5a. FirstSource III - DRAFT Pricing Discount Model Language 2.25.21.pdf

First Source III DRAFT Pricing Discount Model Solicitation Sections B, L, and M Pricing Language

Section B.3 Pricing

Offerors may submit proposals for one or both Functional Categories and some, one or all of the small business Socio-Economic tracks under the Functional Categories for which they are certified based on small business program requirements, their capabilities, and their established size standards. Because there are opportunities for multiple proposal submissions, the contractor shall submit a separate proposal for each functional category.

For the Information Technology Value Added Reseller (ITVAR) Functional Category please see the pricing proposal instructions located at Section L – Instructions, Conditions, and Notices to Offers or Respondents and solicitation Attachment 1 – ITVAR (NAICS 541519, footnote 18) Functional Category Pricing Schedule.

For the Software Publishing Functional Category please see the pricing proposal instructions located at Section L – Instructions, Conditions, and Notices to Offers or Respondents and solicitation Attachment 2 – Software Publishing (NAICS 511210, footnote 20) Functional Category Pricing Schedule.

The pricing schedules will establish minimum pricing discounts for the FirstSource III contract.

After contract award, Contractors may add other items/services to its offering and will have the flexibility to resell other Original Equipment Manufacturer (OEM) products throughout the course of the awarded IDIQ contract period.

The pricing discount model reflects the fluidity of the FirstSource III IDIQ contract vehicle, across both Functional Categories. Because the scope and price of information technology solutions for FirstSource III are anticipated to change rapidly, DHS has eliminated the need to incorporate specific item level requirements and unit prices into the awarded IDIQ contract. This approach will also streamline on-ramping as represented within the terms and conditions of this solicitation 70RTAC21R00000003.

The total weighted discount is based on a projected proportion of FirstSource III Item/Service Category spend. The projected proportion is based on historical spend and the anticipated future spend considering established DHS IT infrastructure and the potential for transition and modernization. DHS has developed an allocation equation based on the above mentioned total projected proportion of spend in order to calculate total weighted discounts as the means to compare Contractor Pricing Schedule responses.

The offeror’s proposed minimum discounts will become a part of the resulting FirstSource III award, Section B, and will be binding for the period of performance represented within the Pricing Schedules (Attachments 1 and 2) for the applicable Item/Service Category. Therefore, Task Order level unit prices shall be discounted based on the established Item/Service Category minimum discount. Further, at the Task Order level, Contractors may, and are encouraged to propose discounts that exceed their established minimum Item/Service Category discounts.

Pricing Schedule instructions are included within solicitation, Section L – Instructions, Conditions, and Notices to Offers or Respondents and solicitation Pricing Schedule Attachments 1 and 2.

Section L.7.1 Factor 4 - Price

Factor 5, Price has a specific Pricing Model and instructions for each Functional Category, ITVAR and Software Publishing. Offerors shall ensure they use the correct Pricing Model and follow the instructions associated with that model for the Functional Category under which they are proposing. Offerors proposing under both Functional Categories shall prepare and submit separate proposals as stated in Section L.3.1.

The ITVAR and Software Publishing Functional Category Pricing Schedules include the Item/Service Categories stated in Section C, Statement of Work. Offerors shall propose Item/Service Category minimum discounts for each ordering period and complete each required cell. Pricing Schedule responses with required cells that are not fully populated shall be considered incomplete and will not be evaluated.

The offeror shall provide the following information in response to Factor, 5, Price

1. Either an e-link or a hard copy (PDF Price Volume attachment) of their own and/or their

Original Equipment Manufacturers (OEMs) commercially available price list(s) used to develop their proposed minimum discounts.

2. A complete and accurate Pricing Schedule (Attachments 1 and/or 2). If an offeror proposes 0%, the Government will consider that the offeror is proposing no discount. 0% minimum discounts will be included within the total weighted discount calculations.

Proposed minimum discounts shall be based on commercially available pricing lists from the offeror and their OEMs, reflected in 1. Immediately above.

Failure to use or complete the Pricing Schedule (Attachments 1 and/or 2) and to include ALL price Factor requirements for the correct FC proposed will result in the proposal being considered non-compliant and removal from consideration. Adding columns or manipulating the Excel sheet other than to provide information in the areas specifically designated for responses will be viewed as non-compliant and the proposal will be removed from further consideration.

Offerors are strongly encouraged to provide advantageous minimum discounts against commercially available pricing and to fully exercise pricing methodologies that will result in economically beneficial solutions to the Government. As represented immediately above, the Offeror shall NOT deviate in any way from what is represented within the Pricing Schedules (Attachments 1 and 2) to this solicitation.

Section M.3.2 Phase II Evaluation

Factor 5 – Price

DHS recognizes that true price competition will occur at the FirstSource III Task Order level. In this instance, at the FirstSource III IDIQ level, the Government will confirm the offeror and/or its OEMs commercially available price list(s) based on the e-link or hard copy provided with their proposal. Additionally, the Government will evaluate the total weighted discounts from the Pricing Schedule to determine the extent to which the minimum discounts proposed are competitive. Confirmation of commercially available price list(s) and total weighted discounts calculated from proposed minimum discounts are considered the basis for FirstSource III competition and price reasonableness determination.

The total weighted discount is calculated utilizing the projected proportion of FirstSource III Item/Service Category spend and represents the means to efficiently and effectively compare Contractor Pricing Schedule responses. The projected proportion is based on historical spend and anticipated future spend considering established DHS IT infrastructure and the potential for transition and modernization. Total weighted discounts based on minimum discounts proposed by offerors will be compared during price evaluations. In conducting a comparison of the total weighted discounts, a greater weighted discount will be considered more beneficial.

Optional periods within the Pricing Schedules (Attachments 1 and 2) will be evaluated and awarded IAW FAR 52.212-2. The evaluation of options does not obligate the Government to exercise such evaluated options. Additionally, in accordance with FAR 52.217-8, the option to extend services for an additional six months will be included within this FirstSource III solicitation. A six-month extension is considered to be within the total project scope of this solicitation. For purposes of evaluation of this extension, the Government shall use the Offeror’s Pricing Schedule response for the Base Ordering Period for each of the Pricing Schedules (Attachments 1 and 2).

Further, the price evaluation conducted will assess accuracy, completeness, and reasonableness.

This process involves verification that information presented is accurate and complete, ensuring all price volume requirements are appropriately included within the proposal response, figures are correctly calculated, and minimum discounts are presented in the prescribed format. A complete and accurate Pricing Schedule for the appropriate FC, ITVAR or Software Publishing, is required in order for an Offeror’s Phase II, Volume III response to be considered for award.