HBCU Capital Financing Program TA PWS_ 08172010.docx

STATEMENT OF WORK

U.S. Department of Education Office of Postsecondary Education (OPE) Historically Black College & University (HBCU) Capital Financing Program Technical Assistance

I. BACKGROUND

The Historically Black College and University (HBCU) Capital Financing Program (The Program) was established under the Higher Education Act of 1965, as amended (HEA). The goal of the HBCU Capital Financing Program is to provide low-cost capital to finance improvements to the infrastructure of the nation’s HBCUs. Specifically, the program provides HBCUs with access to capital financing or refinancing for the repair, renovation, and construction of classrooms, libraries, laboratories, dormitories, instructional equipment, and research instrumentations, and other educational related facilities and items for those facilities.

To facilitate the loan process, the U.S. Department of Education’s (Department) Office of Postsecondary Education (OPE) uses a designated bonding authority (DBA). The DBA issues the taxable construction bonds for the HBCU Capital Financing Program. In addition, the DBA is responsible for many of the program’s operations and is subject to Departmental oversight. Specifically, the DBA reviews loan applications, makes a lending recommendation to the Department, monitors loan agreements, and enforces loan agreements. HBCUs interested in obtaining loans through the program must submit a preliminary application to the DBA that includes information such as enrollment, a description of existing debt, proposed capital projects, audited financial statements and various campus plans and assessments. After the DBA reviews the preliminary application information, the DBA makes a recommendation to the Department. The Department makes the final determination whether to proceed with a loan closing based on the DBA’s recommendation, the Department’s visit to the HBCU, and other Department analysis.

The Department is required by section 345(9) of the HEA to provide Technical Assistance (TA) to HBCUs through the HBCU Capital Financing Program. The technical assistance to be provided includes preparing HBCUs to qualify, apply for, and maintain a capital improvement loan.

II. PURPOSE

In 2009, the Department invested in Public Financial Management, Incorporated’s (PFM) Future Perfect software. PFM Future Perfect is a proprietary, strategic planning modeling software designed to assist financial professionals in their decision making, as it relates to operating and capital initiatives. The purpose of this requirement is to obtain the services of a contractor who will use this software to develop a strategic planning model. The contractor-developed model will be used to assist the Department in its decision making process regarding acceptance of the DBA’s loan recommendations. The contractor-developed model will also be used to provide HBCUs with financial consultation through the use of webinars and other related training. The contractor will also be required to provide technical assistance to HBCUs, as they prepare their loan applications, assist individual HBCUs in the development of a plan to help them reach their financial goals, and to review current borrowers information to assist them in maintaining their loans.

III. SCOPE OF WORK

The contractor shall perform the following tasks in support of current and potential borrowers of the HBCU Capital Financing Program. The actual number of loans for new borrowers is dependent on the availability of congressionally-appropriated funds by the United States Congress each fiscal year (October 1 - September 30). Information on the HBCU Capital Financing Program is available at www.ed.gov/programs/hbcucapfinance. The Department will provide the contractor with a proposed loan schedule confirming the number of loan applications.

Task 1 – Initial Meeting with OPE

The contractor shall attend the initial meeting with OPE Staff within five (5) business days after contract award. The purpose of the meeting is to o review the goals and objectives of the requirement, to review milestone dates and deliverables, and any other contractual items requiring clarification. The expectation is for both the Contracting Officer Representative’s (COR), OPE Staff and the contractor to make a mutual effort to resolve any problems identified during this meeting. The COR will prepare an agenda and submit it electronically to the contractor three (3) business days after contract award. The contractor shall prepare written minutes of the meeting and submit them electronically to the Contract Specialist (CS) and COR for review ten (10) business days after the initial meeting. The COR shall provide comments to the contractor five (5) business days after receipt of the written minutes. The contractor shall submit the final version, with COR edits incorporated, two (2) business days after receipt of the edits.

Task 2 – Provide A Customized Strategic Financial Model

The contractor shall provide the Department with a Strategic Planning Model (The Model) that is designed to assist HBCUs in making decisions about operation and capital initiatives. The Contractor shall create a model that is suitable for Financial Accounting Standards Board (FASB) and Government Accounting Standards Board (GASB) financial statements. The Model shall meet the following specifications:

a. The Model shall have the capacity to produce a fully articulated prospective set of financial statements.

b. The Model shall have the ability to produce various financial metrics used by the Program and other public and private lenders when evaluating the creditworthiness of a borrower. Managing these financial ratios is a key component of an institutions credit status and its long-term viability.

c. The Model shall be fully functional in a Microsoft Excel format.

d. The Model shall possess flexibility for redesign and restructure to meet new imperatives, challenges, or Federal Mandates.

e. The Model shall possess the ability to provide audited financial statements and financial data from the HBCU by organization and object class across at least a 10-year planning window. This model should be comprised of up to 4 years of historical data, current year data, and at least 5 years of projected results.

f. Financial statement results and selected metrics produced by The Model, from one source in the spreadsheet, shall immediately reflect any change in assumptions, including but not limited to operating and financial variables such as: enrollment, discount rates, personnel, investments, debt, and facilities, including the addition of one-time initiatives or projects.

Task 3– Financial Consultation Webinar and Training

Once the contractor has developed a model for an HBCU, the contractor shall conduct financial consultation of software for the HBCU. This consultation shall address matters including, but not limited to, creating a financial report summary of the model results; creating a fiscal plan for the HBCU to become financially stronger; making a determination of the appropriate project for the HBCU; devising ways to reconcile financial discrepancies in financial data; reconciling reviewed amended/restated financials of the HBCU; and creating a refined proposed project budget for the HBCU.

These consultations shall be conducted for approximately 13 schools or HBCUs. These consultations shall also address current financial issues and they shall include discussions regarding topics such as asset management, structured products, and changes in accounting standards. The initial consultation shall include presentations that cover Microsoft Excel, finance basics, bond math, tax code, bond pricing, and investment management.

The contractor shall provide financial consultation with all HBCUs regardless of whether the HBCU has a loan with the Program, is seeking a loan, or has not yet received the loan.

Task 4 – Reporting Requirements

The contractor shall prepare and submit quarterly progress reports (via email) to the COR and CS for the duration of the contract. The Contractor shall summarize major activities and accomplishments, best practices, any problems encountered, and mitigation efforts during the reporting period. The contractor shall submit quarterly reports twenty (20) calendars days after the end of each quarter. All quarterly reports shall provide the contractor’s name, project title, and contract number on the cover page. These reports may be submitted with the contractor’s invoice.

IV. PERIOD OF PERFORMANCE

The period of performance shall be a base period of 12 months and four (4), (possible) 12-month option periods.