REQUEST FOR PROPOSALS FOR
DISTRIBUTION CENTER CONSOLIDATION AND LOGISTICS SERVICES
ISSUING OFFICE
PENNSYLVANIA LIQUOR CONTROL BOARD BUREAU OF PURCHASING AND CONTRACT ADMINISTRATION ROOM 316, NORTHWEST OFFICE BUILDING HARRISBURG, PENNSYLVANIA 17124
RFP NUMBER 20121016
DATE OF ISSUANCE
MAY 16, 2013
REQUEST FOR PROPOSALS FOR DISTRIBUTION CENTER CONSOLIDATION AND LOGISTICS SERVICES TABLE OF CONTENTS CALENDAR OF EVENTS
PAGE ii
PART I—GENERAL INFORMATION
PAGES 1-10
PART II—PROPOSAL REQUIREMENTS
PAGES 11-21
PART III—CRITERIA FOR SELECTION
PAGES 22-27
PART IV—WORK STATEMENT
PAGES 28-61
APPENDICES A. B. C. D. E. F. G. H. I. J. K. L. M.
COST SUBMITTAL WORKSHEET PLCB DATA PACKAGE PLCB STATEMENT ON SUSTAINABILITY PROPOSAL COVER SHEET 2013 STORE HOLIDAY SCHEDULE DOMESTIC WORKFORCE UTILIZATION CERTIFICATION CORPORATE SIGNATORY DELEGATION AUTHORIZATION PROPOSED CONTRACT LIQUOR CODE SECTION, LAWS OF PENNSYLVANIA BID BOND FORM TRADE SECRET/CONFIDENTIAL PROPRIETARY INFORMATION NOTICE SYSTEM LEVELS AND TROUBLESHOOTING SMALL DIVERSE BUSINESS LETTER OF INTENT
i
CALENDAR OF EVENTS The PLCB will make every effort to adhere to the following schedule: Activity
Responsibility
Date
Deadline to submit first round of questions via e-mail to the Issuing Officer, Beverly Ward at
[email protected].
Potential Offerors
No later than 10:00 a.m. on May 23, 2013
Answers to first round of questions posted to http://www.emarketplace.state.pa.us no later than this date.
Issuing Office
May 30, 2013
MANDATORY Pre-proposal Conference, Conference Room 117, Northwest Office Building, 910 Capital Street, Harrisburg, PA 17124. Offerors must register with the Issuing Office no later than 10:00 a.m. on July 2, 2013.
Issuing Office/Potential Offerors
10:00 a.m. on July 9, 2013
Answers to Potential Offeror questions received during the Pre-proposal Conference posted to the following website: http://www.emarketplace.state.pa.us no later than this date.
Issuing Office
July 16, 2013
Deadline to submit third round of questions via e-mail to the Issuing Officer, Beverly Ward at
[email protected].
Potential Offerors
No later than 10:00 a.m. on July 30, 2013
Answers to third round of questions posted to http://www.emarketplace.state.pa.us no later than this date.
Issuing Office
August 6, 2013
Please monitor website for all communications regarding the RFP.
Potential Offerors
Regularly until proposal due date
Offerors
No later than 1:00 p.m. on September 30, 2013
Sealed proposals must be received by the Issuing Office at Pennsylvania Liquor Control Board, Bureau of Purchasing and Contract Administration, Room 316, Northwest Office Building, Harrisburg, PA 17124-0001.
PART I GENERAL INFORMATION I-1. Purpose. This request for proposals (RFP) provides to those interested in submitting proposals for the subject procurement (“Offerors”) sufficient information to enable them to prepare and submit proposals for the Pennsylvania Liquor Control Board’s (“PLCB”) consideration on behalf of the Commonwealth of Pennsylvania (“Commonwealth”) to satisfy a need for Distribution Center Consolidation and Logistics Services (“Project”). I-2. Issuing Office. The PLCB (“Issuing Office”) has issued this RFP on behalf of the Commonwealth of Pennsylvania (“Commonwealth”). The sole point of contact in the Commonwealth for this RFP, and the Issuing Officer for this RFP, shall be Beverly Ward, Bureau of Purchasing & Contract Administration, Northwest Office Building, 910 Capital Street, Room 316, Harrisburg, PA 17124;
[email protected]. Please refer all inquiries to the Issuing Officer. I-3. Scope. This RFP contains instructions governing the requested proposals, including the requirements for the information and material to be included; a description of the service to be provided; requirements which Offerors must meet to be eligible for consideration; general evaluation criteria; and other requirements specific to this RFP. I-4. Problem Statement. The PLCB operates approximately six hundred (600) retail wine and spirits stores throughout the Commonwealth of Pennsylvania. Currently, the PLCB utilizes three (3) Distribution Centers (“DC”) for the receipt, processing, and storage of PLCB merchandise. The PLCB anticipates using this selection process to identify and contract with an Offeror who will provide a solution for the overall supply chain infrastructure and operations, receive shipments from vendors and consolidators, safely store and rotate inventory, pick orders and ship inventory to PLCB stores and other locations as directed, and provide means to repack, re-label and recoup merchandise as required. The selected Offeror will use sound processes and industry best practices to provide a high level of service, inventory accuracy, scalability, and cost effectiveness. Additional detail is provided in PART IV of this RFP. I-5. Type of Contract. It is proposed that if the Issuing Office enters into a contract as a result of this RFP, it will be a fixed fee and transactional fee based contract (See Appendix H). The Issuing Office, in its sole discretion, may undertake negotiations with Offerors whose proposals, in the judgment of the Issuing Office, show them to be qualified, responsible and capable of performing the Project. I-6. Rejection of Proposals. The Issuing Office reserves the right, in its sole and complete discretion, to reject any proposal received as a result of this RFP. I-7. Incurring Costs. The Issuing Office is not liable for any costs the Offeror incurs in preparation and submission of its proposal, in participating in the RFP process or in anticipation of award of the contract.
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I-8. Overview Videos of a PLCB DC and Store. The Issuing Office has made a video of DC#2. One copy of the video will be distributed as a CD to each Offeror that attends the mandatory Pre-proposal Conference. In order to ensure that ample CDs are available, Offerors should register to attend the Conference by sending an email to the Issuing Officer at
[email protected] no later than one week prior to the Pre-Proposal Conference date listed in the Calendar of Events on Page ii of this RFP. The video is intended to give an overview of current operations at this DC. The video is being supplied solely to provide background as to operations at one of the PLCBs current DCs, and is not intended to provide guidance to respondents as to future expectations. The DC #2 is located in Scranton. In addition, the PLCB has made a video of a store receiving merchandise. The video will be included on the same CD as the video of DC#2. This video is intended to outline a typical store’s receipt of merchandise from a PLCB DC. Most deliveries are currently performed by having the delivery driver assemble contractor supplied skate wheel conveyor from the truck into the store’s receiving area. The driver unloads cases onto the conveyor, where store employees scan the barcode on the cases using a hand-held scanner and unload product from the conveyor. When all cases have been unloaded from the truck, the delivery driver dismantles the conveyor. The store’s receiving personnel check the record of the scanned cases against an advanced ship notice generated by the DC when the order was ship confirmed. When store employees and the delivery driver agree on the case tally, they both sign the delivery paperwork, and the driver is then free to either return to the DC or move on to the next delivery stop. Delivery times can be extended if the receiving personnel are called away for other urgent business needs or if a case reconciliation is needed. The video is not intended to demonstrate all of the current delivery nuances, but does give a realistic overview of the current delivery process. I-9. Questions & Answers. If an Offeror has any questions regarding this RFP, the Offeror must submit the questions by email (with the subject line “RFP 20121016 Question”) to the Issuing Officer named in PART I, Section I-2 of the RFP. If the Offeror has questions, they must be submitted via email no later than the dates indicated on the Calendar of Events. The Offeror shall not attempt to contact the Issuing Officer by any other means. The Issuing Officer shall post the answers to the questions on the Department of General Services’ (“DGS”) website by the dates stated on the Calendar of Events. All questions and responses as posted on the DGS website are considered as an addendum to, and part of, this RFP in accordance with RFP PART I, Section I-11. Each Offeror shall be responsible to monitor the DGS website for new or revised RFP information. The Issuing Office shall not be bound by any verbal information nor shall it be bound by any written information that is not either contained within the RFP or formally issued as an addendum by the Issuing Office. The Issuing Office does not consider questions to be a protest of the specifications or of the solicitation. The required protest process for Commonwealth procurements is described on the DGS website.
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I-10. Pre-proposal Conference. The Issuing Office will hold a Pre-proposal Conference as specified in the Calendar of Events. The purpose of this conference is to provide an opportunity for clarification of the RFP. Offerors should forward all questions to the Issuing Office in accordance with PART I, Section I-9 to ensure adequate time for analysis before the Issuing Office provides an answer. Offerors may also ask questions at the conference. In view of the limited facilities available for the conference, Offerors should limit their representation to two (2) individuals per Offeror. The Pre-proposal Conference is for information only. Any answers furnished during the conference will not be official until they have been verified, in writing, by the Issuing Office. All questions and written answers will be posted on the DGS website as an addendum to, and shall become part of, this RFP. Attendance at the Pre-proposal Conference is mandatory. Failure to attend the Preproposal Conference shall disqualify an Offeror from consideration for the contract to be awarded from this RFP, and its proposal will be returned unopened. I-11. Addenda to the RFP. If the Issuing Office deems it necessary to revise any part of this RFP before the proposal response date, the Issuing Office will post an addendum to the DGS website. It is the Offeror’s responsibility to periodically check the website for any new information or addenda to the RFP. Answers to the questions asked during the Questions & Answers period also will be posted to the website as an addendum to the RFP. I-12. Response Date. To be considered for selection, hard copies of proposals must arrive at the Issuing Office on or before the time and date specified in the RFP Calendar of Events. The Issuing Office will not accept proposals via email or facsimile transmission. Offerors who send proposals by mail or other delivery service should allow sufficient delivery time to ensure timely receipt of their proposals. If, due to inclement weather, natural disaster, or any other cause, the Commonwealth office location to which proposals are to be returned is closed on the proposal response date, the deadline for submission will be automatically extended until the next Commonwealth business day on which the office is open, unless the Issuing Officer otherwise notifies Offerors. The hour for submission of proposals shall remain the same. The Issuing Office will reject, unopened, any late proposals. I-13. Proposals. To be considered, Offerors should submit a complete response to this RFP to the Issuing Office, using the format provided in PART II, providing thirteen (13) paper copies of the Technical Submittal and one (1) paper copy of the Cost Submittal and two (2) paper copies of the Small Diverse Business (SDB) participation submittal. In addition to the paper copies of the proposal, Offerors shall submit two complete and exact copies of the entire proposal (Technical, Cost and SDB submittals, along with all requested documents) on CDROM or Flash drive in Microsoft Office or Microsoft Office-compatible format. The electronic copy must be an exact duplicate of the paper copy and any spreadsheets must be in Microsoft Excel. The Offerors may not lock or protect any cells or tabs. Offerors should ensure that there is no costing information in the Technical Submittal. Offerors should not reiterate technical information in the cost submittal. The CD or Flash drive should clearly identify the Offeror and include the name and version number of the virus scanning software that was used to scan the CD or Flash drive before it was submitted. The Offeror shall make no other distribution of its proposal to any other Offeror or Commonwealth official or Commonwealth consultant. Each
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proposal page should be numbered for ease of reference. An official authorized to bind the Offeror to its provisions must sign the proposal. If the official signs the Proposal Cover Sheet (Appendix D) and the Proposal Cover Sheet is attached to the Offeror’s proposal, the requirement will be met. For this RFP, the proposal must remain valid until a contract is fully executed. If the Issuing Office selects the Offeror’s proposal for award, the contents of the selected Offeror’s proposal will become, except to the extent the contents are changed through Best and Final Offers or negotiations, contractual obligations. Each Offeror submitting a proposal specifically waives any right to withdraw or modify it, except that the Offeror may withdraw its proposal by written notice received at the Issuing Office’s address for proposal delivery prior to the exact hour and date specified for proposal receipt. An Offeror or its authorized representative may withdraw its proposal in person prior to the exact hour and date set for proposal receipt, provided the withdrawing person provides appropriate identification and signs a receipt for the proposal. An Offeror may modify its submitted proposal prior to the exact hour and date set for proposal receipt only by submitting a new sealed proposal or sealed modification which complies with the RFP requirements. I-14. Small Diverse Business Information. The Issuing Office encourages participation by small diverse businesses as prime contractors, and encourages all prime contractors to make a significant commitment to use small diverse businesses as subcontractors and suppliers. A Small Diverse Businesses is a DGS-verified minority-owned business, woman-owned business, veteran-owned business or vice-disabled veteran-owned business. A small business is a business in the United States which is independently owned, not dominant in its field of operation, employs no more than one hundred (100) full-time or full-time equivalent employees, and earns less than $7 million in gross annual revenues for building design, $20 million in gross annual revenues for sales and services and $25 million in gross annual revenues for those businesses in the information technology sales or service business. Questions regarding this program can be directed to: Department of General Services Bureau of Small Business Opportunities Room 611, North Office Building Harrisburg, PA 17125 Phone: 717.783.3119 Fax: 717.787.7052 Email:
[email protected] Website: www.dgs.state.pa.us The Department’s directory of BSBO-verified minority, women, veteran and service disabled veteran-owned businesses can be accessed from: Searching for Small Diverse Businesses.
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I-15. Economy of Preparation. Offerors should prepare proposals simply and economically, providing a straightforward, concise description of the Offeror’s ability to meet the requirements of the RFP. I-16. Alternate Proposals. The Issuing Office suggests that respondents be creative and submit their best solution to meeting these requirements. The Issuing Office will accept one alternate proposal per respondent. Any submitted alternate proposal must be materially different in design or cost, and not simply a minor variation to the base proposal. An alternate proposal must be full and complete in all respects as a response to the RFP, and will be reviewed as a separate response. I-17. Discussions for Clarification. Offerors may be required to make an oral or written clarification of their proposals to the Issuing Office to ensure thorough mutual understanding and Offeror responsiveness to the solicitation requirements. The Issuing Office will initiate requests for clarification. Clarifications may occur at any stage of the evaluation and selection process prior to contract execution. I-18. Prime Contractor Responsibilities. The contract will require the selected Offeror to assume responsibility for all services offered in its proposal whether it produces them itself or by subcontract. The Issuing Office will consider the selected Offeror to be the sole point of contact with regard to contractual matters. I-19.
Proposal Contents. A.
Confidential Information. The Commonwealth is not requesting, and does not require, confidential proprietary information or trade secrets to be included as part of Offerors’ submissions in order to evaluate proposals submitted in response to this RFP. Accordingly, except as provided herein, Offerors should not label proposal submissions as confidential or proprietary or trade secret protected. Any Offeror who determines that it must divulge such information as part of its proposal must submit the signed written statement described in subsection C. below and must additionally provide a redacted version of its proposal, which removes only the confidential proprietary information and trade secrets, for required public disclosure purposes.
B.
PLCB Use. All material submitted with the proposal shall be considered the property of the PLCB and may be returned only at the Issuing Office’s option. The PLCB has the right to use any or all ideas not protected by intellectual property rights that are presented in any proposal regardless of whether the proposal becomes part of a contract. Notwithstanding any Offeror copyright designations contained on proposals, the PLCB shall have the right to make copies and distribute proposals internally and to comply with public record or other disclosure requirements under the provisions of any Commonwealth or United States statute or regulation, or rule or order of any court of competent jurisdiction.
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C.
I-20.
Public Disclosure. After the award of a contract pursuant to this RFP, all proposal submissions are subject to disclosure in response to a request for public records made under the Pennsylvania Right-to-Know-Law, 65 P.S. § 67.101, et seq. If a proposal submission contains confidential proprietary information or trade secrets, a signed written statement to this effect (Appendix K) must be provided with the submission in accordance with 65 P.S. § 67.707(b) for the information to be considered exempt under 65 P.S. § 67.708(b)(11) from public records requests. If financial capability information is submitted in response to PART II, Section II-8 of this RFP such financial capability information is exempt from public records disclosure under 65 P.S. § 67.708(b)(26).
Best and Final Offers. A.
B.
While not required, the Issuing Office reserves the right to conduct discussions with Offerors for the purpose of obtaining “Best and Final Offers.” To obtain Best and Final Offers from Offerors, the Issuing Office may do one or more of the following, in any combination and order: 1.
Schedule oral presentations;
2.
Conduct visits to the proposed site or other sites currently operated by the Offeror. The PLCB reserves the right to perform more than one site visit to the proposed site or a site currently operated by the Offeror.
3.
Request revised proposals; and
4.
Enter into pre-selection negotiations.
The following Offerors will not be invited by the Issuing Office to submit a Best and Final Offer: 1.
Those Offerors, which the Issuing Office has determined to be not responsible or whose proposals the Issuing Office has determined to be not responsive.
2.
Those Offerors, which the Issuing Office has determined in accordance with PART III, Section III-5, from the submitted and gathered financial and other information, do not possess the financial capability, experience or qualifications to assure good faith performance of the contract.
3.
Those Offerors whose score for their technical submittal of the proposal is less than seventy percent (70%) of the total amount of technical points allotted to the technical criterion. The Issuing Office may further limit participation in the Best and Final Offers process to those remaining responsible Offerors which the Issuing Office has,
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within its discretion, determined to be within the top competitive range of responsive proposals. C.
The Evaluation Criteria found in PART III, Section III-4, shall also be used to evaluate the Best and Final Offers.
D.
Dollar commitments to Small Diverse Businesses can be reduced only in the same percentage as the percent reduction in the total price offered through negotiations.
I-21. News Releases. Offerors shall not issue news releases, Internet postings, advertisements or any other public communications pertaining to this Project without prior written approval of the Issuing Office, and then only in coordination with the Issuing Office. I-22. Restriction of Contact. From the issue date of this RFP until the Issuing Office selects a proposal for award, the Issuing Officer is the sole point of contact concerning this RFP. Any violation of this condition may be cause for the Issuing Office to reject the offending Offeror’s proposal. If the Issuing Office later discovers that the Offeror has engaged in any violations of this condition, the Issuing Office may reject the offending Offeror’s proposal or rescind its contract award. Offerors must agree not to distribute any part of their proposals beyond the Issuing Office. An Offeror who shares information contained in its proposal with other Commonwealth personnel and/or competing Offeror personnel may be disqualified. I-23. Offeror’s Full Participation. Offerors shall provide all services, supplies, facilities, and other support necessary to complete the identified work. I-24. Term of Contract. The term of the contract will commence on the Effective Date and will end after ten (10) years for the services within the scope of the RFP. The PLCB reserves the right to extend this contract for three (3) one (1)-contract year option periods, subject to the terms and conditions set forth in the initial term of this Contract. The Issuing Office will fix the Effective Date after the contract has been fully executed by the selected Offeror and by the PLCB and all approvals required by PLCB contracting procedures have been obtained. The selected Offeror shall not start the performance of any work prior to the Effective Date of the contract and the PLCB shall not be liable to pay the selected Offeror for any service or work performed or expenses incurred before the Effective Date of the contract. I-25. Offeror’s Representations and Authorizations. Offeror understands, represents, and acknowledges that: A.
By submitting its proposal, each
All of the Offeror’s information and representations in the proposal are material and important, and the Issuing Office may rely upon the contents of the proposal in awarding the contract(s). The Commonwealth shall treat any misstatement, omission or misrepresentation as fraudulent concealment of the true facts relating to the proposal submission, punishable pursuant to 18 Pa. C.S. § 4904.
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B.
The Offeror has arrived at the price(s) and amounts in its proposal independently and without consultation, communication, or agreement with any other Offeror or potential Offeror.
C.
The Offeror has not disclosed the price(s), the amount of the proposal, nor the approximate price(s) or amount(s) of its proposal to any other firm or person who is an Offeror or potential Offeror for this RFP, and the Offeror shall not disclose any of these items on or before the proposal submission deadline specified in the Calendar of Events of this RFP.
D.
The Offeror has not attempted, nor will it attempt to induce any firm or person to refrain from submitting a proposal on this contract, or to submit a proposal higher than this proposal, or to submit any intentionally high or noncompetitive proposal or other form of complementary proposal.
E.
The Offeror makes its proposal in good faith and not pursuant to any agreement or discussion with, or inducement from, any firm or person to submit a complementary or other noncompetitive proposal.
F.
To the best knowledge of the person signing the proposal for the Offeror, the Offeror, its affiliates, subsidiaries, officers, directors, and employees are not currently under investigation by any governmental agency and have not in the last four (4) years been convicted or found liable for any act prohibited by State or federal law in any jurisdiction, involving conspiracy or collusion with respect to bidding or proposing on any public contract, except as the Offeror has disclosed in its proposal.
G.
To the best of the knowledge of the person signing the proposal for the Offeror and except as the Offeror has otherwise disclosed in its proposal, the Offeror has no outstanding, delinquent obligations to the Commonwealth including, but not limited to, any state tax liability not being contested on appeal or other obligation of the Offeror that is owed to the Commonwealth.
H.
The Offeror is not currently under suspension or debarment by the Commonwealth, any other state or the federal government, and if the Offeror cannot so certify, then it shall submit along with its proposal a written explanation of why it cannot make such certification.
I.
The Offeror has not made, under separate contract with the Issuing Office, any recommendations to the Issuing Office concerning the need for the services described in its proposal or the specifications for the services described in the proposal.
J.
Each Offeror, by submitting its proposal, authorizes Commonwealth agencies to release to the Commonwealth information concerning the Offeror's Pennsylvania taxes, unemployment compensation and workers’ compensation liabilities.
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K.
I-26.
Until the selected Offeror receives a fully executed and approved written contract from the Issuing Office, there is no legal and valid contract, in law or in equity, and the Offeror shall not begin to perform.
Notification of Selection. A.
Contract Negotiations. The Issuing Office will notify the Offeror selected for negotiations after the Issuing Office has determined, taking into consideration all of the evaluation factors, the proposal that is the most advantageous to the Issuing Office.
B.
Award. Offerors whose proposals are not selected will be notified when contract negotiations have been successfully completed and the Issuing Office has received the final negotiated contract signed by the selected Offeror.
I-27. Debriefing Conferences. Upon notification of award, Offerors whose proposals were not selected will be given the opportunity to be debriefed. The Issuing Office will schedule the debriefing at a mutually agreeable time. The debriefing will not compare the Offeror with other Offerors, other than the position of the Offeror’s proposal in relation to all other Offeror proposals. An Offeror’s exercise of the opportunity to be debriefed does not constitute nor toll the time for filing a protest. (See Section I-28 of this RFP.) I-28. RFP Protest Procedure. The RFP Protest Procedure is on the DGS website at http://www.dgsweb.state.pa.us/comod/ProtestProcedures.doc. A protest by a party not submitting a proposal must be filed within seven (7) days after the protesting party knew or should have known of the facts giving rise to the protest, but no later than the proposal submission deadline specified in the Calendar of Events of the RFP. Offerors may file a protest within seven (7) days after the protesting Offeror knew or should have known of the facts giving rise to the protest, but in no event may an Offeror file a protest later than seven (7) days after the date the notice of award of the contract is posted. The date of filing is the date of receipt of the protest. A protest must be filed in writing with the Issuing Office. To be timely, the protest must be received by 4:00 p.m. on the seventh day. I-29. Use of Electronic Versions of this RFP. This RFP is being made available by electronic means. If an Offeror electronically accepts the RFP, the Offeror acknowledges and accepts full responsibility to insure that no changes are made to the RFP. In the event of a conflict between a version of the RFP in the Offeror’s possession and the Issuing Office’s version of the RFP, the Issuing Office’s version shall govern. I-30. Information Technology Bulletins. Security is an important concern at the PLCB and within the Commonwealth of PA as a whole. Commonwealth agencies must follow standards that are called Information Technology Bulletins (ITB). These ITBs and other Commonwealth, Federal legislation and agreements form the framework of how we are permitted to do business. A listing of Commonwealth ITBs can be found at the following link: Policies and Procedures Information Technology Bulletins.
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ITBs are for agency use only. The Commonwealth cannot force any vendor to follow an ITB. However, it does show the effort that the Commonwealth puts in to ensure that we do business in a secure manner. Provide a statement on what you do to ensure the confidentiality, integrity and availability of information and data resources within facilities that you own and manage. Your response should include the following areas covered by Commonwealth policy: Manage anti-virus – ITB SEC001 Manage data in transit and at rest – ITB SEC020 and SEC031 Manage and use firewalls – ITB SEC004 and ITB SEC011 Minimum standards for user IDs and passwords – ITB SEC007 Manage logs – ITB SEC021 Incident reporting revolving around information – ITB SEC024
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PART II PROPOSAL REQUIREMENTS Offerors must submit their proposals in the format, including heading descriptions, outlined below. To be considered, the proposal must respond to all requirements in this part of the RFP. Offerors should provide any other information thought to be relevant, but not applicable to the enumerated categories, as an appendix to the proposal. All cost data relating to this proposal and all Small Diverse Business cost data should be kept separate from and not included in the Technical Submittal. Each proposal shall consist of the following three (3) separately sealed submittals: A.
Technical Submittal, which shall be a response to RFP PART II, Sections II-1 through II-12; and Section II-16
B.
Small Diverse Business participation submittal, in response to RFP PART II, Section II-13; and
C.
Cost Submittal, in response to RFP PART II, Sections II-14 through II-15.
The Issuing Office reserves the right to request additional information which, in the Issuing Office’s opinion, is necessary to assure that the Offeror’s competence, number of qualified employees, business organization, and financial resources are adequate to perform according to the RFP. The Issuing Office may make investigations as deemed necessary to determine the ability of the Offeror to perform the Project, and the Offeror shall furnish to the Issuing Office all requested information and data. The Issuing Office reserves the right to reject any proposal if the evidence submitted by, or investigation of, such Offeror fails to satisfy the Issuing Office that such Offeror is properly qualified to carry out the obligations of the RFP and to complete the Project as specified. II-1. Statement of the Problem. State in succinct terms your understanding of the problem presented or the service required by this RFP. II-2. Management Summary. Include a narrative description of the proposed effort and a list of the items to be delivered or services to be provided. Include a full explanation of the solution recommended, including the strategy behind the solution, its rationale, and its advantages and benefits, along with its potential drawbacks and risks. This explanation of the chosen strategy vis-á-vis other options is a key aspect of the Technical Submittal. Please include site selection, the warehouse automation chosen (if any), and the delivery scheme in this strategy review. Please include annual projected delivery miles as part of the response. II-3. Facility/Facilities Description. Provide street address of proposed facility/facilities and proof of ownership or documentation verifying a commitment to all facilities included as part of your response. This would include not only any proposed DC facility/facilities, but also any
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cross dock, drop and hook or other facility/facilities that are part of the proposed solution. Provide a proposed layout design for the facility/facilities. Provide photographs or drawings to indicate the size and specifications of the proposed facility/facilities. Include a plan and a timeline for acquiring the facility/facilities. Include full details including areas such as square footage total and by area, case capacities, pallet slot details, dock doors, trailer and car parking facilities, etc. II-4. Work Plan. Describe in narrative form your technical plan for accomplishing the work. This should include both the plan developed to implement the proposal and the plans for normal ongoing operations. Use the task descriptions and requirements located in PART IV of this RFP as your reference point. Modifications of the task descriptions are permitted; however, reasons for changes should be fully explained. Indicate the number of person hours allocated to each task and the anticipated hours of operation. Include a Program Evaluation and Review Technique (PERT) or similar type display, time related, showing each event. If more than one approach is apparent, comment on why you chose this approach. Include the proposed material handling systems design, technology plan, an installation plan, and the benefits of employing the proposed plans. Plans should include timelines for acquisition and deployment. An overview of the systems integration plan should also be included. Include a performance improvement plan, including the process to facilitate this effort and measure results. Copies of corporate safety, health, and environmental policy statements should be included, as well as documentation of safety programs for warehouse and transportation. The Offeror’s philosophy and policies related to sustainability and the Offeror’s experience with implementing and managing sustainability programs and practices in past or current operations should be included. Please include an overview of any proposed Environmental Management System (EMS) and note if the system is accredited to an international standard. II-5. Prior Experience. Include specific organizational operating experience with emphasis on consolidating, storing, handling, shipping, receiving, and securing beverage alcohol or other high value or high velocity commodities, such as grocery products. The size of any facility/facilities operated shall be included along with volumes and types of commodities handled. Include the date your company was founded, principal ownership, scope of operations, and general data regarding experience. Also note any special expertise that would enhance your company’s qualifications, such as membership in professional organizations and/or certifications, etc. Include experience with customers similar to the PLCB that have the proposed IT solution. List any current contracts that may present a conflict of interest. If there are none, provide a statement to that effect. With respect to proposed subcontractor arrangements, the Offeror must provide an overview of situations in which the Offeror and subcontractor(s) have worked together in the past.
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Experience shown should be work done by individuals who will be assigned to this project as well as that of your company. At least three (3) references should be identified and the name of the customer shown, including the name, address, and telephone number of the responsible official of the customer, company, or agency who may be contacted II-6. Personnel. Include the number of executive and professional personnel, analysts, auditors, researchers, programmers, consultants, etc., who will be engaged in the work. Identify those who will be assigned for implementation and those who will be part of ongoing operations. Show where these personnel will be physically located during the time they are engaged in the Project. Please specify if union labor will be used and in what areas. Also include a hiring plan. For key leadership personnel, such as the account manager, facility general manager and senior operational management staff, include the employee’s name, and, through a resume or similar document, describe their education and experience in retail distribution services and order fulfillment with wine and spirits or consumer packaged goods. Indicate the responsibilities each individual will have in this Project and how long each individual has been with your company. Identify by name any subcontractors you intend to use and describe the services they will perform. II-7. Training. Include a training plan for employees to perform the tasks required and to address OSHA and other regulatory requirements. If appropriate, indicate recommended training of agency personnel. Include the agency personnel to be trained, the number to be trained, duration of the program, place of training, curricula, training materials to be used, number and frequency of sessions, and number and level of instructors. II-8. Financial Capability. Describe your company’s financial stability and economic capability to perform the contract requirements. Provide your company’s financial statements (audited, if available) for the past three (3) fiscal years. Financial statements must include the company’s Balance Sheet and Income Statement or Profit/Loss Statements. Also include a Dun & Bradstreet comprehensive report, if available. If your company is a publicly traded company, please provide a link to your financial records on your company website in lieu of providing hardcopies. The PLCB reserves the right to request additional information it deems necessary to evaluate an Offeror’s financial capability. II-9. Insurance Requirements. Demonstrate your company’s planned insurance coverage level with respect to the following: Workers’ Compensation Insurance, Liability/Damage Insurance, Personal Injury/Property Damage and Flood Insurance (as applicable). Please see PART IV-3, Section L of this RFP for more information. II-10. Disclosure of Information. The selected Offeror, its affiliates, agents and employees shall not disclose to others any information, documents, reports, data, or records provided to, or prepared by the selected Offeror under the resulting contract without the prior written approval of the PLCB, except as required by the Pennsylvania Right-to-Know Law, 65 P.S. §§ 67.1013104, or other applicable law or as otherwise provided in the resulting contract. Any information, documents, reports, data, or records secured by the selected Offeror from the PLCB or a third
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party in connection with the performance of this contract shall be kept confidential unless disclosure of such information is: A.
Approved in writing by the PLCB prior to its disclosure; or
B.
Directed by a court or other tribunal of competent jurisdiction unless the resulting contract requires prior PLCB approval; or
C.
Required for compliance with federal or state securities laws or the requirements of national securities exchanges; or
D.
Necessary for purposes of the selected Offeror’s internal assessment and review; or
E.
Deemed necessary by the selected Offeror in any action to enforce the provisions of the contract or to defend or prosecute claims by or against parties other than the Commonwealth; or
F.
Permitted by the valid authorization of a third party to whom the information, documents, reports, data, or records pertain: or
G.
Otherwise required by law.
II-11. Objections and Additions to Standard Contract Terms and Conditions. The Offeror will identify which, if any, of the terms and conditions (contained in Appendix H) it would like to negotiate and what additional terms and conditions the Offeror would like to add to the standard contract terms and conditions. The Offeror’s failure to make a submission under this paragraph will result in its waiving its right to do so later, but the Issuing Office may consider late objections and requests for additions if to do so, in the Issuing Office’s sole discretion, would be in the best interest of the Commonwealth. The Issuing Office may, in its sole discretion, accept or reject any requested changes to the standard contract terms and conditions. The Offeror shall not request changes to the other provisions of the RFP, nor shall the Offeror request to completely substitute its own terms and conditions for Appendix H. All terms and conditions must appear in one integrated contract. The Issuing Office will not accept references to the Offeror’s, or any other, online guides or online terms and conditions contained in any proposal. Regardless of any objections set out in its proposal, the Offeror must submit its proposal, including the cost proposal, on the basis of the terms and conditions set out in Appendix H. The Issuing Office will reject any proposal that is conditioned on the negotiation of the terms and conditions set out in Appendix H or to other provisions of the RFP as specifically identified above. II-12. Bid and Performance Bonds. The bid must be accompanied by a certified check, bank cashier's check, or a bid bond form supplied by the Pennsylvania Liquor Control Board (Appendix J), payable to the Pennsylvania Liquor Control Board, in the amount equal to one million dollars ($1,000,000.00) lawful money of the United States of America. The selected
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14
Offeror will be required to post a performance bond within seven (7) days of receiving a “Notice of Intent to Award” from the PLCB. A.
Bid Bond Requirements. The bid bond must meet the following requirements: 1.
The bond must be from a surety approved to do business in Pennsylvania. For information on approved sureties, contact the PA Department of Insurance, Division of Companies, at (717) 787-2735, or go to www.ins.state.pa.us.
2.
The bid bond must be properly executed by the surety company and the Offeror.
3.
All signatures on the bond must be original and hand-scripted signatures.
4.
The bid bond must be accompanied by a power of attorney from the surety company, indicating that the agent signing the bond has the authority to bind the company. The power of attorney must bear the same date as the bid bond.
5.
Any alterations to the pre-printed portions of the bid bond, e.g., erasures, write-overs, or white outs, are not acceptable and will be rejected as not responsive. Any alterations to the filled in spaces on the bid bond, e.g., erasures, write-overs, or white outs, are not acceptable, unless initialed by an authorized representative of the surety, preferably the agent signing the bond. Such unauthorized alterations, if they are to date, amount of bond, or name of Offeror, will result in the bid being rejected as not responsive.
6.
B.
Failure to comply with any section of this instruction will result in the rejection of the bid as not responsive. Return of Bid Bond. The bid bond of the selected Offeror will be retained until such Offeror has executed the Contract and furnished the required performance bond. If the selected Offeror fails to execute and deliver the Contract or furnish the required performance bond within seven (7) days, the bid bond of that Offeror will be forfeited. 1.
If a valid performance bond is posted and a Contract is executed between the PLCB and an Offeror, the checks and bid bonds of all other Offerors shall be returned within thirty (30) days after the execution of all Contract documents by the selected Offeror.
2.
If, for whatever reason, the PLCB determines that it will not execute a Contract with any of the Offerors who submit a proposal in response to this RFP, all checks and bid bonds will be returned to the Offerors within thirty (30) days after such determination has been made by the PLCB. The PLCB has the sole discretion to reject all offers and not execute a Contract.
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C.
D.
Bid Bond Damages. The Bid Bond shall guarantee that: 1.
The Offeror shall not withdraw its proposal in response to the RFP until the PLCB has executed a Contract with the selected Offeror or rejected all bids, whichever date is later.
2.
Should the PLCB issue a Contract to an Offeror, the selected Offeror shall obtain, a performance bond within seven (7) days as required by the terms of the RFP.
3.
Should the selected Offeror fail to meet either of the guarantees provided above in Paragraphs 1 and 2, the selected Offeror and the surety agree to pay the PLCB the difference between the amount of the selected Offeror’s proposal, as accepted by the PLCB, and the higher amount for which the required work shall be contracted for by the PLCB, together with any additional advertising costs, legal fees (including but not limited to legal fees and costs associated with litigating the selected Offeror’s failure to perform), and any and all other fees, expenses, and consequential damages incurred by the PLCB by reason of the failure of the selected Offeror to meet such guarantees, provided however that: a.
