HFS B28001 Paper Tiger Sole Source Justification Form Part I-II.pdf

Sole Source Justification Form

Version 7.01 Page 1 of 6

Bulletin Reference Number 22-478HFS-PERSA-B-28001

Requesting Agency/University Healthcare and Family Services

Sole Source Justification Form - Part I Section I - General Information

Department/Bureau/Section: HFS/Bureau of Administrative Services/Procurement Management

Need Identified Date: Jan 1, 2022 Supply/Service Need By Date: Apr 1, 2022

Project Title: Off-Site Secure Document Destruction Sole Source

Vendor: Business Storage Inc. d/b/a Paper Tiger

Provide a description of the supplies or services required: Off-Site Secure Document Destruction Services

Value: Estimated Value of Initial Term, this Change Order or Amendment: 120,000

Will this Sole Source amend a Professional or Artistic Services contract? Yes No

*Sole Source may not be used for amendments for Professional or Artistic Services if the amendment would increase the value by more than 5% of the initial award or extend the term by more than 60 days.

Type: New Sole Economically Feasible Source

Section II - Proposed Term

One-Time Purchase Term Contract

Section III - Funding Source Select the type of funding to be used (Check all that apply): State Appropriate Funds Federal Funds Other (Explain):

Section IV - Sole Source Justification

This purchase is economically only available from a single source primarily because it is: (If "Other" explain in one sentence)

Compatibility of Equipment, Accessories, Replacement Parts or Service

Are there secondary justification(s) for this sole source? Yes No

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Bulletin Reference Number 22-478HFS-PERSA-B-28001

Requesting Agency/University Healthcare and Family Services

Section V - Purchase History

Has the Agency or University Purchased these supplies or services in the past? Yes No

Term Term From Term To Value Description Contract Number Type

1 Jan 1, 2022 Mar 31, 2022 40,000 Off site secure document destruction Services. 2022-11-007 Small Purchase

2 Jul 1, 2021 Jan 31, 2022 60,000 Off site secure document destruction Services. 2022-11-003 Small Purchase

If more than 10, or if other comments, explain:

Section VI - Business Rationale

1. Provide a detailed explanation of the need for the supplies or services:

HFS program areas often require documents that contain Federal Tax Information (FTI) or confidential Protected Health Information (PHI) that are necessary to provide assistance to clients. Improper disposal of these documents can result in a breach of confidentiality to the Agency or clients of the Agency. HFS is required by the Health Insurance Portability and Accountability Act to safeguard the confidentiality of providers, applicants and clients. A crucial element in securing this confidentiality is providing a proper method for the destruction of documents that contain Federal Tax Information or Protected Health Information.

2. Provide a list and describe in detail the specifications required to satisfy the need:

Supply and Services required: * Supply of Locked Bins - Vendor shall supply sufficient quantity of appropriately sized locked bins at each Department of Healthcare and Family Services (26) service locations for storage of Department’s confidential documents until transportation to Vendor’s site for shredding. As requested by the Department, Vendor shall increase or decrease the size or number of bins to ensure each facility has sufficient storage of documents between Vendor pickup dates. Vendor shall provide the keys to the bins to one (1) Department site supervisor at each facility to allow restricted access to the bins.

* Transportation of Bins - Vendor shall ensure all bins remain locked during transit until they reach the Vendor’s secured site. Drivers of vehicles shall not have keys to the locked bins. Vendor shall weigh contents of each bin and record the weight of each bin on the bill of lading/service ticket. Weigh tickets shall be available for inspection at the request of the Department.

* Processing & Destruction of Documents - The Vendor shall shred all documents that are collected from the Department within (72) hours after receipt. At the request of the Department, Vendor shall show surveillance tape showing the chain of custody of the documents from delivery to Vendor’s dock, and through the sorting, shredding and baling process. All shredded documents shall be recycled through the pulping process. The Vendor shall be certified by the National Association for Information Destruction (NAID).

* Reporting & Certificates of Destruction - The Vendor shall provide a monthly report with the invoice for each month’s service. The monthly report must include, at a minimum: the pickup location, date, number of bins delivered, number of bins retrieved, weight of documents from bins retrieved, and the date of destruction of those documents. Invoice payment will be contingent upon the inclusion of the report.

