25RFP11629 Q_A Document.pdf

Vendor Questions State's Response 25RFP11629 - 3rd Party Debt Collection Servcies

No.

RFP

Section Subject Question State's Response

1 1.1 General

Information How would the Contractor connect to and access Reliant’s collection software platform?

The contractor would be required to supply thin clients which would connect to Reliant’s network via virtual desktop software. Reliant would whitelist the thin client IP address to provide access to the collection software. The Virtual Desktop will provide all applications needed. Reliant would maintain user IDs and permissions as needed.

2 3 Project Description

How would the Contractor connect to and access ORC’s DialConnection? See question 1

3 3.3.2 Fees Are all fees for services on this contract covered by the 3% fee to ORC? If not, what is not included in these fees?

There is no fee to the Contractor to use the platforms, except for telephony charges, letters, and data scrubs. These services will be provided at cost and billed monthly to the Contractor.

4 1 & 6.1.1 Location Does 100% of the work have to be completed in South Dakota? There is no requirement to conduct the collections physically in South Dakota.

5 6.1.1.2 Location To what extent will the location of the bidder’s proposed location or headquarters have a bearing on any award?

The offeror's physical location, including their headquarters will not be a factor for award.

6 3.3.2 Fees How are fees currently being billed by any incumbent(s), by category, and at what rates?

Please review section 3.7.3 of RFP #: 25RFP11629.

7 1.1 Accounts Table

What estimated or actual dollars were paid last year, last month, or last quarter to any incumbent(s)?

Cost recovery fees earned by the incumbent vendor in FY24 totaled $191,404. Cost recovery fees earned through the first six months of FY25 totaled $99,732.

8 1.1 Accounts

Table Can you please provide a greater description of the specific kind of receivables to be placed for collection?

Any type of debt owed to any agency or department of the State of South Dakota, including but not limited to:

Student Account Balances Annual, Permit or Inspection Related Fees Regulatory Licensing Fire Services Supervision of delinquent juveniles Tax (Sales, Excise, Use) Property Damage (Roadway, Public Utilities, etc.)

Hunting/Fishing Violation Criminal Conviction Benefit Overpayment Judicial Fines and Fees (Criminal, Low Class Misdemenaor, Traffic Offenses, etc.)

9 3.3.5 Litigation Will the selected vendor be allowed to litigate balances exceeding a certain dollar amount on your behalf, with your explicit approval?

Account litigation services are not required, requested or allowed at this time.

10 1.1 Accounts

Table What is the total dollar value of accounts available for placement now by category, including any backlog?

The State does not guarantee the amount of debt to be referred to, or collected by, the Contractor. The debt types placed would be expected to reflect the overall portfolio as shown in the Table in Section 1.1 of the RFP, with the majority of accounts from the Unified Judicial System. A placement backlog of six months or more will likely be available by the time a new vendor is onboarded. Based on historical placements, that could be $4 million or more.

Additionally, State is willing to discuss with vendor whether data would support additional collection efforts on accounts currently considered uncollectible. A determination of that amount is not currently available. At the time they exited the project, the previous vendor had 39,272 open accounts with outstanding balances totaling $34,629,345.

11 1.1 Accounts

Table What is the total number of accounts available for placement now by category, including any backlog?

The State does not guarantee the amount of debt to be referred to, or collected by, the Contractor. A placement backlog of six months or more will likely be available once a new vendor is onboarded. Based on historical placements, that would be 4,000 or more accounts with the majority of accounts from the Unified Judicial System. Additionally, State is willing to discuss with vendor whether data would support additional collection effforts on accounts currently considered uncollectible. A determination of that amount is not currently available. At the time they exited the project, the previous vendor had 39,272 open accounts with outstanding balances totaling $34,629,345.

12 1.1 Accounts Table

What is the average balance of accounts by category? Unified Judicial System: $645. Department of Revenue: $7,231. Higher Education : $2,338. Corrections and Social Services: $2,104. All others: $3,016.

13 1.1 Accounts

Table What is the average age of accounts at placement (at time of award and/or on a going-forward basis), by category?

Typically, the ORC will assign accounts to the Contractor after six (6) months of ORC collection effort. ORC may assign accounts earlier than 6 months, if the Contractor has other open accounts for the same debtor. The ORC does not control the frequency of placement or age of accounts placed by various state agencies.

14 1.1 Accounts

Table What is the monthly or quarterly number of accounts expected to be placed with the vendor(s) by category? There is conflicting data within the RFP document.

