00011197_ApprovedSP_REQ-DASOBO-00073758_TAMS_ODOT.pdf

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REQUEST FOR SPECIAL PROCUREMENT No. REQ-DASOBO-00073758

PART A. Requesting Agency must complete Items 1 through 13.

1. Requesting Agency Name: Oregon Department of Transportation (“ODOT”)

2. Date of Request: May 3, 2024 3. Agency Number: 73000

4. Agency Contact Name: Brittiny Vollmar 5. Phone: (503) 910-0911

6. Type of Request: __ Class Special Procurement _X_ Contract-specific Special Procurement

7. Time Period Requested: From: July 22, 2024 To: December 31, 2032

8. Total Estimated Cost: $6,000,000

9. Title: Supplies and/or Services to be Acquired:

Ultimate Kronos Group (“UKG”) Pro Workforce Management System

10. Request, Background, Current Need, and Proposed Contracting Procedure:

a. Request:

The Oregon Department of Transportation (“ODOT” or “Agency”) requests approval of this Special Procurement (“SP”) to :

1. Amend as delegated the Department of Administrative Services, Procurement Services (“DAS PS”) Master Services Agreement (“MSA”) No. 6194, to include UKG Pro Workforce Management System (“Pro WFM”) software package and professional services under a new work order contract (“WOC”), and

2. Extend the term of the MSA to December 31, 2032, and extend and execute ODOT WOC(s) entered into under the MSA, for term(s) that may not extend beyond December 31, 2032.

This Special Procurement will allow ODOT to migrate from the existing Time and Attendance Management system, currently known as Kronos Workforce Central System (“WFC”), to the Pro Workforce Management system (“Pro WFM”).

b. Background:

In 2015, DAS PS issued Request for Proposal (“RFP”) #DASPS-1135-15 for a Time and Attendance Management System (“TAMS”), which resulted in MSA #6194 between DAS PS and Kronos Incorporated (now Ultimate Kronos Group, “UKG”).

In 2016, ODOT as an Authorized Purchaser executed WOC #B34687, under MSA #6194, to implement a multi-year project for a Software-as-a-Service (“SaaS”) solution to provide a single, online time capture, leave management, scheduling, and work tracking system for its approximately 4,800 employees.

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Per ODOT’s requirements for a base time and attendance product, Kronos built Workforce Central, as a customized SaaS system for ODOT. That system, known as TAMS, provides an industry standard time and attendance capability, as well as meeting Agency’s unique business requirements to capture standard-labor and transportation infrastructure maintenance activity data, which ODOT requires to conduct operations and comply with data requirements for federal funding.

The WOC has been amended 7 times as follows:

• Amendment 1 – update Deliverable and Payment Schedule.

• Amendment 2 – update Deliverable and Payment Schedule.

• Amendment 3 – update Maximum Payment Amount, Change Order Payment Schedule and Form.

• Amendment 4 – update Authorized Agency Personnel.

• Amendment 5 – extend WOC Term to 2/7/2022.

• Amendment 6 – extend WOC Term to 3/31/2022.

• Amendment 7 – extend WOC Term to 8/7/2026 and increase the Maximum Payment Amount.

In 2020, Kronos Incorporated officially completed a merger with Ultimate Software Group, establishing Ultimate Kronos Group (“UKG”). UKG is the current contractor entity under the MSA and the WOC.

In 2022, ODOT was notified by UKG that UKG would be sunsetting the Workforce Central System in December of 2025. All UKG active business elements of TAMS are prepared to be migrated to the Pro WFM System. UKG has agreed to migrate ODOT’s standard-labor and maintenance data and complex code customizations into Pro WFM to continue to support ODOT’s unique business requirements. The migration will, however, require UKG professional services and software. The migration will preserve continuity of user support and system monitoring for ODOT’s payroll, timekeeping, workforce management, standard labor and maintenance activity systems.

In 2022, DAS PS approved Delegation Agreement #REQ-DASOBO-00024436, which was amended 7/17/2024 and remains in effect through December 31, 2032. This delegation grants ODOT’s Designated Procurement Officer (“DPO”), and any successor DPO acting on behalf of Agency, delegated specific procurement authority to:

1. Amend the existing MSA #6194 between DAS PS and ODOT and the underlying WOC #B34687, through the remainder of their respective current terms.

2. Conduct a Special Procurement, to extend MSA #6194 for an additional period not to exceed five additional years and make other contractual adjustments as needed.

