SSJF part I and part II DHS B-36572.pdf

Sole Source Justification Form

Version 7.01 Page 1 of 6

Bulletin Reference Number 24-444DHS-BUSSE-B-36572

Requesting Agency/University Illinois Department of Human Services

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

Department/Bureau/Section: Office of Business Services - Mail Processing Unit

Need Identified Date: Apr 10, 2023 Supply/Service Need By Date: Jul 1, 2023

Project Title: Resident Technician Repair and Maintenance Agreement for Bell & Howell Producer Inserters

Vendor: Bell & Howell

Provide a description of the supplies or services required:

The Illinois Department of Human Services (DHS) intends to procure a 5-year Repair & Maintenance (R&M) agreement for the four automated intelligent Producer Inserters utilized by the Office of Business Services (OBS) Mail Processing Unit (MPU) located at 5020A Industrial Ave in Springfield. This R&M agreement will provide all required repair and maintenance services, software updates/installations, sorting software subscriptions and monthly preventative maintenance services on the equipment with the work being performed by a dedicated Resident Technician housed on-site at 5020A Industrial Ave. The services will include, but are not limited to, making repairs, technical adjustments, and replacing and/or cleaning parts - using only Original Equipment Manufacturer (OEM) parts and/or components.

Value: Actual Value of Initial Term, this Change Order or Amendment: 1,734,420

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 Source

Section II - Proposed Term

One-Time Purchase Term Contract

Estimated Contract Begin Date: July 1, 2023

Estimated Contract End Date: June 30, 2028

Number of Potential Renewals:

Length of Each Renewal in Months:

Total Value of All Renewals:

If a Term Contract, does the term, including renewals, exceed 12 months? Yes No

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

See attachment "BH SSJF Attachment for Multi-Year Term" for explanation.

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

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Bulletin Reference Number 24-444DHS-BUSSE-B-36572

Requesting Agency/University Illinois Department of Human Services

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

Items are Copyrighted or Patented and the Items are Only Available from the Holder

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

Another justification that this purchase is only available from a sole source is because it is:

Compatibility of Equipment, Accessories, Replacement Parts or Service

Another justification that this purchase is only available from a sole source is because it is:

Software License/Upgrade/Maintenance

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 9/24/2021 9/23/2022 2,977,000 Purchase of four (4) Producer 400TM High Speed Inserting System 4100147900 RFP

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:

DHS invested nearly $3M in FY22 for the purchase of new inserting equipment for the OBS/MPU. This procurement was done via competitive bid with Bell & Howell emerging as the winning vendor. Four (4) new Producer Inserters replaced eight (8) legacy automated inserters that had reached the end of their service life. As with all equipment, the new Producer Inserters require scheduled PM's along with emergency break fix to ensure operational viability and long-term serviceable life, in addition to annual software upgrades enabling mailings to be processed timely and accurately. Because Bell & Howell holds proprietary rights to this equipment, no other vendor has the expertise, capability, access to parts and components, or the required software to keep the machines in good working order - nor is any other vendor allowed to provide the services. Without this R&M agreement when equipment requires service we will have no recourse to make repairs, upgrades, or load software that allows the equipment to remain operational. This, in turn, would reduce the MPU's ability to process mailings timely or at all, resulting in the interruption or loss of benefits to customers/clients, loss of Federal funding, fines and repayment of Federal funds, lawsuits and more, not just for but for several other State agencies that the MPU provides mail processing services for.

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Bulletin Reference Number 24-444DHS-BUSSE-B-36572

Requesting Agency/University Illinois Department of Human Services

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

This R&M agreement will provide all required repair and maintenance services, software updates/installations, sorting software subscriptions and monthly preventative maintenance services on the equipment with the work being performed by a dedicated Resident Technician housed on-site at 5020A Industrial Ave. The services will include, but are not limited to, making repairs, technical adjustments, and replacing and/or cleaning parts , using only Original Equipment Manufacturer (OEM) parts and/or components. The Vendor shall be required to carry a parts and/or components inventory on-site. This inventory shall include all parts and/or components normally required for routine repair and maintenance services of the inserting equipment currently in use within the OBS/MPU. In addition, Bell & Howell will provide all required software and updates, ensuring the inserting equipment is able to process mailings timely and accurately.

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?