The State does not guarantee the amount of debt to be referred to, or collected by, the Contractor. In FY24, the most recent fiscal year completed, 9,003 accounts were placed with the vendor. Placements in the two years previous included a significant number of accounts that had been backlogged. At the time they exited the project, the previous vendor had 39,272 open accounts with outstanding balances totaling $34,629,345.

15 1.1 Accounts

Table What is the monthly or quarterly dollar value of accounts expected to be placed with the vendor(s) by category? There is conflicting data within the RFP document.

The State does not guarantee the amount of debt to be referred to, or collected by, the Contractor. In FY24, the most recent fiscal year completed the value of accounts placed with the vendor totaled $7,965,350. Placements in the two years previous included a significant number of accounts that had been backlogged. At the time they exited the project, the previous vendor had 39,272 open accounts with outstanding balances totaling $34,629,345.

16 1.1 Accounts

Table What has been the historical rate of return or liquidation rate provided by any incumbent(s), and/or what is anticipated or expected as a result of this procurement?

Retrospective cohort liquidation rates average 13% for accounts aged 12 months from placement with ORC. The liquidation rate at 36 months averages 20 percent. Liquidation rates rates have steadily improved over the last two years. Another way of measuring is to divide total collections year-to-date by total placements year-to-date. The year-to-date liquidation rate is 21 percent through the first eight months of this fiscal year.

17 3 Project

Description Can you please indicate what inbound and outbound contact methods, beyond phone calls or letters (such as email and text), would be permitted by the scope of work?

Yes, in addition to calls and letters, the State permits communication with customers via email and text message, provided such communications are conducted within the boundaries of the ORC platform and in compliance with all applicable rules, regulations, and legal requirements.

18 1.3 RFP Schedule Please reconfirm the due date for this procurement by providing it in response to answers to questions.

Electronic Proposals are Due no later than 5/2/2025 (5:00pm CT).

19 1.3 RFP Schedule What is the date by which you will answer these questions? The state's response to all questions received will be no later than 4/16/2025 (5:00pm CT)

20 N/A Procurement

Can you please provide greater explanation of your expectations related to any required subcontracting to minority-owned, women-owned, or other types or categories of small or disadvantaged businesses? For example, what is required with the proposal, and what is required to comply during the term of the contract?

There is no requirement regarding subcontracting to minority-owned, women-owned, or other types or categories of small or disadvantaged businesses to be part of your proposal or required during the term of the contract. It is not a requirement for award.

21 3.3.2 Fees

Are bidders permitted to deviate in any way from any manner of quoting fees you may be expecting? For example, if there is a pricing page in the RFP, can bidders submit an alternate fee structure? If there is no pricing page in the RFP, do you have any preference for how bidders should quote fees or can bidders create their own pricing categories?

Please review section 3.7.3 of RFP #: 25RFP11629. Your response should not include a pricing page.

22 N/A Procurement Please describe your level of satisfaction with your current or recent vendor(s) for the same purchasing activity, if applicable.

This question is not related to clarification of RFP requirements. The confidentiality of contractors is protected therefore the state will not respond.

23 1.1 Accounts

Table

On page 2 of the RFP, the State shows the volumes of accounts assigned and collected by the OCA during the most recent three fiscal years.' Please confirm that the OCA refers to the collection contractors and that the State placed $7.9 million with said contractors in 2024.

That is correct.

24 1.1 Debt Backlog Will there be a backlog at the start of the contract? If yes, what is the value of said backlog?

The State does not guarantee the amount of debt to be referred to, or collected by, the Contractor. A placement backlog of six months or more will likely be available once a new vendor is onboarded. Based on historical placements, that could be $4 million or more with the majority of accounts from the Unified Judicial System. Additionally, State is willing to discuss with vendor whether data would support additional collection efforts on accounts currently considered uncollectible. A determination of that amount is not currently available. At the time they exited the project, the previous vendor had 39,272 open accounts with outstanding balances totaling $34,629,345.

25 1.3 Procurement If shortlisted, may a proposer attend any potential oral presentations virtually? Yes, if pesentations are needed, they may be conducted virtually.

3.3.2 Fees

How much were the incumbent firms charged for telephony services, letters, and data scrubs by Reliant Capital Solutions in 2024?

These services will be provided at cost and billed monthly to the Contractor.