The obligation of the surety shall not exceed the stated principal amount of this bond; and
b.
If the PLCB does not procure an executed Contract with any other person for the performance of the work contemplated in the RFP, as accepted by the PLCB, upon the same terms and conditions, other than price as provided in the Contract documents, within the period provided in the RFP during which no proposals of Offerors may be withdrawn, whether because of the lack of another Offeror to enter into an appropriate Contract or because the cost under any higher proposal would be greater than the PLCB can afford, which it shall determine in its sole discretion, then the selected Offeror and the surety agree to pay to the PLCB the full amount of this bond as liquidated damages. The Offeror, by submitting a proposal, agrees and recognizes that if the PLCB is required to repeat the RFP process as a result of the selected Offeror’s failure to meet its guarantees as set forth above, assessing and determining damages suffered by the PLCB would be difficult and speculative. Accordingly, the Offeror and the PLCB recognize and agree that under these circumstances, liquidated damages in the full amount of the bid bond is a reasonable measure of the PLCB’s damages and is not considered a penalty of punitive damages.
Performance Bond. Each Offeror shall submit, with its proposal, documented evidence that the required performance bond surety can be furnished. Within seven (7) days of receiving a Contract from the PLCB, the selected Offeror will be
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required to post a performance bond in the amount equal to five million dollars ($5,000,000.00) lawful money of the United States of America, to guarantee performance of all work and services under the terms thereof. Failure of the Offeror to post such bond within seven (7) days from issuance of the Contract shall result in the Offeror being disqualified, and the bid bond being declared forfeited for the damages described more fully above in PART II, Section II-12(C)(3). All obligations on the part of the PLCB in connection herewith will then be canceled. The selected Offeror will present a series of five (5) two (2)-year performance bonds, each in the amount equal to five million dollars ($5,000,000.00). One hundred eighty (180) days prior to the expiration of the initial two (2)-year performance bond, and for each subsequent two (2)-year performance bonds, the selected Offeror will present to the PLCB a performance bond covering the next two (2)-year term, to guarantee performance of all work and services under the terms of the Contract. Failure to timely provide a renewal performance bond may be grounds for default of contract, at the PLCB’s sole discretion. The performance bond required by this section shall be issued by a surety that is licensed to do business in the Commonwealth of Pennsylvania, included on the approved list of sureties issued by the United States Department of Treasury, and with a rating from A. M. Best Company (or other equivalent rating company) equal to or better than A-. The intent of the PLCB is to award a Contract only to an Offeror who has the ability and experience to meet the requirements of this RFP, and that has sufficient capital and resources to enable it to prosecute the same successfully, and to accomplish it in the specified time. The performance bond shall be maintained in full force and effect until the expiration of the term of the Contract. The performance bond is forfeited to the PLCB if the selected Offeror defaults in the performance of the Contract. The performance bond required by this section must cover all damages which are related to the selected Offeror’s failure to meet any requirement of the Contract, including but not limited to consequential damages, fees, costs and expenses associated with obtaining services for another contractor to complete the Contract, legal fees and costs associated with obtaining a replacement Contract, and all attorney’s fees and costs associated with litigating the issues of the selected Offeror’s default. The cost of the bond is included in the Offeror’s cost. II-13. Small Diverse Business Participation Submittal. A.
To receive credit for being a Small Diverse Business or for subcontracting with a Small Diverse Business (including purchasing supplies and/or services through a purchase agreement), an Offeror must include proof of Small Diverse Business qualification in the Small Diverse Business participation submittal of the proposal, as indicated below:
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A Small Diverse Business verified by BSBO as a Small Diverse Business must provide a photograph of their verification letter. B.
In addition to the above verification letter, the Offeror must include in the Small Diverse Business participation submittal of the proposal the following information: 1.
All Offerors must include a numerical percentage which represents the total percentage of the work (as a percentage of the total cost in the Cost Submittal) to be performed by the Offeror and not by subcontractors and suppliers.
2.
All Offerors must include a numerical percentage which represents the total percentage of the total cost in the Cost Submittal that the Offeror commits to paying to Small Diverse Businesses (SDBs) as subcontractors. To support its total percentage, SDB subcontractor commitment, Offeror must also include: a.
The percentage and dollar amount of each subcontract commitment to a Small Diverse Business;
b.
The name of each Small Diverse Business. The Offeror will not receive credit for stating that after the contract is awarded it will find a Small Diverse Business.
c.
The services or supplies each Small Diverse Business will provide, including the timeframe for providing the services or supplies.
d.
The location where each Small Diverse Business will perform services.
e.
The timeframe for each Small Diverse Business to provide or deliver the goods or services.
f.
A subcontract or letter of intent signed by the Offeror and the Small Diverse Business (SDB) for each SDB identified in the SDB Submittal. The subcontract or letter of intent must identify the specific work, goods or services the SDB will perform, how the work, goods or services relates to the project, and the specific timeframe during the term of the contract and any option/renewal periods when the work, goods or services will be performed or provided. In addition, the subcontract or letter of intent must identify the fixed percentage commitment and associated estimated dollar value that each SDB will receive based on the total value of the initial term of the contract as provided in the Offeror's Cost Submittal. A letter of intent template which may be used to satisfy these requirements is included as Appendix M.
g.
The name, address and telephone number of the primary contact person for each Small Diverse Business.
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3.
The total percentages and each SDB subcontractor commitment will become contractual obligations once the contract is fully executed.
4.
The name and telephone number of the Offeror’s project (contact) person for the Small Diverse Business information.
C.
The Offeror is required to submit two copies of its Small Diverse Business participation submittal. The submittal shall be clearly identified as Small Diverse Business information and sealed in its own envelope, separate from the remainder of the proposal.
D.
A Small Diverse Business can be included as a subcontractor with as many prime contractors as it chooses in separate proposals.
E.
An Offeror that qualifies as a Small Diverse Business and submits a proposal as a prime contractor is not prohibited from being included as a subcontractor in separate proposals submitted by other Offerors.
II-14. Cost Submittal. The information requested in this PART II, Section II-14 shall constitute the Cost Submittal. The Cost Submittal shall be placed in a separate sealed envelope within the sealed proposal, separated from the Technical Submittal. The total proposed cost shall be broken down into the following components as detailed in the PLCB Distribution Services RFP Cost Submittal Worksheet (Appendix A): Instructions. Directions for completion of each of the subsequent tabs: A.
Pricing. The pricing submitted in response to this RFP will cover the full ten (10) year period of the contract. During final contract negotiations, the PLCB and the Selected Offeror will develop contract language that defines how the parties will handle significant unforeseen cost increases or decreases due to regulation, inflation, or legislation impacts that are beyond the control of either party.
B.
Year One (1/14 – 12/14) Cost Recovery. Provide detail regarding cost recovery payments that will be requested for Contract Year 1. Follow the guidelines in Part II, Section II-15 A.
C.
Cost Breakdown Year 3 (1/16 – 12/16 First full year of operations). Provide a breakdown of the costs developed in the detail tabs.
D.
Management and Labor Detail. Labor costs, by position, for management and administration, as well as for direct and indirect hourly labor.
E.
DC Facility and Equipment Detail. Equipment costs by type and facility space related costs by functional area.
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F.
Transportation Facility and Equipment Detail. Equipment costs by type and facility space related costs by functional area.
G.
Overhead Costs Detail. Overhead costs by support category.
H.
Capital Investment. Detailed list of capital investments to execute the solution as designed.
I.
Accessorial Fees. Fees to be applied to required services outside of the normal course of operations.
J.
Fuel Surcharge. Fuel surcharge program details.
Offerors should not include any assumptions in their Cost Submittals. If an Offeror includes assumptions in its Cost Submittal, the Issuing Office may reject the proposal. Offerors should direct in writing to the Issuing Officer pursuant to PART I, Section I-9, of this RFP any questions about whether a cost or other component is included or applies. All Offerors will then have the benefit of the Issuing Officer’s written answer so that all proposals are submitted on the same basis. II-15. Contract Phases. The approach to pricing services provided will vary with each phase of the Contract. A detailed description of each Contract phase is found in PART IV of this RFP. The pricing approach to each phase is described below: A.
Phase 1 (Secure and Prepare Site(s), Configure Systems and Prepare for Operations). During this period, the PLCB will allow three (3) progress payments to minimize the impact of out-of-pocket costs incurred before the inception of monthly billing in Phase 2. The PLCB will allow three payments, beginning ninety (90) days after the Notice to Proceed, and after succeeding ninety (90) day periods. These payments will reimburse only for upfront costs incurred for employee training, site lease payments, and for amortized charges for investments in materials handling equipment and racking. As these early payments will reduce the amount of unrecovered early investment spending, it is anticipated the selected Offeror’s monthly fixed cost billings will reflect such reduction. It is the intent that the amount of these payments is fixed, as identified in the respondent’s proposal, but be contingent upon meeting the defined milestones as laid out in the respondent’s proposed project plan. In the event the selected Offeror defaults on the Contract at any time, the PLCB shall have the right to recover all of the progress payments made as of the time of the default, whether by offset, by outright payment, by tender of the performance bond and/or by perfection of a security interest. This recovery will not limit the PLCB’s right to any other remedies allowable by contract or by law or equity.
B.
Phase 2 (Receive and Store Merchandise at the DC(s)). Both a monthly fixed fee and a receiving per case fee shall be imposed as per the contract.
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C.
Phase 3 (Full Receiving and Delivery Operations). Fees shall be imposed as per the contract, including a monthly fixed fee, a receiving per case fee, and a delivery per case fee.
D.
Phase 4 (Wind Down). Fees shall be considered an accessorial service.
The Issuing Office will reimburse the selected Offeror for work satisfactorily performed after execution of a written contract and the start of the contract term, in accordance with contract requirements, and only after the Issuing Office has issued a notice to proceed. II-16. Domestic Workforce Utilization Certification. Complete and sign the Domestic Workforce Utilization Certification contained in Appendix F of this RFP. Offerors who seek consideration for this criterion must submit in hardcopy the signed Domestic Workforce Utilization Certification Form in the same sealed envelope with the Technical Submittal.
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PART III CRITERIA FOR SELECTION III-1. Mandatory Responsiveness Requirements. To be eligible for selection, a proposal must be: A.
Timely received from an Offeror;
B.
Properly signed by the Offeror; (For guidance on proper signatory protocol in Pennsylvania procurements, please go to: http://www.portal.state.pa.us/portal/server.pt/document/642846/pt_i_ch_31_contrac t_signatures_pdf.)
C.
Financial statements for three (3) years in accordance with Section II-8;
D.
Bid bond in accordance with Section II-12.
III-2. Technical Nonconforming Proposals. The four (4) Mandatory Responsiveness Requirements set forth in Section III-1 above (A-D) are the only RFP requirements that the PLCB will consider to be non-waivable. The Issuing Office reserves the right, in its sole discretion, to (1) waive any other technical or immaterial nonconformities in an Offeror’s proposal, (2) allow the Offeror to cure the nonconformity, or (3) consider the nonconformity in the scoring of the Offeror’s proposal. III-3. Evaluation. The Issuing Office has selected a committee of qualified personnel to review and evaluate timely submitted proposals. Independent of the committee, BSBO will evaluate the Small Diverse Business participation submittal and provide the Issuing Office with a rating for this component of each proposal. The Issuing Office will notify in writing of its selection for negotiation the responsible Offeror whose proposal is determined to be the most advantageous to the PLCB as determined by the Issuing Office after taking into consideration all of the evaluation factors. III-4. Evaluation Criteria. The following criteria will be used in evaluating each proposal: A.
Technical: The Issuing Office has established the weight for the Technical criterion for this RFP as fifty percent (50%) of the total points. Evaluation will be based upon the following in order of importance: 1A. Soundness of Approach. The responsiveness of the proposed solution to all written specifications and requirements contained in the RFP, including, but not limited to the following: overall strategy, proposed site and facility; material handling solution, transportation solution, and contingency plans to provide critical business services to the PLCB in the event of natural disasters or labor disruption.
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22
1B. Offeror and Personnel Qualifications. This category refers to the ability of the Offeror to meet all requirements of the RFP, including, but not limited to time constraints, quality, relevancy, and recency of projects completed by the Offeror. The Offeror’s financial ability to undertake a project of this size will also be evaluated in this category. Qualifications of professional personnel will be measured by experience and education, with particular reference to experience in services similar to that described in this RFP. Particular emphasis is placed on the qualifications of the implementation project manager, account manager, facility general manager and senior operational management staff. 2A. Implementation Plan. This category is an evaluation of the Offeror’s plan that meets the PLCB’s target for initial receipt of merchandise through the commencement of full operations. This includes but not limited to site preparation, implementation of material handling system and IT systems. This category includes a detailed evaluation of all plans and timelines. 2B. IT Capabilities. This category is an evaluation of the following, but not limited to the Offeror’s IT Plan, proposed system and experience with similar customers that have the proposed system. The proposed system must be capable of delivering data flows between the PLCB Oracle host system and the selected Offeror’s systems. (See IV-3 C.) The final Technical scores are determined by giving the maximum number of technical points available to the proposal with the highest raw technical score. The remaining proposals are rated by applying the Technical Scoring Formula set forth at the following webpage: http://www.portal.state.pa.us/portal/server.pt/community/rfp_scoring_formulas_ove rview/20124. B.
Cost: The Issuing Office has established the weight for the Cost criterion for this RFP as thirty percent (30%) of the total points. The cost criterion is rated by giving the proposal with the lowest total cost the maximum number of Cost points available. The remaining proposals are rated by applying the Cost Formula set forth at the following webpage: http://www.portal.state.pa.us/portal/server.pt/community/rfp_scoring_formulas_ove rview/20124
C.
Small Diverse Business Participation: BSBO has established the weight for the Small Diverse Business (SDB) participation criterion for this RFP as twenty percent (20%) of the total points. Each SDB participation submittal will be rated for its approach to enhancing the utilization of SDBs in accordance with the belowlisted priority ranking and subject to the following requirements: 1.
A business submitting a proposal as a prime contractor must perform sixty percent (60%) of the total contract value to receive points for this criterion under any priority ranking.
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23
2.
To receive credit for an SDB subcontracting commitment, the SDB subcontractor must perform at least fifty percent (50%) of the work subcontracted to it.
3.
A significant subcontracting commitment is a minimum of five percent (5%) of the total contract value.
4.
A subcontracting commitment less than five percent (5%) of the total contract value is considered nominal and will receive reduced or no additional SDB points depending on the priority ranking. Priority Rank 1: Proposals submitted by SDBs as prime offerors will receive one hundred-fifty (150) points. In addition, SDB prime Offerors that have significant subcontracting commitments to additional SDBs may receive up to an additional fifty (50) points (200 points total available). Additional subcontracting commitments to SDBs are evaluated based on the proposal offering the highest total percentage SDB subcontracting commitment. All other Offerors will be scored in proportion to the highest total percentage SDB subcontracting commitment within this ranking. See formula below. Priority Rank 2: Proposals submitted by SDBs as prime contractors, with no or nominal subcontracting commitments to additional SDBs, will receive one hundred-fifty (150) points. Priority Rank 3: Proposals submitted by non-small diverse businesses as prime contractors, with significant subcontracting commitments to SDBs, will receive up to one hundred (100) points. Proposals submitted with nominal subcontracting commitments to SDBs will receive points equal to the percentage level of their total SDB subcontracting commitment. SDB subcontracting commitments are evaluated based on the proposal offering the highest total percentage SDB subcontracting commitment. All other Offerors will be scored in proportion to the highest total percentage SDB subcontracting commitment within this ranking. See formula below. Priority Rank 4: Proposals by non-small diverse businesses as prime contractors with no SDB subcontracting commitments shall receive no points under this criterion. To the extent that there are multiple SDB Participation submittals in Priority Rank 1 and/or Priority Rank 3 that offer significant subcontracting commitments to SDBs, the proposal offering the highest total percentage SDB subcontracting commitment shall receive the highest score (or additional points) available in that Priority Rank category and the other proposal(s) in
PART III, CRITERIA FOR SELECTION
24
that category shall be scored in proportion to the highest total percentage SDB subcontracting commitment. Proportional scoring is determined by applying the following formula: SDB % Being Scored x Highest % SDB Commitment
Points/Additional = Awarded/Additional Points Available* SDB Points
Priority Rank 1 = fifty (50) Additional Points Available Priority Rank 3 = one hundred (100) Total Points Available Please refer to the following webpage for an illustrative chart which shows SDB scoring based on a hypothetical situation in which the Commonwealth receives proposals for each Priority Rank: http://www.portal.state.pa.us/portal/server.pt/community/rfp_scoring_formula s_overview/20124 D.
Domestic Workforce Utilization: Any points received for the Domestic Workforce Utilization criterion are bonus points in addition to the total points for this RFP. The maximum amount of bonus points available for this criterion is three percent (3%) of the total points for this RFP. To the extent permitted by the laws and treaties of the United States, each proposal will be scored for its commitment to use domestic workforce in the fulfillment of the contract. Maximum consideration will be given to those Offerors who will perform the contracted direct labor exclusively within the geographical boundaries of the United States or within the geographical boundaries of a country that is a party to the World Trade Organization Government Procurement Agreement. Those who propose to perform a portion of the direct labor outside of the United States and not within the geographical boundaries of a party to the World Trade Organization Government Procurement Agreement will receive a correspondingly smaller score for this criterion. See the following webpage for the Domestic Workforce Utilization Formula: http://www.portal.state.pa.us/portal/server.pt/community/rfp_scoring_formulas_ove rview/20124. Offerors who seek consideration for this criterion must submit in hardcopy the signed Domestic Workforce Utilization Certification Form in the same sealed envelope with the Technical Submittal. The certification will be included as a contractual obligation when the contract is executed.
III-5. Offeror Responsibility. To be responsible, an Offeror must submit a responsive proposal and possess the capability to fully perform the Contract requirements in all respects and the integrity and reliability to assure good faith performance of the Contract. In order for an Offeror to be considered responsible for this RFP and therefore eligible for selection for Best and Final Offers or selection for Contract negotiations:
PART III, CRITERIA FOR SELECTION
25
A.
The total score for the Technical Submittal of the Offeror’s proposal must be greater than or equal to seventy percent (70%) of the available technical points; and
B.
The Offeror’s financial information must demonstrate that the Offeror possesses the financial capability to assure good faith performance of the contract. The Issuing Office will review the Offeror’s previous three (3) financial statements, any additional information received from the Offeror, and any other publicly-available financial information concerning the Offeror, and assess each Offeror’s financial capacity based on calculating and analyzing various financial ratios, and comparison with industry standards and trends.
An Offeror which fails to demonstrate sufficient financial capability to assure good faith performance of the Contract as specified herein may be considered by the Issuing Office, in its sole discretion, for Best and Final Offers or contract negotiation contingent upon such Offeror providing Contract performance security for the first Contract year cost proposed by the Offeror in a form acceptable to the Issuing Office. Based on the financial condition of the Offeror, the Issuing Office may require a certified or bank (cashier’s) check, letter of credit, or a performance bond conditioned upon the faithful performance of the Contract by the Offeror. The required performance security must be issued or executed by a bank or surety company authorized to do business in the Commonwealth. The cost of the required performance security will be the sole responsibility of the Offeror and cannot increase the Offeror’s cost proposal or the Contract cost to the Commonwealth. Further, the Issuing Office will award a Contract only to an Offeror determined to be responsible in accordance with the most current version of Commonwealth Management Directive 215.9, Contractor Responsibility Program.
III-6. Final Ranking and Award. A.
After any Best and Final Offer process conducted, the Issuing Office will combine the evaluation committee’s final technical scores, BSBO’s final SDB participation scores, the final cost scores, and (when applicable) the Domestic Workforce Utilization scores, in accordance with the relative weights assigned to these areas as set forth in this Part.
B.
The Issuing Office will rank responsible Offerors according to the total overall score assigned to each, in descending order.
C.
The Issuing Office must select for Contract negotiations the Offeror with the highest overall score; PROVIDED, HOWEVER, THAT AN AWARD WILL NOT BE MADE TO AN OFFEROR WHOSE PROPOSAL RECEIVED THE LOWEST TECHNICAL SCORE AND HAD THE LOWEST COST SCORE OF THE RESPONSIVE PROPOSALS RECEIVED FROM RESPONSIBLE OFFERORS. IN THE EVENT SUCH A PROPOSAL ACHIEVES THE HIGHEST OVERALL SCORE, IT SHALL BE ELIMINATED FROM CONSIDERATION AND
PART III, CRITERIA FOR SELECTION
26
AWARD SHALL BE MADE TO THE OFFEROR WITH THE NEXT HIGHEST OVERALL SCORE. D.
The Issuing Office has the discretion to reject all proposals or cancel the request for proposals, at any time prior to the time a Contract is fully executed, when it is in the best interests of the Commonwealth. The reasons for the rejection or cancellation shall be made part of the Contract file.
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27
PART IV WORK STATEMENT IV-1. Objectives. A.
General. The PLCB operates approximately six hundred (600) retail wine and spirits stores throughout the Commonwealth of Pennsylvania. Currently, the PLCB utilizes three (3) Distribution Centers for the receipt, processing, and storage of PLCB merchandise. The PLCB anticipates using this selection process to identify and contract with an Offeror who will: 1.
Provide a solution for the overall supply chain infrastructure and operations and a description of the strategy and rationale for this solution
2.
Receive shipments from vendors and consolidators
3.
Safely store and rotate inventory
4.
Pick orders and ship inventory to PLCB stores and other locations as directed based on full case orders from the PLCB host system
5.
Provide means to repack, re-label and recoup merchandise as required The selected Offeror will also provide all management, equipment and tools necessary to complete the above, leveraging material handling systems, warehousing and transportation management systems, as well as sound processes and industry best practices, to provide a high degree of service, scalability and cost effectiveness.
B.
C.
Specifics. The following activities are not within the scope of this RFP: 1.
Demand Management – Through the PLCB's host system, the PLCB will provide planning and forecast processes to call forward replenishment quantities from vendors.
2.
Order Management – The PLCB host system will be used to review inventory availability at the stores and the DC, and transmit orders to the distribution center Warehouse Management System (WMS).
3.
Consumer Order Fulfillment – Shipments of bottle-based orders to consumers or stores through the PLCB’s e-Commerce initiatives.
4.
Special Liquor Orders – Shipments of non-stocked merchandise placed by licensees for delivery directly from vendors to the retail stores.
Current Operations. Each DC is currently operated by a different logistics service provider (“Contractor”):
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1.
DC #1 is operated by XTL, Inc. (“XTL”) in Philadelphia; this contract is scheduled to end on March 31, 2015;
2.
DC #2 is operated by Kane is Able (“Kane”) in Scranton; this contract is scheduled to end on July 4, 2015; and
3.
DC #4 is operated by General Commodities Company, Inc. (“Genco ATC”) in Pittsburgh; this contract is scheduled to end on April 30, 2015. The DC #1 facility is owned by the Commonwealth; DC #2 and DC #4 facilities are owned or leased by the Contractors. The current daily order cycle timing for store deliveries follows the schedule outlined below: On Day 1, centralized replenishment runs on the PLCB host system as an overnight job, creating orders for regular stocked merchandise for the stores. In the morning, a replenishment clerk reviews the system’s proposed store orders, completing the review by 10:00 a.m. The orders are then available to the store managers, who are free to edit both items and quantities. The store managers complete their changes by 10:00 p.m. On Day 2, in an overnight process, the PLCB host system then reviews the edited orders, removing any items that are not available at the DC and adding allocations of luxury merchandise to the order. The orders are then sent to the DC and are presented to the WMS by 2:00 a.m. The DC then routes the orders and assigns wave priorities. The DC picks the orders during the day according to departure time requirements. The orders are then either loaded directly onto trucks, or staged for later truck loading, for delivery the following morning. On Day 3, the order is delivered to the store. Store deliveries currently start no earlier than 5:00 a.m., and occur throughout the day based on each store’s individual schedule and routing. Although the PLCB is somewhat flexible in the timing of the individual elements of this process, we do not wish to add additional time to the end-to-end process. Contractors receive merchandise five (5) days per week, store the merchandise, operate the PLCB-owned WMS at all three DCs, operate the PLCB-owned Material Handling System (“MHS”) at DC # 1 only, and deliver to the PLCB’s wine and spirits stores on a set, five (5) day (Monday through Friday) delivery schedule. Approximate case throughput numbers for CY 2012 are as follows: 5.9 million cases for DC #1, 5.4 million cases for DC #2, and 4.4 million cases for DC #4.
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As part of the current PLCB Contracts with the DC operators, each Contractor utilizes a dedicated pool of delivery trailers for its respective delivery tasks. Contractors utilize forty foot (40’) to fifty-three foot (53’) long trailers, as well as pups, city vans, or box trucks to perform store delivery transportation services. Each delivery vehicle is equipped with rollers, and has right and left-side doors, as well as rear access to merchandise. Each DC Contractor is also required, when requested by the PLCB, to perform DC to DC deliveries, to each of the other two (2) DCs. The Contractors generally follow similar approaches to managing store deliveries. Each Contractor utilizes a manual routing methodology based entirely on daily retail store order quantities and the current fixed delivery schedule (Appendix B). Once orders are routed, the WMS controls batch or wave release of merchandise to be selected and loaded for next-day delivery to the PLCB’s wine and spirits stores. Loads are prepared in a variety of methods at the DCs for delivery to the stores, ranging from palletized loads (although not in stretch-wrapped format) to floor loads. Most stores cannot receive palletized deliveries. In those situations, the driver removes the cases from the truck and unloads them onto a skate wheel conveyor that connects to a similar conveyor in the store’s back room. All merchandise is hand-unloaded at the retail stores utilizing Contractor-supplied rollers. Store employees use Radio Frequency (“RF”) scanners to check-in deliveries. The DC #1 facility is wholly staffed by International Brotherhood of Teamsters (“IBT”) employees, including two (2) PLCB subcontracted MHS mechanics. Maintenance of the MHS system is performed by a separate PLCB Contractor. All services at this facility are performed by members of Teamsters’ Locals 929 and 107. DC #2 is a non-union operation. DC #4 also utilizes IBT labor for its services. All services at DC #4 are performed by members of Teamsters’ Locals 926 and 636. D.
Expected Operations. Through the issuance of this RFP and the resulting Contract, the PLCB intends to rationalize its supply chain network into an efficient and cost-effective supply network. Network design will be determined by the selected Offeror, consisting of either one (1) or two (2) DCs, as well as any other necessary cross dock, hub or drop and hook facilities as needed to service PLCB activity. Orders include shipments to retail stores throughout the entire Commonwealth, and will also include deliveries to selected large volume licensees who will receive palletized shipments. The PLCB will retain the services of the selected Offeror to provide DC facilities, any required cross dock, hub or drop and hook facilities, material handling systems, warehouse management technology and labor, as well as industry expertise to manage distribution operations and transportation services to the PLCB’s wine and spirits stores. The selected Offeror shall manage receipt, storage, inventory control, full case order fulfillment and shipment preparation. It is anticipated that case picking will be performed Sunday
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through Thursday with store delivery Monday through Friday. The selected Offeror must provide space for all PLCB activities outlined in the RFP. In addition to DC operations, the selected Offeror shall provide store delivery transportation services to all of the PLCB’s wine and spirits stores in dry van equipment. The PLCB is also in the process of developing a shipment program that will include deliveries of palletized product directly to selected licensees. In order to participate in the program, the licensee will be required to order a minimum case level (anticipated to be a pallet load) and must be able to accept palletized deliveries. With respect to transportation services, the selected Offeror shall provide and manage all transportation assets, labor, technology and maintenance support to meet the PLCB’s requirements. Loads will be palletized and stretch-wrapped at the DC. Deliveries to stores will be made on stretch-wrapped pallets, with a list attached identifying the content of each pallet. In those situations in which a store cannot receive a pallet delivery, the driver will remove the cases from the pallet and unload them onto a skate wheel conveyor that connects to a similar conveyor in the store back room. Appendix B of the RFP details average inventory levels, in case quantities, from January 2012 through December 2012, held by the current three (3) DC networks. E.
Future Operations. The PLCB is considering making other changes to the supply chain process. Offerors are advised not to include these potential changes in developing their Technical or Cost Submittal. These items are provided below so that Offerors may be aware of the potential for future changes. 1.
Five (5) day per week operations are normal. In rare instances, the PLCB reserves the right to require Saturday or Sunday receipts and/or deliveries, and will pay the premium labor costs to do so. It is anticipated that this would be very rare.
2.
Expanding store receiving hours to accommodate early morning and late evening deliveries.
3.
Increasing the number of stores that are able to receive a stretch-wrapped pallet from the warehouse, enabling store employees to receive such pallets into store inventory at their convenience. Automated lift gates on trucks may be necessary to accommodate pallet delivery.
4.
Increasing the use of cross-dock shipping practices is under evaluation. Some portion of Luxury Goods or one-time buys may move to a procedure where they are allocated to stores when the purchase order is written, opening up the potential to broaden the use of cross-dock practices for the affected volume.
5.
Order Handling – Because of limitations in the current WMS system, the PLCB’s host system runs a customized program that combines a store’s
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normal replenishment order with the luxury item allocations for that store, creating a single order and shipment for the store. As part of anticipated process changes at the PLCB, we plan to send multiple orders to the WMS for a store. These could include a normal replenishment order, a luxury merchandise allocation order and a store manager’s supplemental product request. It is expected that the WMS will be able to view multiple orders for a store on a single day as a shipment, combining them for routing, picking and shipping purposes. IV-2. Nature and Scope of the Project. The scope of services to be performed by the selected Offeror includes distribution and transportation services. Distribution services will consist of receipt, storage, inventory control and accountability, and order fulfillment. From a transportation perspective, the scope of services includes delivery to every PLCB wine and spirits store. A firm date for receiving should begin in sufficient time so that the DC(s) is completely servicing the DC #1 region no later than March 31, 2015, and is completely servicing the DC #4 region no later than April 30, 2015, and is completely servicing the DC #2 region no later than July 4, 2015. The selected Offeror shall be responsible for store deliveries, pickup and return of pallets, and return merchandise from PLCB’s wine and spirits stores. Specific information on stores is available in the PLCB Data Package (Appendix B). The PLCB reserves the right to add, open, close and/or relocate its wine and spirits stores and, as a result, adjust the service requirements of the selected Offeror. A.
Anticipated Schedule of Key Events. All dates are estimated. Activity
Contract Award - Notice to Proceed issued.
Date December 2013
Phase I – Secure and Prepare Site, Configure Systems and January - December Prepare for Operations 2014 Phase II – Receive and Store Merchandise at the DC(s) Phase III – Full Receiving and Delivery Operations at the DC(s) Contract Termination Date B.
January 2015 March - July 2015 December 2023
Pertinent Data. A PLCB Data Package, including volume data, growth projections, operational profiles, and store information is attached as Appendix B of this RFP. Please note that the volumes shown in the PLCB Data Package are not guaranteed volumes for the contracted period. The PLCB Store Holiday schedule for 2013 is attached as Appendix E of this RFP.
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The data includes receiving, ordering, shipping, and inventory profiles; receiving, order and shipment transactional data; inventory details; an item master list, and growth projections. The data also includes a store list with addresses, delivery restriction requirements, anticipated frequency of delivery, a listing of store holidays, and other pertinent data. The data profiles are included to provide a detailed reference to volume and inventory levels. Offerors should develop their own profiles and conduct their own analysis from the transactional data provided to ensure full understanding of the PLCB’s business requirements. Offerors should also use the supplied data to perform supply chain network analysis to determine the infrastructure model they wish to propose in the response. C.
Growth projections. The PLCB anticipates the following growth estimates over the anticipated term of the service period: 1.
Case volume (cases) – three percent (3%) annually.
2.
Case inventory (cases) – three percent (3%) annually. Inventory levels are currently based on four (4) to six (6) weeks of inventory and are not expected to change materially. Please see historical data to understand seasonal fluctuation (Appendix B). 3. Case SKUs – zero percent (0%) (SKUs added are expected to be offset by SKU deletions). There are approximately three thousand five hundred (3,500) SKUs that are normally stocked during the year for routine store replenishment. SKUs are added and discontinued throughout the year as driven by customer demand. It is normal to have approximately three thousand two hundred (3,200) active replenishment SKUs at any point in time. In addition to the replenishment SKUs, the PLCB also purchases seasonal and other limited availability merchandise (called Luxury Goods) that is received and shipped to stores during a limited timeframe. This luxury volume may be converted to cross-dock operations. About ten thousand (10,000) different SKUs flow through the supply chain annually for this type of product.
4.
Store Count – There are no plans to add additional stores at this time, other than normal routine openings and closings.
The PLCB does not guarantee any of the growth estimates shown above, nor does the PLCB guarantee that volumes will continue at current levels. D.
Bailment. Bailment was implemented by the PLCB in 2012. In this program, vendors control the movement of their regular stocked products into the PLCB DCs and subsequently control the DCs inventory levels for that material. In order to maintain control of total stock levels, vendors are assessed significant penalties for exceeding their targeted weeks of supply. Since the initiation of Bailment, the
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PLCB has seen product inventory levels remain generally in line with historic levels. Also as part of the Bailment initiative, the vendors maintain title to their merchandise until the product is ship-confirmed. Regardless of the ownership, the PLCB and, in turn its DC Contractors are responsible to the vendors for the safety and security of their product in the DCs. Bailment is transparent to the DC operator. Records regarding ownership of the product in the DCs are maintained in the PLCB’s host system, and are not a matter of concern for the DC operators. IV-3. Requirements. A.
Contingency Plans. To support continuity of operations during an emergency, including, but not limited to: natural disasters, information technology failures, labor disruptions, power outages, or a pandemic, the Commonwealth needs a strategy for maintaining operations for an extended period of time. One part of this strategy is to ensure that essential Contracts that provide critical business services to the Commonwealth have planned for such an emergency and put contingencies in place to provide needed goods and services. 1.
Describe how you anticipate such a crisis will impact your operations.
2.
Describe your emergency response continuity of operations plan. Please attach a copy of your plan, or at a minimum, summarize how your plan addresses the following aspects of emergency preparedness: a.
Identify employee training (describe your organization’s training plan, and how frequently your plan will be shared with employees)
b.
Identify essential business functions and key employees (within your organization) necessary to carry them out
c.
Identify contingency plans for: (1)
Short-term contingency planning – temporary interruption of normal business operations (e.g., electrical power outages, weather events, etc.).
(2)
Long-term contingency planning – several months disruption of normal business operations due to a catastrophic event (e.g., fire, tornado, etc.).
(3)
An assessment of how various crises (e.g., natural disasters, weather conditions, labor strikes, etc.) would be managed to reduce the impact on operations.
(4)
An assessment of how employees in your organization will carry out the essential functions if contagion control measures prevent
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them from coming to the primary workplace.
B.
3.
Describe how your organization will communicate with staff and suppliers when primary communications systems are overloaded or otherwise fail, including key contacts, chain of communications (including suppliers), etc.
4.
Describe how and when your emergency plan will be tested, and if the plan will be tested by a third-party.
5.
Describe your contingency plan for the operation of any supplied IT systems, including the WMS and TMS.
Facility/facilities Requirements. The PLCB will accept proposals in which the proposed facility/facilities is located anywhere within Pennsylvania. If more than one physical facility is part of the submitted design, these requirements apply to each, unless otherwise stated. Please include details on all facilities that are part of the proposal. 1.
General (both selected Offeror and PLCB workspace) a.
The interior of the proposed facility/facilities must be able to accommodate three percent (3%) volume expansion per year, as needed.
b.
The facility/facilities and real estate must have the capability to allow the Distribution Center to rapidly expand by as much as twenty percent (20%).
c.
The facility/facilities must be located on a lot with full perimeter fencing which supports parking of transportation assets and employee vehicles, including those of PLCB employees. The facility/facilities must be able to store loaded trucks or trailers securely on the site.
d.