3. Execute MSA and WOC amendment and conduct contract administration activities, each as needed.

c. Current Need:

The current need is to amend the DAS PS MSA #6194 to include Pro WFM System elements that will provide the same methodologies, functionalities, and requirements of the current version, ensuring continuity of operations throughout ODOT and extend the MSA and any subsequent WOCs until December 31, 2032. Below is a Cost Table reflecting the estimated spend over the term of this SP request:

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Description Estimated Cost

Year 1 Software and Maintenance Application $515,408

Year 2 Software and Maintenance Application $536,024

Year 3 Software and Maintenance Application $557,465

Year 4 Software and Maintenance Application $579,764

Year 5 Software and Maintenance Application $602,954

Year 6 Software and Maintenance Application $627,073

Year 7 Software and Maintenance Application $652,156 Implementation Costs: IT Professional Services and Maintenance Application $719,100

Subtotal: $4,789,944 Contingency Funds - Optional (unknown costs such as increases to Licensing and related Services fees, additional in-scope ITPro Services that may be identified during the term of the engagement, etc.) $1,200,000

Total Estimated Cost: $5,989,944

Under Delegation Agreement #REQ-DASOBO-00081011, Amendment #1 (previously REQ-DASOBO- 00024436), Agency’s DPO, and any successor DPO acting on behalf of ODOT, is now delegated specific procurement authority to:

• Amendment the Delegation to extend the term of the MSA and each WOC to December 31, 2032.

• Conduct a Special Procurement No. REQ-DASOBO-00073758, to extend the term of MSA #6194 with UKG.

d. Proposed Contracting Procedure:

Direct Award and Negotiation.

1. As required by Oregon Administrative Rule (“OAR”) 125-247-0287, ODOT will issue a public notice

(the “Notice”) of this approved SP on OregonBuys for a period of seven calendar days.

2. The Notice will include provisions that any affected party may protest the approval of this SP.

3. DAS PS, along with ODOT, will respond to and resolve all protests, if any.

4. If no protests to this approved SP are received or sustained, ODOT will proceed with amending the MSA as set out in Section 10.a above.

5. ODOT will obtain DAS Enterprise Information Services’ (“EIS”) endorsement before executing the

MSA Amendment and any subsequent WOCs, if required.

6. ODOT will work with Oregon Department of Justice (“DOJ”) and obtain its legal sufficiency approval for MSA and WOC amendments, and any additional WOCs, as required.

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11. Justification for use of Special Procurement:

1. Preservation of Investment in Configuration of Data Elements and Rules:

1.1. Standard Labor is an essential ODOT business process to track and facilitate bill back of hours identified in Agency’s Standard Labor agreement with the Federal Highway Administration (“FHWA”). This process is not concerned with an employee’s attendance, only the time worked on tasks that fall within the Standard Labor agreement. As an outcome of the prior project, UKG built a custom add-on software component for ODOT to provide for this unique need. ODOT has not identified another solution available under other State contracts or in the marketplace that supports this Standard Labor function “out of the box.” This customized element of the Workforce Central System is critical to ensuring ODOT compliance with the Standard labor agreement.

1.2. The Pro WFM System will maintain all the current business elements and rules already represented digitally in the customized Workforce Central System; including schedules, leave codes, period dates, holidays and how they interact.

1.2.1. Approximately 60% of these elements and rules will be digitally migrated to the new platform with already established processes for integration with current system logic.

1.2.2. The remaining 40% of existing business elements and rules will require manual conversion.

1.3. A different vendor would require significant effort on ODOT’s behalf, within a timeframe that does not allow for a thorough, tested transition: 100% of business elements to be validated, redefined, and coded in a way the new vendor system would understand, integrate, and interact to reproduce already established and effective business results in a net-new system logic.

1.4. UKG has confirmed that it can integrate ODOT’s requirements around the Standard Labor business process into Pro WFM, which are required by the agency to conduct operations and maintain federal funding. A survey of the market did not identify other vendors who provide this functionality as a part of a time and attendance system. ODOT requires those customizations to conduct operations and maintain federal funding.

2. Preservation of Investment in Organization Processes and Learning:

2.1. The upgrade to Pro WFM System will mitigate the need for substantial re-learning, training and required competency of entirely new rulesets.

2.2. Agency’s organizational responsibility for system operations will maintain the same distribution of roles, significantly reducing the costs and risks associated with change in departmental duties. For example, other time and attendance systems, such as Workday Payroll, configure roles and data access such that ODOT would need to shift duties from finance to human resources personnel.

3. Preservation of Investment in Standard-Labor and Maintenance Activity Tracking:

3.1. Currently ODOT does not have a dedicated and specialized platform for tracking Delivery and Operations maintenance activity. The business need for this is well founded and long standing.

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3.2. This capability has been designed into WFC System as an add-on function that required significant design and testing. This function will include cross-capability as an add-on with Pro WFM, incorporating lessons and know-how from the previous deployment.

3.3. A survey of the market did not identify other vendors who provide this functionality as part of a time and attendance system but did identify vendors of highway transportation-centric maintenance management systems that do offer such functionality. Therefore, to meet ODOT’s existing business requirements, the agency would either need to procure and integrate a separate system for that need or build it in-house.