Letters Incumbent firm established a direct billing relationship with letter vendor, so we do not have access to historical cost information. Pricing is:

24# white paper 8.5 x 11 $0.02018 each White perforated paper 8.5 x 11 $0.02697 each Duplex prints 8.5 x 11 $0.076 each 10DWS (letter processing) $0.04461 each 9WS Reply envelope $0.02997 each Non Qualifying fees (non-barcode mail) $0.07 each Inserter fees (inserting, sealing and metering) $0.026 each

Letters are metered at the First Class presorted rate (currently $0.61 per piece). Postage rates are subject to current and future U.S. Postal Service rates and increases that may apply.

Data Scrubs Accounts are scrubbed by ORC upon receipt for updated contact information, bankruptcy, death and litigious debtors. Contractor may conduct manual searches using its own data vendors if desired. If the contractor desires to do a refresh of the batch scrub previously performed by ORC, the cost per account is $0.14.

Telephony $.03/minute

1.1 Location

Please confirm, given the requirement to use the ORC’s collections technologies and platforms, that this work can be performed 100% remotely by out-of-state firms.

The vendor must be located in the United States, and all agents assigned to the project must be working onsite within the vendor's facility.

3.3.5 Litigation

May an out-of-state firm, subcontract litigation services to a South Dakota law firm (one approved by the ORC and/or State)?

See question 9

N/A Fees Please state the fees paid to the incumbent contractors in 2024.

Cost recovery fees earned by the incumbent vendor in FY24 totaled $191,404. Cost recovery fees earned through the first six months of FY25 totaled $99,732.

1.5 Procurement

Is it acceptable that hand-signed pages may not be searchable? Does the State prefer digital signatures?

Offerors may choose to use either digital signatures or physically sign and scan the first page of the RFP document. The signed page should be submitted as a separate file along with the rest of the proposal, allowing the proposal to be searchable. The State does not have a preference for digital or physical signatures.

1.1 Debt Types

Is experience in collecting tuition accounts for higher education institutions a requirement?

Experience collecting tuition accounts is not required

6.2 Procurement How will accounts be divided among the collections contractors?

The intent of this RFP is to award one contract. The final number of awards will be determined based on the quality of proposals and the State’s best interests.

6.2 Procurement How many contractors will be awarded from this RFP?

The intent of this RFP is to award one contract. The final number of awards will be determined based on the quality of proposals and the State’s best interests.

1.1 Debt Types

Are all accounts split evenly between the vendors, or do some vendors receive certain debt types and others receive other debt types?

The intent of this RFP is to award one contract. The final number of awards will be determined based on the quality of proposals and the State’s best interests.

1.1 Accounts

Table What is the historical breakdown of placements between vendors? All accounts have been placed with just one vendor for the past two years.

3 Training How long is the initial training period provided by the ORC trainer, and are there ongoing training updates included throughout the contract term?

The initial training period provided by the ORC trainer will span five (5) business days and will cover both compliance and systems training. The training will include:

Compliance Training:

• Security Awareness & Incident Response Training

• Federal Tax Information (FTI) Disclosure Awareness Security Training

• South Dakota Bureau of Information and Telecommunications (BIT) Security Training

• Fair Debt Collection Practices Act (FDCPA)

• Health Insurance Portability and Accountability Act (HIPAA)

• Family Educational Rights and Privacy Act (FERPA) Systems Training:

• Latitude

• DialConnection South Dakota-Specific Content:

• Overview of referring entities

• Types of debt collected

• Available resolution options

• Customer-focused approach

• Policies & Procedures (i.e. Dispute Resolution, Bankruptcy Handling, Etc.)

In addition to the initial training, ongoing training is included throughout the contract term. All individuals with access to South Dakota data will be required to complete the compliance modules listed above on an annual basis. Furthermore, the ORC will provide ongoing training updates via email or virtual sessions as needed to address changes in relevant regulations, policies, procedures, or systems. This ensures that all staff remain current with compliance standards and operational updates throughout the duration of the contract.

3 Operational

Costs Can the State provide an estimate of typical monthly telephony charges (via DialConnection) based on past Contractor usage?

See question 26

3 Operational

Costs Are there caps or restrictions on the volume of LexisNexis skip tracing services the Contractor can utilize, and how are these costs calculated?

There are no caps. See question 26 for cost information.

Operational Costs

Are there specific fees associated with processing debtor payments through the ORC’s payment portal (e.g., credit/debit card or ACH transaction fees), and if so, what are the per-transaction rates?