The facility/facilities must have fire protection and suppression systems which meet or exceed regulatory standards. There are approximately two hundred (200) SKUs that are at least one hundred (100) proof. The facility/facilities must have a sprinkler system, which the selected Offeror shall have checked/tested and certified prior to receiving initial merchandise, and annually thereafter, through the length of the Contract. A copy of the certification of the sprinkler system shall be forwarded to the Contracting Officer within thirty (30) days following the test. If the test is not made, the PLCB may contract for test certification and deduct said charges from monies owed the selected Offeror.
e.
The facility/facilities should be in close proximity to transportation infrastructure (e.g., rail, rail intermodal facility, ease of interstate access, no bridge or height restrictions).
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2.
f.
The facility/facilities must be compliant with the Americans with Disabilities Act (“ADA”) and Occupational Safety and Health Administration (“OSHA”) requirements and meet all other regulatory requirements.
g.
The PLCB requires access to a conference room for meetings with suppliers (DC only).
h.
The PLCB will install a telephone system to support the PLCB offices and workspaces (DC(s) only).
i.
Potential for incentives or tax advantages with respect to labor, inventory, and investment based on the selected location(s).
j.
Condition and appearance of the facility/facilities with respect to its capability to support sound warehousing and housekeeping practices.
k.
Transition plan if the facility/facilites is currently occupied.
l.
All access roads are required to be paved and approved by local authorities to handle the volume and nature of anticipated traffic to and from the DC(s).
Security. The selected Offeror shall be responsible for all maintenance and security in and around the facility/facilities. The selected Offeror must supply and maintain protective equipment and services, which include burglar alarm and sprinkler systems with both off and on-site monitoring. Costs for any service/maintenance contract related to the overall security system shall be borne by the selected Offeror. Equipment shall remain at all times the property of the selected Offeror. The selected Offeror shall ensure, at a minimum, that the following security requirements are met: a.
DC(s) is enclosed within a perimeter.
b.
Security team coverage twenty-four (24) hours per day, seven (7) days per week, three hundred sixty-five (365) days per year to safeguard all site personnel, merchandise, equipment, and PLCB property.
c.
Guardhouse with standardized entrance requirements for visitor and employee check-in.
d.
Alarm and video surveillance systems to monitor the premises and prevent unauthorized access. The system must monitor all methods of ingress/egress. Video surveillance systems must be operable at all times and are required to record loading docks and all methods of ingress and egress on the property (including any roof access doors); such recordings must be maintained for a minimum of ninety (90) days. The
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selected Offeror shall assure that the PLCB is fully aware of its retention period regarding surveillance video. e.
The selected Offeror shall safeguard all merchandise from theft and damage while in the selected Offeror’s control. The selected Offeror is deemed to be in control of merchandise from the point in time that the load is accepted at the DC through delivery and acceptance by PLCB store personnel. Additionally, with respect to return merchandise, the selected Offeror assumes control at store pickup. Commonwealth laws and regulations require one hundred percent (100%) accountability for all product at all times. The selected Offeror shall maintain accurate perpetual inventory records with transactional audit trail capabilities.
f.
All external areas of facility/facilities and parking lot must be well lit. The selected Offeror shall ensure that all exterior lights are in working condition and that adequate lighting is achieved in the external areas of the facility/facilities and parking lot.
g.
The selected Offeror shall develop, implement and maintain an identification system for all PLCB and selected Offeror employees.
h.
The selected Offeror shall ensure segregation and security of inventory if space is shared.
3.
Safety. The selected Offeror shall provide clean, well-lit, well-ventilated, and safe working conditions for all employees. The selected Offeror is required to comply with all federal, state and local regulations including, but not limited to, Equal Employment Opportunity Commission (“EEOC”), OSHA, ADA, Federal Motor Carrier Safety Act, and other applicable regulations. The selected Offeror shall maintain records documenting that all employees are trained and qualified for the function which they are performing. Documentation to verify compliance with regulatory requirements will be the responsibility of the selected Offeror.
4.
Environmental Issues (Sustainability). The PLCB is committed to minimizing the impact of its operation on the environment. A copy of the PLCB Statement on Sustainability is included in Appendix C. Describe your organization’s conservation plans in support of the PLCB’s Statement on Sustainability.
5.
DC Facility/Facilities Configuration. Required space and its configuration will be determined by the selected Offeror based upon its proposed solution design to support the business requirements included in this RFP. The PLCB
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office and visitor work space is only required at the DC facility/facilities, not at any cross-dock, hub or drop and hook facility/facilities. a.
A sufficient number of dock doors are required to accommodate receiving activities, staging, and loading of delivery trailers.
b.
A drivers’ room must be provided.
c.
Direct rail access is not required. Prior to the conversion to the new DC(s), any vendors utilizing boxcars for delivery will be instructed to either switch to an alternative shipment method or to provide their own boxcar transloading arrangements to deliver to the DC in containers or trailers.
d.
PLCB Office. The selected Offeror shall provide at least two thousand (2,000) square feet of office space at the facility/facilities for PLCB employees and office equipment. The office space shall have readily available access to adequate restroom facilities for both sexes and be temperature controlled. The selected Offeror shall provide lighting adequate for office work purposes and at least equivalent to that in the selected Offeror’s office space. The selected Offeror shall provide electrical power to support up to five (5) PLCB employees. The office space must include one (1) private office and a shared area for four (4) employees, which will include wiring for computer access, Internet access, and printers. The selected Offeror shall provide trash removal and routine office cleaning. The PLCB shall have access to office temperature controls.
e.
Network/Server Closet. The selected Offeror shall include, within or reasonably adjacent to the PLCB’s office space, a network/server closet which has the following characteristics: (1)
Six foot (6') x six foot (6') (thirty-six (36) square feet) of space in a wiring closet that will contain one (1) network cabinet. The closet must have a door. The door to the closet does not require a lock.
(2)
Space for one (1) nineteen inch (19") wide lockable network cabinet for the network equipment (router, switch(es), wireless access point, servers) to be supplied by the PLCB.
(3)
The cabinet and closet must be located so that the longest Ethernet run from the network cabinet to the furthest desktop, laptop, register or printer is no more than ninety (90) meters as per the Cat 5 specification.
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(4)
The closet must maintain an ambient temperature between seventy (70) and eighty (80) degrees Fahrenheit while cooling six thousand five hundred (6,500) BTUs.
(5)
The Telecommunications Demarcation Point must be extended into the wiring closet and be within two (2) meters of the network cabinet.
(6)
Electrical and structural support shall be provided for the network cabinet, including the router, patch panel, switch and server, which requires 7.5 amps and weighs approximately three hundred pounds (300 lbs.).
(7)
All cabling and patch panels must comply with the Commonwealth Master Information (IT) Services Invitation to Qualify (ITQ) Contract Telecommunications Wiring Standards located at: http://www.itqrp.state.pa.us/ITQ/ITQ/ITQLibrary/Documents/100. 2%20-%20Master%20IT%20Services%20ITQ%20%20Telecommunications%20Wiring%20Standards.doc as described in IT/ITQ Contract #4400004480, available at: http://www.itqrp.state.pa.us/ITQ/ITQ/ITQLibrary/DocumentLibrar y.aspx
(8)
All Ethernet cables must be Cat 5e cable, also known as TIA/EIA568-B.
(9)
A nineteen inch (19") wide patch panel, where all of the Ethernet jacks are connected, shall be located inside the locked network cabinet in the wiring closet.
(10) One (1) four (4)-outlet electrical outlet with a fifteen (15) AMP dedicated circuit. f.
Visitor Work Space. The selected Offeror shall provide a workspace at the facility adjacent to the PLCB office space for the use of visitors. This space may be used by vendor representatives, auditors, or other visitors that do not work for either the selected Offeror or the PLCB. The space shall include two (2) office cubicles or the equivalent area. The selected Offeror shall ensure that the workspace will allow access to the Internet and a printer. This space shall have readily-available access to adequate restroom facilities for both sexes and be temperature controlled. The selected Offeror shall provide lighting adequate for office work purposes and at least equivalent to that in the selected Offeror’s office space. This space must comply with ADA, as well as OSHA requirements, and other applicable regulatory agency directives.
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C.
Systems Technology. The PLCB requires that the selected Offeror supply its own WMS, transportation management systems (“TMS”) and labor management systems (“LMS”) technology as needed to support their proposal. These system(s) will interface with the PLCB host system. The proposed solution may be individual point solutions for each functional area or may be an integrated package solution. The proposed system(s) solutions must be fully detailed in the proposal, including platforms and versions, along with key functionality that will be used to support operations. For the purposes of this RFP, all such systems will be referred to collectively as a WMS. The selected Offeror will be required to provide all hardware to perform DC operations. The Selected Offeror will also provide a single point of contact for all system issues. The WMS must accommodate up to fifteen (15) concurrent operational personnel to include PLCB staff in Harrisburg, Pennsylvania with two (2) separate and distinct roles. One role should have read only access and the other role should have update access. Update access should only be for adding\removing PLCB personnel as they change and will be limited to one (1) or two (2) key PLCB personnel to maintain PLCB user setups. If a web based solution is offered for accessing any portion of the WMS, the browser must be compatible and supported with PLCB’s current operating systems, java versions, and installed web browsers – be it Window’s Internet Explorer, Mozilla’s FireFox, etc. The selected Offeror shall ensure that all actions done within the WMS are documented\recorded through the use of an audit trail and PLCB personnel shall be made privy to all audit trail logs\records. This is for the purpose of being able to discern what transactions occurred, what order they occurred in, and who would be the responsible party for those actions. This includes such things as system\auto generated transactions and is not limited in scope to just user defined actions. The current DCs utilize the Robocom Inventory Management System (“RIMS”), licensed and maintained by the PLCB. The RIMS release currently in use does not support anticipated future DC requirements. The PLCB currently pulls data from RIMS every two (2) hours during the day, starting at 3:00 AM and ending at 9:00 p.m., for the PLCB host system. Although this is able to be modified somewhat, the selected Offeror’s systems integration design should account for a similar frequency and schedule. The selected Offeror will provide all upgrade releases for the basic software as they become available. Installation of upgrade releases is the responsibility of the selected Offeror, but must be coordinated with the PLCB. As maintenance and upgrade releases become available, the selected Offeror will evaluate the potential impact of the release as it relates to the operation of the basic software or customizations and report conclusions to the PLCB. For any PLCB requested customizations, the selected Offeror will provide the PLCB with an estimate of costs of those adjustments. If agreed upon by the PLCB, the selected Offeror will
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coordinate with the PLCB to make such adjustments. No software changes shall be installed without first getting PLCB consent and the timing of said implementations must be coordinated with the PLCB to minimize system\operating impacts. Upon receipt of a request for service from the PLCB, the selected Offeror will attempt as soon as practical to access the system in order to diagnose the source of the operating problem. If the selected Offeror determines that the problem relates to the basic software or the customizations maintained by the selected Offeror, the selected Offeror will recommend suitable corrective action and upon PLCB’s consent, implement the steps to correct the problem. Timing of load transmissions back to the PLCB is critical. The stores are expecting the ASN (Advance Shipment Notification) information to them prior to the truck’s arrival for delivery. Hence, load transmissions\shipment verifications back to the PLCB must occur no later than two (2) hours prior to dispatch. This gives PLCB time to process shipment verification and create the ASN out to the store. This is needed for receipting in the store delivery. It is the goal of the PLCB that the selected Offeror provide a highly available WMS which is resilient from errors of the underlying platform and single points of failure. Expectation is that the WMS will provide a high level of uptime with a minimum of outages (including scheduled downtime and any site disasters) and disruptions. Uptime is based upon scheduled working time of the DCs and PLCB personnel. Objective: a minimum of 99.5% Assuming a scheduled work time of: 23 hours per day @ 5 days a week (M-F) PLUS 8 hours per day @ 1 day a week (Sun) For an average scheduled working time of 123 hours per week that equates to allowable downtime of: 36.9 minutes per week 2.58 hours per month 31 hours per year 1.
Systems Interfaces. The anticipated data flows between the PLCB Oracle host system and the selected Offeror’s systems are shown below: Data sent to selected Offeror from the PLCB: a.
Items – Item master details
b.
Suppliers – Supplier details
c.
Locations – Destination location information
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d.
Inbound Purchase Orders (“PO”s)/Advance Shipment Notifications (“ASN”s) – Expected receiving information for POs and ASNs
e.
Store Returns – Expected receiving information for Store Returns
f.
Store Replenishment Transfers – Store replenishment transfer shipment information
g.
Store Allocation Transfers – Store allocation transfer shipment information
h.
DC Transfers – DC Transfer Order (DCTO) shipment information
i.
Licensee Orders – Licensee order shipment information
j.
Vendor Returns – Return to vendor shipment information
k.
Inventory Request – Oracle inventory request
Data sent to PLCB from the Selected Offeror: l.
Receipts – Receipt of inbound material from POs/ASNs, DCTOs and Store returns information
m.
Inventory Adjustments – Inventory quantity adjustment information
n.
Quality Adjustments – Inventory quality adjustment information
o.
Shipment Confirmations/BOL –DCTO, vendor return and licensee order fulfillment information
p.
Store ASNs – Store Transfer fulfillment details (for pass through to store point-of-sale system)
q.
Inventory Response – Response to inventory request During implementation there may be additional information required in addition to the data flows above. The selected Offeror will work with the PLCB to address all interfaces required at no additional cost to the PLCB. The PLCB interfaces will be based on the standard messaging interfaces in the host system. Any work necessary to move data between the selected Offeror’s WMS, TMS, and LMS will be the responsibility of the selected Offeror. Interface communication/connectivity options must include, at a minimum, ASCII flat file over File Transfer Protocol (FTP).
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D.
System levels and Troubleshooting. (See Appendix L.) 1.
Systems Functionality Required. The following is a listing of functionality anticipated in the provided systems. This is not an all-inclusive list, but highlights key expectations. a.
RF capability in all appropriate functional areas
b.
Receipt of goods
c.
Directed put-away by product attribute/velocity
d.
Warehouse task interleaving
e.
Paperless picking
f.
Re-warehousing capability
g.
Support of transfers among logical inventory classifications within the warehouse (e.g. salable product, damaged product, quarantined product, etc.)
h.
Lot control
i.
Shipping manifest/bill of lading production
j.
Cycle counting
k.
Ability to control individual warehouse areas and storage locations
l.
Ability to support SKU and SCC labeling requirements
m.
Full inventory visibility to the PLCB
n.
Exception reporting and alerting
o.
Management reporting
p.
Ability to control cross-dock operations
q.
Ability to handle multiple order types with differing workflows (e.g. cross-dock orders, store replenishment orders, licensee orders, return to vendor orders, etc.)
r.
Full order and product activity traceability
s.
FIFO (first in, first out) stock rotation control
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t.
Ability to handle multiple stock quality/hold classifications (e.g. damaged, awaiting inspection, salable, on-hold, quarantined, returned from store, etc.)
u.
Time stamp for shipping and receiving operations
v.
Visibility of inbound appointment and yard management functions
w.
Ability to handle multiple orders to a destination on the same day
x.
Ability to combine multiple orders onto a single shipment
y.
Ability to combine multiple shipments onto a single truck
z.
Routing of store transfers in alignment with store delivery schedules, store handling requirements and other operational requirements defined in this document
aa.
Reporting and inquiry support for the PLCB for pending shipments, routed shipments, in-transit shipments and confirmed store deliveries
bb. Full store delivery status visibility cc.
On time delivery calculation and notification
The PLCB will consider the selected Offeror’s recommendations regarding application of technology to streamline the flow of information, optimize equipment utilization and promote efficiency. E.
Delivery Requirements. Delivery restrictions, frequency of delivery at each store, and capabilities to receive pallets at each store are identified in the Store Details and Store Listings tabs of Appendix B. The selected Offeror should note that some stores can only accommodate side-door deliveries and should therefore plan for suitable equipment to support such deliveries. It should also be noted that a few locations are currently capable of receiving pallets. 1.
Delivery Windows. Currently, stores receive deliveries during limited receiving hours generally from 7:00 a.m. to 4:00 p.m. Some stores in congested areas may receive earlier morning deliveries.
2.
Delivery Days. The current schedule for delivery to the PLCB’s wine and spirits stores is five (5) days per week, Monday through Friday. Orders will be picked and loaded on Sunday for the Monday deliveries. Product should not be stored overnight in trucks in the parking area. Stores requiring multiple deliveries per week will be scheduled to balance those shipments across the week.
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The selected Offeror will be expected to jointly develop a delivery schedule with PLCB’s staff that strikes a balance between the preference of the stores and an efficient transportation schedule. 3.
Delivery Schedule and Process Changes. The selected Offeror is expected to design an efficient and scalable order selection process that is aligned with the PLCB’s order transmission timelines, as well as the dispatch timing requirements, to meet store delivery windows. Loads will be palletized and stretch-wrapped at the DC(s). Shipments to stores will be made on stretchwrapped pallets, with a list attached identifying what the pallet contains. In those situations in which a store cannot receive the pallet, the driver will remove the cases from the pallet and unload them onto a skate wheel conveyor that connects to a similar conveyor in the store back room. The selected Offeror is expected to work in concert with the PLCB to support initiatives to improve upon the store delivery process. 4. Holiday Schedule. A special delivery schedule shall be established when a holiday or other occurrence closes the PLCB’s wine and spirits stores on a normal delivery day (Appendix E). Typically, Monday holiday delivery volumes are handled by cancelling the Monday holiday delivery and adding volume to the store’s preceding and subsequent deliveries. The selected Offeror will be required to manage labor planning around such dates to ensure that service levels meet store requirements.
E.
Pallet Requirements. The selected Offeror shall handle and store product on fortyeight inch (48”) x forty inch (40”) four (4)-way pallets. The pallets shall be clean, free of debris, odor and stains. The selected Offeror shall ensure that adequate quantities of pallets and slip-sheets are available to accommodate business requirements. Pallets must be of good quality to ensure the integrity of PLCB merchandise. All deck boards must be intact, securely fastened to stringers. No portions may be cracked or broken. No wood splinters or nails should be protruding from any pallets. At the start of the Contract, all pallets to be used for operations are to be supplied by the selected Offeror. The selected Offeror may enter into a pallet exchange program with shippers, vendors, carriers and other contractors and shall bear sole responsibility for any pallet shortages that occur. The PLCB shall not be liable for pallet shortages. The selected Offeror shall pick up and transport pallets or other delivery carts from the PLCB’s stores to the DC(s) at no additional charge.
F.
Demurrage Charges. The selected Offeror shall be liable for all truck detention and demurrage charges, except those that are incurred as a result of labor strikes by PLCB employees or in other instances where the PLCB specifically accepts responsibility. Should any truck detention charge, except as explained herein above, be paid by the PLCB, the same may be charged to or applied against any monies due the selected Offeror. Neither the selected Offeror nor the PLCB will entertain or honor any detention or demurrage charges for deliveries where the
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carrier has missed their scheduled dock appointment. The PLCB will notify the selected Offeror of receipt of any demurrage charges or detention charges claimed against the selected Offeror. Upon notification of any truck detention or rail demurrage charge, the selected Offeror shall be given a reasonable length of time, not to exceed thirty (30) days, to reply to the carrier and the PLCB indicating whether such charges are valid, and, if not valid, the reasons such charges should not be paid by the selected Offeror. G.
Product Recall. The selected Offeror’s WMS must be capable of supporting recalls to the product lot detail level. WMS support for recalls must allow for specific vendor lot codes to be restricted from selection for store shipment within one (1) hour of notification by the PLCB. Because lot code tracking is not currently used, it is acceptable to put all inventory of the affected SKU on quarantine until a date coded cycle count can be taken. The PLCB will be reasonable in its expectations for timing of the cycle count, but it is a top priority activity when a product recall is communicated to the DC. Support for recalls must also allow for inventory to be quarantined immediately upon receipt of recalled merchandise from the stores. The selected Offeror shall complete product recalls from stores within one (1) delivery cycle from notification that product is being held at a store for return to the DC.
H.
Audits. The PLCB will conduct periodic operational and inventory audits and risk assessments throughout the term of the Contract. These audits may be conducted by either internal or external PLCB resources/representatives. The selected Offeror shall facilitate necessary site visits and fully cooperate with the visiting teams. While the PLCB will typically provide reasonable notice prior to conducting an audit, the PLCB retains the right to conduct unannounced audits. Any charges for inventory audits will be billed as accessorial charges.
I.
PLCB Policies and Procedures. The selected Offeror shall use and follow all policies, practices, systems and procedures as provided by the PLCB and agreed to by the selected Offeror in executing all services unless otherwise approved in advance by the PLCB Contact Person. This includes the manner, availability and all other aspects of merchandise and supplies identification. The selected Offeror shall cooperate with the PLCB in the possible introduction and implementation of advanced systems and procedures designed to streamline operations and gain efficiencies in executing the Contract services.
J.
Process Improvement Management. The PLCB will meet with the selected Offeror to review performance on a regular basis, in order to communicate results, recognize efforts and improvements, and develop action plans for those areas needing improvement. The PLCB will determine the frequency with which process improvement meetings will be conducted. In addition, the selected Offeror shall actively participate in a program of continuous improvement to reduce operating costs and improve service over time. The PLCB intends to implement a program by which process improvement
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opportunities can be identified, reviewed, planned, approved, implemented, and tracked. Financial benefits resulting from continuous improvement opportunities will be shared by the selected Offeror and the PLCB. The PLCB will receive seventy percent (70%) of any approved savings and the selected Offeror will receive the balance. The selected Offeror is expected to develop an approach to formalize this program and track results. The selected Offeror is expected to provide recommended cost reduction and service improvement initiatives at each continuous improvement meeting. The PLCB will also propose improvement initiatives at these meetings. Proposed initiatives will be reviewed and then jointly approved for implementation. Accountability for execution and approach to measuring and tracking results will be determined. The PLCB recognizes that there may be scenarios in which supply chain improvements identified through the continuous program may result in additional costs within the selected Offeror’s operations. Should such a scenario develop, the selected Offeror’s fee structure may be adjusted if approved by the PLCB. K.
Metrics for Service. The PLCB has developed Metrics for Service that the selected Offeror shall track and/or report. It is the PLCB’s plan to measure these metrics monthly and/or quarterly. Failure to achieve these minimum metrics could result in default or other penalty under the terms and conditions of the Contract. Important: After the Contract is awarded, the PLCB and the selected Offeror will develop a regular process to review performance against the objectives established below and identify continuous improvement opportunities.. 1.
Cycle Count Accuracy. The selected Offeror will be required each calendar quarter to count all location slots/SKU’s and immediately (within twenty-four (24) hours) update the book inventory, with appropriate inventory adjustments, to bring the book inventory in line with the physical inventory count. The selected Offeror is expected to perform so that slots will be accurate as to both item identification and stock quantity. The selected Offeror will be responsible for generating quarterly reports to the PLCB Contracting Officer from their system to monitor this Metric for Service. Objective: 95% accuracy as to location, count, and item identification
2.
Level of Store Overage, Shortage and Damage Claims (“OS&D”). It is expected that the selected Offeror shall immediately (within twenty-four (24) hours) resolve any overage, shortage and damage (OS&D) claims from deliveries to the stores. If an overage or shortage is claimed by a store, then the DC, unless approved by the PLCB, is to immediately perform a cycle count of that SKU, and make appropriate inventory adjustments if it finds a count discrepancy. Damage can only be claimed by the store at the time of delivery. The PLCB will be responsible for calculating and monitoring this Metric for Service based on store reported delivery discrepancies and
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damages. This metric will be reviewed monthly and scored on a quarterly basis. Objective: The absolute value of the OSDs on shipments originating from the DC will be less than one-tenth of a percent (0.1%) of cases shipped. If, at the end of a fiscal year, the DC has a net overage, it will be retained by the PLCB. If there is a net shortage, it will be charged to the DC and paid as a deduction from the selected Offeror’s invoices. L.
Insurance Requirements. All insurance policies shall name the PLCB and its contracted bailment vendors as an additional insured. Prior to commencement of work on the Project, the selected Offeror shall provide the PLCB with current certificates of insurance naming the PLCB as an additional insured. Upon the PLCB’s written request, the selected Offeror shall provide the PLCB with a copy of any policy which names the PLCB as an additional insured. These certificates shall contain a provision that coverage afforded under the policies shall not be cancelled or changed until at least thirty (30) days prior written notice has been given the PLCB. Copies of such notification shall be sent to the Issuing Officer. The Offeror also agrees to authorize any provider of insurance coverage required under the Contract to notify the Issuing Officer of any notices or premiums due by sending a copy of such notice to the Issuing Officer. The PLCB reserves the right, in the event of any default by the selected Offeror on any premiums due hereunder, to cure said default and to deduct such premiums from any monies due the selected Offeror. The total combined PLCB inventory in DC #1, DC #2, and DC #4, can be valued in the range of approximately one hundred thirty million dollars to one hundred seventy-five million dollars ($130,000,000.00 - $175,000,000.00). The selected Offeror must purchase and maintain, at its expense, the following types of insurance, issued by companies and evidenced by policies acceptable to the PLCB: 1.
Workers’ Compensation Insurance - Workers’ Compensation Insurance sufficient to cover all of the employees of the selected Offeror working to fulfill the resulting Contract.
2.
Liability/Damage Insurance - Comprehensive General Liability Insurance, Property Damage Insurance, and Automobile Liability Insurance in such amounts as the PLCB shall deem sufficient which shall not exceed ten million dollars ($10,000,000.00) for injury to or death of one (1) person in a single occurrence and twenty million dollars ($20,000,000.00) for injury to or death of more than one (1) person in a single occurrence and ten million dollars ($10,000,000.00) for a single occurrence of property damage. Excess or
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umbrella insurance coverage is required in the amount of no less than one hundred million dollars ($100,000,000.00) for personal injury and property damage. 3.
Flood Insurance - This clause is applicable to any and all facilities/equipment situated in a flood plain designated by the United States (U.S.) government. The selected Offeror shall maintain flood insurance insuring the interest of the PLCB in all merchandise in the custody of the selected Offeror. The amount of the insurance maximum will be based on the allowable insurance available for that specific site.
4.
Fire Regulation Compliance - The selected Offeror agrees to comply with regulations and rules of the fire insurance company(ies) insuring the merchandise in the custody of the selected Offeror.
5.
Personal Injury/Property Damage - The selected Offeror shall be liable for all personal injuries or property damage to invitees while on the selected Offeror's property caused by the negligence of the selected Offeror. The selected Offeror shall also be liable for any injuries or damages sustained by the PLCB, its agents, servants, employees, or invitees resulting from the negligent activities of the selected Offeror, its agents, servants, employees or invitees.
IV-4. Tasks. The PLCB anticipates that the Contract operations will be comprised of four (4) distinct phases: Phase 1: Secure and Prepare Site(s), Configure Systems and Prepare for Operations, Phase 2: Receive and Store Merchandise at the DC(s), Phase 3: Full Receiving and Delivery Operations, and Phase 4: Wind Down. Many of the tasks and subtasks will take place in multiple phases. Include a work plan for each task that identifies the work elements of each task, the resources assigned to the task, and the time allotted to each element and the deliverable items to be produced. Where appropriate, a GANTT chart display should be used to show project, task, and time relationship. A.
Phase 1: Secure and Prepare Site(s), Configure Systems and Prepare for Operations. After the Notice to Proceed has been issued, Phase 1 will begin. Task #1 – Provide a Detailed Implementation Plan. As the initial task of Phase 1, the selected Offeror will develop a complete, detailed, solution design and Implementation Plan. The intent of this task is to ensure that the solution design and Implementation Plan are aligned with current PLCB business requirements, volumes and initiatives. Deliverable #1 – The selected Offeror shall submit a revised detailed solution design and Implementation Plan to the PLCB, within thirty (30) days of the Notice to Proceed, for approval by the PLCB. The plan must include a defined and measurable set of milestones. Examples of measurable milestones may include
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securing the location, completion of construction or renovation, installation and testing of the WMS, etc. Task #2 - Execute Implementation Plan. Once the PLCB approves the detailed solution design and implementation plan, the selected Offeror will begin to execute that plan. The PLCB expects the selected Offeror to be prepared to receive inventory at the DC(s) no later than January 2015. The three progress payments (PART II, Section II-15A of the RFP) as outlined in Phase 1 should be tied to significant Phase 1 milestones as agreed between the PLCB and the selected Offeror. Deliverable #2 – Every thirty (30) days, the selected Offeror shall provide a milestone progress report to show the progress in executing the Implementation Plan, including completion of any milestones. Each milestone must be approved and accepted as complete by the PLCB. B.
Phase 2: Receive and Store Merchandise at the DC(s). By January 2015, the selected Offeror must be able to receive merchandise for storage in the DC(s). The PLCB must approve transitioning from Phase 1 to Phase 2. The selected Offeror shall schedule the arrival of inventory and begin receiving merchandise at the facility/facilities in accordance with the Phase 2 plan within five (5) days after the PLCB has approved the completion of Task #2. Task #3 - Receiving and Put-away. The selected Offeror’s WMS will receive inbound shipment notification (POs and ASNs) from the PLCB’s host system on a daily basis. This serves as a notice to the DC(s) that an authorized shipment is in route to them. It is estimated that in-bound product will arrive via the following methods: truckload (eighty-one percent (81%)), less than truckload (seven percent (7%)) and ocean container (twelve percent (12%)). The selected Offeror shall be responsible for scheduling and adherence to carrier appointment times. The selected Offeror shall promptly unload in-bound vehicles in order to avoid any detention or demurrage charges. Payment for any such charges will be the responsibility of the selected Offeror. In-bound product must be unitized, either palletized or slip-sheeted. Vendors are not to ship inbound product in a floor-loaded fashion. If a vendor ships product in a floor-loaded fashion, the DC is to secure PLCB direction to either 1) refuse the inbound load; or 2) unload it, requiring the carrier to utilize a lumper at the vendor’s sole expense. Where applicable, the selected Offeror shall track security and record seals on inbound trailers. If noticeable damage is identified once a trailer is opened and placed at a dock door, selected Offeror personnel shall contact the onsite PLCB manager to verify the damaged load. The selected Offeror must isolate, record, and track all damages.
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Occasionally, a trailer will require only partial unloading. Once the selected Offeror’s portion has been unloaded, the selected Offeror must ensure that the trailer has a new seal installed and that the seal number is recorded prior to dispatch. Selected Offeror shall ensure that all merchandise is properly identified and labeled, capturing the quantity, and linked to the PLCB item number using the manufacturer’s SCC (a bar-coded stocking item identifier) number within the WMS. The selected Offeror shall ensure that the pallet is tracked into and out of each location as it moves through the warehouse. If an in-bound pallet’s PLCB item number labels or SCC labels are incorrect or missing, the selected Offeror shall print and apply new labels to the cases prior to put-away. Product identification labeling must be approved by the on-site PLCB Manager. Charges for case identification labeling will be billed to the PLCB as accessorial charges. The selected Offeror shall scan product into the warehouse on a blind receipt basis. This policy ensures proper reconciliation of product received into the building. The selected Offeror shall inspect all pallets for carton count and visible damage. The selected Offeror shall isolate, record, and track all damaged product. Random in-bound audits of case contents may be requested by the PLCB from time to time. Labor to perform such audits must be approved by the on-site PLCB manager and will be billed to the PLCB as accessorial charges. Put-away to the optimal location will be directed by the selected Offeror’s WMS. The selected Offeror shall rotate stock on a first in, first out (“FIFO”) basis. The selected Offeror shall also have the capability to track stock by production code date or other such method should the PLCB deem such as necessary. FIFO practices provide sufficient stock rotation so that date code recording is not currently used by the PLCB. However, on a small assortment of date sensitive products such as some box wines, freshness codes are monitored at receipt so that old stock is not received into inventory. The DC will be responsible for FIFO rotation on all merchandise. Merchandise that expires because of rotation problems will be charged to the DC. The selected Offeror shall be financially responsible for any inventory shortages and damages which occur while in the selected Offeror’s control, including through delivery to PLCB stores or other consignees. For bailment merchandise, shortages and damage will be calculated based on the currently-quoted PLCB cost on the date of the damage or, if that date is unknown, on the date that the shortage or damage claim was filed. For PLCB-owned merchandise, the cost shall be based on the weighted average cost.
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If the store claims an overage or shortage upon delivery, the DC is to immediately perform a cycle count of the pick location and SKU and adjust inventory according to the results. Overage and shortage adjustments must be reviewed with the on-site PLCB DC Manager. The PLCB requires regular cycle counting at the SKU/location level. Cycle counting is scheduled to ensure that all SKUs and inventory locations are counted at least quarterly. The selected Offeror must report detailed cycle count results with discrepancies within one (1) business day of cycle count completion. The selected Offeror must provide reasonable access to vendors to allow them to count Bailment merchandise. Such requests will be managed by the PLCB and executed by DC personnel. The PLCB requires any supplier or vendor requesting a physical count to provide adequate notice. Any labor charges incurred will be billed to the supplier or vendor by the PLCB. Deliverable #3 – The selected Offeror shall properly receipt and store merchandise at the DC(s) and make such merchandise available for shipment to the PLCB’s wine and spirits stores. All WMS systems and systems interfaces to the PLCB host system shall be fully functional. All required reporting and status query capability must be fully functional. C.
Phase 3: Full Receiving and Delivery Operations. During Phase 3, the selected Offeror will be servicing all of the PLCB’s wine and spirits stores, providing accessorial services, as shown in PART IV, Section IV-4(D), and receiving and storing merchandise as listed in PART IV, Section IV-4(B). Task #4 – Assume Deliveries to Stores. The selected Offeror shall propose and execute a solution for assuming deliveries to stores currently serviced by the existing DCs, in coordination with the expiration of the DCs’ Contracts. Subtask A – Delivery Routing/Loadbuilding/Order Selection. Orders will be transmitted to the selected Offeror’s WMS from PLCB’s host system. The selected Offeror shall be responsible for order selection of case volumes. Delivery routing will be conducted by the selected Offeror to facilitate order selection planning. The selected Offeror must synchronize picking with store delivery routing both for day of delivery and position on delivery truck. Orders are transmitted by the PLCB in batches based on store delivery schedules. In addition to regular product orders, the selected Offeror shall be responsible for emergency and supply orders. Emergency orders are rush orders that may come after regular cutoff times. Supply orders are for store supplies (e.g., bags, etc.). Subtask B – Loading. The selected Offeror shall stage trailers in dock doors in accordance with the delivery schedule. The selected Offeror will load product in reverse delivery order (last store off is first store loaded on the
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trailer). Once the trailer is loaded, the selected Offeror shall prepare a shipping manifest and/or Bill of Lading and make such available to the transportation driver at the time of dispatch. Shipping shall take place on stretch-wrapped pallets, with pallet level load tickets attached to each pallet. The selected Offeror must seal every completed trailer and record the seal number on the manifest. The selected Offeror shall provide the necessary equipment and staffing to conduct yard moves to and from the dock doors. Subtask C – Deliver Merchandise to PLCB’s wine and spirits stores. The driver is responsible for unloading and transporting the product from the trailer into the store. A palletized delivery will be made through the rear door of some stores; however, most stores will require the driver to utilize the current process which involves the use of a section(s) of skate wheel conveyor which connects to a similar conveyor in the store back room. On occasion, the DC will be asked to deliver miscellaneous items to stores in addition to the normal merchandise deliveries. This may include items like ice melt, printers, paper towel dispensers, etc. All such items will be suitably packed for truck shipment. When these instances arise, delivery of the miscellaneous items will be billed as cases of merchandise. This activity happens very rarely. The driver shall record an arrival time stamp upon arrival at the store and another time stamp once the delivery at the store is complete. The time stamp may be electronic, and must be made available to the PLCB. In addition, the driver must record the number of cases delivered. To avoid the potential for theft, the driver must lock the trailer prior to each trip into the store. The driver will also be responsible for transporting any product returns and pallets to the DC(s). All product returns will be arranged in advance and communicated via PLCB’s host system. Before leaving the store, the driver must notify the manager that the delivery is complete. The driver and a store representative will conduct a total case count for the delivery and record any shortages, overages or damaged product. Both driver and store receiving personnel will sign receiving paperwork indicating agreement on the delivery as to items and case counts. Drivers must be proficient in reading, writing and speaking English to enable communication with PLCB store personnel. In some cases the driver may be unable to complete delivery to a store due to unforeseen circumstances such as road blockages, store closures, or hazardous weather conditions. The PLCB will not reimburse the selected Offeror for store redeliveries without express written consent. Charges for redeliveries will be handled as accessorial charges. PART IV, WORK STATEMENT
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Subtask D – Replenishment. The selected Offeror shall restock active case pick locations from which store orders are fulfilled on an efficient basis to meet required fill-rate metrics. Subtask E – Document and Report Damaged Goods and Shortages. The selected Offeror must document, in a manner which is acceptable to the PLCB, any merchandise damages or shortages identified during warehouse handling or during transport. The selected Offeror will be responsible for any necessary recoup/repack needed to make the product shippable or salable. Charges for recoup will be billed as accessorial charges. Damage on inbound product from a vendor will be billed to the vendor by the PLCB. Damage incurred in warehouse handling or shipment to the final destination will be charged back to the selected Offeror. The selected Offeror will report damages in a fashion that allows proper handling of recoup costs. Subtask F – Maintain Equipment. The selected Offeror is responsible for all maintenance and the condition of materials handling and transportation equipment. The selected Offeror shall ensure that all delivery equipment is swept clean and is clear of debris prior to loading at the DC(s). Subtask G – Store Returns. The DC(s) will receive a very small quantity of returns from stores. All store-to-DC returns will be in full cases only. These could take the form of stock balancing, vendor product recall or regulatory requirements. In the event of a store return, the selected Offeror shall verify returns against accompanying paperwork, load the product from the wine and spirits store onto the truck, return the product to the DC, unload the product from the truck, isolate returned product in the DC, and dispose of or rewarehouse the product according to instructions provided by the PLCB. Charges for store returns should be billed as accessorial charges. Subtask H – Quarantine (Hold) Transactions. As directed by the PLCB, the selected Offeror must be capable of segregating selected merchandise into quarantine status, and restricting activity for such inventory based on the quarantine status. The WMS should provide for various quarantine status options and activity restrictions, to accommodate the particular product requirements. The WMS must also be able to communicate changes in quarantine status to the PLCB host system. For example, merchandise from a vendor that has been recalled and is awaiting disposition at the DC would be recorded in a quarantine status that would not allow any transactions other than return to the vendor. Damaged product awaiting recoup would be removed from normal status and placed in a quarantine status until recoup is completed and the material is returned to stock. Unlisted product arriving on a vendor shipment would be held in a quarantine status until proper handling is determined.