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Bulletin Reference Number 22-478HFS-PERSA-B-28001

Requesting Agency/University Healthcare and Family Services

3. Provide detail explaining the justification selected in Section IV to explain why the requested supplies or services are the only ones available that can satisfy the agency or university requirements?

Currently, Paper Tiger Document Solutions provides secured document destruction service to the agency. The current vendor's equipment (secured bins) and operations plan have been in place for the past seven (7) months. HFS is executing this one (1) year Sole Economically Feasible Source to avoid the disruption to agency services while drafting and publishing a competitive solicitation to secure long term services.

4. What are the unique features of the supplies or services that are not available in any other product or by any other vendor? Provide specific quantifiable factors/qualifications:

Federal Tax Information (FTI) and Personal Identifiable Information (PII) are found on numerous documents created or mailed to the agency. The agency cannot function without these critical documents, and must maintain daily operations without the interruption of secured document destruction service. This Sole Economically Feasible Source is in the best interest of the agency as it will allow HFS to remain in compliance with Federal statutes regarding document destruction requirements, it will provide services at rates that have not increased since 2019, and will prevent a disruption to the operations of the agency. It will provide the agency services while CMS is finalizing the new Master Contract for these services which they are currently working on.

5. Has the Agency or University considered alternative supplies or services to satisfy their need? Yes No

5a. If yes, name the alternative vendors whose supplies or services were evaluated:

HFS has compared their current pricing from Paper Tiger with the Pricing provided to Lottery and Revenue by their awarded vendor F&W Resources, Inc. as result of their own seperate Small Purchase RFQ procurements.

5b. If yes, what were the alternatives for each vendor and why were they unacceptable? Be specific with regard to features, characteristics, requirements, capabilities and compatibility:

Paper Tiger currently provides off-site secured information destruction services to HFS based on the bin size and collection frequency requirements at twenty six (26) different locations throughout the State. Paper Tiger pricing is based on container size, plus a flat rate of $0.15 per pound for purge shredding. Paper Tiger has agreed to hold pricing at the current contract levels, which has been constant since the original agreement with Glenkirk in 2007. The State of Illinois Lottery and Department of Revenue recently released Small Purchase RFQs for Shredding Services as a stop-gap measure until CMS establishes their Master contract and they can execute an Order Against it. Both Lottery and Revenue awarded their contracts to F&W Resources, Inc. and both of these agencies' contracts are for on-site shredding services at 1 Springfield location per State Agency respectively. As stated above, HFS requires off site Secure Document Destruction Services at 26 different locations throughout the state of Illinois at a flat rate based on 2007 pricing of $.15 cents a pound.

Lottery awarded their 8 month contract for $12,599.50 at $.12 a pound for paper files. Revenue awarded their one year contract for $39,968.00 base on a $12.00 per 350 lbs. container at their lone location and they supply their own bins. Even with the exponential rise in fuel prices, Paper Tiger has agreed to honor their current rates of $.15 per pound statewide from offices from Aurora to Marion and from Quincy to Champaign with 22 offices scattered all across the State. HFS believes this is a fair and economically feasible price compared to the recently awarded contracts. HFS will be pursuing an Order Against the CMS Master as soon as it is established and this Sole Economically Feasible Source procurement will be terminated as soon as that is executed.

5c. Explain how the market evaluation was conducted?

*This evaluation is to determine available options within a market. If the evaluation is to determine quality or best suited option, this is not the appropriate source selection. Under no circumstances shall the evaluation consist of testing alternative options. These activities must be conducted in a competitive transparent environment (i.e. IFB or RFP).

