OFFICIAL
REQUEST FOR PROPOSAL
#06-001
CENTRAL BANKING SERVICES
DEPARTMENT OF THE TREASURY
STATE OF LOUISIANA
JOHN NEELY KENNEDY
STATE TREASURER
February 17, 2006
13
TABLE OF CONTENTS
I. STATEMENT OF SOLICITATION 1
II. SCOPE OF SERVICES AND RFP OBJECTIVES 1
III. INSTRUCTIONS FOR SUBMISSION OF PROPOSALS 3
IV. PROPOSAL SUBMISSION 6
V. PLANNED SCHEDULE OF ACTIVITIES 8
VI. EVALUATION AND SELECTION PROCESS 9
VII. STATEMENT OF DISCLOSURE 10
VIII. AWARD OF CONTRACT 11
IX. CONTRACT TERMS AND COMPENSATION METHODS 11
X. OVERVIEW OF SERVICES TO BE PROVIDED 12
XI. ATTACHMENTS
Attachment A: Minimum Qualifications for Participating Banks
Attachment B: Information Required
Attachment C: Description of Accounts
Attachment D: Requirements for the Depository (Collection) Function
Attachment E: Requirements for the Disbursement Function
Attachment F: Requirements for the Collateral/Safekeeping Function
Attachment G: Sample Contract
Attachment H: Indexing Form
XII. APPENDICES
Appendix I: Volume Estimates
Appendix II: Pricing Grid
Appendix III: Investment Reports
Appendix IV: FIRREA Documentation
Appendix V: Matrix of Current Banking Services
13
OFFICIAL REQUEST FOR PROPOSALS FOR
CENTRAL BANKING SERVICES
FOR THE DEPARTMENT OF THE TREASURY
STATE OF LOUISIANA
I. STATEMENT OF SOLICITATION
Proposals for Central Banking Services are hereby solicited by the Department of the Treasury of the State of Louisiana in accordance with LA R.S. 39:1481 et seq and all applicable rules and regulations promulgated there under from bona fide, qualified proposers who are interested in provided specific banking services.
The Request for Proposals (“RFP”) solicits proposals for the delivery and installation of centralized banking services and investment options in the broadest context of those terms.
The RFP includes administrative information, instructions, guidelines, and methodology governing the proposals to be submitted and the material to be included therein. It also describes the evaluation process, and delineates certain terms, conditions, caveats, and requirements to be incorporated in any contract that may result from the RFP. Mandatory requirements, which must be met to be eligible for consideration, and other requirements and instructions to be met by each proposer are appropriately explained. Specific qualifications for banks submitting proposals are included in ATTACHMENT A.
All provisions hereto which in any manner limit, waive, or release any claims for liability on the part of the Department of the Treasury, and all other similar provisions hereto, shall expressly include the State Treasurer and all other elected officials and employees of the Department of the Treasury.
II. SCOPE OF SERVICES AND RFP OBJECTIVES
A. Background and Scope of Services
Under the authority of the Louisiana Constitution, the State Treasurer controls the deposit, investment and disbursement of all funds into or out of the Department of the Treasury.
The State Treasurer is conducting a Request for Proposals (RFP) to select providers and services for a contract term of three years commencing November 1, 2006, with an option to renew for two (2) consecutive one (1) year periods at the discretion of the State Treasurer.
The basic banking functions requested under this RFP include:
(1) Depository services for receipt of State funds
(2) Disbursement services to clear State payments issued
(3) Safekeeping and custodial services for State owned investment securities, repurchase agreements and collateral securities
(4) Lockbox services
(5) Investment tracking and reporting services
(6) Securities Lending services
(7) Medical Trust services
B. RFP OBJECTIVES
Specific requirements are provided within the respective service sections of this document; however, the State Treasurer’s overall objectives for this RFP are to:
(1) Select a provider(s) who will offer efficient and effective services, and product solutions that will support the State’s current and future banking needs;
(2) Select a provider(s) who employs, in their own processes, advanced technology and who will help the State apply technologies that improves its banking processes; and
(3) Establish optimal pricing for the banking services defined within this RFP.
C. CURRENT BANKING PRACTICES AND STRUCTURE
The Department of the Treasury administers the state’s centralized cash management system. This cash management system uses a central depository bank (“pooling”) account for the custody and investment of monies maintained in the Department of the Treasury.