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The selected Offeror shall be required to track and manage the quarantined inventory just as any other inventory. Costs of handling quarantine transactions should be included in the normal case handling fees charged to the PLCB. Any additional miscellaneous activities, such as preparing return to vendor shipments, will be billed as accessorial charges to the PLCB. Subtask I – Facility Maintenance and Housekeeping. The selected Offeror is responsible for all maintenance and housekeeping of the facility/facilities. The selected Offeror must coordinate any planned downtime with the PLCB staff. The selected Offeror shall meet the following maintenance and housekeeping requirements: a.
The facility/facilities shall be maintained in a sanitary fashion. The facility/facilities should be treated as a food-grade facility, utilizing appropriate pest control and sanitation control practices to adequately protect the product.
b.
Regular and routine cleaning of the facility/facilities, including, but not limited to, storage areas, racks, aisles, materials handling equipment, office facilities (including all office space utilized by the PLCB), docks, lunch room, building service area and restrooms.
c.
Collecting and removing all trash, including that of the PLCB office staff.
d.
Landscaping of grounds surrounding the facility/facilities.
e.
Snow removal for all paved areas of the facility/facilities and the maintenance of surrounding ground, lawn and landscaped areas.
f.
The selected Offeror shall be responsible for the maintenance and working condition of the facility/facilities twenty-four (24) hours per day, seven (7) days per week.
g.
The selected Offeror shall be responsible for the maintenance and working condition of the MHS as well as the WMS/TMS and associated equipment.
Deliverable #4 – The selected Offeror shall provide a fully-functioning DC(s) operation, with merchandise efficiently receipted into the DC(s) properly stored, picked, and transported to the PLCB’s wine and spirits stores for customer purchase. D.
Accessorial Services. This section outlines specific accessorial services that have been identified as requirements by the PLCB. The selected Offeror shall be reimbursed for these services at the agreed upon per case, per mile or per hour rate
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as proposed in the PLCB Distribution Services RFP Cost Submittal Worksheet (Appendix A). 1.
Other Shipments. ($/mile) In addition to store delivery service, the selected Offeror may be required to provide other transportation services. These services should be billed on a dollar per mile ($/mile) basis from the pickup point to the delivery point, and will be subject to the fuel surcharge. Moves may include the following transportation services: a.
Drayage services to/from eastern seaboard ports
b.
Transportation of intermodal freight to/from the DC(s) and railhead
c.
Old DC to new DC cartage
d.
Other product or non-product cartage
2.
Backhaul shipments. ($/mile) On occasion, trucks making deliveries of PLCB orders may be asked to pick up merchandise for delivery back to the DC(s). Such backhaul activity will be billed based on a ($/mile) basis from the store delivery, the subsequent pickup and the return to the DC, and will be subject to the fuel surcharge.
3.
Re-label. ($/case) The selected Offeror shall be responsible for some relabeling of items where carton damage occurs or where cases are improperly labeled by the vendor. Only if directed by the PLCB, the selected Offeror shall re-label cases received with improper or missing labels for future shipments to stores. If required to re-label cases, the selected Offeror shall complete re-labeling within two (2) working days of PLCB notice to re-label cases. The selected Offeror shall bring the incorrectly labeled merchandise to the attention of the PLCB site manager and the selected Offeror shall then relabel only merchandise that cannot be processed for storage and delivery without a new label. Billed cost includes the cost of materials, creation of the label, and labor to apply the label to the case. These services will be charged on a dollar per case ($/case) basis.
4.
Store Return to Warehouse. ($/case) The selected Offeror shall accept full cases from the PLCB wine and spirits stores merchandise to be returned to the DC when authorized by the PLCB. This product may be either merchandise being returned to vendors or being repositioned by the PLCB. This merchandise shall be picked up in the course of conducting store deliveries and returned to the DC by the selected Offeror. The selected Offeror shall ensure that the merchandise is properly handled and entered into the WMS upon return to the DC. These services will be charged on a dollar per case ($/case) basis.
5.
Redelivery to stores. ($/case) When weather or other circumstances preclude delivery of a load to a store, the selected Offeror, with the written approval of
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the PLCB, may be asked to redeliver to the store. Since the PLCB would have already been charged for the initial aborted delivery, it is anticipated that the redelivery charge would be somewhat lower than the initial cost. This charge would be subject to the fuel surcharge. These services will be charged on a dollar per case ($/case) basis. 6.
Recoup and reconditioning of product. ($/case) When merchandise is damaged, either upon receipt from the vendor or while under the control of the selected Offeror, the selected Offeror will provide recoup services. This includes segregating non-recoverable merchandise, repacking recovered merchandise and all necessary reporting to allow the PLCB to charge the responsible party. The per case charge should include all materials, and labor required to perform the task, returning good stock to salable inventory and destruction of unsalable merchandise. Destruction of unrecoverable merchandise will be done on-site, and proof of destruction must be retained for auditor review. Such destruction shall be accomplished in compliance with all applicable federal, state, and local laws. If required to recondition/recoup damaged product, the selected Offeror shall complete damage processing within one (1) week of receipt of in-bound damage and within one (1) week of occurrence if damaged while in the selected Offeror’s custody. The selected Offeror shall be paid for this service provided the damage was not caused by the selected Offeror as determined by the PLCB. Payment for recondition/recoupment services shall be made only for cases that the selected Offeror actually reconditioned/recouped, and will not be made for such cases handled incidentally in the process. These services will be charged on a dollar per case ($/case) basis.
7.
Physical Inventory and Audits Counts. (per occurrence) When requested by the PLCB, the selected Offeror will be asked to perform physical inventory counts of inventory in the DC(s). Such counts may be a full physical inventory count of the DC(s) or more limited counts related to a particular vendor’s products or specific items. When such cases occur, the PLCB will request that the selected Offeror prepare a quotation to perform such services. Rates and hours to perform such services will be mutually agreed to between the selected Offeror and the PLCB. Labor to perform the required quarterly cycle counts noted in this document are specifically excluded from accessorial services and part of the base Contract rates.
8.
Product Destruction. ($/case) From time to time the selected Offeror will be requested to assist with destruction of product. Such destruction shall be accomplished in compliance with all applicable federal, state, and local laws. Destruction shall include loading, hauling, delivery to a landfill as arranged and paid for by the selected Offeror. The selected Offeror and the PLCB shall cooperate in securing the presence of required witnesses to destruction of damaged merchandise. This charge is not subject to the fuel surcharge. These services will be charged on a dollar per case ($/case) basis.
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E.
9.
Merchandise Validations and Inspections. ($/hour) As directed by the PLCB, the selected Offeror shall be required to select cases of particular merchandise and open them to verify contents, UPC codes, labels or other data. Inspections may include the quality of contents including cork leakage, label flaws, neck foil integrity, etc. Merchandise will then be processed in accordance with PLCB instructions. These services will be charged on a dollar per hour ($/hour) basis.
10.
Preparation of shipments to other carriers. ($/case and $/pallet) The selected Offeror may be requested to assemble products for shipment that will not be delivered by the selected Offeror. Products being returned to a vendor where the vendor is responsible for return shipment is an example of such an instance. This charge is to reimburse the selected Offeror for picking the product, preparing it for shipment and preparation of shipping paperwork. The cost per case would be applied for case picked merchandise, and the cost per pallet would apply for pallet picked merchandise.
Phase 4: Wind Down. Prior to the expiration or termination date of the Contract, the selected Offeror shall be required to wind down its operations. The selected Offeror may be required to provide a mirror image of data to the PLCB during this period. During the wind-down period, the PLCB may employ the services of another contractor who provides the same or similar services. During the winddown period, the selected Offeror shall fully cooperate with the PLCB and any of its contractors to assure the successful transition from the selected Offeror’s service to the services of any other contractor which the PLCB may engage. The PLCB will make every attempt to notify the selected Offeror of the commencement of the wind-down period.
IV-6. Reports and Project Control. A.
Reporting. Initially, the selected Offeror shall track and report the information listed below. Other, yet to be defined, tracking tools may be developed jointly with the PLCB. Initially, there will be frequent meetings/conference calls to address any issues arising during Phase 1 to help understand and correct problems. During Phase 1, the selected Offeror will prepare monthly progress reports detailing the progress against the project milestones, key upcoming activities, issues identified and resolved, and issues identified and still unresolved. Beginning with Phase 2, periodic meetings will be held to address operational performance, improvement opportunities and suggestions for process changes. In addition to these meetings, the following information must be made available to the PLCB by the selected Offeror through an agreeable conveyance: 1.
Daily Reports a. POs/ASNs received (in-bound)
PART IV, WORK STATEMENT
58
b. c. d. e. f. g. h. i. j. k. l. m. n. o. p. q. r. s.
Cases received POs/ASNs and/or in-bound vehicles which have arrived on-site but were not unloaded by close of business Order transmissions received (to fulfill) Orders scheduled for delivery Orders delivered Orders delivered on-time Trucks shipped Average cases per truck Average weight per truck Total case inventory and case inventory by hold classification Disposition of any orders that are not delivered on-time Cases delivered Pallets/delivery carts received from stores Product received from stores Inventory discrepancies including cycle count results Delivery overages, shortages and damages (units) Reported warehouse damages Reported inbound damages
2.
Weekly Key Performance Indicator Reports a. Order Fill Rate Percentage b. Inventory Accuracy Percentage c. Order Accuracy Percentage d. Product Damages e. Recoup Turnaround Time Performance
3.
Supplementary Weekly Report a. Total cases received b. Total cases received within allowable unload window c. Total POs/ASNs received d. Total cases made available for order fulfillment e. Total cases made available for order fulfillment within allowable timeframe from receipt f. Total orders fulfilled g. Total units not available in inventory for order fulfillment h. Total cases ordered i. Total cases fulfilled j. Total cases fulfilled accurately k. Order fill rate (number of cases shipped as a percentage of cases ordered) l. Order accuracy (number of cases shipped accurately as a percentage of cases shipped) m. Total locations cycle counted n. Total locations cycle counted with discrepancy o. Equipment Utilization (cases/load and loads/day) p. Asset Utilization (hours/week/power unit)
PART IV, WORK STATEMENT
59
q. r. s. 4.
Driver Utilization (hours/week/driver) Miles per Week Use of lumpers/supplemental labor
Risk and Issue Reporting– During Phase 1 & 2, the Contractor’s Project Manager must submit to the PLCB Project Manager, a problem identification report for requirements, design and development issues, staffing problems and other issues that may materially impact the project scope, schedule and work products. For definition purposes, an issue is a current problem. The Issue Report must include: a.
A description of the issue;
b.
Resource(s) assigned to resolve the issue;
c.
A categorization of the issue (such as technical, procurement, resources, training or communications);
d.
An analysis of the likely causes of the issue;
e.
A proposed solution; and
f.
An assessment of its impact on the schedule and completed work products and services.
Weekly Agreement Standards and Supplementary report data will be also be reported on a month-to-date (“MTD”) and a year-to-date (“YTD”) basis. The PLCB and the selected Offeror will work together to structure a reporting system that will provide timely information that is useful to both parties. The PLCB requires the ability to perform ad-hoc inquiries to supplement normal reporting standards whenever needed. B.
Record Retention. The selected Offeror must maintain all paper records for a period of not less than three (3) years and must maintain all electronic records for not less than seven (7) years.
IV-7. Contract Requirements—Small Diverse Business Participation. All Contracts containing SDB participation must also include a provision requiring the selected Offeror to meet and maintain those commitments made to SDBs at the time of proposal submittal or Contract negotiation, unless a change in the commitment is approved by the BSBO. All Contracts containing SDB participation must include a provision requiring SDB subcontractors to perform at least fifty percent (50%) of the subcontracted work. The selected Offeror’s commitments to SDBs made at the time of proposal submittal or Contract negotiation shall, to the extent so provided in the commitment, be maintained throughout the term of the Contract and through any renewal or extension of the Contract. Any proposed PART IV, WORK STATEMENT
60
change must be submitted to BSBO, which will make a recommendation to the Issuing Officer regarding a course of action. If a Contract is assigned to another contractor, the new contractor must maintain the SDB participation of the original Contract. The selected Offeror shall complete the Prime Contractor’s Quarterly Utilization Report (or similar type document containing the same information) and submit it to the Issuing Officer and BSBO within ten (10) workdays at the end of each quarter the contract is in force. This information will be used to determine the actual dollar amount paid to SDB subcontractors and suppliers. Also, this information will serve as a record of fulfillment of the commitment the selected Offeror made and for which it received SDB participation points. If there was no activity during the quarter then the form must be completed by stating “No activity in this quarter.” NOTE: EQUAL EMPLOYMENT OPPORTUNITY AND CONTRACT COMPLIANCE STATEMENTS REFERRING TO COMPANY EQUAL EMPLOYMENT OPPORTUNITY POLICIES OR PAST CONTRACT COMPLIANCE PRACTICES DO NOT CONSTITUTE PROOF OF SMALL DIVERSE BUSINESS STATUS OR ENTITLE AN OFFEROR TO RECEIVE CREDIT FOR SMALL DIVERSE BUSINESS UTILIZATION.
PART IV, WORK STATEMENT
61
APPENDIX A COST SUBMITTAL WORKSHEET
DC Startup Schedule: Calendar Year Fiscal Year Contract Year Contract Phase Area Contractor Activity
Calendar Year 2014 Fiscal Year 2013-2014
Jan
Feb
Mar
Sep
Oct
Nov
Dec
Design, execute and test WMS interfaces
Three milestone-based fixed cost billing for training, lease costs, etc., per contract
Calendar Year 2015 Fiscal Year 2014-2015
Fiscal Year 2015-2016 Contract Year 2
Phase 2 Jan
Feb
Product Receipts Begin
Mar Reg 1 Shipments Begin
Notes
Calendar Year Fiscal Year Contract Year Contract Phase Task Contractor Activity Notes
Aug
Implement data changes and process changes for new WMS
Notes
Contractor Activity
May
Contract Year 1 Phase 1 Jun Jul
Prepare DC for use. Order and install equipment and racking. Prepare WMS and PLCB interfaces.
PLCB Activity
Calendar Year Fiscal Year Contract Period Contract Phase Task
Apr
Fiscal Year 2014-2015
Phase 3 Apr May Jun Jul Aug Sep Oct Reg 3 Reg 2 Full DC Operations Shipments Shipments Begin Begin New DC begins regular billings for receipts, deliveries and fixed costs DC1 DC4 DC 2 Closeout Closeout Closeout
Nov
Dec
Nov
Dec
Calendar Year 2016 Fiscal Year 2015-2016
Jan
Feb
Mar
Apr
Fiscal Year 2016-2017
May
Contract Year 3 Phase 3 Jun Jul
Aug
Sep
Full DC Operations Cost submittal detail covers this period (CY 2016)
The costs detailed in tabs on the cost submittal should be based on the first full year of DC operations, January 2016 through December 2016
Oct
Enter Your Company Name: Provide a price per case and fixed fees as indicated. Notes:
No inputs are to be made in any cells with a grey background. Inputs must be made in yellow shaded cells only. Cells with blue background are calculated and must not be changed.
Tab 1 - Pricing Contract Year 1 2 3 4 5 6 7 8 9 10
Calendar Year 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Description Prep Facility - Milestone-based fixed billing Partial Year Operation First Full Year Operation
Projected Case 3) Total Annual Pricing ($/case) Volume 1) Handling 2) Delivery Sub-Total Fixed Pricing Fee 0 $0.000 $0.000 $0.000 $ 12,000,000 $0.000 16,000,000 $0.000 16,800,000 $0.000 17,640,000 $0.000 18,522,000 $0.000 19,448,100 $0.000 20,420,505 $0.000 21,441,530 $0.000 22,513,607 $0.000
Total 10 year cost: To simplify pricing, inbound and outbound volumes are assumed to be equal each year 1) Handling pricing/case should include all variable costs associated with receiving, putaway, rewarehousing and order picking activity Not subject to Fuel Surcharge
2) Delivery pricing/case should include all variable costs associated with transporting and delivery to stores Subject to Fuel Surcharge
3) Fixed pricing fee should include all fixed costs projected over the contract, e.g. lease, taxes,etc. Not subject to Fuel Surcharge Contract Year 1 fee to remiburse selected up-front costs will be billed in three milestone-based intallments to be determined in final contract Contract Year 2-10 fixed pricing fee will be billed in monthly installments, along with inbound and outbound charges
Other than PLCB-requested Accessorial & Value Added Services, these 3 categories account for 100% of Contractor's billable fees. On Tab 2: Please detail components of Contract Year 1 Cost recovery
On Tabs 3 through 8: Please detail all components & their corresponding $, that add up to the Year 3 per case costs & fixed fee
Annual Total Cost $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
$0
Tab 2 Cost Recovery - Contract Year 1 Allowable recovery of start-up expenses from 1/14 - 12/14 Provide detail on incurred costs incurred in the initial contract year to be billed through progress payments as outlined in the RFP Sec. II-15 A, based on project execution timing. Actual payment will be based on achievement of project execution milestones.
First Billing Date
Second Billing Date
Third Billing Date
First Billing Date Amount
Second Billing Date Amount
Third Billing Date Amount
Billing Dates
Cost Component (add rows as necessary) Building Lease Payments
Date Costs Begin
Total Year 1 Billing
$
-
$
-
$
-
Warehouse Materials Handling Equipment
$
-
$
-
$
-
Warehouse Racking
$
-
$
-
$
-
Training and Personnel Costs
$
-
$
-
$
-
Total Cost Recovery Billing
$
-
$
-
$
-
$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $
Notes -
Tab 3 Cost Breakdown - Contract Year 3 Operational expenses from 1/16 - 12/16
Provide detailed distribution center and transportation costing as outlined. Many of these fields will be filled automatically from the tabs that follow, but yellow shaded cells will require inputs. Cost
Distribution Services Cost Category A. DC Operations DC LABOR Management Base salary & wages Overtime Benefits Clothing allowances Shift premiums Bonus Training Other Total Management Labor Costs
$ $ $ $ $ $ $ $ $
-
Hourly Labor Base salary & wages Overtime Benefits Clothing allowances Shift premiums Bonus Training Other Total Hourly Labor Costs
$ $ $ $ $ $ $ $ $
-
TOTAL DC LABOR COSTS
$
-
DC EQUIPMENT COST Lease / Rent Depreciation Interest on capital Insurance Repairs & maintenance License fees Other TOTAL DC EQUIPMENT COST
$ $ $ $ $ $ $ $
-
DC FACILITY SPACE COSTS Lease Taxes Utilities Building maintenance Insurance TOTAL DC FACILITY SPACE COSTS
$ $ $ $ $ $
-
Tab 3 Cost Breakdown - Contract Year 3 Operational expenses from 1/16 - 12/16
Provide detailed distribution center and transportation costing as outlined. Many of these fields will be filled automatically from the tabs that follow, but yellow shaded cells will require inputs. Cost
Distribution Services Cost Category DC FACILITY OPERATING COSTS Security costs Waste disposal Housekeeping Exterior area maintenance Pest control Other TOTAL DC FACILITY OPERATING COSTS
$ $ $ $ $ $ $
-
TOTAL DC FACILITY COSTS
$
-
DC SUPPLIES Packing materials / Dunnage Office supplies Other TOTAL DC SUPPLIES
$ $ $ $
-
DC COMMUNICATION COSTS Telephones Cell phones Other TOTAL DC COMMUNICATION COSTS
$ $ $ $
-
DC INFORMATION TECHNOLOGY COSTS Depreciation Interest on capital WMS licensing and maintenance Other software maintenance Hardware maintenance Data communication costs System administration Other TOTAL DC INFORMATION TECHNOLOGY COSTS
$ $ $ $ $ $ $ $ $
-
DC CORPORATE OVERHEAD
$
-
TOTAL DC OPERATIONS COST
$
-
Tab 3 Cost Breakdown - Contract Year 3 Operational expenses from 1/16 - 12/16
Provide detailed distribution center and transportation costing as outlined. Many of these fields will be filled automatically from the tabs that follow, but yellow shaded cells will require inputs. Cost
Distribution Services Cost Category B. Transportation Operations TRANSPORTATION LABOR
-
Ton Miles in Year 3 Solution Management Base salary & wages Overtime Benefits Clothing Allowances Shift premiums Bonus Training Other Total Management Labor Costs
$ $ $ $ $ $ $ $ $
-
Labor Base salary & wages Overtime Benefits Clothing allowances Shift premiums Bonus Training Other Total Labor Costs
$ $ $ $ $ $ $ $ $
-
TOTAL TRANSPORTATION LABOR COSTS
$
-
TRANSPORTATION EQUIPMENT COST Lease / Rent Depreciation Interest on capital Insurance - Automotive Insurance - General Taxes Repairs & maintenance (parts, outsourced maintenance, etc) License fees Fuel Tolls Other TOTAL TRANSPORTATION EQUIPMENT COST
$ $ $ $ $ $ $ $ $ $ $ $
-
TRANSPORTATION FACILITY SPACE COSTS Lease Taxes Utilities Building maintenance Insurance TOTAL TRANSPORTATION FACILITY SPACE COSTS
$ $ $ $ $ $
-
Tab 3 Cost Breakdown - Contract Year 3 Operational expenses from 1/16 - 12/16
Provide detailed distribution center and transportation costing as outlined. Many of these fields will be filled automatically from the tabs that follow, but yellow shaded cells will require inputs. Cost
Distribution Services Cost Category TRANSPORTATION FACILITY OPERATING COSTS Security costs Waste disposal Housekeeping Exterior area maintenance Pest control Other TOTAL TRANSPORTATION FACILITY OPERATING COSTS
$ $ $ $ $ $ $
-
TOTAL TRANSPORTATION FACILITY COSTS
$
-
TRANSPORTATION COMMUNICATION COSTS Telephones Cell phones GPS / Onboard Systems Other TOTAL TRANSPORTATION COMMUNICATION COSTS
$ $ $ $ $
-
TRANSPORTATION INFORMATION TECHNOLOGY COSTS Depreciation Interest on capital TMS licensing and maintenance Other software maintenance Hardware maintenance Data communication costs System administration Other TOTAL TRANSPORTATION I.T. COSTS
$ $ $ $ $ $ $ $ $
-
TRANSPORTATION CORPORATE OVERHEAD
$
-
TOTAL TRANSPORTATION OPERATIONS COST
$
-
TOTAL COST OF DISTRIBUTION SERVICES PROVIDED
$
-
PROFIT
$
-
$
-
Profit Margin %
TOTAL COST FOR CONTRACT PERIOD
Tab 4: Management & Labor Detail - Contract Year 3 Provide labor cost detail as outlined. DC Management & Administrative Labor Worksheet List Positions (add rows as needed)
Annual Salary
FTEs
DC Mgmt. & Admin. Labor Total
Base Salary
-
$
Overtime
- $
- $
Benefits
Clothing Allowances
- $
Annualized Shift Premiums
- $
- $
Bonus
Training
- $
Other
-
Total Cost $ $ $ $ $ $ - $
$
Notes
-
DC Hourly Labor Worksheet (include temporary labor) List Positions (add rows as needed)
Wage per Hour
FTEs
Annualized Clothing Shift Base Wages Overtime Benefits Bonus Training Allowances Premiums $ - $ - $ - $ - $ - $ - $ -
$
Receiving and Putaway
-
Hours Projected -
Replenishment
-
-
$
- $
- $
- $
- $
- $
- $
-
$
Order Selection
-
-
$
- $
- $
- $
- $
- $
- $
-
$
Shipping
-
-
$
- $
- $
- $
- $
- $
- $
-
$
Inventory Control
-
-
$
- $
- $
- $
- $
- $
- $
-
$
Other
-
-
$
- $
- $
- $
- $
- $
- $
-
$
DC Hourly Labor Total
-
-
$
- $
- $
- $
- $
- $
- $
-
$
Other
Total Cost - $ $ $ $ $ - $ $ $ $ $ - $ $ $ $ $ - $ $ $ $ $ - $ $ $ $ $ - $ $ $ $ $ - $
-
Notes
Tab 4: Management & Labor Detail - Contract Year 3 Transportation Management & Administrative Labor Worksheet List Positions (add rows as needed)
Annual Salary
FTEs
Transportation Mgmt. & Admin. Labor Total
Base Salary
-
$
Overtime
- $
Benefits
- $
Clothing Allowances
- $
Annualized Shift Premiums
- $
- $
Bonus
Training
- $
Other
-
Total Cost $ $ $ $ $ $ - $
$
Notes
-
Transportation Labor Worksheet (include temporary labor) List Positions (add rows as needed)
Wage per Hour
$
- $
- $
Annualized Clothing Shift Bonus Training Allowances Premiums - $ - $ - $ - $ -
-
$
- $
- $
- $
- $
- $
- $
-
$
-
-
$
- $
- $
- $
- $
- $
- $
-
$
-
-
$
- $
- $
- $
- $
- $
- $
-
$
FTEs
Driver 1
-
Hours Projected -
Mechanics
-
Other
Transportation Labor Total 1
If drivers are paid other than hourly basis, please explain in notes column
Base Wages
Overtime
Benefits
Other $
Total Cost - $ $ $ $ $ - $ $ $ $ $ - $ $ $ $ $ - $
-
Notes
Tab 5: DC Facility & Equipment Detail - Contact Year 3 Provide DC facility and equipment cost detail as outlined. Equipment Worksheet (Leased or Owned) List Equipment for Provider Controlled Areas (add rows as necessary)
Units
Lease Cost per Unit
EITHER
Sub Total
$
List Equipment for PLCB Controlled Areas (add rows as necessary)
Units
OR
-
Lease Cost per Unit
EITHER
Depreciation per Unit
$
OR
Interest on Capital per Unit
- $
Depreciation per Unit
Annual Cost
$ $ $ $ $ $ $ $ $ - $
Interest on Capital per Unit
Sub Total
$
-
$
- $
$ $ $ $ $ $ $ $ $ - $
Equipment Grand Total
$
-
$
- $
- $
Notes -
Annual Cost
Notes -
Facility Space Worksheet Cost per ft2 DC Activity Receiving Shipping Storage and Processing Office Space Other Sub Total Contractor
ft2 required
Lease
-
$
Taxes
- $
Building Maintenance
Utilities
- $
- $
Insurance / Other
Annual Cost
Notes
- $
$ $ $ $ $ - $
-
PLCB Office Space Other Sub Total PLCB
-
$
- $
- $
- $
- $
$ $ - $
Total Facility Costs
-
$
- $
- $
- $
- $
- $
Tab 6: Transportation Facility & Equipment Detail - Contract Year 3 Provide transportation facility and equipment cost detail as outlined. Add lines as necessary. Transportation Equipment Worksheet (Leased or Owned) List Equipment (add rows as Units needed)
Lease Cost per Unit
Depreciation per Interest on Capital per Unit Unit
EITHER
Total Equipment Costs
$ $ $ $ $ $ $ $ $ $ - $
OR
$
-
$
Annual Cost
- $
Notes -
Transportation Facility Space Worksheet Cost per ft2 Area Description Operations Center Maintenance Other Other Total Facility Costs
2
ft required
Lease
- $
Taxes
- $
Building Maintenance
Utilities
- $
- $
Annual Cost
Insurance / Other
- $
$ $ $ $ - $
Notes -
Tab 7: Overhead Costs - Contract Year 3 Provide overhead cost detail such as corporate allocations, SG&A or similar costs. Provide detail for each cost entered. Add rows as necessary. DC Overhead Cost Detail Worksheet Overhead Item 1 2 3 4 5 6 7 8 9 10 DC sub-total
Cost $ $ $ $ $ $ $ $ $ $ $
Transportation Overhead Cost Detail Worksheet Overhead Item 1 $ 2 $ 3 $ 4 $ 5 $ 6 $ 7 $ 8 $ 9 $ 10 $ Transportation sub-total $
Please provide overhead cost details relative to the items listed -
Cost
Please provide overhead cost details relative to the items listed -
Tab 8: Capital Investment Provide a detailed list of capital investments required to execute the solution as designed. Add rows as necessary. DC Capital Investment Worksheet Capital Item 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Total
Number of Units
Transportation Capital Investment Worksheet Capital Item Number of Units 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Total
Unit Cost
Cost $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $
Unit Cost
Cost $ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $
Depreciation Period
Please provide capital investment details relative to the items listed
Depreciation Period
Please provide capital investment details relative to the items listed
-
-
Tab 9: Accessorial Fees Provide pricing detail for accessorial activities. Accessorial Fee Schedule (add lines as needed) Pricing Component 1 2 3 4 5 6 7 8
9
Description
Prepare and deliver shipments to Other Shipments other than store locations Pick up shipments for delivery to DC Backhaul Shipments after merchandise delivery Labeling cases to PLCB specs for Case Labeling/Relabeling inbound item identification Return Merchandise from Store to Pick up merchandise from store for Warehouse delivery to DC after store delivery Redelivery to store after aborted Redelivery to Store delivery attempt Recoup damaged merchandise for Damage Processing - Recouping shipment to store Load, haul, deliver to landfill, Merchandise Destruction at Landfill witness destruction Merchandise Validation and Inspect case contents for defects or Inspection labeling issues Preparation of shipment for other carriers
10 Wind Down Services 11 Other (Specify)
Pick goods, prepare for shipment, prepare paperwork, load shipment
Pricing Metric
Subject to Fuel Surcharge
per Mile
Yes
per Mile
Yes
per Case
No
per Case
Yes
per Case
Yes
per Case
No
per Case
No
per Hour
No
per Case (for less than pallet qty) per Pallet (for full pallets)
Fee per Metric
Comment
No No Will be negotiated
Tab 10: Fuel Surcharge Table
Fuel Surcharge per case and per mile incremental rates will be calculated monthly utilizing the monthly US EIA Central Atlantic (PADD 1B) No 2 Diesel Retail Prices (Dollars per Gallon). Web address: http://www.eia.gov/petroleum/gasdiesel/ full history, Data 2, M Diesel Prices All Types For use with accessorial For use with regular store delivery cost per case* charges billed on a cost per mile basis For per mile For per mile for mileage for mileage Fuel Surcharge/Case if Fuel Fuel Surcharge/Case if Fuel based charges based charges Price per Gallon Above or Prices are > Benchmark Prices are < Benchmark if fuel prices if fuel prices Below (+/-) Benchmark Price Price Price are > are < Benchmark Benchmark Price Price Benchmark Price +/- < $0.25 $0.0000 $0.0000 $0.0000 $0.0000 $0.26 to $0.50 $0.0100 ($0.0100) $0.0500 ($0.0500) $0.51 to $0.75 $0.0200 ($0.0200) $0.1000 ($0.1000) $0.76 to $1.00 $0.0300 ($0.0300) $0.1500 ($0.1500) $1.01 to $1.25 $0.0400 ($0.0400) $0.2000 ($0.2000) $1.26 to $1.50 $0.0500 ($0.0500) $0.2500 ($0.2500) $1.51 to $1.75 $0.0600 ($0.0600) $0.3000 ($0.3000) $1.76 to $2.00 $0.0700 ($0.0700) $0.3500 ($0.3500) $2.01 to $2.25 $0.0800 ($0.0800) $0.4000 ($0.4000) $2.26 to $2.50 $0.0900 ($0.0900) $0.4500 ($0.4500) $2.51 to $2.75 $0.1000 ($0.1000) $0.5000 ($0.5000) Fuel changes beyond the ranges shown on the table will be calculated where each additional $.25 change in fuel will add to or reduce costs by $.01 per case and $.05 per mile
Benchmark Price/Gallon:
$4.019
Date of Contract___________________________________________________
* Charged at time of shipment to stores from DC
APPENDIX B PLCB DATA PACKAGE (SEE EXCEL ATTACHMENT)
APPENDIX C PLCB STATEMENT ON SUSTAINABILITY
PLCB STATEMENT ON SUSTAINABILITY
APPENDIX D PROPOSAL COVER SHEET
PROPOSAL COVER SHEET COMMONWEALTH OF PENNSYLVANIA PENNSYLVANIA LIQUOR CONTROL BOARD RFP# 20121016 Enclosed in three separately sealed submittals is the proposal of the Offeror identified below for the above-referenced RFP: Offeror Information: Offeror Name Offeror Mailing Address Offeror Website Offeror Contact Person Contact Person’s Phone Number Contact Person’s Facsimile Number Contact Person’s E-Mail Address Offeror Federal ID Number
Submittals Enclosed and Separately Sealed:
Technical Submittal Small Diverse Business Submittal Cost Submittal
Signature Signature of an official authorized to bind the Offeror to the provisions contained in the Offeror’s proposal: Printed Name Title FAILURE TO COMPLETE, SIGN AND RETURN THIS FORM WITH THE OFFEROR’S PROPOSAL MAY RESULT IN THE REJECTION OF THE OFFEROR’S PROPOSAL
APPENDIX E 2013 STORE HOLIDAY SCHEDLE
NEW YEAR’S DAY – Tuesday, January 1, 2013 All stores will be closed. MARTIN LUTHER KING, JR. DAY – Monday, January 21, 2013 All stores will be closed. PRESIDENTS’ DAY – Monday, February 18, 2013 All stores will be closed. EASTER – Sunday, March 31, 2013 All stores will be closed. MEMORIAL DAY – Monday, May 27, 2013 All stores will be closed. INDEPENDENCE DAY – Thursday, July 4, 2013 All stores will be closed. LABOR DAY – Monday, September 2, 2013 All stores will be closed. COLUMBUS DAY – Monday, October 14, 2013 Most PA Wine & Spirits Stores will be open per their regularly scheduled hours, some will have alternate hours or remain closed Columbus Day. VETERANS’ DAY – Monday, November 11, 2013 Most PA Wine & Spirits Stores will be open per their regularly scheduled hours, some will have alternate hours or remain closed on Veterans' Day. THANKSGIVING DAY – Thursday, November 28, 2013 All stores will be closed. CHRISTMAS DAY – Wednesday, December 25, 2013 All stores will be closed.