HFS had originally entered into a three (3) year consecutive State Use Contract with Glenkirk for Off Site Secure Document Destruction Services (2020-11-002) which was supposed to be effective July 1, 2019 through June 30, 2022. HFS was informed by CMS on June 16, 2021 that a company named Paper Tiger had bought out Glenkirk and they were no longer a certified 'State Use' vendor. CMS instructed HFS to pursue a small purchase with Paper Tiger until they could finalize a new Master Contract for these services. Paper Tiger pledged to HFS that rates for service would stay the same as they were under Glenkirk's original State Use Contract. OPM sought other alternatives within State Government such as Master Contracts at other agencies and 'piggy backing' opportunities, but there were no feasible alternatives that could be put in place in a timely manner that would provide a seemless transition that would not raise service costs and without putting HFS at risk of being out of compliance with Federal Law regarding document destruction of records with PHI, HIPPA and other sensitive information. HFS then entered into two (2) separate Small Purchases with Sole Source conditions procurements (2022-11-003 for 6 months and 2022-11-007 for 3 months) to provide for continuity of service under the same rates as the original State Use contract. HFS is pursuing this one (1) year Sole Economically Feasible Source Procurement to cover these services for HFS until CMS get their New Master in place.

Paper Tiger currently provides off-site secured information destruction services to HFS based on the bin size and collection frequency requirements at twenty six (26) different locations throughout the State. Paper Tiger pricing is based on container size, plus a flat rate of $0.15 per pound for purge shredding. Paper Tiger has agreed to hold pricing at the current contract levels, which has been constant since the original agreement with Glenkirk in 2007. The State of Illinois Lottery and Department of Revenue recently released Small Purchase RFQs for Shredding Services as a stop-gap measure until CMS establishes their Master contract and they can execute an Order Against it. Both Lottery and Revenue awarded their contracts to F&W Resources, Inc. and both of these agencies' contracts are for on-site shredding services at 1 Springfield location per State Agency respectively. As stated above, HFS requires off site Secure Document Destruction Services at 26 different locations throughout the state of Illinois at a flat rate based on 2007 pricing of $.15 cents a pound.

Lottery awarded their 8 month contract for $12,599.50 at $.12 a pound for paper files. Revenue awarded their one year contract for $39,968.00 base on a $12.00 per 350 lbs. container at their lone location and they supply their own bins. Even with the exponential rise in fuel prices, Paper Tiger has agreed to honor their current rates of $.15 per pound statewide from offices from Aurora to Marion and from Quincy to Champaign with 22 offices scattered all across the State. HFS believes this is a fair and economically feasible price compared to the recently awarded contracts. HFS will be pursuing an Order Against the CMS Master as soon as it is established and this Sole Economically Feasible Source procurement will be terminated as soon as that is executed.

HFS is home to the Division of Child Support Services, Medical Programs and runs/administers the State Medicaid Program. Off Site Document Destruction Services are an integral and required part of daily operations at HFS. Not having these services in place would cause a major emergency to HFS daily operations and the administration of its critical public service programs. The costs of that emergency to the agency would be astronomical and not in the best interest of the State.

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Bulletin Reference Number 22-478HFS-PERSA-B-28001

Requesting Agency/University Healthcare and Family Services

6. Are there resellers or distributors?

Yes No N/A

7. What efforts were made to get the best possible price (i.e. did the agency/university negotiate) and how did you determine the price for this purchase is considered fair and reasonable?

HFS negotiated with Paper Tiger to secure the same rates utilized since 2019.

8. Will this purchase obligate the State to this vendor for future purchases such as maintenance, licensing or continuing need?

Yes No

9. What will be the financial or other impact to the State if this sole source is not approved and a competitive bid is required?

HFS will experience a major disruption in the administration of agency services and daily business operations. The agency will also risk being out of compliance with Federal statutes regarding the destruction of documents containing Protected Health Information and Personal Identifiable Information.

10. Is there any additional information you would like to add to justify this sole source?

No.

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Bulletin Reference Number 22-478HFS-PERSA-B-28001

Requesting Agency/University Healthcare and Family Services

Section VII

Requesting Department Representative

Requesting Department Signature Required

I know and understand the contents of this Sole Source Justification and attest that all statements are true and correct and the fairness and reasonableness of the price was adequately confirmed.

Date

Printed Name E-mail Address

Phone Number

State Agency Bureau/Division Head or University Purchasing Director Approval and Signature Required

I know and understand the contents of this Sole Source Justification and attest that all statements are true and correct and the fairness and reasonableness of the price was adequately confirmed. (All prior form fields will lock once this e-signature is completed)

E-mail Address teresa.r.flesch@illinois.gov

Phone Number 217-524-7336 Date 03092022

Printed Name Teresa R Flesch

Agency Bureau/Division Head or University Purchasing Director and Not a Designee

SPO Approval and Signature Required

I have reviewed and understand the contents of this Sole Source Justification and agree with the State Agency or University determination.

