OMBP RFP Q_A (HQ0423-22-R-0008) 15 July 2022.docx

QUESTIONS and ANSWERS (Q&A) DoD Overseas Military Banking Program (OMBP) Draft Request for Proposal (RFP) July 15, 2022 Q1: Are early termination costs for subcontracts on the current Contract (HQ0423-13-D-0001) allocable costs on to the current Contract or costs for the successor Contractor if the successor Contractor opts to change subcontractors?

A1: Costs associated with early termination of existing cost-reimbursement subcontracts for the current Contract (HQ0423-13-D-0001) should not be included as part of potential Offeror Proposals. Pursuant to FAR 52.249-6 and FAR 31.205-42, reasonable costs that are allowable and allocable costs incident to the transfer or close-out of operations at the end of contract performance are allocable to the current Contract and reimbursable expenses to the incumbent OMBP Contractor.

Q2: Would it be viewed as a conflict of interest for credit unions, who operate on-base overseas under a geographic franchise, to bid?

If it is not viewed as a conflict of interest, what other implications may there be for an overseas on-base credit union if they were to be granted the OMBP contract?

A2: Any entity (financial institution) chartered, properly insured, and capable of meeting criteria and requirements identified in Section C of the RFP and providing a proposal demonstrating the ability to perform requirements identified within the RFP may submit a proposal.

The Community Bank is a separate and distinct DoD entity, which is managed but not owned by the OMBP Contractor. OMBP operations are separate and distinct from an entity’s corporate operations and existing financial institution arrangements would have to remain in place as separate and distinct from OMBP operations.

Q3: Can you provide an overview of the regulatory oversight environment? Clarify the governing regulatory agencies/bodies. Do the regulators such as the Office of the Comptroller of the Currency (OCC) or the Office of the Secretary of Defense (OSD) examine “Community Bank operated by Bank of America,” completely independent of the OMBP Contractor?

A3: The Department of Defense Overseas Military Banking Program, which is also referred to as “Community Bank,” is operated under the authority of 12 United States Code (USC) 90 through the United States Treasury designation of a financial institution as a depositary and financial agent of the U.S. Government and under the authority of Department of Defense Directive (DoDD) 5118.03 for the operation of Military Banking Facilities (MBF) on military installations. Historically, the operations of MBFs have not been considered to be “banking branches” subject to regulation or oversight. See “Comptroller’s Licensing Manual, Branches and Relocations,” Office of the Comptroller of Currency (OCC), October 2019.

Although historically MBFs are not “banking branches” and are not generally subject to regulation on that basis it remains a possibility that a new statute, rule or regulation or reinterpretation of an existing statute, rule or regulation could alter that conclusion and the DoD does not have the authority to preclude such a future possibility although we do not have any reason to believe that any action or reinterpretation is forthcoming.

Q4: What are the licensing requirements and the processes/timelines for obtaining licensing requirements (or exemptions therefrom) from the foreign banking regulators?

A4: The OMBP Contractor has authority to operate in existing OMBP operating locations without foreign banking licensing, except for the United Kingdom which requires a banking license. This operating authority is a result of Status of Forces Agreements and other international agreements between the U.S. Government and the applicable host nation. To the extent that new foreign operating locations are identified during the OMBP Contract period of performance, the U.S. Government will ensure international agreements permit operations and if licensing or other notification of OMBP operations is required, work with the contractor as circumstances dictate to assist in facilitating operations.

Q5: What is composition of the U.S. based Home Office Staff Support team (e.g., Exec Mgt; Finance; Ops)?

A5: Functions in the Home Office currently encompass all core roles to support OMBP operations to include: Executive Management, Human Resources, Loan Servicing, Technology, Online Banking, Project Management, Business Controls, Reconciliation, Card Services, Training & Compliance, Procedure Management, Contract Administration, Wires, Finance and Accounts Payable.

Q6: Does the OMBP Contractor maintain/manage a dedicated call center for Community Bank?