APPENDIX F DOMESTIC WORKFORCE UTILIZATION CERTIFICATION
DOMESTIC WORKFORCE UTILIZATION CERTIFICATION To the extent permitted by the laws and treaties of the United States, each proposal will be scored for its commitment to use the domestic workforce in the fulfillment of the contract. Maximum consideration will be given to those Offerors who will perform the contracted direct labor exclusively within the geographical boundaries of the United States or within the geographical boundaries of a country that is a party to the World Trade Organization Government Procurement Agreement. Those who propose to perform a portion of the direct labor outside of the United States and not within the geographical boundaries of a party to the World Trade Organization Government Procurement Agreement will receive a correspondingly smaller score for this criterion. In order to be eligible for any consideration for this criterion, Offerors must complete and sign the following certification. This certification will be included as a contractual obligation when the contract is executed. Failure to complete and sign this certification will result in no consideration being given to the Offeror for this criterion. I, ______________________[title] of ____________________________________[name of Offeror] a _______________ [place of incorporation] corporation or other legal entity, (“Offeror”) located at __________________________________________________________ [address], having a Social Security or Federal Identification Number of ________________________, do hereby certify and represent to the Commonwealth of Pennsylvania ("Commonwealth") (Check one of the boxes below): All of the direct labor performed within the scope of services under the contract will be performed exclusively within the geographical boundaries of the United States or one of the following countries that is a party to the World Trade Organization Government Procurement Agreement: Aruba, Austria, Belgium, Bulgaria, Canada, Chinese Taipei, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Latvia, Liechtenstein, Lithuania, Luxemburg, Malta, the Netherlands, Norway, Poland, Portugal, Romania, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, and the United Kingdom OR ________________ percent (_____%) [Offeror must specify the percentage] of the direct labor performed within the scope of services under the contract will be performed within the geographical boundaries of the United States or within the geographical boundaries of one of the countries listed above that is a party to the World Trade Organization Government Procurement Agreement. Please identify the direct labor performed under the contract that will be performed outside the United States and not within the geographical boundaries of a party to the World Trade Organization Government Procurement Agreement and identify the country where the direct labor will be performed: ____________________________________________ ______________________________________________________________________________ [Use additional sheets if necessary] The Pennsylvania Liquor Control Board shall treat any misstatement as fraudulent concealment of the true facts punishable under Section 4904 of the Pennsylvania Crimes Code, Title 18, of Pa. Consolidated Statutes. Attest or Witness:
______________________________ Corporate or Legal Entity's Name
_____________________________ Signature/Date
______________________________ Signature/Date
_____________________________ Printed Name/Title
______________________________ Printed Name/Title
Appendix F, Page 1 of 1
APPENDIX G CORPORATE SIGNATORY DELEGATION AUTHORIZATION
CORPORATE SIGNATORY DELEGATION AUTHORIZATION I, ___________________, of ____________________, City of ________________, (Name) (Address) County of _________________, State of __________________, certify that I am the ___________________of_____________________, a corporation organized under the laws (Title/Capacity) (Name of Corporation) of the State of__________________, having its principal office at __________________, (Address) City of _________________, County of _____________, State of ________________; and that the following is a true and complete copy of a resolution duly adopted by the Board of Directors of ______________________ at a meeting held by them on _________ day of (Name of Corporation) ________, ______, at which a quorum was present, and that this resolution has not been altered, amended, repealed, rescinded, or otherwise modified that that it is still in full force and effect. RESOLVED THAT ________________ of __________________________, City of (Name) (Address) ______________, County of ________________, State of _________________ is hereby authorized to execute contracts on behalf of the corporation. IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the corporation this ________________day of __________________, 20___ _________________________ (Signature of Certifying Official) (SEAL) _________________________ (Typed or Printed Name) _________________________ (Title)
Appendix H, Page 1 of 1
APPENDIX H PROPOSED CONTRACT
PROPOSED CONTRACT NO. 20121016 DISTRIBUTION CENTER CONSOLIDATION AND LOGISTICS SERVICES
BETWEEN: COMMONWEALTH OF PENNSYLVANIA PENNSYLVANIA LIQUOR CONTROL BOARD PROCUREMENT DIVISION ROOM 316, NORTHWEST OFFICE BUILDING HARRISBURG, PA 17124-0001 AND
CONTRACTOR
TABLE OF CONTENTS SECTION
PAGE
1. PARTIES ..................................................................................................................................1 2. DEFINITIONS .........................................................................................................................1 3. TERM OF CONTRACT .........................................................................................................5 4. SERVICES TO BE PROVIDED ............................................................................................6 5. OPERATIONAL REQUIREMENTS ..................................................................................16 6. REPORTS AND PROJECT CONTROL ............................................................................27 7. RISK AND ISSUE REPORTING ........................................................................................29 8. RECORD RETENTION .......................................................................................................29 9. PROJECT CHANGE CONTROL PROCEDURES...........................................................30 10. SPECIAL SERVICES ...........................................................................................................31 11. SPECIAL REQUIREMENTS ..............................................................................................31 12. ACCEPTANCE OF DELIVERABLES ...............................................................................31 13. INSPECTION AND ACCEPTANCE OF DEVELOPED MATERIALS ........................32 14. LIQUIDATED DAMAGES ..................................................................................................34 15. PERFORMANCE BONDS ...................................................................................................35 16. EQUIPMENT AND MATERIALS ......................................................................................35 17. INSURANCE ..........................................................................................................................36 18. VIRUS, MALICIOUS, MISCHIEVOUS OR DESTRUCTIVE PROGRAMMING ......37 19. SENSITIVE INFORMATION .............................................................................................38 20. CONDUCT OF SERVICE ....................................................................................................39 21. COMMONWEALTH/PLCB HELD HARMLESS ............................................................59 22. DOMESTIC WORKFORCE UTILIZATION....................................................................60 23. PRIME CONTRACTOR RESPONSIBILITIES ................................................................60 24. COMPENSATION/EXPENSES ...........................................................................................60 25. CONTRACTOR INVOICING/CLAIMS ............................................................................60 26. PAYMENT .............................................................................................................................62 27. DISCHARGE .........................................................................................................................63 28. INSPECTION AND REJECTION.......................................................................................63 29. DEFAULT AND REMEDY ..................................................................................................63 30. NOTICE OF DELAYS ..........................................................................................................68 31. FORCE MAJEURE ...............................................................................................................69 32. CONTRACT CONTROVERSIES .......................................................................................70 33. TERMINATION PROVISIONS ..........................................................................................71 34. CHANGE OF OWNERSHIP................................................................................................73 35. INSOLVENCY .......................................................................................................................73 36. INDEPENDENT CONTRACTOR.......................................................................................73 37. ASSIGNABILITY AND SUBCONTRACTING .................................................................73 38. OTHER CONTRACTORS ...................................................................................................74 39. DOCUMENTATION.............................................................................................................74 40. AUDIT PROVISIONS/EXAMINATION OF RECORDS .................................................74 41. SINGLE AUDIT ACT OF 1984............................................................................................75
42. LIMITATION OF LIABILITY ...........................................................................................76 43. RESPONSIBILITY FOR PROPERTY DAMAGE ............................................................76 44. CONFIDENTIALITY ...........................................................................................................77 45. INTEGRATION.....................................................................................................................77 46. APPLICABLE LAW .............................................................................................................78 47. NOTICES................................................................................................................................78 48. CHANGE IN FUNCTIONS OF THE PLCB ......................................................................79 49. SURVIVAL.............................................................................................................................79 SIGNATURES AND APPROVALS ..........................................................................................80
PROPOSED CONTRACT 20121016 1.
PARTIES - The parties to this agreement (hereinafter referred to as “Contract”) are the Commonwealth of Pennsylvania, Pennsylvania Liquor Control Board, (hereinafter referred to as “PLCB”) and ____________________ (hereinafter referred to as “Contractor”). The parties hereby agree as follows:
2.
DEFINITIONS - For purposes of this Contract, the following terms and definitions apply (unless otherwise specified): a.
Bailment - Warehouse inventory management method whereby wine and spirits owned by the supplier are stored in the warehouse at PLCB expense for subsequent shipment to retail liquor stores, at which point the transfer of ownership to the PLCB occurs when the Merchandise, as defined herein, is loaded on an outbound truck.
b.
Business Day – Monday through Friday, excluding Commonwealth of Pennsylvania holidays.
c.
Central Office - The PLCB’s headquarters at the Northwest Office Building, Harrisburg, PA 17124-0001.
d.
Change Order - A written order signed by the PLCB Project Manager and Contractor Project Manager directing the Contractor to make changes authorized under Paragraph 9, Project Change Control Procedures.
e.
Commonwealth - The Commonwealth of Pennsylvania, including the PLCB.
f.
Contract Year - One (1) full year beginning on the Effective Date of this Contract, and each subsequent full year thereafter during the term of this Contract. The final Contract Year may be less than a full calendar year.
g.
Contracting Officer - PLCB official responsible for administering the contract. This individual shall be the Contractor’s contact for questions and other issues. The PLCB will notify the Contractor of the name of this individual. Also known as Contract Administrator.
h.
Contractor -
i.
Contractor Project Manager - The Contractor’s official or his/her designee responsible for the overall project management and coordination. This individual will be the primary point of contact with the PLCB.
1
j.
Cross-dock - Inbound Merchandise delivered and receipted at the facility that moves directly onto an outbound truck, or is stored temporarily.
k.
Damaged Merchandise - Any Merchandise that has, through the perils of transportation, handling or natural occurrences, attained a condition that prevents its sale at full retail price through the Pennsylvania Liquor Store System or Merchandise where the packaging is in such a condition that its protective function has been compromised and must be removed from normal handling. The PLCB reserves the sole right to determine if Merchandise is damaged.
l.
Day - A calendar day.
m.
Developed Works or Developed Materials - All documents, sketches, drawings, designs, works, papers, files, reports, computer programs, computer documentation, data, records, software, samples or any other tangible material authored or prepared by the Contractor as the work product covered in the scope of work for the Project, without limitation.
n.
Distribution Center (“DC”) - Facilities utilized by the PLCB for the receipt, processing, and storage of Merchandise. Each DC is operated by a different logistics service provider (LSP or Contractor): DC #1 is operated by XTL, Inc. (“XTL”) in Philadelphia; DC #2 is operated by Kane is Able (“Kane”) in Scranton; DC #4 is operated by General Commodities Company, Inc. (“Genco”) in Pittsburgh; and the New DC(s) (“NEWDC(s)”) shall be the facility(ies) operated by Contractor. The DC #1 facility is owned by the Commonwealth; DC #2 and #4 facilities are owned or leased by the Contractors referred to in this paragraph. A. Philadelphia - DC #1: XTL, Inc. 8201 Enterprise Avenue Philadelphia, PA 19153-3896 B. Scranton - DC #2: Kane Warehouse Inc. Stauffer Industrial Park 1 Kane Lane Taylor, PA 18517-9694 C. Pittsburgh - DC #4: General Commodities Company, Inc. (“Genco”) Papercraft Building 2 Papercraft Park Pittsburgh, PA 15238-3218 D. NEWDC(s) Location to be determined. 2
o.
Effective Date - The date fixed by the Contracting Officer or his/her designee, after this Contract has been fully executed by the Contractor and by the PLCB, and all approvals required by PLCB contracting procedures have been obtained.
p.
Emergency Order (“EO”) - A rush order outside of the normal schedule.
r.
Environmental Protection - In carrying out the Contract, the Contractor shall comply in all material respects with all applicable environmental laws and regulations (local, state and federal).
s.
Holiday - A day on which Pennsylvania Liquor Stores are closed. See RFP Appendix E for the 2013 store holiday schedule.
t.
Inbound Transportation Damage - Merchandise discovered by the PLCB Distribution Center or other destination to be damaged at time of receipt.
u.
In Writing - Other than orally, e.g., via U.S. postal, electronic or facsimile transmission and/or delivery.
v.
LTL - Less than a full container/truck/rail car load.
w.
Material Handling System (“MHS”) - The Contractor may utilize a materials handling system. If so, it must integrate in a fashion to meet PLCB operational requirements for process flow and integration. All equipment, supplier, personnel, and maintenance for the MHS are the sole responsibility of the Contractor.
x.
Merchandise - Liquor (wine or spirits) and supplies tendered to the PLCB. Regular stock Merchandise is liquor listed by the PLCB, stocked in PLCB warehouses, and available for ordering by all PLCB Stores. Luxury Merchandise is liquor purchased by the PLCB for sale in selected PLCB Stores.
y.
Normal Business Hours - 7:00 a.m. through 5:00 p.m., inclusive, Monday through Friday, excluding PLCB holidays.
z.
PLCB Code - The unique nine (9) digit product identifier code used by the PLCB to identify a specific Merchandise item. As between the PLCB Code, the SCC Code and the UPC Code, the PLCB Code shall be considered the primary identifier of Merchandise. A PLCB Code may have more than one UPC or SCC codes assigned to it.
aa.
PLCB Project Manager - The PLCB official or his/her designee responsible for the overall project management and coordination. This individual will be the primary point of contact with the Contractor.
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bb.
Recoupment - If a case of Merchandise is on hand at the Distribution Center and is not in saleable condition, the Contractor must take the case from available inventory, perform an inspection of the contents and prepare the case for shipment by either/and/or repacking the Merchandise, disposing of Merchandise that is not saleable, allowing a case to dry, or other means necessary to make all or part of that case available for return to inventory, shipping to store, and sale. The PLCB, at its sole discretion. will determine liability for the cost of recovery.
cc.
Radio-Frequency Equipment – Wrist, truck-mounted or hand-held electronic units designed to aid the Contractor and employees in the performance of operational tasks in accordance with the processes used in Warehouse Management System.
dd.
RFP - Request for Proposals No. 20121016, issued by the PLCB and titled “Distribution Center Consolidation and Logistics Services”, whereby the PLCB solicited the services of a contractor to provide a consolidated distribution center facility(ies), material handling systems, warehouse management technology and labor, as well as transportation services to manage distribution operations.
ee.
SCC - Shipping Container Code, a bar-coded case identifier.
ff.
Service Area - The geographic area and stores served by a DC.
gg.
Store(s) - Locations for the retail sale of Merchandise operated by the PLCB, also referred to herein as PLCB and/or Pennsylvania liquor stores, state stores, wine and spirits stores, the retail liquor store system and retail locations. For purposes of deliveries, may also include festivals, large licensees and e-commerce stores.
hh.
Supply Orders - Other non-Merchandise materials the PLCB chooses to receive at, store in and ship from the DCs, currently including towels and bags. Other items may be added in the future.
ii.
UPC Code - Universal Product Code, a barcode symbology widely used for tracking items in Stores. Its most common form, the UPC-A, consists of twelve (12) numeral digits, which are uniquely assigned to each trade item.
jj.
Vendor Managed Inventory (“VMI”) - See Bailment, subparagraph 2(a), above. In addition, this term is used to define who controls the inventory volumes in the PLCB distribution center. Inventory that is non-bailment is owned by the PLCB and the vendor does not manage that inventory.
kk.
Warehouse Management System (“WMS”) - A computer system, primarily aimed at controlling the movement and storage of materials within a warehouse and processing associated transactions, including shipping, receiving, put away and picking. The system is to be supplied and maintained by the Contractor.
4
ll.
Weighted Average Cost - The PLCB will calculate inventory and claims based on the most current Weighted Average Cost. This calculation includes costs incurred by the PLCB in making Merchandise ready for sale and includes the following: 1. 2. 3. 4. 5.
3.
Purchase Order cost of the Merchandise Shipping from origin to NEWDC Any applicable U.S. Customs duties and taxes Warehouse storage and handling Transportation from the NEWDC to the retail PLCB Store
mm.
Wind-Down Period - The transitional period of time prior to the termination date during which the Contractor systematically phases out its operations and cooperates as directed by the PLCB with any incoming contractor who is implementing the same or similar services for the PLCB.
nn.
Work - The Services, Tasks, Deliverables and Requirements required to be performed by the Contractor under this Contract.
TERM OF CONTRACT - The initial term of this Contract shall commence on Effective Date and shall end at the close of business ten (10) Contract Years from the Effective Date. This Contract shall not be legally binding until after the Effective Date is affixed and the fully-executed Contract has been sent to the Contractor. A.
The Contracting Officer, or his/her designee, shall issue a written Notice to Proceed to the Contractor directing the Contractor to start performance on a date, which shall be on or after the Effective Date. i. Unless otherwise specifically stated in this Contract, the Contractor shall not start the performance of any work prior to the date set forth in the Notice to Proceed and the PLCB shall not be liable to pay the Contractor for any service or work performed or expenses incurred before the date set forth in the Notice to Proceed. ii. No PLCB employee has the authority to verbally direct commencement of any work under this Contract.
B.
The PLCB reserves the right, upon the termination or expiration of this Contract, to withhold payment to the Contractor until all claims have been processed and deducted from amounts due the Contractor.
C.
The PLCB reserves the right to extend this contract for three (3) one (1)-Contract Year option periods, subject to the terms and conditions set forth in the initial term of this Contract.
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i. The PLCB shall exercise this right by providing written notice to the Contractor of its intent to exercise its option up to two (2) Contract Years prior to the expiration of initial term of this Contract or option year, but no later than ninety (90)-days prior to the expiration of the initial term of this Contract or option year then in effect. D.
4.
The PLCB, in its sole discretion, shall have the right, at the expiration of the Contract, to extend the term of the Contract, or any part of the Contract for up to three (3)-months, upon the same conditions, in order to prevent a lapse in contract coverage.
SERVICES TO BE PROVIDED - The following services will be provided pursuant to this Contract: A.
Within ten (10) days of the Notice to Proceed the Contractor shall begin to perform all tasks and requested services as set forth within this Contract.
B.
The Contractor shall accomplish the following tasks, deliverables and requirements in a manner that properly supports the project due dates. The PLCB reserves the right to review all proposed methodologies and recommendations, and to determine when or if implementation will occur. The Contractor will not implement proposed optional tasks until and unless the PLCB has provided written approval.
C.
Tasks: i. Phase 1: Secure and Prepare Site(s), Configure Systems and Prepare Operations: Phase 1 shall begin within ten (10) days of the Notice to Proceed. Task #1 – Provide a Detailed Implementation Plan. As the initial task of Phase 1, the Contractor will develop a complete, detailed, solution design and Implementation Plan. The intent of this task is to ensure that the solution design and Implementation Plan are aligned with current PLCB business requirements, volumes and initiatives. The Contractor should note that the PLCB expects no material changes to the solution design and implementation plan and no re-pricing for services. The Contractor must plan for a five (5) day delivery schedule; the Contractor must plan for a Sunday through Thursday pick schedule with store delivery Monday through Friday; and the Contractor must have the ability with its WMS system to manage open orders. Deliverable #1 – The Contractor shall submit a revised detailed solution design and Implementation Plan to the PLCB, within thirty (30) days of the Notice to Proceed, for approval by the PLCB. The plan must include a defined and measurable set of milestones. Examples of measurable milestones may include
6
securing the location, completion of construction or renovation, installation and testing of the WMS, etc. Task #2 - Execute Implementation Plan. Once the PLCB approves the detailed solution design and implementation plan, the Contractor will begin to execute that plan. The PLCB expects the Contractor to be prepared to receive inventory at the DC(s) no later than January 2015. Deliverable #2 – Every thirty (30) days, the Contractor shall provide a milestone progress report to show the progress in executing the Implementation Plan, including completion of any milestones. Each milestone must be approved and accepted as complete by the PLCB. ii.
Phase 2: Receive and Store Merchandise at the DC(s). By January 2015, the Contractor must be able to receive Merchandise for storage in the NEWDC(s). The PLCB must approve transitioning from Phase 1 to Phase 2. The Contractor shall schedule the arrival of inventory and begin receiving Merchandise at the facility/facilities in accordance with the Phase 2 plan within five (5) days after the PLCB has approved the completion of Task #2.
Task #3 - Receiving and Put-away. The Contractor’s WMS will receive inbound shipment notification (POs and ASNs) from the PLCB’s host system on a daily basis. This serves as a notice to the DC(s) that an authorized shipment is in route to them. It is estimated that in-bound product will arrive via the following methods: truckload (eighty-one percent (81%)), less than truckload (seven percent (7%)) and ocean container (twelve percent (12%)). The Contractor shall be responsible for scheduling and adherence to carrier appointment times. The Contractor shall promptly unload in-bound vehicles in order to avoid any detention or demurrage charges. Payment for any such charges will be the responsibility of the Contractor. In-bound product must be unitized, either palletized or slip-sheeted. Vendors are not to ship inbound product in a floor-loaded fashion. If a vendor ships product in a floor-loaded fashion, the Contractor is to secure PLCB direction to either: 1) refuse the inbound load; or 2) unload it, requiring the carrier to utilize a lumper at the vendor’s sole expense. Where applicable, the Contractor shall track security and record seals on in-bound trailers. If noticeable damage is identified once a trailer is opened and placed at a dock door, Contractor personnel shall contact the onsite PLCB manager to verify the damaged load. The Contractor must isolate, record, and track all damages.
7
Occasionally, a trailer will require only partial unloading. Once the Contractor’s portion has been unloaded, the Contractor must ensure that the trailer has a new seal installed and that the seal number is recorded prior to dispatch. Contractor shall ensure that all Merchandise is properly identified and labeled, capturing the quantity, and linked to the PLCB item number using the manufacturer’s SCC number within the WMS. The Contractor shall ensure that the Merchandise is tracked into and out of each location as it moves through the warehouse. If in-bound PLCB item number labels or SCC labels are incorrect or missing, the Contractor shall print and apply new labels to the cases prior to putaway. Product identification labeling must be approved by the on-site PLCB Manager. Charges for case identification labeling will be billed to the PLCB as accessorial charges. The Contractor shall scan product into the warehouse on a blind receipt basis. This policy ensures proper reconciliation of product received into the building. The Contractor shall inspect all pallets for carton count and visible damage. The Contractor shall isolate, record, and track all damaged product. Random in-bound audits of case contents may be requested by the PLCB from time to time. Labor to perform such audits must be approved by the on-site PLCB manager and will be billed to the PLCB as accessorial charges. Put-away to the optimal location will be directed by the Contractor’s WMS. Inventory Control. The Contractor shall rotate stock on a first in, first out (“FIFO”) basis. The Contractor shall also have the capability to track stock by production code date or other such method should the PLCB deem it necessary. FIFO practices provide sufficient stock rotation so that date code recording is not currently used by the PLCB. However, on a small assortment of date sensitive products such as some box wines, freshness codes are monitored at receipt so that old stock is not received into inventory. The Contractor shall be responsible for FIFO rotation on all Merchandise. Merchandise that expires or spoils because of rotation problems will be charged to the Contractor. The Contractor shall be financially responsible for any inventory shortages and damages which occur while in the Contractor’s control, including through delivery to PLCB stores or other consignees. For bailment Merchandise, shortages and damage will be calculated based on the currently-quoted PLCB cost on the date of the damage or, if that date is unknown, on the date that the shortage or damage claim was filed. For PLCB-owned Merchandise, the cost shall be based on the weighted average cost.
8
If the store claims an overage or shortage upon delivery, the Contractor is to immediately perform a cycle count of the pick location and SKU and adjust inventory according to the results. Overage and shortage adjustments must be reviewed with the on-site PLCB DC Manager. The PLCB requires regular cycle counting at the SKU/location level. Cycle counting is scheduled to ensure that all SKUs and inventory locations are counted at least quarterly. The Contractor must report detailed cycle count results with discrepancies within one (1) business day of cycle count completion. The Contractor must provide reasonable access to vendors to allow them to count Merchandise. Such requests will be managed by the PLCB and executed by DC personnel. The PLCB requires any supplier or vendor requesting a physical count to provide adequate notice. Any labor charges incurred will be billed to the supplier or vendor by the PLCB. Delivery Overages, Shortages and Damages. In the event of a significantly damaged load, the Contractor is to return damaged Merchandise refused by the Store at no charge and adjust inventories within one (1) business day in favor of the Store. If the Store claims an overage or shortage upon delivery, Contractor is to, within one (1) business day, perform a cycle count of the pick location and SKU and adjust inventory according to the results. Overage and shortage adjustments must be reviewed with the on-site PLCB Warehouse Manager. Deliverable #3 – The Contractor shall properly receipt and store Merchandise at the NEWDC(s) and make such Merchandise available for shipment to the PLCB’s wine and spirits stores. All WMS systems and systems interfaces to the PLCB host system shall be fully functional. All required reporting and status query capability must be fully functional. iii.
Phase 3: Full Receiving and Delivery Operations. During Phase 3, the Contractor will be servicing all of the PLCB’s wine and spirits stores, providing accessorial services, as shown in Appendix A of the RFP, and receiving and storing Merchandise as listed in Appendix B of the RFP.
Task #4 – Assume Deliveries to Stores. The Contractor shall propose and execute a solution for assuming deliveries to stores currently serviced by the existing DCs, in coordination with the expiration of the DCs’ Contracts. Subtask A – Delivery Routing/Loadbuilding/Order Selection. Orders will be transmitted to the Contractor’s WMS from PLCB’s host system. The Contractor shall be responsible for order selection of case volumes. Delivery routing will be conducted by the Contractor to facilitate order selection planning. The Contractor must synchronize picking with store delivery routing both for day of delivery and position on delivery truck. Orders are transmitted by the PLCB in batches based on store delivery schedules. 9
In addition to regular product orders, the Contractor shall be responsible for Emergency Orders and Supply Orders. Subtask B – Loading. The Contractor shall stage trailers in dock doors in accordance with the delivery schedule. The Contractor will load product in reverse delivery order (last store off is first store loaded on the trailer). Once the trailer is loaded, the Contractor shall prepare a shipping manifest and/or Bill of Lading and make such available to the transportation driver at the time of dispatch. Shipping shall take place on stretch-wrapped pallets, with pallet level load tickets attached to each pallet. The Contractor must seal every completed trailer and record the seal number on the manifest. The Contractor shall provide the necessary equipment and staffing to conduct yard moves to and from the dock doors. Subtask C – Deliver Merchandise to PLCB’s wine and spirits stores. The driver is responsible for unloading and transporting the product from the trailer into the store. A palletized delivery will be made through the rear door of some stores; however, most stores will require the driver to utilize the current process which involves the use of a section(s) of skate wheel conveyor which connects to a similar conveyor in the store back room. On occasion, the Contractor will be asked to deliver miscellaneous items to stores in addition to the normal Merchandise deliveries. This may include items like ice melt, printers, paper towel dispensers, etc. All such items will be suitably packed for truck shipment. When these instances arise, delivery of the miscellaneous items will be billed as cases of Merchandise. Instances of such deliveries are rare. The driver shall record an arrival time stamp upon arrival at the store and another time stamp once the delivery at the store is complete. The time stamp may be electronic, and must be made available to the PLCB. In addition, the driver must record the number of cases delivered. To avoid the potential for theft, the driver must lock the trailer prior to each trip into the store. The driver will also be responsible for transporting any product returns and pallets to the NEWDC(s). All product returns will be arranged in advance and communicated via PLCB’s host system. Before leaving the store, the driver must notify the manager that the delivery is complete. The driver and a store representative will conduct a total case count for the delivery and record any shortages, overages or 10
damaged product. Both driver and store receiving personnel will sign receiving paperwork indicating agreement on the delivery as to items and case counts. Drivers must be proficient in reading, writing and speaking English to enable communication with PLCB store personnel. In some cases the driver may be unable to complete delivery to a store due to unforeseen circumstances such as road blockages, store closures, or hazardous weather conditions. These instances may cause redeliveries, where the merchandise is driven to the store twice, but only unloaded once. The PLCB will not reimburse the Contractor for store redeliveries without express written consent. Charges for redeliveries will be handled as accessorial charges. Subtask D – Replenishment. The Contractor shall restock active case pick locations from which store orders are fulfilled on an efficient basis to meet required fill-rate metrics. Subtask E – Document and Report Damaged Goods and Shortages. The Contractor must document, in a manner which is acceptable to the PLCB, any Merchandise damages or shortages identified during warehouse handling or during transport. The Contractor will be responsible for any necessary recoup/repack needed to make the product shippable or salable. Charges for recoup will be billed as accessorial charges. Damage on inbound product from a vendor will be billed to the vendor by the PLCB. Damage incurred in warehouse handling or shipment to the final destination will be charged back to the Contractor. The Contractor will report damages in a fashion that allows proper handling of recoup costs. Subtask F – Maintain Equipment. The Contractor is responsible for all maintenance and the condition of materials handling and transportation equipment. The Contractor shall ensure that all delivery equipment is swept clean and is clear of debris prior to loading at the NEWDC(s). Subtask G – Store Returns. The NEWDC(s) will receive a very small quantity of returns from stores. All store-to-NEWDC returns will be in full cases only. These could take the form of stock balancing, vendor product recall or regulatory requirements. In the event of a store return, the Contractor shall verify returns against accompanying paperwork, load the product from the wine and spirits store onto the truck, return the product to the DC, unload the product from the truck, isolate returned product in the DC, and dispose of or re-warehouse the product according to instructions provided by the PLCB. Charges for store returns should be billed as accessorial charges.
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Subtask H – Quarantine (Hold) Transactions. As directed by the PLCB, the Contractor must be capable of segregating selected Merchandise into quarantine status, and restricting activity for such inventory based on the quarantine status. The WMS should provide for various quarantine status options and activity restrictions, to accommodate the particular product requirements. The WMS must also be able to communicate changes in quarantine status to the PLCB host system. For example, Merchandise from a vendor that has been recalled and is awaiting disposition at the NEWDC would be recorded in a quarantine status that would not allow any transactions other than return to the vendor. Damaged product awaiting recoup would be removed from normal status and placed in a quarantine status until recoup is completed and the material is returned to stock. Unlisted product arriving on a vendor shipment would be held in a quarantine status until proper handling is determined. The Contractor shall be required to track and manage the quarantined inventory just as any other inventory. Costs of handling quarantine transactions should be included in the normal case handling fees charged to the PLCB. Any additional miscellaneous activities, such as preparing return to vendor shipments, will be billed as accessorial charges to the PLCB. Subtask I – Facility Maintenance and Housekeeping. The Contractor is responsible for all maintenance and housekeeping of the facility/facilities. The Contractor must coordinate any planned downtime with the PLCB staff. The Contractor shall meet the following maintenance and housekeeping requirements: a.
The facility/facilities shall be maintained in a sanitary fashion. The facility/facilities should be treated as a foodgrade facility, utilizing appropriate pest control and sanitation control practices to adequately protect the product.
b.
Regular and routine cleaning of the facility/facilities, including, but not limited to, storage areas, racks, aisles, materials handling equipment, office facilities (including all office space utilized by the PLCB), docks, lunch room, building service area and restrooms.
c.
Collecting and removing all trash, including that of the PLCB office staff.
d.
Landscaping of grounds surrounding the facility/facilities.
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e.
Snow removal for all paved areas of the facility/facilities and the maintenance of surrounding ground, lawn and landscaped areas.
f.
The Contractor shall be responsible for the maintenance and working condition of the facility/facilities twenty-four (24) hours per day, seven (7) days per week.
g.
The Contractor shall be responsible for the maintenance and working condition of the MHS as well as the WMS/TMS and associated equipment.
Deliverable #4 – The Contractor shall provide a fully-functioning NEWDC(s) operation, with Merchandise efficiently receipted into the NEWDC(s) properly stored, picked, and transported to the PLCB’s wine and spirits stores for customer purchase. D.
Accessorial Services. This section outlines specific NEWDC accessorial services that have been identified as requirements by the PLCB. The Contractor shall be reimbursed for these services at an agreed upon per case, per mile or per hour rate to be initially proposed by the Contractor in the PLCB Distribution Services RFP Cost Submittal Worksheet. i. Other Shipments. ($/mile) In addition to store delivery service, the Contractor may be required to provide other transportation services. These services should be billed on a dollar per mile ($/mile) basis from the pickup point to the delivery point, and will be subject to the fuel surcharge. Moves may include the following transportation services: 1. Drayage services to/from eastern seaboard ports; 2. Transportation of intermodal freight to/from the DC(s) and railhead; 3. Old DC to NEWDC cartage; 4. Other product or non-product cartage. ii. Backhaul shipments. ($/mile) On occasion, trucks making deliveries of PLCB orders may be asked to pick up Merchandise for delivery back to the NEWDC(s). Such backhaul activity will be billed based on a dollar per mile ($/mile) basis from the store delivery, the subsequent pickup and the return to the NEWDC(s), and will be subject to the fuel surcharge. iii. Re-label. ($/case) The Contractor shall be responsible for some relabeling of items where carton damage occurs or where cases are 13
improperly labeled by the vendor. Only if directed by the PLCB, the Contractor shall re-label cases received with improper or missing labels for future shipments to stores. If required to re-label cases, the Contractor shall complete re-labeling within two (2) working days of PLCB notice to re-label cases. The Contractor shall bring the incorrectly labeled Merchandise to the attention of the PLCB site manager and the Contractor shall then re-label only Merchandise that cannot be processed for storage and delivery without a new label. Billed cost includes the cost of materials, creation of the label, and labor to apply the label to the case. These services will be charged on a dollar per case ($/case) basis. iv. Store Return to Warehouse. ($/case) The Contractor shall accept full cases from the PLCB wine and spirits stores Merchandise to be returned to the NEWDC(s) when authorized by the PLCB. This product may be either Merchandise being returned to vendors or being repositioned by the PLCB. This Merchandise shall be picked up in the course of conducting store deliveries and returned to the DC by the Contractor. The Contractor shall ensure that the Merchandise is properly handled and entered into the WMS upon return to the NEWDC. These services will be charged on a dollar per case ($/case) basis. v. Redelivery to stores. ($/case) When weather or other circumstances preclude delivery of a load to a store, the Contractor, with the written approval of the PLCB, may be asked to redeliver to the store. Since the PLCB would have already been charged for the initial aborted delivery, it is anticipated that the redelivery charge would be somewhat lower than the initial cost. In such cases, the driver had driven to the store twice, but only unloaded once. These services will be charged on a dollar per case ($/case) basis. This charge would be subject to the fuel surcharge. vi. Recoup and reconditioning of product. ($/case) When Merchandise is damaged, either upon receipt from the vendor or while under the control of the Contractor, the Contractor will provide recoup services. This includes segregating non-recoverable Merchandise, repacking recovered Merchandise and all necessary reporting to allow the PLCB to charge the responsible party. The per case charge should include all materials, and labor required to perform the task, returning good stock to salable inventory and destruction of unsalable Merchandise. Destruction of unrecoverable Merchandise will be done on-site, and proof of destruction must be retained for auditor review. Such destruction shall be accomplished in compliance with all applicable federal, state, and local laws. If required to recondition/recoup damaged product, the Contractor shall complete damage processing within one (1) week of receipt of in-bound damage and within one (1) week of occurrence if damaged while in the 14
Contractor’s custody. The Contractor shall be paid for this service provided the damage was not caused by the Contractor as determined by the PLCB. Payment for recondition/recoupment services shall be made only for cases that the Contractor actually reconditioned/recouped, and will not be made for such cases handled incidentally in the process. Recoup must be managed and controlled per PLCB guidelines. These services will be charged on a dollar per case ($/case) basis. vii. Physical Inventory and Audits Counts. (per occurrence) When requested by the PLCB, the Contractor will be asked to perform physical inventory counts of inventory in the NEWDC(s). Such counts may be a full physical inventory count of the NEWDC(s) or more limited counts related to a particular vendor’s products or specific items. When such cases occur, the PLCB will request that the Contractor prepare a quotation to perform such services. Rates and hours to perform such services will be mutually agreed to between the Contractor and the PLCB. Labor to perform the required quarterly cycle counts noted in this document are specifically excluded from accessorial services and are part of the base Contract rates. viii. Product Destruction. ($/case) From time to time the Contractor will be requested to assist with destruction of product. Such destruction shall be accomplished in compliance with all applicable federal, state, and local laws. Destruction shall include loading, hauling, delivery to a landfill as arranged and paid for by the Contractor. The Contractor and the PLCB shall cooperate in securing the presence of required witnesses to destruction of damaged Merchandise. These services will be charged on a dollar per case ($/case) basis. This charge is not subject to the fuel surcharge. ix. Merchandise Validations and Inspections. ($/hour) As directed by the PLCB, the Contractor shall be required to select cases of particular Merchandise and open them to verify contents, UPC codes, labels or other data. Inspections may include the quality of contents including cork leakage, label flaws, neck foil integrity, etc. Merchandise will then be processed in accordance with PLCB instructions. These services will be charged on a dollar per hour ($/hour) basis. x. Preparation of shipments to other carriers. ($/case and $/pallet) The Contractor may be requested to assemble products for shipment that will not be delivered by the Contractor. Products being returned to a vendor where the vendor is responsible for return shipment is an example of such an instance. This charge is to reimburse the Contractor for picking the product, preparing it for shipment and preparation of shipping paperwork. The cost per case would be applied for case picked Merchandise, and the cost per pallet would apply for pallet picked Merchandise. 15
5.