I have reviewed and understand the contents of this Sole Source Justification and do not agree with the State Agency or University determination. As a result, the State Agency or University must explore other sourcing methods to satisfy their need.

State Purchasing Officer Signature Phone Number 217-993-1719 Date 3/9/2022

Printed Name Jennifer Klein E-mail Address jennifer.klein@illinois.gov

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Bulletin Reference Number 22-478HFS-PERSA-B-28001

Requesting Agency/University Healthcare and Family Services

Sole Source Justification Form - Part II Section I - General Information

Project Title Offsite Secure Document Destruction

Vendor Business Storage Inc. d/b/a Paper Tiger

Initial Date of Procurement Bulletin Posting 3/9/2022

Was a Sole Source hearing held per 30 ILCS 500/20-25?

Yes - Complete Section II and III below (Section II will only be visible when this option is selected)

No - Section II not required, go to Section III below Section III - CPO Approval and Signature Required

Based on my review, I authorize the Agency/University to proceed in accordance with the published Notice referenced above.

Based upon my review, I authorize the Agency/University to proceed with the following Changes.

Based on my review, the Agency/University is not authorized to proceed with this sole source as presented and my recommendation is that it be cancelled.

Other

CPO Signature CPO Phone 217-558-6897

Printed Name Ellen H. Daley Date

CPO E-mail ellen.h.daley@illinois.gov

Version 7.01 Page of Sole Source Justification Form - Part I Section I - General Information Will this Sole Source amend a Professional or Artistic Services contract?

If yes, what was the original contract value?

*Sole Source may not be used for amendments for Professional or Artistic Services if the amendment would increase the value by more than 5% of the initial award or extend the term by more than 60 days.

Section II - Proposed Term If a Term Contract, does the term, including renewals, exceed 12 months?

If yes, provide a detailed justification including any economic benefit received for agreeing to a multi-year term:

Section III - Funding Source Select the type of funding to be used (Check all that apply):

Section IV - Sole Source Justification Are there secondary justification(s) for this sole source?

Section V - Purchase History Has the Agency or University Purchased these supplies or services in the past?

Term Term From Term To Value Description Contract Number Type Section VI - Business Rationale

1. Provide a detailed explanation of the need for the supplies or services:

2. Provide a list and describe in detail the specifications required to satisfy the need:

3. Provide detail explaining the justification selected in Section IV to explain why the requested supplies or services are the only ones available that can satisfy the agency or university requirements?

4. What are the unique features of the supplies or services that are not available in any other product or by any other vendor? Provide specific quantifiable factors/qualifications:

5. Has the Agency or University considered alternative supplies or services to satisfy their need?

5a. If yes, name the alternative vendors whose supplies or services were evaluated:

5b. If yes, what were the alternatives for each vendor and why were they unacceptable? Be specific with regard to features, characteristics, requirements, capabilities and compatibility:

5c. Explain how the market evaluation was conducted?

*This evaluation is to determine available options within a market. If the evaluation is to determine quality or best suited option, this is not the appropriate source selection. Under no circumstances shall the evaluation consist of testing alternative options. These activities must be conducted in a competitive transparent environment (i.e. IFB or RFP).

5a. If no, why weren't alternatives evaluated?

6. Are there resellers or distributors?

7. What efforts were made to get the best possible price (i.e. did the agency/university negotiate) and how did you determine the price for this purchase is considered fair and reasonable?

8. Will this purchase obligate the State to this vendor for future purchases such as maintenance, licensing or continuing need?

8a. If yes, please provide details regarding future obligations and/or needs:

9. What will be the financial or other impact to the State if this sole source is not approved and a competitive bid is required?

10. Is there any additional information you would like to add to justify this sole source?

Section VII Requesting Department Signature Required I know and understand the contents of this Sole Source Justification and attest that all statements are true and correct and the fairness and reasonableness of the price was adequately confirmed.

