Attachment C - Buy Back Method of Award - Pages 1-2.docx
DOCX document 20 KB Posted
- Attached to
- DOTD Buy Back - Large Excavator
- Solicitation number
- 3000026755
- Issued by
- East Baton Rouge Parish, Baton Rouge City, Louisiana
About this file
This is an Attachment C document outlining the Buy Back Method of Award for RFx number 3000026755, a Large Excavator procurement managed by the Louisiana Division of Administration, Office of State Procurement, in conjunction with the Department of Transportation and Development. The solicitation requests bids for the purchase of a large excavator with a guaranteed repurchase option. Award shall be made to the lowest responsive and responsible bidder that includes preventive maintenance and quotes the lowest calculated total cost over a period of one year and one day from the original delivery date. Each bidder is required to provide a guaranteed repurchase price for the equipment as of one year and one day following delivery in order to be considered responsive to the solicitation.
The award formula calculates the total one-year cost (TC) by combining the initial purchase price (P), depreciation or appreciation (D or A), and lost earnings (LE). The interest rate (IR) used in the calculation is the sum of the Federal Prime Rate and the Consumer Price Index inflation rate, both as of July 1st of the applicable state fiscal year. For the current cycle, the Prime Rate is 6.75% and the annualized inflation rate is 3.19%, resulting in a combined interest rate of 9.94%. Lost earnings are derived by multiplying the dollar difference between a vendor's bid and the lowest responsive bid by the interest rate. The depreciation or appreciation component is calculated by subtracting the guaranteed buy back repurchase price from the initial purchase price, with positive differences representing depreciation and negative differences representing appreciation.
View the file
Other files
| File | Type | Posted |
|---|---|---|
| Attachment F - Online Bidding Instructions - Pages 1-10.docx | DOCX document | |
| Attachment A - Special Terms and Conditions - Pages 1-13.docx | DOCX document | |
| Attachment E - Price Sheet - Page 1.xlsx | XLSX spreadsheet | |
| 3000026755.pdf | ||
| Attachment D - Specifications - Pages 1-5.pdf | ||
| Attachment B - Terms and Conditions - Pages 1-2.docx | DOCX document |
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Text version
Attachment C
RFx number: 3000026755 Title: DOTD Buy Back - Large Excavator
BUY BACK METHOD OF AWARD
The Division of Administration, Office of State Procurement, with the Department of Transportation and Development will use the method of award as specified below:
Buy Back Purchase Price:
Award shall be made to the lowest responsive, responsible bidder with preventive maintenance included (that bidder who first satisfies all requirements and specifications presented in the bid solicitation, and second-quotes the lowest calculated total 1 year and 1 day cost in accordance with the award formula below).
Guaranteed Buy Back Repurchase Price:
Each bidder must include its guaranteed repurchase price of the equipment quoted 1 year and 1 day from its original delivery date, to be considered responsive.
Award Formula:
Award prices will be calculated with the following formula: TC = P + (D or A) + LE
Where:
· TC is the total 1 year cost including purchase price (P), depreciation (D) or appreciation (A), and potential lost earnings.
· P is the initial purchase price.
· BB is the guaranteed buy back repurchase.
· D is the depreciation, or positive difference, after subtracting the buy back repurchase price from the initial purchase price.
· A is the appreciation, or negative difference, after subtracting the buy back repurchase price from the initial purchase price.
· $I is the difference between the vendor’s bid and the lowest responsive bid.
· IR (Interest Rate) is the cost of money charge. IR is the sum of the current Prime Rate & Inflation Rate for the 12 months ending July of current year.
Page 1-2
Prime Rate used in the Buy Back Award Formula is the monthly rate published by the Federal Open Market Committee (FOMC) in effect for July 1st of the given state fiscal year.
Inflation is the annualized percentage change of the Consumer Price Index (CPI), over time. It is calculated by using the Consumer Price Index – Urban (CPI-U), South Region, in effect on July 1st of the given state fiscal year. The CPI-U is published monthly by the Bureau of Labor Statistics: https://www.bls.gov/regions/southeast/news-release/consumerpriceindex_south.htm Inflation Rate = [((Current Period CPI-U) – (Prior Period CPI-U)) / Prior Period CPI-U] * 100
Prime Rate (July 1, 2026) = 6.75% CPI-U (July 1, 2026) = 322.280 CPI-U (July 1, 2025) = 312.330
IR = 6.75% + [% = 6.75% + 3.19% = 9.94%
· LE is lost earnings, derived from multiplying the dollar increase ($I) by the interest rate (IR).
LE = $I x IR
File details come from the government source that posted it. Updated .