E.
Phase 4: Wind Down. Prior to the expiration or termination date of the Contract, the Contractor shall be required to wind down its operations. The Contractor may be required to provide a mirror image of data to the PLCB during this period. During the wind-down period, the PLCB may employ the services of another contractor who provides the same or similar services. During the winddown period, the Contractor shall fully cooperate with the PLCB and any of its contractors to assure the successful transition from the Contractor’s service to the services of any other contractor which the PLCB may engage. The PLCB will make every attempt to notify the Contractor of the commencement of the winddown period.
F.
Bid Protests. Notwithstanding anything to the contrary provided herein, in the event of any challenge, bid protest, or litigation seeking to halt the award of this Contract to Contractor (collectively, a "Protest") or an Effective Date later than _______________ (the "Expected Start Date"), all deadlines for any Tasks, Deliverables and date-specific obligations and the Term specified under Paragraph 3 will be automatically extended, without any further action required by the Parties, by an amount of time equal to the difference between the Expected Start Date and the Effective Date or the final resolution of any Protest, whichever is later. During the pendency of any Protest, the Contractor will have no obligation to commence the Work. In the event a Protest extends for more than one hundred-eighty (180) days after the Expected Start Date, and as a result of the delay caused by such Protest the Contractor's costs are increased above the documented amounts that would have been incurred if the Contractor was able to commence the Work on the Expected Start Date, the Parties agree to execute a change order as provided in Paragraph 9 to address such increased costs.
OPERATIONAL REQUIREMENTS A.
Facility Requirements. requirements:
The NEWDC(s) shall conform to the following
i. General. (both Contractor and PLCB workspace) a. The interior of the proposed facility must be able to accommodate three percent (3%) volume expansion per year, as needed. b. The facility and real estate must have the capability to allow the NEWDC(s) to rapidly expand by as much as twenty percent (20%). c. The facility must be located on a lot with full perimeter fencing which supports parking of transportation assets and employee vehicles, including those of PLCB employees. The facility must be able to store loaded trucks or trailers securely on the site. 16
d. The facility must have fire protection and suppression systems which meet or exceed regulatory standards. There are approximately two hundred (200) SKUs that are at least one hundred (100) proof. The facility must have a sprinkler system, which the Contractor shall have checked/tested and certified prior to receiving initial Merchandise, and annually thereafter, through the length of the Contract. A copy of the certification of the sprinkler system shall be forwarded to the Contracting Officer within thirty (30) days following the test. If the test is not made, the PLCB may contract for test certification and deduct said charges from monies owed the Contractor. e. The facility should be in close proximity to transportation infrastructure (e.g., rail, rail intermodal facility, ease of interstate access, no bridge or height restrictions). f. The facility must be compliant with the Americans with Disabilities Act (“ADA”) and Occupational Safety and Health Administration (“OSHA”) requirements and meet all other regulatory requirements. g. The PLCB requires access to a conference room for meetings with suppliers. h. The PLCB will install a telephone system to support the PLCB offices and workspaces. i. Condition and appearance of the facility with respect to its capability to support sound warehousing and housekeeping practices. j. Transition plan if the facility is currently occupied. k. All access roads are required to be paved and approved by local authorities to handle the volume and nature of anticipated traffic to and from the NEWDC(s). ii.
NEWDC Facility/Facilities Configuration. Required space and its configuration will be determined by the Contractor based upon its proposed solution design to support the business requirements included in the RFP. The PLCB office and visitor work space is only required at the NEWDC(s) facility/facilities, not at any cross-dock, hub or drop and hook facility/facilities.
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a. A sufficient number of dock doors are required to accommodate receiving activities, staging, and loading of delivery trailers. b. A drivers’ room must be provided. c. Direct rail access is not required. Prior to the conversion to the NEWDC(s), any vendors utilizing boxcars for delivery will be instructed to either switch to an alternative shipment method or to provide their own boxcar transloading arrangements to deliver to the NEWDC(s) in containers or trailers. d. PLCB Office. The Contractor shall provide at least two thousand (2,000) square feet of office space at the facility for PLCB employees and office equipment. The office space shall have readily available access to adequate restroom facilities for both sexes and be temperature controlled. The Contractor shall provide lighting adequate for office work purposes and at least equivalent to that in the Contractor’s office space. The Contractor shall provide electrical power to support up to five (5) PLCB employees. The office space must include one (1) private office and a shared area for four (4) employees, which will include wiring for telephone, computer access, Internet access, and printers. The Contractor shall provide trash removal and routine office cleaning. The PLCB shall have access to office temperature controls. e. Network/Server Closet. The Contractor shall include, within or reasonably adjacent to the PLCB’s office space, a network/server closet which has the following characteristics: 1. Six foot (6') x six foot (6') (thirty-six (36) square feet) of space in a wiring closet that will contain one (1) network cabinet. The closet must have a door. The door to the closet does not require a lock. 2. Space for one (1) nineteen inch (19") wide lockable network cabinet for the network equipment (router, switch(es), wireless access point, servers) to be supplied by the PLCB. 3. The cabinet and closet must be located so that the longest Ethernet run from the network cabinet to the furthest desktop, laptop, register or printer is no more than ninety (90) meters as per the Cat 5 specification. 18
4. The closet must maintain an ambient temperature between seventy (70) and eighty (80) degrees Fahrenheit while cooling six thousand five hundred (6,500) BTUs. 5. The Telecommunications Demarcation Point must be extended into the wiring closet and be within two (2) meters of the network cabinet. 6. Electrical and structural support shall be provided for the network cabinet, including the router, patch panel, switch and server, which requires 7.5 amps and weighs approximately three hundred pounds (300 lbs.). 7. All cabling and patch panels must comply with the Commonwealth Master Information (IT) Services Invitation to Qualify (ITQ) Contract Telecommunications Wiring Standards located at: http://www.itqrp.state.pa.us/ITQ/ITQ/ITQLibrary/D ocuments/100.2%20%20Master%20IT%20Services%20ITQ%20%20Telecommunications%20Wiring%20Standards. doc as described in IT/ITQ Contract #4400004480, available at: http://www.itqrp.state.pa.us/ITQ/ITQ/ITQLibrary/D ocumentLibrary.aspx. 8. All Ethernet cables must be Cat 5e cable, also known as TIA/EIA-568-B. 9. A nineteen inch (19") wide patch panel, where all of the Ethernet jacks are connected, shall be located inside the locked network cabinet in the wiring closet. 10. One (1) four (4)-outlet electrical outlet with a fifteen (15) AMP dedicated circuit. f. Visitor Work Space. The Contractor shall provide a workspace at the facility adjacent to the PLCB office space for the use of visitors. This space may be used by vendor representatives, auditors, or other visitors that do not work for either the Contractor or the PLCB. The space shall include two (2) office cubicles or the equivalent area. The Contractor shall ensure that the workspace 19
will allow access to the Internet and a printer. This space shall have readily-available access to adequate restroom facilities for both sexes and be temperature controlled. The Contractor shall provide lighting adequate for office work purposes and at least equivalent to that in the Contractor’s office space. This space must comply with ADA, as well as OSHA requirements, and other applicable regulatory agency directives. iii.
Security. The Contractor shall be responsible for all maintenance and security in and around the facility/facilities. The Contractor must supply and maintain protective equipment and services, which include burglar alarm and sprinkler systems with both off and on-site monitoring. Costs for any service/maintenance contract related to the overall security system shall be borne by the Contractor. Equipment shall remain at all times the property of the Contractor. The Contractor shall ensure, at a minimum, that the following security requirements are met: a. The NEWDC(s) is enclosed within a secure perimeter. b. Security team coverage twenty-four (24) hours per day, seven (7) days per week, three hundred sixty-five (365) days per year to safeguard all site personnel, Merchandise, equipment, and PLCB property. c. Guardhouse with standardized entrance requirements for visitor and employee check-in. d. Alarm and video surveillance systems to monitor the premises and prevent unauthorized access. The system must monitor all methods of ingress/egress. Video surveillance systems must be operable at all times and are required to record loading docks and all methods of ingress and egress on the property (including any roof access doors); such recordings must be maintained for a minimum of ninety (90) days. The Contractor shall assure that the PLCB is fully aware of its retention period regarding surveillance video. e. The Contractor shall safeguard all Merchandise from theft and damage while in the Contractor’s control. The Contractor is deemed to be in control of Merchandise from the point in time that the load is accepted at the NEWDC(s) through delivery and acceptance by PLCB store personnel. Additionally, with respect to return Merchandise, the Contractor assumes control at store pickup.
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Commonwealth laws and regulations require one hundred percent (100%) accountability for all product at all times. The Contractor shall maintain accurate perpetual inventory records with transactional audit trail capabilities. f. All external areas of facility and parking lot must be well lit. Contractor shall ensure that all exterior lights are in working condition and that adequate lighting is achieved in the external areas of the facility and parking lot. g. Contractor shall develop, implement and maintain an identification system for all PLCB and Contractor employees. h. Contractor shall ensure segregation and security of inventory if space is shared. iv.
B.
Safety. The Contractor shall provide clean, well-lit, well-ventilated, and safe working conditions for all employees and visitors. The Contractor is required to comply with all federal, state and local regulations including, but not limited to, Equal Employment Opportunity Commission (“EEOC”), OSHA, ADA, Federal Motor Carrier Safety Act, and other applicable regulations. The Contractor shall maintain records documenting that all employees are trained and qualified for the function which they are performing. Documentation to verify compliance with regulatory requirements will be the responsibility of the Contractor.
Delivery Requirements. Delivery restrictions, frequency of delivery at each store, and capabilities to receive pallets at each store are identified in the Store Details and Store Listings tabs of Appendix B of the RFP. The Contractor should note that some stores can only accommodate side-door deliveries and should therefore plan for suitable equipment to support such deliveries. It should also be noted that only a few locations are currently capable of receiving pallets. This listing was deemed accurate at the time the RFP was released, but is subject to change with the normal ebb and flow of ongoing operations. i.
Delivery Windows. Currently, stores receive deliveries during limited receiving hours, generally from 7:00 a.m. until 4:00 p.m. Times may be earlier in the morning in more congested areas.
ii.
Delivery Days. The current schedule for delivery to the PLCB’s wine and spirits stores is five (5) days per week, Monday through Friday. Orders will be picked and loaded on Sunday for the Monday deliveries. Product should not be stored overnight in trucks in the parking area. Stores requiring multiple deliveries per week will be scheduled to balance those shipments across the week. The Contractor shall jointly develop a
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delivery schedule with PLCB’s staff that strikes a balance between the preference of the stores and an efficient transportation schedule.
C.
iii.
Delivery Schedule and Process Changes. The Contractor shall design an efficient and scalable order selection process that is aligned with the PLCB's order transmission timelines, as well as the dispatch timing requirements, to meet store delivery windows. Loads will be palletized and stretch-wrapped at the NEWDC(s). Shipments to stores will be made on stretch-wrapped pallets, with a list attached identifying what the pallet contains. In those situations in which a store cannot receive the pallet, the driver will remove the cases from the pallet and unload them onto a skate wheel conveyor that connects to a similar conveyor in the store back room. The Contractor shall work in concert with the PLCB to support initiatives to improve upon the store delivery process.
iv.
Holiday Schedule. A special delivery schedule shall be established when a holiday or other occurrence closes the PLCB’s wine and spirits stores on a normal delivery day. (See Appendix E of the RFP.) Typically, Monday holiday delivery volumes are handled by cancelling the Monday holiday delivery and adding volume to the store’s preceding and subsequent deliveries. The Contractor shall manage labor planning around such dates to ensure that service levels meet store requirements.
Metrics for Service. The PLCB has developed Metrics for Service that the Contractor shall track and/or report. These metrics shall be measured monthly and quarterly. Failure to achieve these minimum metrics could result in default or other penalty under the terms and conditions of this Contract. The Contractor, in collaboration with the PLCB, shall develop a regular process to review performance against the Objectives established below and identify continuous improvement opportunities. 1.
Cycle Count Accuracy. The Contractor will be required, each calendar quarter, to count all location slots/SKU’s and immediately (within twenty-four (24) hours) update the book inventory, with appropriate inventory adjustments, to bring the book inventory in line with the physical inventory count. The Contractor is expected to perform so that slots will be accurate as to both item identification and stock quantity. The Contractor will be responsible for generating quarterly reports to the PLCB Contracting Officer from their system to monitor this Metric for Service. a. Objective: 95.0% accuracy as to location, count, and item identification. b. The Parties agree that failure to achieve this metric will result in damages to the PLCB. The PLCB and the Contractor therefore agree that, in the event of any such 22
failure, the Contractor shall pay to the PLCB liquidated damages in the amount and manner outlined in Paragraph 14, Liquidated Damages. 2.
Level of Store Overage, Shortage and Damage Claims (“OS&D”). It is expected that the Contractor shall immediately (within twenty-four (24) hours) resolve any overage, shortage, and damage (OS&D) claims from deliveries to the Stores. If an overage or shortage is claimed by a Store, then the NEWDC, unless approved by the PLCB, is to immediately perform a cycle count of that SKU, and make appropriate inventory adjustments if it finds a count discrepancy. Damage can only be claimed by the store at the time of delivery. The PLCB will be responsible for calculating and monitoring this Metric for Service based on store reported delivery discrepancies and damages. This metric will be reviewed monthly and scored on a quarterly basis. c. Objective: The absolute value of the OSDs on shipments originating from the DC will be less than one-tenth of a percent (0.1%) of cases shipped. d. If, at the end of the fiscal year, the NEWDC has a net overage, it will be retained by the PLCB. If there is a net shortage, it will be charged to the Contractor and paid as a deduction from the Contractor’s invoices. e. The Parties agree that failure to achieve this metric will result in damages to the PLCB. The PLCB and the Contractor therefore agree that, in the event of any such failure, the Contractor shall pay to the PLCB liquated damages in the amount and manner outlined in Paragraph 14, Liquidated Damages.
D.
Systems Technology. The PLCB requires that the Contractor supply its own warehouse management systems (“WMS”), transportation management systems (“TMS”) and labor management systems (“LMS”) technology. These system(s) must interface with the PLCB host system. For the purposes of this Contract, all such systems will be referred to collectively as a WMS. i.
Contractor shall operate _____________________ (“System”).
ii.
Hardware. The Contractor shall provide all hardware to perform DC operations.
iii.
Point of Contact. The Contractor shall provide a single point of contact for all System issues. 23
E.
iv.
Access. The WMS must accommodate up to fifteen (15) concurrent operational personnel to include PLCB staff in Harrisburg, Pennsylvania with two (2) separate and distinct roles. One (1) role should have read only access and the other role should have update access. Update access should only be for adding\removing PLCB personnel as they change and will be limited to one (1) or two (2) key PLCB personnel to maintain PLCB user setups.
v.
Audit trails. The Contractor shall ensure that all actions done within the WMS are documented\recorded through the use of an audit trail and PLCB personnel shall be made privy to all audit trail logs\records.
vi.
Upgrades. The Contractor shall provide all upgrade releases for the basic software as upgrades become available. Installation of upgrade releases are the responsibility of the Contractor, but must be coordinated with the PLCB. As maintenance and upgrade releases become available, the Contractor will evaluate the potential impact of the release as it relates to the operation of the basic software or customizations and report conclusions to the PLCB. For any PLCB requested customizations, the Contractor will provide the PLCB with an estimate of costs of those adjustments. If agreed upon by the PLCB, the Contractor will coordinate with the PLCB to make such adjustments. No software changes shall be installed without first getting PLCB consent and the timing of said implementations must be coordinated with the PLCB to minimize system/operating impacts.
vii.
Requests for Service. Upon receipt of a request for service from the PLCB, the Contractor will attempt as soon as practical to access the system in order to diagnose the source of the operating problem. If the Contractor determines that the problem relates to the basic software or the customizations maintained by the Contractor, the Contractor will recommend suitable corrective action and upon PLCB’s consent, implement the steps to correct the problem. The Contractor will follow the processes established in Appendix L of the RFP to identify and resolve problems.
Pallet Requirements. The Contractor shall handle and store product on fortyeight inch (48”) x forty inch (40”) four (4)-way pallets. The pallets shall be clean, free of debris, odor and stains. The Contractor shall ensure that adequate quantities of pallets and slip-sheets are available to accommodate business requirements. Pallets must be of good quality to ensure the integrity of PLCB Merchandise. All deck boards must be intact, securely fastened to stringers. No portions may be cracked or broken. No wood splinters or nails should be protruding from any pallets.
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i.
At the start of the Contract, all pallets to be used for operations are to be supplied by the Contractor.
ii.
The Contractor may enter into a pallet exchange program with shippers, vendors, carriers and other contractors and shall bear sole responsibility for any pallet shortages that occur. The PLCB shall not be liable for pallet shortages.
iii.
The Contractor shall pick up and transport pallets or other delivery carts from the PLCB’s stores to the DC(s) at no additional charge.
F.
Demurrage Charges. The Contractor shall be liable for all truck detention and demurrage charges, except those that are incurred as a result of labor strikes by PLCB employees or in other instances where the PLCB specifically accepts responsibility. Should any truck detention charge, except as explained herein above, be paid by the PLCB, the same may be charged to or applied against any monies due the Contractor. Neither the Contractor nor the PLCB will entertain or honor any detention or demurrage charges for deliveries where the carrier has missed its scheduled dock appointment. The PLCB will notify the Contractor of receipt of any demurrage charges or detention charges claimed against the Contractor. Upon notification of any truck detention or rail demurrage charge, the Contractor shall be given a reasonable length of time, not to exceed thirty (30) days, to reply to the carrier and the PLCB indicating whether such charges are valid, and, if not valid, the reasons such charges should not be paid by the Contractor.
G.
Product Recall. The Contractor’s WMS must be capable of supporting recalls to the product lot detail level. WMS support for recalls must allow for specific vendor lot codes to be restricted from selection for store shipment within one (1) hour of notification by the PLCB. Because lot code tracking is not currently used, it is acceptable to put all inventory of the affected SKU on quarantine until a date coded cycle count can be taken. The PLCB will be reasonable in its expectations for timing of the cycle count, but it is a top priority activity when a product recall is communicated to the Contractor. Support for recalls must also allow for inventory to be quarantined immediately upon receipt of recalled Merchandise from the stores. The Contractor shall complete product recalls from stores within one (1) delivery cycle from notification that product is being held at a store for return to the NEWDC(s).
H.
Audits. The PLCB will conduct periodic operational and inventory audits and risk assessments throughout the term of the contract. These audits may be conducted by either internal or external PLCB resources/representatives. The Contractor shall facilitate necessary site visits during Normal Business Hours with reasonable advance notice, and cooperate in all reasonable respects with the visiting teams. While the PLCB will typically provide reasonable notice prior to
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conducting an audit, the PLCB retains the right to conduct unannounced audits. Any charges for inventory audits will be billed as accessorial charges. I.
Environmental Issues (Sustainability). The PLCB is committed to minimizing the impact of its operation on the environment. A copy of the PLCB Statement on Sustainability is included in RFP Appendix C. The Contractor shall establish processes and leverage equipment (where possible) that will support and advance the PLCB's goals in the area of sustainability.
J.
PLCB Policies and Procedures. The Contractor shall use and follow all policies, practices, systems and procedures as provided by the PLCB and agreed to by the Contractor in executing all services unless otherwise approved in advance by the PLCB Contact Person. This includes the manner, availability and all other aspects of Merchandise and supplies identification. The Contractor shall cooperate with the PLCB in the possible introduction and implementation of advanced systems and procedures designed to streamline operations and gain efficiencies in executing the Contract services.
K.
Process Improvement Management. The PLCB will meet with the Contractor to review performance on a regular basis, in order to communicate results, recognize efforts and improvements, and develop action plans for those areas needing improvement. The PLCB will determine the frequency with which process improvement meetings will be conducted. In addition, the Contractor shall actively participate in a program of continuous improvement to reduce operating costs and improve service over time. The PLCB intends to implement a program by which process improvement opportunities can be identified, reviewed, planned, approved, implemented, and tracked. Financial benefits resulting from continuous improvement opportunities will be shared by the Contractor and the PLCB. The PLCB will receive seventy percent (70%) of any approved savings and the Contractor will receive the balance. The Contractor is expected to develop an approach to formalize this program and track results. The Contractor is expected to provide recommended cost reduction and service improvement initiatives at each continuous improvement meeting. The PLCB will also propose improvement initiatives at these meetings. Proposed initiatives will be reviewed and then jointly approved for implementation. Accountability for execution and approach to measuring and tracking results will be determined. The PLCB recognizes that there may be scenarios in which supply chain improvements identified through the continuous program may result in additional costs within the Contractor's operations. Should such a scenario develop, the Contractor's fee structure may be adjusted if approved by the PLCB and all appropriate Commonwealth of Pennsylvania parties.
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6.
REPORTS AND PROJECT CONTROL - The Contractor shall submit reports, receipts, forms and/or controls as the PLCB shall require. The Contractor must prepare, maintain and provide to the PLCB a detailed work plan for each task outlined in this Contract. The plan must clearly identify the work elements of each task, the resources assigned to each element, the time allotted to each element, task dependencies and deliverable items to be produced. Where appropriate, a PERT or GANTT chart display should be used to show project, task, and time relationship. The project plan must be updated on a bi-weekly basis (every other week) or more frequently as required. A.
Progress Reports. The Contractor shall prepare and submit to the PLCB written weekly progress reports during the project addressing progress against the project milestones, key upcoming activities, issues identified and resolved, issues identified and still unresolved, project status, significant accomplishments during the reporting period, issues and material risks affecting cost and schedule, and recommendations for resolution and knowledge transfer/mentoring activities of note. Reports must be in electronic format to the PLCB Project Manager by Tuesday of each week for the previous week and are intended to show progress through the entire week. Issues and risks are defined in Paragraph 7, Risk Reporting and Issue Reporting.
B.
Project Meetings. During the course of work, the Contractor’s Project Manager and PLCB will hold weekly meetings at mutually agreeable times. The meetings will take place in Harrisburg, Pennsylvania. The PLCB Project Manager will schedule all meetings. The purpose of these meetings may include, but will not be limited to, project status and presenting recommendations and strategies.
C.
Reporting. Initially, the Contractor shall track and report the information listed below. Other, yet to be defined, tracking tools may be developed jointly with the PLCB. i. Initially, there will be frequent meetings/conference calls to address any issues arising during Phase 1 to help understand and correct problems. During Phase 1, the Contractor will prepare monthly progress reports detailing the progress against the project milestones, key upcoming activities, issued identified and resolved, and issues identified and still unresolved. ii. Beginning with Phase 2, periodic meetings will be held to address operational performance, improvement opportunities and suggestions for process changes. In addition to these meetings, the following information must be made available to the PLCB by the Contractor through an agreeable conveyance: a. Daily Reports 1. POs/ASNs received (in-bound) 27
2. Cases received 3. POs/ASNs and/or in-bound vehicles which have arrived on-site but were not unloaded by close of business 4. Order transmissions received (to fulfill) 5. Orders scheduled for delivery 6. Orders delivered 7. Orders delivered on-time 8. Trucks shipped 9. Average cases per truck 10. Average weight per truck 11. Total case inventory and case inventory by hold classification 12. Disposition of any orders that are not delivered on-time 13. Cases delivered 14. Pallets/delivery carts received from stores 15. Product received from stores 16. Inventory discrepancies including cycle count results 17. Delivery overages, shortages and damages (units) 18. Reported warehouse damages 19. Reported inbound damages b. Weekly Key Performance Indicator Reports 1. 2. 3. 4. 5.
Order Fill Rate Percentage Inventory Accuracy Percentage Order Accuracy Percentage Product Damages Recoup Turnaround Time Performance
c. Supplementary Weekly Reports 1. 2. 3. 4. 5.
Total cases received Total cases received within allowable unload window Total POs/ASNs received Total cases made available for order fulfillment Total cases made available for order fulfillment within allowable timeframe from receipt 6. Total orders fulfilled 7. Total cases not available in inventory for order fulfillment 8. Total cases ordered 9. Total cases fulfilled 10. Total cases fulfilled accurately 11. Order fill rate (number of cases shipped as a percentage of cases ordered)
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12. Order accuracy (number of cases shipped accurately as a percentage of cases shipped) 13. Total locations cycle counted 14. Total locations cycle counted with discrepancy 15. Equipment Utilization (cases/load and loads/day) 16. Asset Utilization (hours/week/power unit) 17. Driver Utilization (hours/week/driver) 18. Miles per week 19. Use of lumpers/supplemental labor iii. Weekly Metrics for Service and Supplementary report data will be also be reported on a month-to-month date (“MTD”) and a year-to-date (“YTD”) basis. The PLCB and the Contractor will work together to structure a reporting system that will provide timely information that is useful to both parties. The PLCB requires the ability to perform ad-hoc inquiries to supplement normal reporting standards as necessary. 7.
RISK AND ISSUE REPORTING – During Phase 1 & 2, the Contractor’s Project Manager must submit to the PLCB Project Manager, a problem identification report for requirements, design and development issues, staffing problems and other issues that may materially impact the project scope, schedule and work products. For definition purposes, an issue is a current problem. The Issue Report must include: A.
A description of the issue;
B.
Resource(s) assigned to resolve the issue;
C.
A categorization of the issue (such as technical, procurement, resources, training or communications);
D.
An analysis of the likely causes of the issue;
E.
A proposed solution; and
F.
An assessment of its impact on the schedule and completed work products and services.
At a minimum, the Issue Report must be submitted on a weekly basis with the Status Report; however, it may be required more frequently depending on the number and type of open issues at any given time, and mutually determined by the PLCB and Contractor Project Managers. The Issue Report should be produced in a format that allows realtime access and updates. 8.
RECORD RETENTION – Following the termination of this Contract, the Contractor must maintain all paper records related to the Contract for a period of not less than three
29
(3) years and must maintain all electronic records related to the Contract for not less than seven (7) years. 9.
PROJECT CHANGE CONTROL PROCEDURES - The PLCB reserves the right to make changes at any time during the term of the Contract or any renewals or extensions thereof: 1) to increase or decrease the quantities resulting from variations between any estimated quantities in the Contract and actual quantities; 2) to make changes to the services within the scope of the Contract; 3) to notify the Contractor that the Commonwealth is exercising any Contract renewal or extension option; or 4) to modify the time of performance that does not alter the scope of the Contract to extend the completion date beyond the Expiration Date of the Contract or any renewals or extensions thereof. A.
Any Change Order shall be in writing and signed by the PLCB Project Manager and Contractor Project Manager.
B.
Changes relating to the work to be accomplished by the Contractor under the Contract may be requested at any time by either party to the Contract. The Change Order shall be effective as of the date appearing on the change order, unless the change order specifies a later effective date.
C.
Increases, decreases, changes, or modifications will not invalidate the Contract. The Contractor must provide written notice to the PLCB when such a change order will result in increased costs or delay of deliverables. In such a case, the PLCB and the Contractor shall negotiate and agree on appropriate fees for services or materials required under the change order within ten (10) days of the required effective date of the change order.
D.
The Contractor agrees to provide the services in accordance with the change order. Any dispute by the Contractor in regard to the performance required under any Change Order shall be handled through Paragraph 35, Contract Controversies.
E.
The following procedure will be used by the PLCB and the Contractor to control changes relating to the work to be accomplished by the Contractor. It will also be used if modifications to deliverables are requested: i. The PLCB or Contractor Project Manager will write a Project Change Request (PCR) which describes the change, and includes the necessary rationale and/or effect the change will have on the project. PCRs shall be numbered sequentially, starting with number one (1). ii. The PLCB Project Manager or Contractor Project Manager, as appropriate, will review the proposed change in order to determine the effect of the proposed Change Order on price and schedule.
30
iii. The PLCB Project Manager and Contractor Project Manager will weigh the merits of the proposed change and approve it or reject it. The Contractor will not have any obligation to implement any changes until the applicable PCR is approved by both parties. iv. Each PCR approved through this procedure must be signed by both parties and will be incorporated into the Contract and will not require any additional written Contract amendment(s), provided that the PCR process may be used in this manner only to accomplish the expeditious approval of necessary modifications or other project deliverables, previously unforeseen. However, it may not be used to modify other Contract language or any other terms or conditions of the Contract. v. The Contractor and PLCB agree that change orders may result in increases, decreases or other revisions to certain costs associated with the Work. 10.
SPECIAL SERVICES – Upon request of the PLCB and upon receipt of all required Commonwealth approvals, the Contractor shall perform special services, not otherwise specifically provided for in this Contract. As specific projects are requested by the PLCB and agreed to by both parties in writing in advance, the Contractor shall submit a detailed work plan, schedule of deliverables and cost for PLCB approval prior to the commencement of any work.
11.
SPECIAL REQUIREMENTS – Subject to the provisions of this Contract, the PLCB reserves the right to purchase services and equipment covered under this Contract through other procurement methods whenever extraordinary circumstances require the PLCB to secure those services and equipment through another source.
12.
ACCEPTANCE OF DELIVERABLES – In order to assure that each deliverable required under this Contract is accepted in a uniform manner, the following procedure shall be utilized: A.
The Contractor shall notify the PLCB Project Manager when each deliverable is completed and ready for acceptance by the PLCB. Unless otherwise agreed to in writing by the parties, the acceptance period shall be as set forth in the deliverables for each task as contained in Paragraph 4, Services to be Provided.
B.
Following receipt by the PLCB Project Manager of the Contractor’s notification of completion of a particular task, as set forth in Paragraph 4 of this Contract, the PLCB shall either: i. Provide the Contractor with its written acceptance of the deliverable for that task or,
31
ii. Reject the deliverable. In such case, the PLCB shall identify to the Contractor, in writing, the failure of the deliverable to comply with the PLCB’s specifications, listing all such errors and omissions with reasonable detail. C.
If a deliverable is not acceptable, the Contractor must provide written justification for its failure or deviation. The PLCB may either waive the requirement as not applicable to the PLCB’s business requirements, or require that the Contractor provide an alternative acceptable to the PLCB. Any waiver or modification of the requirement must be in writing.
D.
Upon the Contractor’s receipt of the PLCB’s written notice of rejection, the Contractor shall have fifteen (15) business days, or such other time as the PLCB and the Contractor may agree in writing is reasonable, within which to correct failures and to re-submit the corrected deliverable to the PLCB certifying, in writing, that the failures have been corrected. Upon receipt of such corrected and resubmitted deliverable and certification, the PLCB shall have thirty (30) business days to review the deliverable and to confirm that it is acceptable and provide the Contractor with its acceptance of the deliverable for the completed task.
E.
If, in the reasonable opinion of the PLCB, the resubmitted deliverable still contains material failures, the PLCB may, in its sole discretion, either: i. Repeat the procedure set forth above, ii. Invoke liquidated damages against the Contractor pursuant to Paragraph 14, Liquidated Damages, or iii. Terminate the Contract pursuant to Paragraph 36, Termination Provisions, and pursue any and all remedies to which the PLCB is entitled under this Contract and/or at law or in equity.
13.
INSPECTION AND ACCEPTANCE OF DEVELOPED MATERIALS - Acceptance of Developed Materials will occur in accordance with the Deliverable Approval Plan submitted by the Contactor and approved by the PLCB. Upon approval of the plan by the PLCB, the Deliverable Approval Plan becomes part of this Contract. If software or a developed system is the deliverable, the Deliverable Approval Plan must include an Acceptance Test Plan. The Acceptance Test Plan will provide for a Final Acceptance Test, and may provide for Interim Milestone Acceptance Tests. Each Acceptance Test will be designed to demonstrate that the Developed Materials conform to the functional specification for the Developed Materials, if any, and/or the requirements of this Contract. The Contractor shall notify the PLCB when the deliverable is completed and ready for acceptance testing. The PLCB will not unreasonably delay commencement of acceptance testing.
32
A.
The Contractor shall certify, in writing, to the PLCB when a particular Deliverable milestone, interim or final, is completed and ready for acceptance (hereinafter Acceptance). Unless otherwise agreed to by the PLCB, the Acceptance period shall be ten (10) business days for interim milestones and thirty (30) days for final milestones. On or before the 10th business day for interim milestones or 30th business day for the final milestone, following receipt by the PLCB of the Contractor’s certification of completion of a particular milestone, the PLCB shall either: (1) provide the Contractor with the PLCB’s written conditional acceptance of the Developed Materials in the completed milestone, subject to the PLCB’s final acceptance of the Developed Materials or (2) identify to the Contractor, in writing, the failure of the Developed Materials to comply in all material respects with the specifications, listing all such errors and omissions with reasonable detail.
B.
If the Developed Materials are in compliance in all material respects with the specifications, then the PLCB shall provide the Contractor with the PLCB’s written conditional acceptance of the Developed Materials in the completed milestone. If the Developed Materials are not in compliance in all material respects with the specifications, then the PLCB shall provide the Contractor with the PLCB’s written rejection of the Developed Materials in the competed milestone. If the PLCB fails to notify the Contractor in writing of any such failures in the Acceptance period within the applicable Acceptance period, the Developed Materials shall be deemed accepted. Payment for Developed Materials will only be made if the PLCB has accepted the Developed Materials, either through written acceptance or through deemed acceptance.
C.
If the Developed Materials do not meet an accessibility standard, the Contractor must provide written justification for its failure to meet the standard. The justification must provide specific details as to why the standard has not been met. The PLCB may either waive the requirement as not applicable to the PLCB’s business requirements or require that the Contractor provide an acceptable alternative. Any PLCB waiver of the requirement must be in writing.
D.
Upon the Contractor’s receipt of the PLCB’s written notice of rejection, which must identify the reasons for the failure of the Developed Materials in a completed milestone to comply in all material respects with the specifications, the Contractor shall have fifteen (15) business days, or such other time as the PLCB and Contractor may agree is reasonable, within which to correct all such failures, and resubmit the corrected Developed Materials, certifying to the PLCB, in writing, that the failures have been corrected, and that the Developed Materials have been brought into compliance with the specifications. Upon receipt of such corrected and resubmitted Developed Materials and certification, the PLCB shall have thirty (30) business days to test the corrected Developed Materials to confirm that they are in compliance with the specifications. If the corrected Developed Materials are in compliance with the specifications, then the PLCB
33
shall provide the Contractor with the PLCB’s conditional acceptance of the Developed Materials in the completed milestone. E.
If, in the opinion of the PLCB, the corrected Developed Materials still contain material failures, the PLCB may either: i. repeat the procedure set forth above; or ii. terminate the Contract in accordance with Paragraph 33, Termination Provisions.
14.