The debtor may pay by ACH without charge. If they wish to pay by Credit/Debit card, there is a 3% fee. There is no payment processing fee charged to the

OCA.

3 & 3.7 Operational

Costs If a debtor’s payment fails (e.g., insufficient funds), does the Contractor incur any associated costs, or are these handled by the ORC?

See question 26

Operational Costs

Can the State provide a detailed breakdown of the "at cost" charges for letter production and mailing through the ORC platform, including per-letter rates for printing, postage, and any additional fees?

See question 26

3 Operational

Costs What is the average monthly volume of letters sent by the current Contractor, and how might this inform our budgeting for letter-related expenses?

See question 26

3 Collection

System To what extent will the proposer have access in the ORC’s collection system to build collection strategies?

The contractor will collaborate with Reliant to configure and automate their strategies. There are various tools within the collection software and dialing platforms that allow the proposer to segragate and target specific account populations.

3 Collection

System Will proposer have access to recorded calls for our quality assurance team’s review? Yes

1.1 Accounts

Table

In section 1.1, the RFP details that $1.151M was collected by ORC in 2024. Does that include revenue collected only by ORC during primary placement, or both revenues collected by ORC and a secondary engagement like what is being solicited in this procurement.

The amount collected by the vendor was $1.151 million. Collections for the entire program were $5,067,545, of which the OCA collected $1,151,003.

N/A Procurement Will Reliant Capital Solutions be part of the selection committee for this procurement? Reliant Capital Solutions serves in an advisory role on the evaluation team, contributing their experience and expertise.

3.4.3 Bonding Will The State accept crime insurance in lieu of a surety bond?

The Bureau of Human Resources and Administration (BHRA) will accept Crime Insurance in lieu of the employee fidelity bond required by Section 3.4.3 of the Request for Proposals (“RFP”) . To be acceptable, the Contractor must obtain and maintain Crime Insurance coverage for the duration of the Agreement with a coverage limit not less than one hundred thousand dollars ($100,000.00) for each occurrence. If such insurance contains a general aggregate limit, it shall apply separately or be no less than two (2) times the occurrence limit. At minimum, the Crime Insurance policy must protect BHRA’s Obligation Recovery Center (“ORC”) against loss through failure by the Contractor or any of its employees or agents to remit to the ORC all monies due, and include coverage for: Employee Theft, Computer Fraud, Funds Transfer Fraud, Fraudulent Impersonation, and Theft of Client Property. The insurance policy shall name the State of South Dakota as Loss Payee.

1.1 Accounts

Table

Section 1.1 of the RFP states that “the ORC manages 165,664 active debts with a combined value of $143,171,262. A portion of the inventory is assigned to Contractor for collection effort.” Could you clarify the estimated amount or percentage of inventory that will be assigned to the Contractor?

At the time they exited the project, the previous vendor had 39,272 open accounts with outstanding balances totaling $34,629,345.

N/A Procurement Does the State consider Letter Vendors as subcontractors? The ORC provides a letter vendor for the contractor. Any letter vendor contracted by the awardee is considered a subcontractor and is thus prohibited.

3 Collection

System Does DialConnection include or support auto-dialer functionality? Campaigns executed via the DialConnection platform are done through a predictive dialing mechanism which is not an auto-dialer.

1.1

Accounts Table

What is the current liquidation rate broken down by division?

For the first eight months of Fiscal Year 2025 the liquidation rate by debt type is as follows: Unified Judicial System 15%; Higher Education 39%; Revenue 19%: Corrections and Social Services 93%: and All Others 116%. This is determined by dividing total collections year-to-date by total placements year-to-date.

1.1 General

Information How many of the current vendors’ collection agents have direct access to your system to work accounts?

There is no cap on the number of agents who may have access to the system. Once the agent sucessfully completes the state's background check, they may be granted access.

1.1 Accounts

Table Do the total amounts collected include in-house collections and agency collections?

The amount collected by the outside collection agency vendor was $1.151 million. Collections for the entire program were $5.068 million. In-house collections were $3.917 million and OCA collections were $1.151 million..

3 Collection

System Does the ORC platform have texting capability? Yes

3 Operational

Costs Can you provide the average monthly costs for telephony charges, letter mailings, and data scrubs?

See question 26

1 Accounts

Table Are offset payments from federal or state income tax returns included in the amounts provided?

South Dakota does not have a state income tax and does not participate in the US Treasury's treasury offset program

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