State Agency Bureau/Division Head or University Purchasing Director Approval and Signature Required I know and understand the contents of this Sole Source Justification and attest that all statements are true and correct and the fairness and reasonableness of the price was adequately confirmed. (All prior form fields will lock once this e-signature is completed) SPO Approval and Signature Required Sole Source Justification Form - Part II Section I - General Information Was a Sole Source hearing held per 30 ILCS 500/20-25?

Section II - Sole Source Hearing Details The State posted to the Illinois Procurement Bulletin a description of the State's need, the justification for the sole source decision, and information regarding the opportunity to submit comments and testify at a public hearing. Notice of the hearing was also posted outside of the hearing room 48 hours prior to the hearing.

The public hearing was conducted for the purpose of receiving testimony regarding the sole source determination. The Hearing Officer recommends the following:

The following relevant documents are attached:

Section III - CPO Approval and Signature Required 9.0.0.2.20101008.1.734229 ellen.h.daley@illinois.gov

* Transportation of Bins - Vendor shall ensure all bins remain locked during transit until they reach the Vendor’s secured site. Drivers of vehicles shall not have keys to the locked bins. Vendor shall weigh contents of each bin and record the weight of each bin on the bill of lading/service ticket. Weigh tickets shall be available for inspection at the request of the Department.

* Processing & Destruction of Documents - The Vendor shall shred all documents that are collected from the Department within (72) hours after receipt. At the request of the Department, Vendor shall show surveillance tape showing the chain of custody of the documents from delivery to Vendor’s dock, and through the sorting, shredding and baling process. All shredded documents shall be recycled through the pulping process. The Vendor shall be certified by the National Association for Information Destruction (NAID).

* Reporting & Certificates of Destruction - The Vendor shall provide a monthly report with the invoice for each month’s service. The monthly report must include, at a minimum: the pickup location, date, number of bins delivered, number of bins retrieved, weight of documents from bins retrieved, and the date of destruction of those documents. Invoice payment will be contingent upon the inclusion of the report.

Paper Tiger currently provides off-site secured information destruction services to HFS based on the bin size and collection frequency requirements at twenty six (26) different locations throughout the State. Paper Tiger pricing is based on container size, plus a flat rate of $0.15 per pound for purge shredding. Paper Tiger has agreed to hold pricing at the current contract levels, which has been constant since the original agreement with Glenkirk in 2007. The State of Illinois Lottery and Department of Revenue recently released Small Purchase RFQs for Shredding Services as a stop-gap measure until CMS establishes their Master contract and they can execute an Order Against it. Both Lottery and Revenue awarded their contracts to F&W Resources, Inc. and both of these agencies' contracts are for on-site shredding services at 1 Springfield location per State Agency respectively. As stated above, HFS requires off site Secure Document Destruction Services at 26 different locations throughout the state of Illinois at a flat rate based on 2007 pricing of $.15 cents a pound. Lottery awarded their 8 month contract for $12,599.50 at $.12 a pound for paper files. Revenue awarded their one year contract for $39,968.00 base on a $12.00 per 350 lbs. container at their lone location and they supply their own bins. Even with the exponential rise in fuel prices, Paper Tiger has agreed to honor their current rates of $.15 per pound statewide from offices from Aurora to Marion and from Quincy to Champaign with 22 offices scattered all across the State. HFS believes this is a fair and economically feasible price compared to the recently awarded contracts. HFS will be pursuing an Order Against the CMS Master as soon as it is established and this Sole Economically Feasible Source procurement will be terminated as soon as that is executed.

HFS is home to the Division of Child Support Services, Medical Programs and runs/administers the State Medicaid Program. Off Site Document Destruction Services are an integral and required part of daily operations at HFS. Not having these services in place would cause a major emergency to HFS daily operations and the administration of its critical public service programs. The costs of that emergency to the agency would be astronomical and not in the best interest of the State.