LIQUIDATED DAMAGES - These liquidated damages provisions shall be in addition to and not in substitution of any other remedy or remedies available to the PLCB at law or in equity. A.
The PLCB shall have the right to recover damages through deduction from the Contractor’s invoices, in the amount equal to the damages incurred, or by direct billing to the Contractor.
B.
The parties agree that failure to achieve the Metrics for Service result in damages to the PLCB. The PLCB and the Contractor therefore agree that failures will be handled in the following manner: i.
Cycle Count Accuracy Metric will be reviewed quarterly. The Contractor is expected to perform in a manner such that during each quarterly full warehouse cycle count, a minimum of ninety-five percent (95%) of the slots will be accurate as to both item identification and stock quantity. The vendor will be responsible for generating quarterly reports to the PLCB Contracting Officer from their system to monitor this Metric for Service. The PLCB has the right to review and audit these reports.
ii.
The level of Store OSDs will be calculated and reviewed quarterly. The Contractor is expected to perform in a manner such that the absolute value of the OSDs on shipments originating from the DC will be less than onetenth of a percent (0.1%) of cases shipped. The PLCB will be responsible for calculating and monitoring this Metric for Service, based on store reported delivery discrepancies and damages.
iii.
Each Metric for Service performance target will be reviewed separately. If the Contractor does not meet any of the performance target(s), the following actions will be taken: a. The PLCB will notify the Contractor, in writing, of the failed metric.
34
b. Within five (5) days of the written notification provided in subparagraph 14(B)(iii)(a) above, the Contractor will be required to develop and submit to the PLCB a corrective action plan to improve on the problem area. c. The Contractor shall correct the issues within twenty-five (25) days of the date the corrective action plan is submitted to the PLCB. d. If the next quarter’s performance target is not met, the Contractor will be assessed, and agrees to pay twenty-five thousand dollars ($25,000.00) in liquidated damages. Any liquidated damage assessment may be waived with Board approval. e. If there is a pattern of repeated failures to meet either or both of the Metrics for Service targets, the PLCB may consider such failure as a breach of contract subject to the language in subparagraph 32(A)(iv)(c). iv.
15.
16.
Such payment shall not be construed as a penalty, but as a minimum value of the liquidated damages.
PERFORMANCE BOND - Within seven (7) days of the Effective Date, the Contractor shall post an initial two (2)-year performance bond, naming the PLCB as beneficiary, in the amount equal to five million dollars ($5,000,000.00) lawful money of the United States of America, to guarantee performance of all work and services under the terms thereof. A.
Failure of the Contractor to post such bond within seven (7) days from Effective Date may result in the Contractor being disqualified, and the bid bond being declared forfeited for the damages described more fully in Part II, Section II12(C)(3) of the RFP, the Notice to Proceed may be voided and all obligations on the part of the PLCB in connection herewith will be canceled
B.
One hundred eighty (180) days prior to the expiration of the initial two (2)-year performance bond, and for each subsequent two (2)-year performance bond throughout the term of the Contract, the Contractor will present to the PLCB a performance bond covering the next two (2)-year term, to guarantee performance of all work and services under the terms of the Contract. Failure to timely provide a renewal performance bond may be grounds for default of contract, at the PLCB’s sole discretion.
EQUIPMENT AND MATERIALS - The Contractor shall furnish all software, materials, and other necessary equipment for its employees to perform its Contractual
35
requirements. All equipment provided by the Contractor shall remain the property of the Contractor, unless otherwise specifically set forth herein. 17.
INSURANCE – All insurance policies shall name the PLCB and its contracted bailment vendors as an additional insured. Prior to commencement of work on the Project, the Contractor shall provide the PLCB with current certificates of insurance naming the PLCB as an additional insured. Upon the PLCB’s written request, the Contractor shall provide the PLCB with a copy of any policy which names the PLCB as an additional insured. These certificates shall contain a provision that coverage afforded under the policies shall not be cancelled or changed until at least thirty (30) days prior written notice has been given the PLCB. Copies of such notification shall be sent to the PLCB Issuing Officer. A.
The Contractor also agrees to authorize any provider of insurance coverage required under this Contract to notify the PLCB Issuing Officer of any notices or premiums due by sending a copy of such notice to the Issuing Officer. The PLCB reserves the right, in the event of any default by the awarded Contractor on any premiums due hereunder, to cure said default and to deduct such premiums from any monies due the Contractor.
B.
The Contractor must purchase and maintain, at its expense, the following types of insurance, issued by companies and evidenced by policies acceptable to the PLCB: i. Workers’ Compensation Insurance - Workers’ Compensation Insurance sufficient to cover all of the employees of Contractor working to fulfill this Contract. ii. Liability/Damage Insurance - Comprehensive General Liability Insurance, Property Damage Insurance, and Automobile Liability Insurance in such amounts as the PLCB shall deem sufficient which shall not exceed ten million dollars ($10,000,000.00) for injury to or death of one (1) person in a single occurrence and twenty million dollars ($20,000,000.00) for injury to or death of more than one (1) person in a single occurrence and twenty million dollars ($20,000,000.00) for a single occurrence of property damage. Excess or umbrella insurance coverage is required in the amount of no less than one hundred million dollars ($100,000,000.00) for personal injury and property damage. iii. Flood Insurance - This clause is applicable to any and all facilities/equipment situated in a flood plain designated by the United States (U.S.) government. The Contractor shall maintain flood insurance insuring the interest of the PLCB in all Merchandise in the custody of the Contractor. The amount of the insurance maximum will be based on the allowable insurance available for that specific site.
36
iv. Fire Regulation Compliance - The Contractor agrees to comply with regulations and rules of the fire insurance company(ies) insuring the Merchandise in the custody of the Contractor. v. Personal Injury/Property Damage - The Contractor shall be liable for all personal injuries or property damage to invitees while on the Contractor’s property caused by the negligence of the Contractor. The Contractor shall also be liable for any injuries or damages sustained by the PLCB, its agents, servants, employees, or invitees resulting from the negligent activities of the Contractor, its agents, servants, employees or invitees.
18.
VIRUS, MALICIOUS, MISCHIEVOUS OR DESTRUCTIVE PROGRAMMING – A.
Notwithstanding any other provision in this Contract to the contrary, the Contractor shall be liable for any damage to any data and/or software owned or licensed by the Commonwealth/PLCB if the Contractor or any of its employees, subcontractors or consultants knowingly or negligently introduces a virus or malicious, mischievous or destructive programming into the Commonwealth’s/PLCB’s software or computer networks and has failed to comply with the Commonwealth software security standards. The Commonwealth/PLCB must demonstrate that the Contractor or any of its employees, subcontractors or consultants knowingly or negligently introduced the virus or malicious, mischievous or destructive programming. The Contractor’s liability shall cease if the Commonwealth/PLCB has not fully complied with its own software security standards.
B.
The Contractor shall be liable for any damages incurred by the Commonwealth/PLCB including, but not limited to, the expenditure of Commonwealth/PLCB funds to eliminate or remove a computer virus or malicious, mischievous or destructive programming that result from the Contractor’s failure to take proactive measures to keep virus or malicious, mischievous or destructive programming from originating from the Contractor or any of its employees, subcontractors or consultants through appropriate firewalls and maintenance of anti-virus software and software security updates (such as operating systems security patches, etc.). Any damages under this paragraph shall be limited to the amount paid or payable by the PLCB to the Contractor under this Contract.
C.
In the event of destruction or modification of software, the Contractor shall eliminate the virus, malicious, mischievous or destructive programming, restore the Commonwealth’s/PLCB’s software, and be liable to the Commonwealth/PLCB for any resulting damages.
D.
The Contractor shall be responsible for reviewing Commonwealth software security standards and complying in all material respects with those standards. 37
19.
E.
The Commonwealth/PLCB may, at any time during Normal Business Hours following reasonable notice, audit, by a means deemed appropriate by the Commonwealth/PLCB, any computing devices being used by representatives of the Contractor to provide services to the Commonwealth/PLCB for the sole purpose of determining whether those devices have anti-virus software with current virus signature files and the current minimum operating system patches or workarounds have been installed. Devices found to be out of compliance will immediately be disconnected and will not be permitted to connect or reconnect to the Commonwealth/PLCB network until the proper installations have been made.
F.
The Contractor may use the anti-virus software used by the Commonwealth/PLCB to protect Contractor’s computing devices used in the course of providing services to the Commonwealth/PLCB. It is understood that the Contractor may not install the software on any computing device not being used to provide services to the Commonwealth/PLCB, and that all copies of the software will be removed from all devices upon termination of this Contract.
G.
The Commonwealth/PLCB will not be responsible for any damages to the Contractor’s computers, data, software, etc. caused as a result of the installation of the Commonwealth’s/PLCB’s anti-virus software or monitoring software on the Contractor’s computers.
SENSITIVE INFORMATION – The Contractor shall safeguard all sensitive information. A.
The Contractor shall not publish or otherwise disclose, except to the Commonwealth and to Contractor’s advisors and subcontractors, with a legitimate need to know in order to provide the contracted services, and except matters of public record or information otherwise publically available, any information or data obtained hereunder from private individuals, organizations, or public agencies, in a publication whereby the information or data furnished by or about any particular person or establishment can be identified, except with the consent of such person or establishment.
B.
The parties shall not use or disclose any information about a recipient receiving services from, or otherwise enrolled in, a Commonwealth program affected by or benefiting from services under this Contract for any purpose not connected with the parties’ Contract responsibilities except with the written consent of such recipient, recipient’s attorney, or recipient’s parent or guardian pursuant to applicable state and federal law and regulations or to the extent permitted or not restricted under Paragraph 44, Confidentiality.
38
20.
CONDUCT OF SERVICE – A.
Work Performance - Unless otherwise provided herein, the Contractor shall furnish all necessary qualified personnel and equipment to perform the requirements set forth in this Contract. Unless otherwise mutually agreed by the parties or otherwise accepted herein, all services required in this Contract shall be performed within the time periods specified in this Contract. In determining whether or not the Contractor has performed in a timely manner hereunder, it is agreed and understood that the PLCB Project Manager may measure the amount and quality of the Contractor’s effort against the representations made by the Contractor and in comparison with the schedules and guidelines established by the PLCB under this Contract in determining the extent of services to be provided. If the PLCB reasonably determines that the Contractor has not performed in a timely manner, the PLCB and the Contractor will attempt to reach agreement with respect to such matter. Failure of the PLCB or the Contractor to arrive at such mutual determinations shall be a dispute concerning a question of fact within the meaning of Paragraph 32, Contract Controversies. The Contractor’s work hereunder shall be carried out under the supervision of the PLCB Project Manager. The PLCB will, within five (5) days of the Effective Date of this Contract, provide the Contractor with the name of the PLCB Project Manager.
B.
Clerical/Administrative Costs - The Contractor is responsible for and agrees to pay for all clerical and administrative costs which it incurs incidental to the terms and conditions of this Contract.
C.
Offset Provision -The Contractor agrees that the Commonwealth may set off the amount of any state tax liability or other debt or obligation of the Contractor or its subsidiaries that is owed to the Commonwealth and is not being contested on appeal against any payments due the Contractor under this or any other contract with the Commonwealth.
D.
Nondiscrimination/Sexual Harassment Clause - The Contractor agrees as follows: i. In the hiring of any employee(s) for the manufacture of supplies, performance of work, or any other activity required under the contract or any subcontract, the Contractor, each subcontractor, or any person acting on behalf of the Contractor or subcontractor shall not, by reason of gender, race, creed, or color, discriminate against any citizen of this Commonwealth who is qualified and available to perform the work to which the employment relates. ii. Neither the Contractor nor any subcontractor nor any person on their behalf shall in any manner discriminate against or intimidate any employee involved in the manufacture of supplies, the performance of
39
work, or any other activity required under the contract on account of gender, race, creed, or color. iii. The Contractor and each subcontractor shall establish and maintain a written sexual harassment policy and shall inform their employees of the policy. The policy must contain a notice that sexual harassment will not be tolerated and employees who practice it will be disciplined. iv. The Contractor and each subcontractor shall not discriminate by reason of gender, race, creed, or color against any subcontractor or supplier who is qualified to perform the work to which the contract relates. v. The Contractor and each subcontractor shall, within the time periods requested by the PLCB, furnish all necessary employment documents and records and permit access to their books, records, and accounts by the contracting agency and the Bureau of Small Business Opportunities (BSBO), for purpose of ascertaining compliance with provisions of this Nondiscrimination/Sexual Harassment Clause. The Contractor must meet and maintain commitments made to Small Diverse Businesses (SDB) at the time of proposal submittal or Contract negotiation, unless a change in the commitment is approved by the BSBO. All SDB subcontractors must perform at least fifty percent (50%) of the subcontracted work. Within fifteen (15) days after award of any contract, the Contractor shall be required to complete, sign and submit Form STD-21, the “Initial Contract Compliance Data” form. Those contractors who have fewer than five employees or whose employees are all from the same family or who have completed the Form STD-21 within the past 12 months may, within the 15 days, request an exemption from the Form STD-21 submission requirement from the contracting agency. vi. The Contractor shall include the provisions of this Nondiscrimination/Sexual Harassment Clause in every subcontract so that those provisions applicable to subcontractors will be binding upon each subcontractor. vii. The PLCB may cancel or terminate the contract and all money due or to become due under the contract may be forfeited for a violation of the terms and conditions of this Nondiscrimination/Sexual Harassment Clause. In addition, the agency may proceed with debarment or suspension and may place the Contractor in the Contractor Responsibility File. E.
Contractor Integrity Provisions - It is essential that those who seek to contract with the Commonwealth of Pennsylvania (“Commonwealth”) observe high standards of honesty and integrity. They must conduct themselves in a manner 40
that fosters public confidence in the integrity of the Commonwealth procurement process. In furtherance of this policy, the Contractor agrees to the following: i. Contractor shall maintain the highest standards of honesty and integrity during the performance of this contract and shall take no action in violation of state or federal laws or regulations or any other applicable laws or regulations, or other requirements applicable to Contractor or that govern contracting with the Commonwealth or the PLCB. ii. Contractor shall establish and implement a written business integrity policy, which includes, at a minimum, the requirements of these provisions as they relate to Contractor employee activity with the Commonwealth/PLCB and Commonwealth/PLCB employees, and which is distributed and made known to all Contractor employees. iii. Contractor, its affiliates, agents and employees shall not influence, or attempt to influence, any Commonwealth/PLCB employee to breach the standards of ethical conduct for Commonwealth/PLCB employees set forth in the Public Official and Employees Ethics Act, 65 Pa.C.S.A. §§1101 et seq.; the State Adverse Interest Act, 71 P.S. §776.1 et seq.; and the Governor’s Code of Conduct, Executive Order 1980-18, 4 Pa. Code §7.151 et seq., or to breach any other state or federal law or regulation. iv. Contractor, its affiliates, agents and employees shall not offer, give, or agree or promise to give any gratuity to a Commonwealth/PLCB official or employee or to any other person at the direction or request of any Commonwealth/PLCB official or employee. v. Contractor, its affiliates, agents and employees shall not offer, give, or agree or promise to give any gratuity to a Commonwealth/PLCB official or employee or to any other person, the acceptance of which would violate the Governor’s Code of Conduct, Executive Order 1980-18, 4 Pa. Code §7.151 et seq. or any statute, regulation, statement of policy, management directive or any other published standard of the Commonwealth/PLCB. vi. Contractor, its affiliates, agents, employees, or anyone in privity with him or her shall not accept or agree to accept from any person, any gratuity in connection with the performance of work under the contract, except as provided in the contract. vii. Contractor shall not have a financial interest in any other contractor, subcontractor, or supplier providing services, labor, or material on this project, unless the financial interest is disclosed to the Commonwealth/PLCB in writing and the Commonwealth/PLCB consents to Contractor’s financial interest prior to Commonwealth/PLCB execution of the contract. Contractor shall disclose the financial interest to the 41
Commonwealth/PLCB at the time of bid or proposal submission, or if no bids or proposals are solicited, no later than Contractor’s submission of the contract signed by Contractor. viii. Contractor, its affiliates, agents and employees shall not disclose to others any information, documents, reports, data, or records provided to, or prepared by, Contractor under this contract without the prior written approval of the Commonwealth, except as required by the Pennsylvania Right-to-Know Law, 65 P.S. §§ 67.101-3104, or other applicable law or as otherwise provided in this contract. Any information, documents, reports, data, or records secured by Contractor from the Commonwealth/PLCB or a third party in connection with the performance of this contract shall be kept confidential unless disclosure of such information is: a. Approved in writing by the Commonwealth/PLCB prior to its disclosure; or b. Directed by a court or other tribunal of competent jurisdiction unless the contract requires prior Commonwealth/PLCB approval; or c. Required for compliance with federal or state securities laws or the requirements of national securities exchanges; or d. Necessary for purposes of Contractor’s internal assessment and review; or e. Deemed necessary by Contractor in any action to enforce the provisions of this contract or to defend or prosecute claims by or against parties other than the Commonwealth/PLCB; or f. Permitted by the valid authorization of a third party to whom the information, documents, reports, data, or records pertain; or g. Otherwise required by law. ix. Contractor certifies that neither it nor any of its officers, directors, associates, partners, limited partners or individual owners has been officially notified of, charged with, or convicted of any of the following and agrees to immediately notify the Commonwealth agency contracting officer in writing if and when it or any officer, director, associate, partner, limited partner or individual owner has been officially notified of, charged
42
with, convicted of, or officially notified of a governmental determination of any of the following: a. Commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements or receiving stolen property. b. Commission of fraud or a criminal offense or other improper conduct or knowledge of, approval of or acquiescence in such activities by Contractor or any affiliate, officer, director, associate, partner, limited partner, individual owner, or employee or other individual or entity associated with: 1. obtaining; 2. attempting to obtain; or 3. performing a public contract or subcontract. Contractor’s acceptance of the benefits derived from the conduct shall be deemed evidence of such knowledge, approval or acquiescence. c. Violation of federal or state antitrust statutes. d. Violation of any federal or state law regulating campaign contributions. e. Violation of any federal or state environmental law. f. Violation of any federal or state law regulating hours of labor, minimum wage standards or prevailing wage standards; discrimination in wages; or child labor violations. g. Violation of the Act of June 2, 1915 (P.L.736, No. 338), known as the Workers’ Compensation Act, 77 P.S. 1 et seq. h. Violation of any federal or state law prohibiting discrimination in employment. i. Debarment by any agency or department of the federal government or by any other state. j. Any other crime involving moral turpitude or business honesty or integrity. 43
Contractor acknowledges that the Commonwealth may, in its sole discretion, terminate the contract for cause upon such notification or when the Commonwealth otherwise learns that Contractor has been officially notified, charged, or convicted. x. If this contract was awarded to Contractor on a non-bid basis, Contractor must, (as required by Section 1641 of the Pennsylvania Election Code) file a report of political contributions with the Secretary of the Commonwealth on or before February 15 of the next calendar year. The report must include an itemized list of all political contributions known to Contractor by virtue of the knowledge possessed by every officer, director, associate, partner, limited partner, or individual owner that has been made by: a. Any officer, director, associate, partner, limited partner, individual owner or members of the immediate family when the contributions exceed an aggregate of one thousand dollars ($1,000) by any individual during the preceding year; or b. Any employee or members of his immediate family whose political contribution exceeded one thousand dollars ($1,000) during the preceding year. To obtain a copy of the reporting form, Contractor shall contact the Bureau of Commissions, Elections and Legislation, Division of Campaign Finance and Lobbying Disclosure, Room 210, North Office Building, Harrisburg, PA 17120. xi. Contractor shall comply with requirements of the Lobbying Disclosure Act, 65 Pa.C.S.A. § 13A01 et seq., and the regulations promulgated pursuant to that law. Contractor employee activities prior to or outside of formal Commonwealth procurement communication protocol are considered lobbying and subjects the Contractor employees to the registration and reporting requirements of the law. Actions by outside lobbyists on Contractor’s behalf, no matter the procurement stage, are not exempt and must be reported. xii. When Contractor has reason to believe that any breach of ethical standards as set forth in law, the Governor’s Code of Conduct, or in these provisions has occurred or may occur, including but not limited to contact by a Commonwealth officer or employee which, if acted upon, would violate such ethical standards, Contractor shall immediately notify the Commonwealth/PLCB contracting officer or Commonwealth Inspector General in writing.
44
xiii. Contractor, by submission of its bid or proposal and/or execution of this contract and by the submission of any bills, invoices or requests for payment pursuant to the contract, certifies and represents that it has not violated any of these contractor integrity provisions in connection with the submission of the bid or proposal, during any contract negotiations or during the term of the contract. xiv. Contractor shall cooperate with the Office of Inspector General in its investigation of any alleged Commonwealth employee breach of ethical standards and any alleged Contractor non-compliance with these provisions. Contractor agrees to make identified Contractor employees available for interviews at reasonable times and places. Contractor, upon the inquiry or request of the Office of Inspector General, shall provide, or if appropriate, make promptly available for inspection or copying, any information of any type or form deemed relevant by the Inspector General to Contractor's integrity and compliance with these provisions. Such information may include, but shall not be limited to, Contractor's business or financial records, documents or files of any type or form that refers to or concern this contract. xv. For violation of any of these Contractor Integrity Provisions, the Commonwealth may terminate this and any other contract with Contractor, claim liquidated damages in an amount equal to the value of anything received in breach of these provisions, claim damages for all additional costs and expenses incurred in obtaining another contractor to complete performance under this contract, and debar and suspend Contractor from doing business with the Commonwealth. These rights and remedies are cumulative, and the use or non-use of any one shall not preclude the use of all or any other. These rights and remedies are in addition to those the Commonwealth may have under law, statute, regulation, or otherwise. xvi. For purposes of these Contractor Integrity Provisions, the following terms shall have the meanings found in this subparagraph: a. “Confidential information” means information that a) is not already in the public domain; b) is not available to the public upon request; c) is not or does not become generally known to Contractor from a third party without an obligation to maintain its confidentiality; d) has not become generally known to the public through an act or omission of Contractor; or e) has not been independently developed by Contractor without the use of confidential information of the Commonwealth.
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b. “Consent” means written permission signed by a duly authorized officer or employee of the Commonwealth, provided that where the material facts have been disclosed, in writing, by pre-qualification, bid, proposal, or contractual terms, the Commonwealth shall be deemed to have consented by virtue of execution of this contract. c. “Contractor” means the individual or entity that has entered into this contract with the Commonwealth, including those directors, officers, partners, managers, and owners having more than a five percent interest in Contractor. d. “Financial interest” means: 1. Ownership of more than a five percent interest in any business; or 2. Holding a position as an officer, director, trustee, partner, employee, or holding any position of management. e. “Gratuity” means tendering, giving or providing anything of more than nominal monetary value including, but not limited to, cash, travel, entertainment, gifts, meals, lodging, loans, subscriptions, advances, deposits of money, services, employment, or contracts of any kind. The exceptions set forth in the Governor’s Code of Conduct, Executive Order 1980-18, the 4 Pa. Code §7.153(b), shall apply. f. “Immediate family” unemancipated child.
means
a
spouse
and
any
g. “Non-bid basis” means a contract awarded or executed by the Commonwealth with Contractor without seeking bids or proposals from any other potential bidder or offeror. h. “Political contribution” means any payment, gift, subscription, assessment, contract, payment for services, dues, loan, forbearance, advance or deposit of money or any valuable thing, to a candidate for public office or to a political committee, including but not limited to a political action committee, made for the purpose of influencing any election in the Commonwealth of Pennsylvania or for paying debts incurred by or for a candidate or committee before or after any election.
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F.
Liquor Code - The Contractor agrees to the conditions of Appendix I of PLCB RFP 20121016, as incorporated herein by reference.
G.
Americans with Disabilities Act – i. Pursuant to federal regulations promulgated under the authority of The Americans With Disabilities Act, 28 C.F.R. § 35.101 et seq., the Contractor understands and agrees that it shall not cause any individual with a disability to be excluded from participation in this Contract or from activities provided for under this Contract on the basis of the disability. As a condition of accepting this contract, the Contractor agrees to comply with the “General Prohibitions Against Discrimination,” 28 C.F.R. § 35.130, and all other regulations promulgated under Title II of The Americans With Disabilities Act which are applicable to all benefits, services, programs, and activities provided by the Commonwealth/PLCB through contracts with outside contractors. ii. The Contractor shall be responsible for and agrees to indemnify and hold harmless the Commonwealth/PLCB from all losses, damages, expenses, claims, demands, suits, and actions brought by any party against the Commonwealth/PLCB as a result of the Contractor’s failure to comply with the provisions of subparagraph a above.
H.
Contractor Responsibility Provisions - For the purpose of these provisions, the term contractor is defined as any person, including, but not limited to, a bidder, offeror, loan recipient, grantee or lessor, who has furnished or performed or seeks to furnish or perform, goods, supplies, services, leased space, construction or other activity, under a contract, grant, lease, purchase order or reimbursement agreement with the Commonwealth/PLCB. The term contractor includes a permittee, licensee, or any agency, political subdivision, instrumentality, public authority, or other public entity in the Commonwealth. i. The Contractor certifies, in writing, for itself and its subcontractors required to be disclosed or approved by the Commonwealth/PLCB, that as of the date of its execution of this Bid/Contract, that neither the Contractor, nor any such subcontractors, are under suspension or debarment by the Commonwealth or any governmental entity, instrumentality, or authority and, if the Contractor cannot so certify, then it agrees to submit, along with its Bid/Contract, a written explanation of why such certification cannot be made. ii. The Contractor also certifies, in writing, that as of the date of its execution of this Bid/Contract it has no tax liabilities or other Commonwealth obligations, or has filed a timely administrative or judicial appeal if such liabilities or obligations exist, or is subject to a duly approved deferred payment plan if such liabilities exist. 47
iii. The Contractor's obligations pursuant to these provisions are ongoing from and after the effective date of the Contract through the termination date thereof. Accordingly, the Contractor shall have an obligation to inform the Commonwealth/PLCB if, at any time during the term of the Contract, it becomes delinquent in the payment of taxes, or other Commonwealth obligations, or if it or, to the best knowledge of the Contractor, any of its subcontractors are suspended or debarred by the Commonwealth, the federal government, or any other state or governmental entity. Such notification shall be made within 15 days of the date of suspension or debarment. iv. The failure of the Contractor to notify the Commonwealth/PLCB of its suspension or debarment by the Commonwealth, any other state, or the federal government shall constitute an event of default of the Contract with the Commonwealth/PLCB. v. The Contractor agrees to reimburse the Commonwealth/PLCB for the reasonable costs of investigation incurred by the Office of State Inspector General for investigations of the Contractor's compliance with the terms of this or any other agreement between the Contractor and the Commonwealth/PLCB that results in the suspension or debarment of the contractor. Such costs shall include, but shall not be limited to, salaries of investigators, including overtime; travel and lodging expenses; and expert witness and documentary fees. The Contractor shall not be responsible for investigative costs for investigations that do not result in the Contractor's suspension or debarment. vi. The Contractor may obtain a current list of suspended and debarred Commonwealth contractors by either searching the Internet at http://www.dgs.state.pa.us/ or contacting the: Department of General Services Office of Chief Counsel 603 North Office Building Harrisburg, PA 17125 Telephone No: (717) 783-6472 FAX No: (717) 787-9138 I.
Covenant Against Contingent Fees – The Contractor warrants that no person or selling agency has been employed or retained to solicit or secure the Contract upon an agreement or understanding for a commission, percentage, brokerage, or contingent fee, except bona fide employees or bona fide established commercial or selling agencies maintained by the Contractor for the purpose of securing business. For breach or violation of this warranty, the Commonwealth shall have the right to terminate the Contract without liability or in its discretion to deduct 48
from the Contract price or consideration, or otherwise recover the full amount of such commission, percentage, brokerage, or contingent fee. J.
Licenses Required – The final award of this Contract is contingent upon the satisfactory issuance to the Contractor of any appropriate federal, state or local license, or permit legally necessary to operate.
K.
Other Contractors – The Contractor, its servants, agents and employees shall fully cooperate with and not restrict access to other Commonwealth/PLCB contractors and/or employees insomuch as the performance of work of such other contractors and/or Commonwealth/PLCB employees is related to the operation of the PLCB’s business. The Contractor, its servants, agents and employees, shall not commit or permit any act which will interfere with the performance of work by any other Commonwealth/PLCB contractor and/or employees. This subparagraph shall be included in the contracts of all contractors with whom this Contractor will be required to cooperate in the performance of this Contract. The PLCB shall equitably enforce this subparagraph on all contractors to prevent the imposition of unreasonable burden upon any contractor. The Contractor shall be responsible for any costs incurred by the Commonwealth/PLCB or the Commonwealth/PLCB contractors for violations of this subparagraph.
L.
Compliance with Law - The Contractor shall comply with all applicable federal and state laws and regulations and local ordinances in the performance of this Contract. Contractor shall procure, at its expense, all licenses and permits necessary for the fulfillment of this Contract.
M.
Environmental Provisions - In the performance of this Contract, the Contractor shall minimize pollution and shall strictly comply with all applicable environmental laws and regulations.
N.
Post-Consumer Recycled Content - Except as specifically waived by the Department of General Services in writing, any products which are provided to the Commonwealth/PLCB as a part of the performance of this Contract must meet the minimum percentage levels for total recycled content as specified in Exhibits ______ through _______ of this Contract.
O.
Right to Know Law - The Pennsylvania Right-to-Know Law, 65 P.S. §§ 67.1013104, (“RTKL”) applies to this Contract. i. If the PLCB needs the Contractor’s assistance in any matter arising out of the RTKL related to this Contract, it shall notify the Contractor using the legal contact information provided in this Contract. The Contractor, at any time, may designate a different contact for such purpose upon reasonable prior written notice to the PLCB.
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ii. Upon written notification from the PLCB that it requires the Contractor’s assistance in responding to a request under the RTKL for information related to this Contract that may be in the Contractor’s possession, constituting, or alleged to constitute, a public record in accordance with the RTKL (“Requested Information”), the Contractor shall: a. Provide the PLCB, within ten (10) calendar days after receipt of written notification, access to, and copies of, any document or information in the Contractor’s possession arising out of this Contract that the PLCB reasonably believes is Requested Information and may be a public record under the RTKL; and b. Provide such other assistance as the PLCB may reasonably request, in order to comply with the RTKL with respect to this Contract. iii. If the Contractor considers the Requested Information to include a request for a Trade Secret or Confidential Proprietary Information, as those terms are defined by the RTKL, or other information that the Contractor considers exempt from production under the RTKL, the Contractor must notify the PLCB and provide, within seven (7) calendar days of receiving the written notification, a written statement signed by a representative of the Contractor explaining why the requested material is exempt from public disclosure under the RTKL. iv. The PLCB will rely upon the written statement from the Contractor in denying a RTKL request for the Requested Information unless the PLCB determines that the Requested Information is clearly not protected from disclosure under the RTKL. Should the PLCB determine that the Requested Information is clearly not exempt from disclosure, the Contractor shall provide the Requested Information within five (5) business days of receipt of written notification of the PLCB’s determination. v. If the Contractor fails to provide the Requested Information within the time period required by these provisions, the Contractor shall indemnify and hold the PLCB harmless for any damages, penalties, costs, detriment or harm that the PLCB may incur as a result of the Contractor’s failure, including any statutory damages assessed against the PLCB. vi. The PLCB will reimburse the Contractor for any costs associated with complying with these provisions only to the extent allowed under the fee schedule established by the Office of Open Records or as otherwise provided by the RTKL if the fee schedule is inapplicable.
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vii. The Contractor may file a legal challenge to any PLCB decision to release a record to the public with the Office of Open Records, or in the Pennsylvania Courts, however, the Contractor shall indemnify the PLCB for any legal expenses incurred by the PLCB as a result of such a challenge and shall hold the PLCB harmless for any damages, penalties, costs, detriment or harm that the PLCB may incur as a result of the Contractor’s failure, including any statutory damages assessed against the PLCB, regardless of the outcome of such legal challenge. As between the parties, the Contractor agrees to waive all rights or remedies that may be available to it as a result of the PLCB disclosure of Requested Information pursuant to the RTKL. viii. The Contractor’s duties relating to the RTKL are continuing duties that survive the expiration of this Contract and shall continue as long as the Contractor has Requested Information in its possession. P.
Warranty - The Contractor warrants that all items furnished and all services performed by the Contractor, its agents and subcontractors shall be free and clear of any defects in workmanship or materials. Unless otherwise stated in the Contract, all items are warranted for a period of one (1) year following delivery by the Contractor and acceptance by the PLCB. The Contractor shall repair, replace or otherwise correct any problem with the delivered item. When an item is replaced, it shall be replaced with an item of equivalent or superior quality without any additional cost to the PLCB.
Q.
Patent, Copyright, and Trademark Indemnity - The Contractor warrants that it is the sole owner or author of, or has entered into a suitable legal agreement concerning either: a) the design of any product or process provided or used in the performance of the Contract which is covered by a patent, copyright, or trademark registration or other right duly authorized by state or federal law or b) any copyrighted matter in any report document or other material provided to the commonwealth under the contract. i. The Contractor shall defend any suit or proceeding brought against the Commonwealth/PLCB on account of any alleged patent, copyright or trademark infringement in the United States of any of the products provided or used in the performance of the Contract. a. This is upon condition that the Commonwealth/PLCB shall provide prompt notification in writing of such suit or proceeding; full right, authorization and opportunity to conduct the defense thereof; and full information and all reasonable cooperation for the defense of same. b. As principles of governmental or public law are involved, the Commonwealth/PLCB may participate in or choose to
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conduct, in its sole discretion, the defense of any such action. c. If information and assistance are furnished by the Commonwealth/PLCB at the Contractor’s written request, it shall be at the Contractor’s expense, but the responsibility for such expense shall be only that within the Contractor’s written authorization. ii. The Contractor shall indemnify and hold the Commonwealth/PLCB harmless from all damages, costs, and expenses, including attorney’s fees that the Contractor or the Commonwealth/PLCB may pay or incur by reason of any infringement or violation of the rights occurring to any holder of copyright, trademark, or patent interests and rights in any products provided or used in the performance of the Contract. iii. If any of the products provided by the Contractor in such suit or proceeding are held to constitute infringement and the use is enjoined, the Contractor shall, at its own expense and at its option, either procure the right to continue use of such infringement products, replace them with non-infringement equal performance products or modify them so that they are no longer infringing. iv. If the Contractor is unable to do any of the preceding, the Contractor agrees to remove all the equipment or software which are obtained contemporaneously with the infringing product, or, at the option of the Commonwealth/PLCB, only those items of equipment or software which are held to be infringing, and to pay the Commonwealth/PLCB: a. any amounts paid by the Commonwealth/PLCB towards the purchase of the product, less straight line depreciation; b. any license fee paid by the Commonwealth/PLCB for the use of any software, less an amount for the period of usage; and c. the pro rata portion of any maintenance fee representing the time remaining in any period of maintenance paid for. v. The obligations of the Contractor under this paragraph continue without time limit. vi. No costs or expenses shall be incurred for the account of the Contractor without its written consent.
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R.