A6: Yes the OMBP has call center operations with a live response option and a 24 hour Interactive Voice Response capability. The call centers are currently located in San Antonio and in Germany. Information about call center operations may be viewed online at: https://www.dodcommunitybank.com/home/newcomer/contact. Additionally, OMBP customers may submit questions or concerns to customer service personnel through secure email capability available on www.dodcommunitybank.com.

Q7: “...the servicing MBF shall provide transactional U.S. currency to defense credit unions… at no cost…” Can you provide context to this requirement?

A7: In performance under the Contract, the OMBP Contractor acquires U.S. currency for use by U.S. credit unions operating overseas on DoD installations. While there are costs incurred under the Contract to do so, currently there are no charges levied by the OMBP Contractor to the U.S. credit unions.

Q8: How do you control the ban on marketing the OMBP Contractor’s products to Community Bank account holders?

A8: The OMBP Contractor is responsible for establishing controls and procedures to ensure that corporate offerings are not introduced during contract performance. Additionally, use of any Personally Identifiable Information or names attained through OMBP contract performance for corporate marketing purposes is strictly prohibited. Information on this topic may be shared in training and covered as part of management routines. The current RFP identifies that upon approval of the DoD, certain corporate marketing to individuals returning to the United States may take place.

Q9: Any special considerations for Business Continuity Plans?

A9: The OMBP has established Business Continuity Plans that the OMBP Contractor will be responsible for maintaining and ensuring are appropriate to deliver intended results. Periodically, the OMBP Contractor may be required to participate in table-top exercise plans with the DFAS PMO or local commands.

Q10: Per C-16: The Contractor…shall provide banking services (including ATMs) to Department installations within the United States. Can you provide context to this requirement?

A10: This provision was in the draft RFP but was not in the final RFP so proposals should not contain anything related to this requirement.

Q11: What are the key elements of a transition plan between the incumbent Contractor and a successor Contractor?

A11: The transition plan should identify tasks, resources, costs, and schedule for a new OMBP contractor to operate the OMBP as described within the RFP (See C-17).

Q12: Does the OMBP Contractor or DoD maintain the subcontracts/licensing agreements with vendors and operating agreements with the installations? Are all subcontracts/agreements transferable?

A12: The OMBP Contractor contracts directly with vendors. A list of agreements above a set threshold ($100,000) is reported to DoD. DoD maintains the ability to review all agreements. All subcontracts/agreements are transferable. To the extent that a subcontract/agreement were not transferable, the program would absorb any increased costs, assuming the costs were otherwise reasonable, allowable, and allocable. The OMBP Contractor does not have operating agreements with local installations.

A list of current licensing agreements, subcontracts/agreements for the current Contract (HQ0423-13-D-0001, H-14 Report) for goods or services acquired in excess of $100,000 will be provided to FIs that request them and have completed and submitted the NDA to the Contracting Officer.

Q13: What risk does the OMBP Contractor bear related to increased third-party contract costs (e.g., cost to maintain ATMs; facilities maintenance expense)?

A13: There is no risk to an OMBP contractor for increased third-party contract costs insomuch as costs have been approved by the DFAS Contracting Officer prior to contract award and during the annual budget cycle review. The third-party costs are reimbursed on a cost basis. Although the risk of increased costs falls upon the DoD it is expected that the OMBP Contractor works to ensure all costs to operate the program, including escalation factors for future costs with third-party vendors, provide best value to the DoD and are in accordance with the Cost Accounting Standards and Contract Cost Principles in FAR Parts 30 and 31.

Q14: Please provide transaction-level or financial detail for 2019, 2020, and YTD 2022 for the OMPB.

A14: UNREDACTED version(s) of the OMBP Program Management Report (which provides the data from the OMBP Contract by year for OMBP Banking Operations will be provided to potential offerors upon request after completion of the non-disclosure agreement and submission to the Contracting Officer. Please keep in mind that the Government considers some of the content Non-public or Confidential information. Potential offerors are reminded that it is expected that all reasonable measures to protect the confidentiality and avoid the unauthorized use, disclosure, publication, or dissemination of the disclosing the contents are taken.