The pooling account receives deposits of checks, Automated Clearing House credits, wire transfer credits, deposits of other negotiable instruments, and transfers from other bank accounts including reverse zero-balance accounts within the bank.
The pooling account disburses monies via wire transfer, checks, interbank transfers to zero balance disbursement bank accounts, and Automated Clearing House debits originated by the State (not by outside parties).
Deposits made to the pooling account at bank branch locations are included in the bank account ledger balance as if the deposits were made in the Baton Rouge bank location.
The Department of the Treasury uses a deposit ticket form designed for the state’s centralized accounting system. The bank will be required to accept this deposit ticket form in lieu of any other deposit ticket forms used by the bank. A copy of this deposit ticket form is in Attachment D. Each agency will use a unique 3 digit numeric identifier with sequential numbering which will be the deposit ticket number in the MICR field. These identifier numbers are required to be listed in most reports, statements, inquiry and data displays and files that are transmitted to the Department of the Treasury or viewable by the Department of the Treasury.
The Department of the Treasury has numerous reverse zero balance bank accounts and zero balance disbursement accounts tied to the pooling account.
The pooling account is reconciled daily by the the Department of the Treasury. The Department of the Treasury uses proprietary PC based reconciliation software for this purpose. The bank provides a daily electronic file of paid items, deposit items, and other items in a format determined by the Department of the Treasury. This file is imported into the reconciliation software. This file is in a BAI format and is downloaded via modem. The file format is in Attachment D.
Daily balance reporting, by bank account, of ledger balances, collected balances, clearing, and outstanding items are provided via computer-to-computer viewing.
The bank also provides a daily report of investment activity that is used by the Department of the Treasury to reconcile to the Department of the Treasury’s investment portfolio software. This daily investment activity report reflects all trades with specific detailed information on each security. A copy of the daily investment activity report is in Appendix III.
The Department of the Treasury has two centralized vendor zero balance disbursement accounts used by all state agencies to pay operating expenditures. One controlled disbursement account is used for check disbursements and the second account is used for electronic disbursement via Automated Clearinghouse transactions initiated by the State.
State agencies in rural areas of the state may make deposits to banks other than the central banking services bank. These deposits are swept into the pooling account on a weekly basis.
The bank selected shall be expected to keep abreast of new innovations, products and methods in the industry with respect to electronic commerce, data interchanges, and similar advances and changes and to provide them to the the Department of the Treasury, at its option, at competitive prices.
III. INSTRUCTIONS FOR SUBMISSION OF PROPOSALS
A. Submission Deadline:
Proposals must be received on or before 4:30 p.m. CST on Wednesday, March 30, 2006. Perfection of delivery is the responsibility of the proposer. Failure to meet the proposal submission deadline shall result in rejection of the proposal.
Proposers are hereby advised that the U.S. Postal Service does not make deliveries to our physical location.
Proposals may be mailed through the U.S. Postal Service to:
Barbara G. Baier
Attorney, Department of the Treasury
Post Office Box 44154
Baton Rouge, Louisiana 70804-4154
Proposals may be delivered by hand or courier service to our physical location at:
Barbara G. Baier
Attorney, Department of the Treasury
State Capitol, 21st Floor
900 North 3rd Street
Baton Rouge, Louisiana 70802
Proposer is solely responsible for ensuring that its courier service makes the delivery to our physical location. The Department of the Treasury is not responsible for any delay or failure to deliver caused by the proposer’s chosen means of proposal delivery.
B. Inquiries and /or Clarifications
Questions proposers may have regarding the information presented in this Request for Proposals must be received in writing via facsimile transmission or electronic mail no later than 4:30 P.M. March 2, 2006 and addressed to:
Barbara G. Baier
Attorney, Louisiana Department of the Treasury
900 N. 3rd Street
State Capitol, 21st Floor
Baton Rouge, LA 70802
Facsimile: (225) 342-0064
All questions received by this date will be answered in writing. Questions and responses will be made available to the public on the agency website (www.latreasury.com) and sent to all parties who have submitted written requests for a copy of the Request for Proposals. The source of the query will not be divulged.
The Department of the Treasury reserves the right to request clarification and modification of any proposal prior to awarding the contract. Any proposer retains the right to withdraw their proposal at any time prior to the contract being awarded.
