Tab_4_-_Confidential_Information_BAFO.pdf

Proposal Submitted to:

Arizona Department of Corrections

Request for Best and Final Offer (BAFO):

750 Minimum and Low Custody Contract Beds Solicitation Number BPM004542 August 30, 2022

Jennifer Houston 4955 Technology Way Boca Raton, Florida 33431 Tel: 866.301.4436/561.893.0101 jhouston@geogroup.com

R

TAB 4

Florence West Correctional & Rehabilitation Facility

Designation of Confidential, Trade Secret & Proprietary Information

TAB 4

Designation of Confidential, Trade Secret & Proprietary Information

Title Page Table of Contents

Designation of Confidential, Trade Secret & Proprietary Information

Proposal Submitted to:

Arizona Department of Corrections

Request for Best and Final Offer (BAFO):

750 Minimum and Low Custody Contract Beds Solicitation Number: BPM004542 August 30, 2022

Designation of Confidential, Trade Secret &

Proprietary Information

Solicitation No. BPM004542

750 Minimum and Low Custody Contract Beds

State of Arizona Department of Corrections, Rehabilitation & Reentry Procurement Services

1645 W Jefferson Street Phoenix, AZ 85007

Attachment 3 Page 108 of 158

ADCRR Tracking No. 22-096-27

All materials submitted as part of a response to a solicitation are subject to Arizona public records law and will be disclosed if there is an appropriate public records request at the time of or after the award of the contract. Recognizing there may be materials included in a solicitation response that are proprietary or a trade secret, a process is set out in

A.A.C. R2-7-103 (copy attached) that will allow qualifying materials to be designated as confidential and excluded from disclosure. For purposes of this process the definition of “trade secret” will be the same as that set out in A.A.C. R2-7-

101(52).

Complete this form and return it with your Offer along with the appropriate supporting information to assist the State in making its determination as to whether any of the materials submitted as part of your Offer should be designated confidential because the material is proprietary or a trade secret and therefore not subject to disclosure.

STATE WILL NOT CONSIDER ANY MATERIAL IN YOUR OFFER “CONFIDENTIAL” UNLESS DESIGNATED ON THIS FORM.

Check one of the following – if neither is checked, State will consider that as equivalent to “DOES NOT”:

This response DOES NOT contain proprietary or trade secret information. I understand that my entire response will become public record in accordance with A.A.C. R2-7-C317.

This response DOES contain trade secret information because it contains information that:

1. Is a formula, pattern, compilation, program, device, method, technique or process, AND

2. Derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; AND

3. Is the subject of efforts by myself or my organization that are reasonable under the circumstances to maintain its secrecy.

NOTE: Failure to attach an explanation may result in a determination that the information does not meet the statutory trade secret definition. All information that does not meet the definition of trade secret as defined by A.A.C. R2-7-101(52) will become public in accordance with A.A.C. R2-7-C317. State may make its own determination on materials in accordance with A.A.C. R2-7-103.

If State agrees with Offeror’s designation of trade secret or confidentiality and the determination is challenged, the undersigned hereby agrees to cooperate and support the defense of the determination with all interested parties, including legal counsel or other necessary assistance.

By submitting this response, Offeror agrees that the entire Offer, including confidential, trade secret and proprietary information may be shared with an evaluation committee and technical advisors during the evaluation process. Offeror agrees to indemnify and hold State, its agents and employees, harmless from any claims or causes of action relating to

State’s withholding of information based upon reliance on the above representations, including the payment of all costs and attorney fees incurred by State in defending such an action.

Offeror Company Name Signature of Authorized Person

Address Printed Name

City State Zip Title

Attachment 3 - Designation of Confidential, Trade Secret & Proprietary Information (TA 4)

GEO Secure Services, LLC

4955 Technology Way

Boca Raton FL 33431 Executive Vice President, Proposal Development

Jennifer L. Houston

BAFO - August 30, 2022 750 Minimum and Low Custody Contract Beds – Solicitation BPM004542

Tab 4 – Designation of Confidential, Trade Secret & Proprietary Information page 1 of 4

Tab 4. Designation of Confidential, Trade Secret & Proprietary Information

The process of how GEO derives prices and GEO’s actual prices are confidential, proprietary and a trade secret. This is because of the importance of pricing in a proposal (inclusive of design and staffing elements).