Q15: Please provide additional information pertaining to the Overseas Branch Network and ATMs, currencies in use, need for cash after hours, physical characteristics of the MBFs, and inventory of equipment.

A15: The following additional OMBP information is provided as follows:

1. Overseas Branch Network and ATMs

a. Specific location of each office - MBF Operating Locations are identified in Section J, Attachment J-1 of the RFP.

b. For each office

i. Hours – MBF Hours of Operation are identified in Section J, Attachment J-2 of the RFP.

ii. Staffing – Information related to FTEs is provided in Section J, Attachment J-17 of the RFP as well as the UNREDACTED version(s) of the OMBP Program Management Report, which will be provided to potential offerors upon request after completion of the non-disclosure agreement and submission to the Contracting Officer. Please keep in mind that the Government considers some of the content Non-public or Confidential information. Potential offerors are reminded that it is expected that all reasonable measures to protect the confidentiality and avoid the unauthorized use, disclosure, publication, or dissemination of the disclosing the contents are taken.

iii. Accounts domiciled – As of March 2022:

1. Loans 2,973

2. Checking 53,947

3. Savings 12,184

4. # customers: Estimated at 50K

2. Currencies in use:

a. Local: Euro, Pound Sterling, Yen, and Won at locations where these currencies are used in surrounding areas

b. USD: At all locations

c. Other: None on a recurring basis although there may be local requests to acquire other currency for use by local commands

3. Need for cash after/off hours: For local command use, on an extremely limited basis there could be the need to provide cash outside of normal operating hours. This request would be worked at the local level. For individuals, ATMs are typically placed in locations permitting 24/7 access.

4. Physical characteristics of banking centers:

a. Square footage: Varies by location. DoD policy requires that space provided is adequate to conduct retail banking operations. See RFP H-16.b.(8).

b. Description of location (# offices/teller stations, etc.): There are global standard fixtures and furniture which can be seen in photos which will be posted with the contract opportunity documents in conjunction with July 15, 2022 Q&A responses and incorporated into Section J, Attachment J-1a of the RFP in Amendment 5.

c. Vaults/safes: Each location has a vault and/or safe based on design or build.

d. Space for additional equipment such as ITM’s: Space for additional equipment would vary by location.

5. Inventory of equipment:

a. ATM’s: There are currently 276 current ATMs. Specific locations and lifecycle information pertaining to the ATMs is provided in Section J, Attachments J-1, J-19, and J-20 of the RFP.

b. Security equipment: Security equipment is furnished and maintained by the base and varies by location

Q16: Please provide a description and diagram of the OMBP IT network structure.

A16: Please refer to RFP Section J, Attachment J-18 for the OMBP Information Systems Architecture Overview. The Technical Architecture Diagram identifies all major core applications in use, as well as application to application interfaces. Detailed descriptions of the core banking applications, functionality within those applications, and specific software used within the environment will be included as part of the incumbent Contractor’s work performed during a transition to a new OMBP contractor.

Q17: Where are the locations of operations and related operations centers Stateside vs. OCONUS?

A17: There are currently four operating locations (Home Office in San Antonio TX, a District Office in Mainz-Kastel Germany, a District office at Camp Humphries Korea, and a Main Cash Vault at Miseau Army Depot).

Q18: Which services not offered today does the DoD hope to offer within next few years?

A18: As stated in B-3. of the RFP “…the Program Management Office may require the Contractor to implement relevant new technological advancements, upgrade the current system platforms and telecommunication capabilities and other innovations throughout the life of the Contract. Such changes will be implemented by a contract modification.

Technology and Products/Services Refresher – The Contractor shall conduct and provide the Government with a technology and products/services review annually, in accordance with Section C, paragraph 6-5(c).”

Q19: With regard to Fraud Detection/Prevention/Mitigation:

a. Please advise of Fraud incidents and how they are expected to be managed by Bank and on-base (base personnel as victim and as perpetrator)

b. Note expectations of Bank communication with Base MP regarding fraud incidents

c. Please advise of Fraud prevention and mitigation procedures

A19: Dependent on dollar amount, if internal fraud is detected, it is turned over to the base. The local forces guide next actions. In some cases, local labor law requirements will need to be followed. The Program deploys audits, cash counts, card fraud detection, and other standard actions to prevent financial fraud.

