security Measures. Ability to develop a security plan response to a proposed scenario. The chart shown below summarizes the ratings for each of the three Finalists: Rated Factor All Phase Universal Cypress Response to Interview Questions Meets Exceeds Meets Response to Scenario Meets Exceeds Meets Overall Rating Meets Exceeds Meets As stated in the RFP, bidders receiving a minimum overall rating of Exceeds during the Rated Submittal Evaluation advanced to the Finalist Interview and Price Assessment. The Evaluation Team convened on August 22, 2012 to calculate and verify costs provided by the Bidders on Attachment 1, Price Sheet. Bidders provided their Annual Unit Hourly Rate for all guard classifications, their Total Annual Billable Charges based on the estimated annual hours and the security guard wages plus benefits. This initial analysis did not include applying the small business contracting preference. Listed below are the initial price assessment results: Bidder Total Annual Billable Charges All Phase Security $1,262, Cypress Private Security $1,365,172,00 Universal Protection Service $1,322,934.60

4 Page 4 At the conclusion of the Evaluation Team s initial price assessment, All Phase Security provided the lowest Total Annual Billable Charges. Based on the scope of services for this RFP, the Lottery set an optional Small and Micro Business Participation goal of 25% for utilization of small or micro businesses as subcontractors under the contract resulting from this solicitation. Full participation in the program awards a bidder a 5% preference for price. Certified small business bidders automatically receive the preference. The Small Business Procurement and Contract Act (Government Code Section et seq) states in part: a. If a procurement is to be awarded to the responsible bidder offering the lowest price, the evaluation price preference to a small business or micro business shall be 5% of the lowest price offered by a responsible, non-small bidder. For these procurements, non-small business bidders that meet the specific small or micro business subcontractor participation goal, as may be outlined in the solicitation document, shall receive 5% price evaluation preference. Those non-small business bidders who subcontract less than the participation goal shall receive a pro-rated portion of the 5% price evaluation preference based upon the percentage of small or micro business subcontractor participation commitment. On August 23, 2012, the Lottery s Small and DVBE Program Specialist conducted the Small and Micro Business evaluation of the Finalist s proposals. The Small and Micro Business evaluation determined that Cypress Private Security is a certified small business and would receive the full 5% preference. All Phase Security and Universal Protection Services are subcontracting 3% and will receive a prorated contracting preference. Applying the 5% small business preference is based on the lowest cost submitted by a non-small bidder (5% of $1,262, = $63, which is capped at $50,000). The prorated amount is (.6% of $1,262, = $7,573.77). The.6% was a prorated percentage since the bidder did not subcontract the 25% goal that was listed in the RFP (had the bidder subcontracted 25%, they would have received the full 5% preference). The results are as follows: Small Business New Bidder Bid Amt Preference Amount* All Phase Security $1,262, $7, $1,254, Cypress Private Security $1,365, $50, $1,315,172.00

5 Page 5 Universal Protection Services $1,322, $7, $1,315, *These amounts are for calculation purposes only. On August 29, 2012, the Evaluation Team re-convened to complete the price assessment and calculated that All Phase Security submitted the lowest, total assessed bid amount. Pursuant to the Lottery Act and the terms of the RFP, the contract will be awarded to the Bidder who offers the best value to the Lottery. In accordance with the Lottery s competitive bidding procedures, best value maximizes greater overall benefits and value to the Lottery. Below is an explanation of the Evaluation Team s Best Value Analysis for each Finalist: All Phase: All Phase demonstrated a thorough understanding of the Lottery s current conditions during the Rated Evaluation phase. All Phase also provided a comprehensive security plan detailing processes and training plans. During the Interview phase, All Phase demonstrated a substantial amount of experience and an ability to perform all the necessary guard functions as outlined in the RFP s Scope of Services. Cypress: Cypress presented a strong proposal and security plan during the rated evaluation phase. Cypress clearly has experience dealing with similar conditions as presented in the Security Guard Issue Statement. However, Cypress proposed hourly rates are the highest for each individual classification. In addition, the team that presented lacked cohesiveness in response to several questions and the scenario during the Interview Evaluation. Universal: Universal provided both an excellent written proposal and interview. Universal understood the needs of the Lottery and demonstrated substantial experience performing Random Security Measures (RSMs) with their list of client references as identified in the RFP. Universal displayed a high-level attention to detail and professionalism. However, Universal s proposed total annual billable charges for each individual guard classification were the second highest among the Finalists. Based on the analysis described above, the Lottery Evaluation Team believes the proposal submitted by All Phase Security provides the overall best value for the Lottery. All Phase received a Meets in the interview evaluation and their proposed annual billable rates are the lowest of the three finalists and are considerably lower in cost than the Lottery s current security guard services contract. Overall, All Phase provided a satisfactory written proposal and offered an economical price for security guard services.