This information has independent economic value, actual and potential, from not being generally known to, and not being readily ascertainable by proper means, by, other persons who can obtain economic value from its disclosure and use. Further, this information is subject to efforts that are reasonable under the circumstances to maintain its secrecy due to the following reasons:

Competition in the Corrections Market

The corrections industry is highly competitive for many reasons: significant and risky capital investment; government-owned contractor-operated contracts; underbidding competition strategies; specialized equipment and specialized vendors; and long-term contracts.

Significant and Risky Capital Expenditure: Many corrections contracts require the contractor both to provide a facility and to operate that facility. This involves significant long term capital investment. Furthermore, many corrections contracts only allow offerors to propose existing facility capacity. Thus, to remain competitive and expand market share, a company must build new facilities or expand existing facilities to maintain excess capacity in anticipation of future contracts. While this might be seen as a barrier to entry that would reduce competition, it in fact amplifies competition because the construction or expansion of a facility involves significant risk thereby amplifying the competitive environment. Competition becomes keener as the market becomes riskier.

Government-Owned Contractor-Operated (“GOCO”) Contracts: Some corrections contracts are GOCO contracts, in which the contractor must operate a government-owned facility. Because the contractor is not burdened with the substantial cost of the facility itself, the remaining price and operational factors are increasingly competitive. For instance, staffing plans and operational approaches carry greater competitive weight in GOCO procurements because there is no distinction between offerors based on differing capital expenses.

Strategy of Underbidding: Percentage of market-share is a critical competitive element in the privatized corrections market. This creates substantial incentives for a company to increase market share, even at the risk of losing money on a contract.

There are multiple reasons that even a nominally unprofitable contract is rational.

Tab 4 – Designation of Confidential, Trade Secret & Proprietary Information page 2 of 4

First, if the contract is performed at a facility that would otherwise be empty, a contract award can mitigate the full carrying costs (e.g., financing) and upkeep costs associated with an unused facility. Furthermore, expanding on this scenario, if each of two companies has a detention facility which would be unused but for a particular contract, whichever company does not win the contract will suffer even greater loss, e.g., carrying costs of an unused facility.

Special Requirements Requires Specialized Vendors: The pool of vendors that can provide particular items is limited to those vendors that meet the specialized needs of a corrections facility. This is a significantly smaller pool than the pool of all commercial vendors. For instance, a corrections facility cannot simply use a folding table from a general office supply vendor or big box retailer; the corrections need is for a specially designed and manufactured table to prevent tampering, such as removing wood or metal for use as weapons. This limited pool of vendors minimizes competition among vendors and means that any information that is released regarding pricing or contract terms would

Vendors and Service Providers: Subcontracts with vendors, service providers, and equipment providers are predominantly long-term contracts which cannot be changed or terminated easily. This exacerbates the competitive harm, because once known, competitors can use this information and the injured company cannot change course or take actions to mitigate the competitive harm. A particular example of vendor and service provider harm is whether a competitor uses a food company to provide meals, or whether the competitor hires internal staff to provide food service directly.

Long Term Contracts: Many contracts tend to be long-term contracts, sometimes spanning up to twenty years. Facilities tend to be operated in the same manner, down to the specific number of people in a given position on a particular shift, during the full period of performance. Accordingly, the passage of time from when a proposal was submitted does not limit or mitigate competitive harm caused by release of confidential or proprietary proposal information, as that information is normally still in use for ten years or longer.