Bell & Howell is the manufacturer of the Producer Inserters owned and utilized within the IDHS OBS/MPU. They hold proprietary ownership of the equipment technology, parts, components, and software required for the operation of the inserters. With these proprietary rights, Bell & Howell is the only vendor that has the expertise, capability, access to parts and components, and the required software to keep the machines in good working order - no other vendor is allowed to provide these 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:

DHS invested nearly $3M in FY22 for the procurement of these new inserters to ensure the MPU would be able to meet mandated time frames for the mailing of critical notices to clients/customers of DHS, Healthcare and Family Services (HFS), Central Management Services (CMS), Department of Commerce and Economic Opportunity (DCEO), Department of Natural Resources (DNR), Department of Public Health (DPH) and other state agencies. The equipment was purchased through the competitive bid process, where Bell & Howell was awarded the contract. Because Bell & Howell is the manufacturer of the Producer Inserters owned and utilized within the IDHS OBS/MPU, they hold proprietary ownership of the equipment technology, parts, components, and software required for the operation of the inserters. With these proprietary rights, Bell & Howell is the only vendor that has the expertise, capability, access to parts and components, and the required software to keep the machines in good working order - no other vendor is allowed to provide these services. Failing to provide proper maintenance and software upgrades would result in the failure of the MPU meeting these deadlines, resulting in the interruption or loss of benefits to customers/clients, loss of Federal funding, fines and repayment of Federal funds, lawsuits and more. In addition, the $3M spent on this capital investment would be wasted if the equipment is not properly maintained and required software upgrades are not installed.

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

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

Bell & Howell holds proprietary rights to the equipment and no other vendor can provide maintenance services, parts, or software.

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?

DHS requested a 5-year R&M agreement from Bell & Howell for the Producer Inserters and Bell & Howell responded with a proposal that provides all required repair and maintenance services, software updates/installations, sorting software subscriptions and monthly preventative maintenance services on the equipment with the work being performed by a dedicated Resident Technician housed on-site at 5020A Industrial Ave. The services will include, but are not limited to, making repairs, technical adjustments, and replacing and/ or cleaning parts - using only Original Equipment Manufacturer (OEM) parts and/or components. The Vendor shall be required to carry a parts and/or components inventory on-site. This inventory shall include all parts and/or components normally required for routine repair and maintenance services of the inserting equipment currently in use within the OBS/MPU. Their proposal included pricing breaks that will not be available on single-year agreements, saving the state nearly $78,000 over the full 5-year term if procured.

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Bulletin Reference Number 24-444DHS-BUSSE-B-36572

Requesting Agency/University Illinois Department of Human Services

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

Yes No

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

Maintenance, licensing, and software upgrades will be required over the useful service life of this equipment. The agency invested nearly $3M in FY22 for the procurement of these new inserters to ensure the MPU would be able to meet mandated time frames for the mailing of critical notices to clients/customers of DHS, HFS, CMS, DCEO, DNR, DPH and other state agencies. Failing to provide proper maintenance and software upgrades would result in the failure of the MPU meeting these deadlines, resulting in the interruption or loss of benefits to customers/clients, loss of Federal funding, fines and repayment of Federal funds, lawsuits and more.

In addition, the $3M spent on this capital investment would be wasted if the equipment is not properly maintained and required software upgrades are not installed.

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?

Competitive bid is not an option as Bell & Howell has proprietary rights to this equipment. No other vendor or third party has the capability, operational knowledge, or software licenses required by this equipment to ensure operational viability.

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

N/A

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Bulletin Reference Number 24-444DHS-BUSSE-B-36572

Requesting Agency/University Illinois Department of Human 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 May 31, 2023

Printed Name Paul Hartman E-mail Address Paul.Hartman@Illinois.gov

Phone Number 217-786-6218

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 Jean.Sandstrom@illinois.gov

Phone Number 217-557-9298 Date Jun 6, 2023

Printed Name

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 217-494-1351 Date

Printed Name E-mail Address adrienne.grover@illinois.gov

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Bulletin Reference Number 24-444DHS-BUSSE-B-36572

Requesting Agency/University Illinois Department of Human Services

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

Project Title Resident Technician Repair and Maintenance Agreement for Bell & Howell Producer Inserters

Vendor Bell & Howell

Initial Date of Procurement Bulletin Posting 6/6/2023

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 217-558-2231

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