Q5bAnswer: Paper Tiger currently provides off-site secured information destruction services to HFS based on the bin size and collection frequency requirements at twenty six (26) different locations throughout the State. Paper Tiger pricing is based on container size, plus a flat rate of $0.15 per pound for purge shredding. Paper Tiger has agreed to hold pricing at the current contract levels, which has been constant since the original agreement with Glenkirk in 2007. The State of Illinois Lottery and Department of Revenue recently released Small Purchase RFQs for Shredding Services as a stop-gap measure until CMS establishes their Master contract and they can execute an Order Against it. Both Lottery and Revenue awarded their contracts to F&W Resources, Inc. and both of these agencies' contracts are for on-site shredding services at 1 Springfield location per State Agency respectively. As stated above, HFS requires off site Secure Document Destruction Services at 26 different locations throughout the state of Illinois at a flat rate based on 2007 pricing of $.15 cents a pound. Lottery awarded their 8 month contract for $12,599.50 at $.12 a pound for paper files. Revenue awarded their one year contract for $39,968.00 base on a $12.00 per 350 lbs. container at their lone location and they supply their own bins. Even with the exponential rise in fuel prices, Paper Tiger has agreed to honor their current rates of $.15 per pound statewide from offices from Aurora to Marion and from Quincy to Champaign with 22 offices scattered all across the State. HFS believes this is a fair and economically feasible price compared to the recently awarded contracts. HFS will be pursuing an Order Against the CMS Master as soon as it is established and this Sole Economically Feasible Source procurement will be terminated as soon as that is executed.

Q5cAnswer: HFS had originally entered into a three (3) year consecutive State Use Contract with Glenkirk for Off Site Secure Document Destruction Services (2020-11-002) which was supposed to be effective July 1, 2019 through June 30, 2022. HFS was informed by CMS on June 16, 2021 that a company named Paper Tiger had bought out Glenkirk and they were no longer a certified 'State Use' vendor. CMS instructed HFS to pursue a small purchase with Paper Tiger until they could finalize a new Master Contract for these services. Paper Tiger pledged to HFS that rates for service would stay the same as they were under Glenkirk's original State Use Contract. OPM sought other alternatives within State Government such as Master Contracts at other agencies and 'piggy backing' opportunities, but there were no feasible alternatives that could be put in place in a timely manner that would provide a seemless transition that would not raise service costs and without putting HFS at risk of being out of compliance with Federal Law regarding document destruction of records with PHI, HIPPA and other sensitive information. HFS then entered into two (2) separate Small Purchases with Sole Source conditions procurements (2022-11-003 for 6 months and 2022-11-007 for 3 months) to provide for continuity of service under the same rates as the original State Use contract. HFS is pursuing this one (1) year Sole Economically Feasible Source Procurement to cover these services for HFS until CMS get their New Master in place.

Paper Tiger currently provides off-site secured information destruction services to HFS based on the bin size and collection frequency requirements at twenty six (26) different locations throughout the State. Paper Tiger pricing is based on container size, plus a flat rate of $0.15 per pound for purge shredding. Paper Tiger has agreed to hold pricing at the current contract levels, which has been constant since the original agreement with Glenkirk in 2007. The State of Illinois Lottery and Department of Revenue recently released Small Purchase RFQs for Shredding Services as a stop-gap measure until CMS establishes their Master contract and they can execute an Order Against it. Both Lottery and Revenue awarded their contracts to F&W Resources, Inc. and both of these agencies' contracts are for on-site shredding services at 1 Springfield location per State Agency respectively. As stated above, HFS requires off site Secure Document Destruction Services at 26 different locations throughout the state of Illinois at a flat rate based on 2007 pricing of $.15 cents a pound. Lottery awarded their 8 month contract for $12,599.50 at $.12 a pound for paper files. Revenue awarded their one year contract for $39,968.00 base on a $12.00 per 350 lbs. container at their lone location and they supply their own bins. Even with the exponential rise in fuel prices, Paper Tiger has agreed to honor their current rates of $.15 per pound statewide from offices from Aurora to Marion and from Quincy to Champaign with 22 offices scattered all across the State. HFS believes this is a fair and economically feasible price compared to the recently awarded contracts. HFS will be pursuing an Order Against the CMS Master as soon as it is established and this Sole Economically Feasible Source procurement will be terminated as soon as that is executed.

HFS is home to the Division of Child Support Services, Medical Programs and runs/administers the State Medicaid Program. Off Site Document Destruction Services are an integral and required part of daily operations at HFS. Not having these services in place would cause a major emergency to HFS daily operations and the administration of its critical public service programs. The costs of that emergency to the agency would be astronomical and not in the best interest of the State.