C. Required Format for Submission
Each proposer shall submit six (6) copies of the completed proposal to the Department of the Treasury. On the outside of the sealed proposal package the following information is required:
· Proposer’s name and address
· Primary contact person and telephone number
· The words, “Central Banking Services Proposal”
· The words, “RFP #06-001”
All six (6) copies of the completed proposal must contain original signatures – such copies should be clearly marked by notation in the lower left hand corner of the cover of each copy with the words “Signed Original”. These copies will be retained for incorporation by reference in any contract resulting from this RFP.
All proposals must be submitted on letter size paper (8 ½ x 11) left spiral bound with tabs. Pages must have one (1”) inch margins, use Times New Roman font, and font size no less than ten (10).
Failure to follow the required format may result in rejection of the proposal.
D. Multi-volume Submission:
Cover Letter
A cover letter, which will be considered an integral part of the proposal package, shall be signed by the individual(s) who is (are) authorized to bind the proposer contractually. This cover letter must indicate the signer is so authorized and must indicate the title or position the signatory holds in the proposing firm. An unsigned proposal shall be rejected. The letter shall also contain the following:
(1) The proposer’s name, address, telephone number, fax number and e-mail address.
(2) A statement to the effect the proposal is a firm and irrevocable offer good for 180 days.
(3) A statement expressing the proposer’s willingness and ability to perform the services as described in this Request for Proposals.
(4) A statement as to the availability of staff and other required resources for performing all services as described in this Request for Proposals.
(5) Name, title or position, telephone number, fax number and e-mail address of the proposed account administrator.
(6) The proposer’s Federal Employer Identification Number.
(7) Identification of any sections of the proposal that the proposer is identifying as confidential; provided, however, that any such identification shall be subject to and comply with the Louisiana Public Records law contained in LA R.S. 44:1 et seq.
There are three volumes that compose the total response to the RFP. Each volume must be submitted in a separate enclosure that is clearly labeled with the proposer’s name, RFP #006-01, and volume title (e.g. “Volume 1 – Minimum Qualifications”). The volumes are described as follows:
Volume 1. Minimum Qualifications - The proposer must certify that all tasks and activities associated with the requirements in Attachment A can be performed. Where written documentation is requested said documents should be attached to Attachment H.
The responses and documentation required to be submitted with proposals in Attachment A should be indexed and referenced on Attachment H.
Volume 2. Required Information – The proposer must submit written responses and documentation as provided in Attachment B.
The information required to be submitted with proposals in Attachment B should be presented in the following format:
1. Question Number
2. Question
3. Response to Question.
Information and materials that are strictly promotional in nature shall not be used. The submission of such material may serve to disqualify the proposer from further consideration.
Each page upon which confidential information appears must be marked as such; provided, however, that any such identification shall be subject to and comply with the Louisiana Public Records Law contained in LA R.S. 44:1 et seq. The confidential information must be clearly identifiable to the reader wherever it appears. The Louisiana Public Records Law should be referred to if there is any question regarding confidential matters.
Volume 3. Pricing Grid – The proposer must complete Appendix II, the Pricing Grid. The proposer to whom this contract is awarded will be required to bill for services in the same manner as listed in the Pricing Grid. The proposer shall not make any changes or revisions to the Pricing Grid. The winning proposer will be required to bill for services as listed in the Pricing Grid. New services added during the contract term will be amended into the Pricing Grid.
Failure to follow the required format may result in rejection of the proposal.
IV. PROPOSAL SUBMISSION
A. Duration of Offer
Proposals submitted in response to this solicitation are irrevocable for 180 days following the proposal submission deadline date. This period may be extended at the First Assistant State Treasurer’s request only by a proposer’s written agreement.
Perfection of the delivery is the responsibility of the proposers. All proposals will be logged in as to the date and time of delivery. No proposal will be accepted after the deadline.
Submission of a proposal or any portion thereof via facsimile transmission, electronic, or magnetic media shall not be allowed. The Department of the Treasury shall not accept or consider any proposal material submitted in this manner.
If, prior to the final filing date for submission of proposals, a proposer discovers an error or omission in a proposal already submitted to the Department of the Treasury, the only method of correcting, modifying, or completing the proposal is to withdraw the proposal in its entirety by written notification to the Department of the Treasury prior to the final filing date and time. A complete corrected proposal package may be resubmitted, but not after the final filing date and time. Modification offered in any other manner - oral, written, or facsimile transmission - will not be considered.