Q20: Please provide information pertaining to Cybersecurity Maturity Model Certification (CMMC) 2.0 certification level, NIST SP 800-171 compliance, and Information Security and Incident Response policies, procedures, and other relevant documentation.

A20:

a. CMMC: DFARS clause 252.204-7021 CYBERSECURITY MATURITY MODEL CERTIFICATION (NOV 2020) and the requirements contained therein are not applicable to the OMBP at this time (i.e., specific CMMC level is not a requirement).

b. NIST SP 800-171: The requirements in DFARS 252.204-7019 NOTICE OF NIST SP 800-171 DOD ASSESSMENT REQUIREMENTS (NOV 2020) are applicable to the OMBP. Please note, the links have been updated in the DFARS clause252.7019 published MAR 2022 and can be found at: https://www.acquisition.gov/dfars/part-252-solicitation-provisions-and-contract-clauses#DFARS_252.204-7019 DFARS 252.204-7019 and 252.204-7020 (both dated MAR 2022) will be updated in RFP Amendment 5 accordingly.

c. Information Security and Incident Response: Community Bank has robust information security and internal control processes and testing. For security reasons, these cannot be publically revealed. These will be revealed as part of the transition.

Q21: Would the Government consider a cost incentive type contract, rather than a predominantly CPFF type contract?

A21: Offerors are required to submit Cost Proposals with predominantly CPFF type CLIN structures pursuant to Section B of the RFP.

Q22: Monthly payments to the Contractor include: 1.) fixed fee; 2.) operating loss payment (if applicable); and bad debt expense (if applicable). Can you provide insight on any financial risks to the Contractor (e.g., failure to get DoD approval for allowable expenses; gov’t shutdown)?

A22: There are no financial risks provided that all reimbursable costs are reasonable, allocable, legally permissible, and government approved. In the event of a government shut down or failure to raise the debt ceiling, payments will be made, with applicable interest, as soon as the shut down ends or the debt ceiling is raised.

QUESTIONS and ANSWERS (Q&A)

June 28, 2022

Q1: Is there a Community Bank Charter?

A1: Community Bank does not have a separate Charter from the incumbent Contractor/financial institution (FI). The Community Bank is not a “Bank” in the usual sense of the word. It is a government program that is implemented through a contract with a charted financial institution. The incumbent Contractor (Bank of America) is a chartered bank/FI.

Q2: Is the Contractor a Federal Deposit Insurance Corporation (FDIC) insured FI?

A2: Yes, the FI must participate in the FDIC program. The depositors are protected by the insurance as provided by law and regulation. The costs of insurance for Community Bank depositors are a program expense, assuming that the costs are otherwise allowable under DCAA rules.

Q3: Is there a FDIC number for the Legal Entity?

A3: Community Bank is not a legal entity. Community Bank customers receive protection under the FDIC. The insurance premium is paid by the Contractor and is reimbursed under the Contract if the costs are otherwise allowable under DCAA rules.

Q4: Is Community Bank a Legal Entity?

A4: No. Community Bank is a government program operated by a contractor/FI on behalf of the Department of Defense.

Q5: Can the successful Offeror talk to the Community Bank customers about insurance or other FI product offerings on the way out of the Country?

A5: The marketing of financial services broadly speaking to include insurance to Community Bank customers, including permissibility, timing, and materials will be subject to the approval of the DoD.

Q6: Who works with the host country to have the ability to operate?

A6: The OMBP Contractor and the DoD work together to obtain the needed authority to operate. The cost, if any, of obtaining the necessary authorizations, is a cost of the Contract, assuming the costs are otherwise allowable under DCAA rules.

Q7: Who signs the agreement? (Community Bank, OMBP Contractor, PMO/DOD Banking?)

A7: This will be determined by the specifics of the Status of Forces Agreement (SOFA) or implementing agreement. To the extent that new agreements are necessary, costs associated with obtaining those agreements would be a cost of the Contact, assuming the costs are otherwise allowable under DCAA rules.