3.4. TAMS, not only provides an industry standard Time and Attendance capability, but also meets

Agency’s unique business requirements to enable capture standard-labor and maintenance activity data. Standard-labor and maintenance activity are essential ODOT business processes required to track and facilitate bill back of hours identified in Agency’s Standard Labor agreement with the Federal Highway Administration (“FHWA”). This distinct Agency process ensures federal reimbursement for specific work categories on state transportation assets and requires auditability to sustain federal funding.

12. Findings to Satisfy the Required Standards: This proposed Special Procurement:

X (a) will be unlikely to encourage favoritism in the awarding of public contracts or to substantially diminish competition for public contracts because:

1. The initial open competitive procurement resulted in the selection of UKG as the provider of software, equipment, and related professional services for time and attendance management.

2. ODOT’s goal is to transition to the State of Oregon enterprise system, Workday Payroll, for which it is already paying, within approximately five years. The readiness of the current Workday Payroll system precludes it as a near-term option, and UKG is ending support for WFC on December 31, 2025.

3. ODOT’s need, therefore, is time-constrained and cost-prohibitive. It is in the best interest of the public and ODOT to migrate to the readily available WFC system in order to maintain the functionality enabled by the existing time and attendance system solution.

4. ODOT is not seeking a new system or additional features. Rather, the Agency desires to move to what is most like its current and effective system (TAMS).

and

X (b)(i) will result in substantial cost savings to the contracting Agency or to the public because:

1. ODOT made a substantial investment of resources into developing its TAMS system. In total, the project cost to implement TAMS was $8,281,324 and spanned six (6) years, exclusive of the DAS PS RFP. Since project completion in 2022, ODOT has spent an additional $1,039,839 on licensing and maintenance and support for TAMS. TAMS is used by every employee at the Agency and ODOT has also made significant investment in staff training to use the system, as well as to administer and support it.

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2. Acquisition, provisioning, and five-year costs for a new, different commercial cloud-based software-as-a-service (“SAAS”), enterprise-level time and attendance system is estimated to cost at least $8M (similar to the Agency’s original investment in TAMS).

3. It is most effective and efficient for ODOT to continue to use TAMS and migrate forward to the vendor’s Pro WFM platform. Due to ODOT’s structural revenue problems, ODOT lacks both the funds and staff resources to invest in a new time and attendance system, assuming any commercial vendors could deliver ODOT’s required customizations.

13. Signature: The actual signature of the Agency Head or designee (e.g., Designated Procurement Officer) is not required on the Request if it is submitted through OregonBuys. Agency may elect to attach a signed Request.

Signature: e.g. Electronically in OregonBuys _________________ Type Name: Date:

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PART B. The Department of Administrative Services completes Part B.

STATUTORY AND RULE AUTHORITY:

ORS 279B.085(2) states the Director of the Department of Administrative Services may approve a special procurement if the Director finds that a written request submitted under ORS 279B.085(4) demonstrates that the use of a special procurement as described in the request, or an alternative procedure prescribed by the Director will:

(a) Be unlikely to encourage favoritism in the awarding of public contracts or to substantially diminish competition for public contracts; and (b)(A) Result in substantial cost savings to the contracting agency or to the public; or

(B) Otherwise substantially promote the public interest in a manner that could not practicably be realized by complying with requirements that are applicable under ORS 279B.055, 279B.060, 279B.065 or 279B.070 or under any rules adopted thereunder.

OAR 125-246-0170 delegates the authority of the Director of the Department of Administrative Services to approve special procurements to the State Chief Procurement Officer. OAR 125-247-0285 through 125- 247-0288 implement ORS 279B.085.

OAR 125-247-0700(2) Protests and Judicial Review of Special Procurements designates the State Chief Procurement Officer as the Contract Review Authority.

FINDINGS: The findings are accepted, adopted, and incorporated by reference herein.

CONDITIONS OF APPROVAL:

1. Notice Period. The Authorized Agency shall post the Public Notice on OregonBuys. The Special Procurement may not be used until after the completion of the seven (7) day notice period required pursuant to OAR 125-247-0287(4), and either:

a. No Written protests are received by the Contract Review Authority, State Chief Procurement Officer, from an Affected Person in response to the notice, or

b. If any protest is received during the notice period, then not until:

i. the State Chief Procurement Officer or delegate issues a written disposition of the protest in accordance with ORS 279B.400 and OAR 125-247-0700 and OAR 137-047-0700, and

ii. confirms in writing the first possible date of use of the Special Procurement.

2. ORS 279A.165 Requirements. Authorized Agency shall comply with the requirements of ORS 279A.165 and OAR 125-247-0287(12) regarding a report about this Special Procurement. Agency shall use a form and follow the instructions provided by the State Chief Procurement Officer or delegate.

3. Authorized Agency shall comply with all Enterprise Information Services (“EIS”) conditions and requirements prior to contract execution, if any.

APPROVED:

Stephen Nelson, State Chief Procurement Officer Date:

Department of Administrative Services, Procurement Services

8/6/2024