Facility Design

Facility Design and Construction: This element of the GEO business model includes the proprietary and confidential formulas and approaches used in designing new and expanded facilities for GEO. GEO views these designs as trade secrets. This also includes working with operational planners regarding staffing issues such as the Dot Diagrams, discussed above as a type of staffing plan. All of these functions are focused on increasing efficiencies through better design and better implementation. Correspondingly, knowledge of how GEO would expand a facility or reorganize the use of an existing facility would

Tab 4 – Designation of Confidential, Trade Secret & Proprietary Information page 3 of 4 substantially harm GEO’s competitive position by enabling competitors to duplicate these strategies and approaches, which are interrelated with all other aspects of a proposal.

Facility Staffing

Staffing: Staffing information includes the following types of documents and information, each type entails proprietary information, the release of which is likely to result in substantial competitive harm: (1) Staffing Charts that list the types of positions and the number of personnel required for each position; (2) Shift Schedules (also referred to as Post Assignment Schedules) that list positions and numbers by shift, as well as relief factors; (3) Activation Schedules that show the specific timeframes for particular personnel to begin work at the facility, including training; and (4) Dot Diagrams that show the specific location of each person within the facility. GEO’s staffing plans have consistently been determined to qualify as a trade secret under the Freedom of Information Act and numerous state public records laws.

Occurrence and Vacancy Data

Occurrence and Vacancy Data: Due to the lack of industry wide operational occurrence definitions, the occurrence data included in the proposal are based on the Offeror’s definitions and formats. Occurrence data, as required in the RFP, is not collected and distributed in a uniform fashion on a national level, therefore, release of such information would cause competitive harm. This harm would be amplified because any competitor or opponent of privatization (or corrections in general), would have access to data that is inherently subject to misinterpretation

Confidential Items

Disclosing the following portions of GEO’s proposal to general public review would reveal elements crucial in determining pricing structure, as well as the safety and security (staffing/design) of the public. Therefore, GEO considers the following sections of our proposal to be CONFIDENTIAL:

a. Tab 1: Offer and Acceptance: Transmittal Letter – redact starting wages for Correctional Officers; Executive Summary – redact starting wages for Correctional Officers.

b. Tab 2: Section 7: Attachments – Population Classification; Current and Past Client Reference Sheets; Deficiencies and Monetary Offsets; Pending Litigation. Section 8: Attachments – Facility Organizational Chart;

Emergency Operations and Response Plan; PREA Coordinated Response Plan; Sample Building Schedule; Sample Religious Services Calendar;

Sample Emergency Response Policy; Mutual Aid Agreements Policy; Anti- Retaliation Policy; Transportation Policy; Escape Response Policy.

Tab 4 – Designation of Confidential, Trade Secret & Proprietary Information page 4 of 4

Section 9: Attachments – Pro-Forma Statement. Section 10: Attachments

– Staff Deployment Plans; Current vs. Proposed Staffing Analysis; General Staffing Pattern Forms. Section 11: Attachments – Sample Building Schedule; Key and Lock Control Policy; Sample Emergency Response Plans; Emergency Operations and Response Plan; PREA Coordinated Response Plan; Mutual Aid Agreements Policy; PREA Audit Tools; Sample Religious Services Calendar; Emergency Medical Response Policy. Section 13: Attachments – Maintenance Program Policy; Maintenance Program Plan Procedure.

c. Tab 5: Fee Schedule: Fee Schedule Introduction – redact starting wages for Correctional Officers.

d. Tab 10: Occurrence and Vacancy Data: All completed Attachment 8 forms and associated summaries.

e. Tab 11: General Staffing Plan: All staffing and deployment plans.

Release of such information, which contains or describes proprietary compilations, programs, methods, techniques and/or processes created by GEO, would cause substantial harm to the competitive position of the company.

GEO considers the information listed above to be confidential, proprietary, and trade secret financial information normally withheld from GEO’s competitors and also within the scope of information not subject to disclosure under Arizona Procurement Code, Chapter 23, R2- 7-103, Confidential Information, the Arizona Constitution or other authority.