Q8: Is there a Mobile Banking APP?

A8: Yes, there is a Mobile Banking APP available for OMBP customers.

Q9: Is there any added value in connecting with the PMO?

A9: The PMO and the incumbent Contractor interact on a daily basis. The Contractor and the PMO are not directly systemically connected.

Q10: Is there system integration between Community Band and the OMBP Contractor?

A10: No, the Community Bank has separate systems from corporate Bank of America (incumbent). To the extent that some unknown integration exists, the costs of disintegration would be a cost of the Contract, assuming the costs are otherwise allowable under DCAA rules.

Q11: Who tracks the dollar value of funds held in account?

A11: The OMBP Contractor initially tracks the dollar value of the amounts in the accounts. The OMBP Contractor reports the dollar value of the accounts to the PMO.

QUESTIONS and ANSWERS (Q&A)

April 7, 2022

Q1: The DFARS Proposal Adequacy Checklist (i.e., DFARS 252.215-7009) was included in the updated solicitation materials. Per DFARS 215.408 (4), this checklist is to be included in proposals that require the submission of certified cost or pricing data. Section M-1 of the solicitation states that this is a competitive source selection, which may create an exception to submit certified cost or pricing data under FAR 15.403-1(b)(1). Please explain why this checklist was included in the solicitation and whether or not it is required to be completed as part of an offeror’s proposal.

A1: DFARS 252.215-7009, entitled “Proposal Adequacy Checklist” was erroneously included in the Draft RFP and was removed from the Final RFP prior to issuing the Solicitation. The Proposal Adequacy Checklist will not be required for proposal submissions.

Q2: We request additional guidance from the government as to the level of detail required on projecting costs for the replacement of existing government furnished property over the period of performance in the RFP. There are over 10,000 items in the current inventory and it seems unrealistic that an offeror could reasonably project the timing and cost for such a magnitude of items. Further, the government exercises considerable control over replacement of existing equipment in the current contract. The annual budget submittal includes a request for replacement of property with updated pricing for each item. The request is not based on a planned lifecycle but on the expectation the items will no longer be serviceable in the coming fiscal year. The government evaluates the requests each year and often provides guidance to defer or cancel items. The expected costs for replacement of existing property would not be subject to fee and, consequently, not viewed as a differentiator between proposals. Actual costs for replacement of equipment in the current contract have ranged from $269,000 to $963,000 in any given year. We have no basis for developing a reasonable approach to estimating this cost for the RFP.

We do agree a reasonable estimate for the replacement of ATMs can be provided. Future pricing on each ATM will be subject to changes in makes and models of ATMs. We would be willing to provide an estimate for replacement of ATMs based on pricing available to us at this time.

A2: The Government established an estimate of the costs for replacement of existing government property (which includes government furnished property and contractor acquired property) as well as any non-replacement property (i.e., additional property that’s not replacing existing property). The Government estimates that $500,000 will be the cost for the OMBP “Equipment Purchases” for each year in the base year and nine one-year options periods ($250,000 for the six-month extension) during the period of performance in the RFP. An Amendment will be issued to the Final RFP (issued March 30, 2022) to reflect the $500,000 baseline. The Government is not requiring offerors to propose an item-by-item methodology for Equipment Purchases and recognizes the difficulties inherent in predicting future costs, especially over a range of equipment and supplies. Although the baseline has established an estimate for OMBP “Equipment Purchases” Offerors should describe their proposed methodology for MBF “Equipment Purchases” in sufficient detail so the methodology can be analyzed to determine if the proposed approach will result in fair and reasonable costs. Offerors should note that “Equipment Purchases” is exclusive of ATM Purchases and Installation on the Cost_Pricing Matrix.

Q3: Would DFAS be open to amend the current RFP to include the submission of the GPATs post the contract award?

A3: The Government’s expectation is that offerors submit the GPATs (RFP Attachments J-10, J-11, and J-12) to the best of their ability as Appendix C in their Technical Proposal.

Q&A July 15, 2022

OMBP RFP