Ownership Rights – This provision shall govern the ownership of properties, the rules of usage for developed works, copyright ownership, intellectual property rights, source code and escrow items obligations, contractor’s copyright notice obligations and publication rights. i. Ownership of Properties. a. The PLCB shall have unrestricted authority to reproduce, distribute, and use any submitted report, data, or material, and any software or modifications and any associated documentation that is designed or developed and delivered to the PLCB as part of the performance of the Contract. b. All software owned by the Commonwealth/PLCB or its licensors (“Commonwealth Software”) as of the Effective Date, shall be and shall remain the exclusive property of the Commonwealth/PLCB or its licensors, and Contractor shall acquire no rights or interests in the Commonwealth Software or tools or that if its licensors except as described in this paragraph or in another provision set forth in this contract. The Contractor shall not use any Commonwealth Software, Commonwealth tools or software or tools of its licensors for any purpose other than for completion of work to be performed under this Contract. ii. Rules of Usage for Developed Works. a. If Developed Works modify, improve, or enhance application software programs or other materials generally licensed by the Contractor, then such Developed Works shall be the property of the Contractor, and the Contractor hereby grants the PLCB an irrevocable, nonexclusive, worldwide, fully paid-up license (to include source code and relevant documentation) in perpetuity to use, modify, execute, reproduce, display, perform, prepare derivative works from and distribute, within the Commonwealth, of such Developed Works. For purposes of distribution under the license grant created by this paragraph, Commonwealth includes any government agency, department, instrumentality, division, unit or other office that is part of the Commonwealth of Pennsylvania, together with the State System of Higher Education (including its universities), any county, borough, city, municipality, town, township, special purpose district, or other similar type of governmental instrumentality located within the geographical boundaries of the Commonwealth of 53
Pennsylvania. If federal funds are used in the creation of the Developed Works, the Commonwealth also includes any other state government as well as the federal government. b. If Developed Works modify, improve, or enhance application software or other materials not licensed to the PLCB by the Contractor, then such modifications, improvements and enhancements shall be the property of the PLCB or its licensor. To the extent the PLCB owns the software or other materials, it hereby grants to the Contractor an irrevocable, nonexclusive, worldwide, fully paid-up license to use, modify, execute, reproduce, display, perform, prepare derivative works from, and distribute copies of such Developed Works. To the extent the PLCB has a license to the software or other materials, and to the extent that it, in its sole discretion determines it is able to do so, the PLCB will grant to the Contractor an irrevocable, nonexclusive, worldwide, fully paid-up license to use, modify, execute, reproduce, display, perform and distribute copies of such Developed Works. c. If Developed Works have been funded by the PLCB, to any extent, with either PLCB or federal funds, and the Developed Works do not include pre-existing materials generally licensed by the Contractor, then the PLCB shall have all right, title, and interest (including ownership of copyright and trademark) to such Developed Works and the PLCB hereby grants to the Contractor an irrevocable, nonexclusive, worldwide, fully paid-up license to use, modify, execute, reproduce, display, perform, prepare derivative works from, and distribute copies of such Developed Works. The PLCB shall exclusively own all software products first developed under the terms of this Contract by the Contractor, its subcontractors or other third party vendors that are specifically developed for, engineered and integrated into the Developed Works. iii. Copyright Ownership. a. Works Developed as Part of the Scope of Work for the Project, including Developed Works developed by Subcontractors, are the sole and exclusive property of the PLCB and shall be considered “works made for hire” under the United States Copyright Act of 1976, as amended, 17 United States Code. In the event that the Developed Works 54
do not fall within the specifically enumerated works that constitute works made for hire under the United States copyright laws, the Contractor agrees to assign and, upon their authorship or creation, expressly and automatically assigns all copyright interests, proprietary rights, trade secrets, and other right, title, and interest in and to such Developed Works to the PLCB. The Contractor further agrees that it will have its Subcontractors assign, and upon their authorship or creation, expressly and automatically assign all copyright interest, proprietary rights, trade secrets, and other right, title, and interest in and to the Developed Works to the PLCB. The PLCB shall have all rights accorded an owner of copyright under the United States copyright laws including, but not limited to, the exclusive right to reproduce the Developed Works in multiple copies, the right to distribute, copies by sales or other transfers, the right to register all copyrights in its own name as author in the United States and in foreign countries, the right to prepare derivative works based upon the Creative Works and the right to display the Developed Works. The Contractor further agrees that it will include this requirement in any subcontractor or other agreement with third parties who in any way participate in the creation or development of Developed Works. Upon completion or termination of this Contract, all working papers, files and other documentation shall immediately be delivered by the Contractor to the PLCB. The Contractor warrants that the Developed Works are original and do not infringe any copyright, patent, trademark, or other intellectual property right of any third party and are in conformance with the intellectual property laws of the United States. iv. Intellectual Property Rights. a. The Contractor acknowledges the PLCB’s exclusive right, title and interest, including without limitation copyright and trademark rights, in and to PLCB Software, PLCB Tools and the Developed Works developed under the provisions of this paragraph, shall not in any way, at any time, directly or indirectly, do or cause to be done any act or thing contesting or in any way impairing or tending to impair any part of said right, title, and interest, and shall not use or disclose the PLCB Software, PLCB Tools, or the Developed Works without the PLCB’s written consent, which consent may be withheld by the PLCB for any reason. Further, the Contractor shall not in any manner 55
represent that the Contractor has any ownership interest in the PLCB Software, PLCB Tools, or the Developed Works. This provision is a material part of this paragraph. v. Source Code and Escrow Items Obligations. a. Simultaneously with delivery of the Developed Works to the PLCB, the Contractor shall deliver a true, accurate and complete copy of all source codes relating to the Developed Works. To the extent that the Developed Works include application software or other materials generally licensed by the Contractor, then the source code shall be placed in escrow, subject to the terms and conditions of an Escrow Agreement to be executed by the Parties and an Escrow Agent that is acceptable to the PLCB. vi. Contractor’s Copyright Notice Obligations. a. The Contractor will affix the following Copyright Notice to the Developed Works developed under this Contract and all accompanying documentation: “Copyright [year] by the PLCB. All Rights Reserved.” This notice shall appear on all tangible versions of the Developed Works delivered under this Contract and any associated documentation. It shall also be programmed into any and all Developed Works delivered hereunder so that it appears at the beginning of all visual displays of such Developed Works. vii. Publication Rights. a. The Contractor shall not publish any of the results of the work without the written permission of the PLCB. The publication shall include the following statement: “The opinions, findings, and conclusions expressed in this publication are those of the author and not necessarily those of the PLCB.” The Contractor shall not include in the documentation any copyrighted matter, unless the Contractor provides the PLCB with written permission of the copyright owner. S.
Assignment of Antitrust Claims - The Contractor and the PLCB recognize that in actual economic practice, overcharges by the Contractor’s suppliers resulting from violations of state or federal antitrust laws are in fact borne by the PLCB. As part of the consideration for the award of the Contract, and intending to be legally bound, the Contractor assigns to the PLCB all right, title and interest in and to any claims the Contractor now has, or may acquire, under state or federal 56
antitrust laws relating to the products and services which are the subject of this Contract. T.
Officials Not to Benefit - No member of the General Assembly of the Commonwealth of Pennsylvania or any individual employed by the PLCB/Commonwealth on a full-time basis shall be admitted to any share or part of the Contract, or to any benefit that may arise therefrom; but this provision shall not be construed to extend to this Contract if made with a corporation for the corporation’s general benefit.
U.
Taxes - The Commonwealth is exempt from all excise taxes imposed by the Internal Revenue Service and has accordingly registered with the Internal Revenue Service to make tax free purchases under Registration No. 23740001-K. With the exception of purchases of the following items, no exemption certificates are required and none will be issued: undyed diesel fuel, tires, trucks, gas guzzler emergency vehicles, and sports fishing equipment. The Commonwealth is also exempt from Pennsylvania state sales tax, local sales tax, public transportation assistance taxes and fees and vehicle rental tax. The Department of Revenue regulations provide that exemption certificates are not required for sales made to governmental entities and none will be issued. Nothing in this paragraph is meant to exempt a construction contractor from the payment of any of these taxes or fees which are required to be paid with respect to the purchase, use, rental, or lease of tangible personal property or taxable services used or transferred in connection with the performance of a construction contract.
V.
Hazardous Substances - The Contractor shall provide information to the Commonwealth about the identity and hazards of hazardous substances supplied or used by the Contractor in the performance of the Contract. The Contractor must comply with Act 159 of October 5, 1984, known as the “Worker and Community Right to Know Act” (the “Act”) and the regulations promulgated pursuant thereto at 4 Pa. Code § 301.1 et seq. i. Labeling. The Contractor shall insure that each individual product (as well as the carton, container or package in which the product is shipped) of any of the following substances (as defined by the Act and the regulations) supplied by the Contractor is clearly labeled, tagged or marked with the the following information: a. Hazardous Substances: 1. The chemical name or common name, 2. A hazard warning, and 3. The name, address, and telephone number of the manufacturer. 57
b. Hazardous mixtures: 1. The common name, but if none exists, then the trade name, 2. The chemical or common name of special hazardous substances comprising .01% or more of the mixture, 3. The chemical or common name of hazardous substances consisting 1.0% or more of the mixture, 4. A hazard warning, and 5. The name, address, and telephone number of the manufacturer. c. Single chemicals: 1. The chemical name or the common name, 2. A hazard warning, if appropriate, and 3. The name, address, and telephone number of the manufacturer. d. Chemical Mixtures: 1. The common name, but if none exists, then the trade name, 2. A hazard warning, if appropriate, 3. The name, address, and telephone number of the manufacturer, and 4. The chemical name or common name of either the top five substances by volume or those substances consisting of 5.0% or more of the mixture. A common name or trade name may be used only if the use of the name more easily or readily identifies the true nature of the hazardous substance, hazardous mixture, single chemical, or mixture involved. 58
Container labels shall provide a warning as to the specific nature of the hazard arising from the substance in the container. The hazard warning shall be given in conformity with one of the nationally recognized and accepted systems of providing warnings, and hazard warnings shall be consistent with one or more of the recognized systems throughout the workplace. Examples are:
NFPA 704, Identification of the Fire Hazards of Materials
National Paint and Coatings Association: Hazardous Materials Identification System.
American Society for Testing and Materials, Safety Alert Pictorial Chart.
American National Standard Institute, Inc., for the Precautionary Labeling of Hazardous Industrial Chemicals.
Labels must be legible and prominently affixed to and displayed on the product and the carton, container, or package so that employees can easily identify the substance or mixture present therein ii. Material Safety Data Sheet. The contractor shall provide Material Safety Data Sheets (MSDS) with the information required by the Act and the regulations for each hazardous substance or hazardous mixture. The Commonwealth must be provided an appropriate MSDS with the initial shipment and with the first shipment after an MSDS is updated or product changed. For any other chemical, the contractor shall provide an appropriate MSDS, if the manufacturer, importer, or supplier produces or possesses the MSDS. The contractor shall also notify the Commonwealth when a substance or mixture is subject to the provisions of the Act. Material Safety Data Sheets may be attached to the carton, container, or package mailed to the Commonwealth at the time of shipment. 21.
COMMONWEALTH/PLCB HELD HARMLESS – The Contractor shall hold the Commonwealth/PLCB harmless from and indemnify the Commonwealth/PLCB against any and all third party claims, demands and actions based upon or arising out of any activities performed by the Contractor and its employees and agents under this Contract, provided the Commonwealth/PLCB gives Contractor prompt notice of any such claim of which it learns. Pursuant to the Commonwealth Attorneys Act (71 P.S. § 732-101, et seq.), the Office of Attorney General (OAG) has the sole authority to represent the Commonwealth/PLCB in actions brought against the Commonwealth/PLCB. The OAG 59
may, however, in its sole discretion and under such terms as it deems appropriate, delegate its right of defense. If OAG delegates the defense to the Contractor, the Commonwealth/PLCB will cooperate with all reasonable requests of the Contractor made in the defense of such suits. A.
Notwithstanding the above, neither party shall enter into any settlement without the other party’s written consent, which shall not be unreasonably withheld. The Commonwealth/PLCB may, in its sole discretion, allow the Contractor to control the defense and any related settlement negotiations.
22.
DOMESTIC WORKFORCE UTILIZATION - The Contractor agrees to use and maintain the percentage of domestic workforce as set forth in Appendix F of the RFP as completed by the Contractor and as incorporated herein by reference.
23.
PRIME CONTRACTOR RESPONSIBILITIES - The Contractor shall assume responsibility for all services in this Contract, whether it produces or performs them itself or by subcontract. Further, the PLCB shall consider the Contractor to be the sole point of contact with regard to contractual matters.
24.
COMPENSATION/EXPENSES – Unless otherwise provided in this Contract:
25.
A.
The Contractor shall be required to perform at the rate(s) quoted in the Contractor’s Response to Appendix A of the RFP, as incorporated herein by reference. All items shall be performed within the time period(s) specified in the Contract. The Contractor shall be compensated only for items supplied and services performed to the satisfaction of the PLCB. The Contractor shall not be allowed or reimbursed actual travel or per diem expenses.
B.
The Contractor shall send an invoice itemized by to: PLCB - Accounts Payable, Comptroller Operations LCBS, PO Box 12025, Harrisburg, PA 17108-2025 promptly after items and/or services are satisfactorily delivered. The invoice should include only amounts due under the Contract. The Contract number must be included on all invoices.
CONTRACTOR INVOICING/CLAIMS – A.
During Phase 1 - the PLCB will permit requests for three (3) progress payments in order to minimize the impact of out-of-pocket costs incurred before the inception of monthly billing in Phase 2. i. The first of these three (3) payments requests may be made (90) days after the Notice to Proceed, and may be made in succeeding ninety (90) day periods thereafter.
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ii. These payments will reimburse only for upfront costs actually incurred for employee training, site lease payments, and for amortized charges for investments in materials handling equipment and racking. iii. As these early payments will reduce the amount of unrecovered early investment spending, it is anticipated the Contractor’s monthly fixed cost billings will reflect such reduction. iv. It is the intent that the amount of these payments is fixed, as identified in the Contractors response to the RFP, but be contingent upon meeting the defined milestones as laid out in the Contractor’s proposed project plan. v. In the event of Contractor Default during Phase 1, the PLCB shall have the right to recover all of the progress payments made as of the time of the Default, whether by offset, by outright payment, by tender of the performance bond and/or by perfection of a security interest. This recovery will not limit the PLCB’s right to any other remedies allowable by contract or by law or equity. B.
During Phase 2 - The Contractor shall submit an original and one (1) copy of detailed and itemized invoices showing percentage of task(s) completed by deliverable to the PLCB - Accounts Payable, Comptroller Operations LCBS, PO Box 12025, Harrisburg, PA 17108-2025 at the end of each month. The PLCB agrees to process these invoices for payment in a timely manner. The Contractor shall cooperate with the Commonwealth in the upgrade or improvement of any invoicing or claim systems and processes.
C.
The Contractor shall provide detailed invoices to the PLCB for work performed. At a minimum, the following information shall be furnished on all invoices: i. The time period covered; ii. Task(s) completed by the Contractor for each deliverable and approved by the PLCB Project Manager during the billing period, and percentage of the deliverable completed; iii. Amounts invoiced and approved to date for each deliverable, including total days and/or hours worked.
D.
The Contractor agrees that all undisputed claims presented by the PLCB to the Contractor shall be paid within thirty (30) days from the claim date. Failure to make such payments will result in the PLCB deducting the claim amount from monies owed the Contractor. The Contractor agrees that any dispute of a claim presented by the PLCB shall be submitted by the Contractor in writing within thirty (30) days of the claim date to Contract Administrator. Failure to submit timely a dispute to the claim shall be considered the Contractor’s agreement to the 61
propriety of the claim and a waiver of the Contractor’s rights under Paragraph 32, Contract Controversies. If a timely dispute is filed to a claim presented by the PLCB, the Contractor may present evidence to the PLCB in support of its dispute. The PLCB will respond in writing to the Contractor’s dispute within thirty (30) days from the filing date of the Contractor’s dispute. The Contractor must pay the remaining amount of the disputed claim within fifteen (15) days of the PLCB’s written response to the Contractor’s dispute or the PLCB shall deduct the amount of the remaining claim from monies owed the Contractor. The PLCB’s written response to the Contractor’s dispute shall be final, conclusive, binding and nonreviewable in all respects unless the Contractor files a claim in the Commonwealth Board of Claims within thirty (30) days of the date of the PLCB’s written response to the Contractor’s dispute 26.
PAYMENT – A.
The Commonwealth/PLCB shall put forth reasonable efforts to make payment by the required payment date. The required payment date is: (a) the date on which payment is due under the terms of the Contract; (b) thirty (30) days after a proper invoice is actually received at the “Bill To” address if a date on which payment is due is not specified in the Contract (a “proper” invoice is not received until the Commonwealth accepts the service as satisfactorily performed); or (c) the payment date specified on the invoice if later than the dates established by (a) and (b) above. Payment may be delayed if the payment amount on an invoice is not based upon the price(s) as stated in the Contract. If any payment is not made within fifteen (15) days after the required payment date, the Commonwealth/PLCB may pay interest as determined by the Secretary of Budget in accordance with Act No. 266 of 1982 and regulations promulgated pursuant thereto. Payment should not be construed by the Contractor as acceptance of the service performed by the Contractor. The Commonwealth/PLCB reserves the right to conduct further testing and inspection after payment, but within a reasonable time after performance, and to reject the service if such post payment testing or inspection discloses a defect or a failure to meet specifications. The Contractor agrees that the Commonwealth/PLCB may set off the amount of any state tax liability or other obligation of the Contractor or its subsidiaries to the Commonwealth/PLCB against any payments due the Contractor under any contract with the Commonwealth/PLCB.
B.
The Commonwealth will make contract payments through Automated Clearing House (ACH). i. Within 10 days of award of the contract or purchase order, the contractor must submit or must have already submitted their ACH information within their user profile in the Commonwealth’s procurement system (SRM).
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ii. The contractor must submit a unique invoice number with each invoice submitted. The unique invoice number will be listed on the Commonwealth of Pennsylvania’s ACH remittance advice to enable the contractor to properly apply the state agency’s payment to the invoice submitted. iii. It is the responsibility of the contractor to ensure that the ACH information contained in SRM is accurate and complete. Failure to maintain accurate and complete information may result in delays in payments. 27.
DISCHARGE – Notwithstanding any other notice provisions contained in this Contract, if during the term of the Contract, or any additional period or extension thereof, the PLCB is required to discontinue operations through actions taken by the courts, the state or federal government, or by action or inaction of the General Assembly of the Commonwealth of Pennsylvania, or some other cause beyond the control of the PLCB, this Contract shall immediately expire and both parties are discharged from all terms, conditions and covenants in this Contract. However, a final settlement of this Contract is required and shall survive expiration of this Contract.
28.
INSPECTION AND REJECTION - No item(s) received by the Commonwealth shall be deemed accepted until the Commonwealth has had a reasonable opportunity to inspect the item(s). Any item(s) which is discovered to be defective or fails to conform to the specifications may be rejected upon initial inspection or at any later time if the defects contained in the item(s) or the noncompliance with the specifications were not reasonably ascertainable upon the initial inspection. It shall thereupon become the duty of the Contractor to remove rejected item(s) from the premises without expense to the Commonwealth within fifteen (15) days after notification. Rejected item(s) left longer than fifteen (15) days will be regarded as abandoned, and the Commonwealth shall have the right to dispose of them as its own property and shall retain that portion of the proceeds of any sale which represents the Commonwealth’s costs and expenses in regard to the storage and sale of the item(s). Upon notice of rejection, the Contractor shall immediately replace all such rejected item(s) with others conforming to the specifications and which are not defective. If the Contractor fails, neglects or refuses to do so, the Commonwealth shall then have the right to procure a corresponding quantity of such item(s), and deduct from any monies due or that may thereafter become due to the Contractor, the difference between the price stated in the Contract and the cost thereof to the Commonwealth
29.
DEFAULT AND REMEDY – In the event the Contractor defaults on the Contract at any time, the PLCB shall have the right to recover all of the progress payments made as of the time of the default, whether by offset, by outright payment, by tender of the performance bond and/or by perfection of a security interest. This recovery will not limit the PLCB’s right to any other remedies allowable by contract or by law or equity. In addition to other provisions of this Contract, the following provisions shall determine when a default occurs: 63
A.
The occurrence of any one or more of the following events during the Term shall constitute a “Contractor Default” under this Contract: i. If the Contractor fails to pay, or show cause why payment should not be made, within ten (10) days after written notice from the Contracting Officer of any amount due for materials furnished, labor supplied or performed, for equipment rentals or for utility services rendered; ii. If the Contractor fails to begin the Work within ten (10) days following receipt of a Notice to Proceed from the PLCB; iii. If the Contractor abandons or discontinues the Work for a period of thirty (30) consecutive days without prior PLCB approval; iv. If the Contractor fails to comply with, perform or observe: a. the Tasks, Deliverables, Requirements, Terms and/or Conditions of Paragraphs/Subparagraphs 4(C), Deliverable #1 Implementation Plan, at Deliverable #3, and/or at Task #4 Subtasks A, B and C; Paragraph 5(A)(iii) Security; Paragraph 5(D) Systems Technology (each, a “Critical Provision”) and such failure continues unremedied for a period of five (5) days following Warning Notice thereof (giving particulars of the failure in reasonable detail) from the PLCB to the Contractor or for such longer period as may be reasonably necessary to cure such failure, provided that in the latter case, the Contractor has demonstrated to the satisfaction of the PLCB, acting reasonably, that (1) it is proceeding, and will proceed, with all due diligence to cure or cause to be cured such failure, (2) its actions can be reasonably expected to cure or cause to be cured such failure within a reasonable period of time acceptable to the PLCB, acting reasonably and (3) such failure is in fact cured within such period of time; b. the Tasks, Deliverables, Requirements, Terms and/or Conditions of Paragraphs/Subparagraphs 15 Performance Bond; Paragraph 17 Insurance (insofar as it relates to the direct interests of the PLCB); Paragraph 24 Compensation; Paragraph 34 Change of Ownership; Paragraph 38 Other Contractors; and/or Paragraph 40 Audit Provisions/Examination of Records (each, a “Material Provision”) and such failure continues unremedied for a period of ten (10) days following Warning Notice thereof (giving particulars of the failure in reasonable detail) from 64
the PLCB to the Contractor or for such longer period as may be reasonably necessary to cure such failure, provided that in the latter case, the Contractor has demonstrated to the satisfaction of the PLCB, acting reasonably, that (1) it is proceeding, and will proceed, with all due diligence to cure or cause to be cured such failure, (2) its actions can be reasonably expected to cure or cause to be cured such failure within a reasonable period of time acceptable to the PLCB, acting reasonably and (3) such failure is in fact cured within such period of time; c. any obligation, covenant, Contract, term or condition in this Contract (other than those described in Subparagraph 29(A)(iv)(a) or 29(A)(iv)(b) above), or the requirements or directives of a final decision in a matter submitted to dispute resolution in accordance with Paragraph 32 (each, a “Standard Provision”), and such failure continues unremedied for a period of thirty (30) days following Warning Notice thereof (giving particulars of the failure in reasonable detail) from the PLCB to the Contractor or for such longer period as may be reasonably necessary to cure such failure; provided that in the latter case, the Contractor has demonstrated to the satisfaction of the PLCB, acting reasonably, that (1) it is proceeding, and will proceed, with all due diligence to cure or cause to be cured such failure, (2) its actions can be reasonably expected to cure or cause to be cured such failure within a reasonable period of time acceptable to the PLCB, acting reasonably and (3) such failure is in fact cured within such period of time. v. If the Contractor: a. admits, in writing, that it is unable to pay its debts as such become due, b. makes an assignment for the benefit of creditors, or c. files a voluntary petition under Title 11 of the United States Bankruptcy Code, or d. if the Contractor files any petition or answer seeking, consenting to or acquiescing in any reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar relief under the present or any future United States Bankruptcy Code or any other present or future applicable Law, or 65
e. seeks or consents to or acquiesces in or suffers the appointment of any trustee, receiver, custodian, assignee, sequestrator, liquidator or other similar official of the Contractor, or of all or any substantial part of its properties. vi. Notwithstanding anything contained in this Contract to the contrary, in the event the PLCB fails to make payments of undisputed amounts invoiced hereunder within the period specified by Paragraph 26, the Contractor may suspend all Work by giving the PLCB ninety (90) days’ notice of nonpayment and its intention to suspend Work and failure of the PLCB to cure such failure prior to the expiration of the ninety (90) days. Such suspension under this paragraph may continue until such failure has been remedied, will not be considered a “Contractor Default” hereunder and will not give rise to any PLCB remedies set forth herein, including any right to collect on the performance bond. B.
PLCB Remedies upon Contractor Default - Except as otherwise provided, upon the occurrence of a Contractor Default, the PLCB, by notice to the Contractor, may do any or all of the following as the PLCB, in its discretion, shall determine: i. The PLCB may collect on the performance bond to the extent of all damages related to Contractor’s Default, including but not limited to consequential damages, fees, costs and expenses including those associated with obtaining services for another contractor to complete the services, up to and including legal fees and costs associated with obtaining a replacement contract if Contractor’s Default is sufficiently significant to also require Contract termination. All attorneys’ fees and costs associated with litigating issues of Contractor’s Default are also to be covered by the Contractor’s performance bond as set forth in the RFP. ii. Notwithstanding anything contained in this Contract to the contrary, and without regard to any curative time periods that may be provided for in this Contract (other than the period provided in subparagraph 29(A)(iv)) upon the occurrence of (a) a Contractor Default of a Critical Provision; or (b) any occurrences of Contractor Default of Material Provisions which, in the aggregate cause PLCB to believe, in its sole discretion, that Contractor may not be able to perform its obligations under this Contract, then PLCB shall have the right, upon twenty-four (24) hours’ notice to Contractor, to perform, or make arrangements for a third party to perform, any or all of Contractor’s obligations under this Contract. iii. If PLCB exercises its rights under subparagraph (ii), the Contractor shall make available to PLCB or its designee such documents, records, equipment and/or facilities as PLCB or its designee shall request. Contractor shall allow as many personnel as practicable to remain on the 66
job to help PLCB or its designee maintain the continuity and consistency of services and other obligations required of Contractor under the Contract. The Contractor shall also disclose necessary personnel records, to the extent allowable by applicable law, and allow PLCB or its designee to conduct on-site interviews with these employees. iv. Contractor agrees and acknowledges that the interruption, decrease or delay in the supply and delivery of Merchandise would cause irreparable injury to the PLCB which would not adequately be compensated with money damages and accordingly, the PLCB and/or its designee shall be entitled to immediate injunctive relief when enforcing the provisions of this Paragraph 29(B) and Contractor agrees not to contest or challenge any such request for injunctive relief, although the Contractor agrees and acknowledges that an injunctive order is not required before the PLCB can perform the responsibilities of the Contractor under this Contract. v. The provisions of Paragraph 29(B) shall not, in any way, reduce, eliminate or otherwise affect any other rights or remedies that PLBC may have under this Contract and the PLCB’s actions pursuant to this paragraph do not release the Contractor from its obligations under the Contract and do not alter PLCB’s rights with respect to the performance bond as set forth in Paragraph 17. vi. The PLCB may terminate this Contract (without the need for reentry or any other action on behalf of the PLCB) by giving fourteen (14) days’ prior notice to the Contractor upon the occurrence of a Contractor Default under paragraph 29(A)(iv)(b) [a “Material Provision”] and paragraph 29(A)(iv)(c) [a “Standard Provision”]; provided, however, that the Contractor shall be entitled to cure a Contractor Default under paragraph 29(A)(iv)(b) [a “Material Provision”] and 29(A)(iv)(c) [a “Standard Provision”] by correcting the non-compliance or Default to the written approval of the PLCB and in accordance with this Contract within those fourteen (14) days, unless an extension of time is otherwise agreed in writing by the PLCB and Contractor prior to the expiration of the fourteen (14) days; vii. If the Contractor Default is pursuant to subparagraphs 29(A)(i), 29(A)(ii), 29(A)(iii) or 29(iv)(a), the PLCB may terminate this Contract (without the need for any other action on behalf of the PLCB) by giving five (5) days’ prior notice to the Contractor, in which case the Contractor shall be entitled to cure the Contractor Default within such five (5) day period; viii. If the Contractor Default is a failure to pay any monies to a Person other than the PLCB, the PLCB may (without any obligation to do so) make payment of such monies on behalf of the Contractor, and any amount so
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paid by the PLCB will be payable by the Contractor to the PLCB within five (5) Business Days after demand therefor. ix. The PLCB may cure the Contractor Default (but doing so will not obligate the PLCB to cure or attempt to cure a Contractor Default or, after having commenced to cure or attempted to cure a Contractor Default, to continue to do so), and the PLCB’s costs and expenses reasonably incurred by the PLCB in curing or attempting to cure the Contractor Default will be payable by the Contractor to the PLCB within five (5) Business Days of demand. x. The PLCB will not incur any liability to the Contractor for any act or omission of the PLCB or any other Person in the course of remedying or attempting to remedy any Contractor Default, and the PLCB’s cure of any Contractor Default will not affect the PLCB’s rights against the Contractor by reason of the Contractor Default. C.
If the Contractor fails to comply with or timely observe or perform or cause to be timely observed or performed any obligation, covenant, contract, term or condition in this Contract, the PLCB shall, without prejudice to any other right or remedy available to the PLCB, deliver a Warning Notice to the Contractor by both e-mail and overnight delivery service (e.g., Federal Express) notwithstanding anything to the contrary contained in paragraph 47. Such Warning Notice shall: i. state that it is a “Warning Notice;” ii. state in reasonable detail the obligation, covenant, Contract, term or condition giving rise to the Warning Notice; iii. provide for a time period to remedy such failure. This time period shall conform to the time periods outlined in subparagraph 29(A)(iv) above; and iv. state that if such failure continues unremedied after the time period provided, then the non-material failure shall become a Contractor Default set forth in subparagraph 29(A)(iv).
30.
NOTICE OF DELAYS – Whenever the Contractor encounters any difficulty that delays or threatens to delay the timely performance of this Contract (including actual or potential labor disputes), the Contractor shall immediately give notice thereof in writing to the PLCB stating all relevant information with respect thereto. Such notice shall not in any way constitute a basis for an extension of the delivery schedule or be construed as a waiver by the PLCB of any rights or remedies to which it is entitled by law or pursuant to provisions of this Contract. Failure to give such notice, however, may be grounds for denial of any request for an extension of the delivery schedule because of such delay. If an extension of the delivery schedule is granted, it will be done consistent with Paragraph 68
9, Project Change Control Procedures. Evidence of inability or intentional delays shall be cause for Contract cancellation and Contractor suspension. 31.
FORCE MAJEURE - Neither party will incur any liability to the other if its performance of any obligation under this Contract is prevented or delayed by causes beyond its control and without the fault or negligence of either party. Causes beyond a party’s control may include, but are not limited to, acts of God or war, changes in controlling law, regulations, orders or the requirements of any governmental entity, severe weather conditions, civil disorders, natural disasters, fire, epidemics and quarantines, general strikes throughout the trade that are outside the control of the Contractor, and freight embargoes. A.
The Contractor shall notify the Commonwealth/PLCB orally within five (5) days and in writing within ten (10) days of the date on which the Contractor becomes aware, or should have reasonably become aware, that such cause would prevent or delay its performance. Such notification shall: i. describe fully such cause(s) and its effect on performance, ii. state whether performance under the contract is prevented or delayed, and iii. if performance is delayed, state a reasonable estimate of the duration of the delay.
B.
The Contractor shall have the burden of proving that such cause(s) delayed or prevented its performance despite its diligent efforts to perform and shall produce such supporting documentation as the Commonwealth may reasonably request.
C.
After receipt of such notification, the Commonwealth may elect to cancel the Contract, cancel the Purchase Order, or to extend the time for performance as reasonably necessary to compensate for the Contractor’s delay.
D.
In the event of a declared emergency by competent governmental authorities, the Commonwealth/PLCB by notice to the Contractor, may suspend all or a portion of the Contract or Purchase Order.
E.
The Contractor has an affirmative obligation to maintain an operational workforce and to undertake any mitigation and/or remediation in the event of labor strikes, walk-outs and/or other personnel shortages. Except with specific agreement of the PLCB, these situations shall not constitute force majeure events under this Contract.
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32.
CONTRACT CONTROVERSIES - In the event of a controversy or claim arising from the Contract: A.
The Contractor must, within six (6) months after the cause of action accrues, file a written claim with the contracting officer for a determination. The claim shall state all grounds upon which the Contractor asserts a controversy exists.
B.
If the Contractor fails to file a claim or files an untimely claim, the Contractor is deemed to have waived its right to assert a claim in any forum.
C.
At the time the claim is filed, or within sixty (60) days thereafter, either party may request mediation. i. If the Contractor or the Contracting Officer requests mediation and the other party agrees, the contracting officer shall promptly make arrangements for mediation. Mediation shall be scheduled so as to not delay the issuance of the final determination beyond the required one hundred twenty (120) days after receipt of the claim if mediation is unsuccessful. ii. If mediation is not agreed to or if resolution is not reached through mediation, the contracting officer shall review timely-filed claims and issue a final determination, in writing, regarding the claim.
D.
The final determination shall be issued within one hundred twenty (120) days of the receipt of the claim, unless extended by consent of the contracting officer and the Contractor. The contracting officer shall send his/her written determination to the Contractor.
E.
If the contracting officer fails to issue a final determination within the one hundred twenty (120) days (unless extended by consent of the parties), the claim shall be deemed denied.
F.
The contracting officer's determination shall be the final order of the purchasing agency.
G.
Within fifteen (15) days of the mailing date of the determination denying a claim or within one hundred thirty-five (135) days of filing a claim if, no extension is agreed to by the parties, whichever occurs first, the Contractor may file a statement of claim with the Commonwealth Board of Claims.
H.
Pending a final judicial resolution of a controversy or claim, the Contractor shall proceed diligently with the performance of the Contract in a manner consistent with the determination of the contracting officer and the Commonwealth/PLCB shall compensate the Contractor pursuant to the terms of the Contract.
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33.
TERMINATION PROVISIONS - In addition to termination rights elsewhere provided herein, this Contract may be terminated as follows: A.
Termination for Convenience. i. The PLCB may terminate this Contract without cause by giving the Contractor thirty (30) calendar days prior written notice (Notice of Termination) whenever the PLCB shall determine that such termination is in the best interest of the PLCB (Termination for Convenience). Any such termination shall be effected by delivery to the Contractor of a Notice of Termination specifying the extent to which performance under this Contract is terminated either in whole or in part and the date on which such termination becomes effective. ii. In the event that the PLCB should terminate this Contract for Convenience, the Contractor shall be compensated in the following manner: a. The PLCB shall compensate the Contractor for specific expenditures on unamortized capital investment that is deemed by the PLCB as unique to the needs of the PLCB; b. The PLCB shall compensate the Contractor for specific expenditures on unamortized leasehold improvements that are deemed by the PLCB as unique to the needs of the PLCB; c. The PLCB shall compensate the Contractor for the removal of its warehousing business (such as building lease payments, equipment lease payments and unamortized software license fees) for a reasonable and limited period of time, based on existing market conditions and to allow the Contractor to find alternative customers for its services within a reasonable period of time. 1. In no case will the reasonable and limited period of time provided for in this paragraph exceed eighteen (18) months. 2. The Contractor agrees to take all reasonable steps to mitigate the costs, including the sale or lease/sublease of equipment and assets to third parties. If equipment is transferred it shall be done based on terms that are not detrimental to the PLCB.
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d. The PLCB shall return the Performance Bond. B.
Non-Appropriation - Any payment obligation or portion thereof of the PLCB created by this Contract is conditioned upon the availability and appropriation of funds. When funds (state or federal) are not appropriated or otherwise made available to support continuation of performance in a subsequent fiscal year period, the PLCB shall have the right to terminate the Contract. The Contractor shall be reimbursed in the same manner as that described in this paragraph related to Termination for Convenience to the extent that appropriated funds are available.
C.
Termination for Cause. i. Subject to Paragraph 42, Limitation of Liability of this Contract, in the event the PLCB terminates this Contract in whole or in part as a result of a Contractor Default, the PLCB may procure services similar to those so terminated, and the Contractor, in addition to liability for any liquidated damages, shall be liable to the PLCB, as the PLCB’s sole and exclusive remedy for such default, for the difference between the Contract price for the terminated portion of the services and the actual and reasonable cost (but in no event greater than the fair market value) of producing substitute equivalent services for the terminated services, provided that the Contractor shall continue the performance of this Contract to the extent not terminated under the provisions of this paragraph. ii. Except with respect to defaults of Subcontractors, the Contractor shall not be liable for any excess costs if the failure to perform the Contract arises out of causes beyond the control of the Contractor. Such causes may include, but are not limited to, acts of God or of the public enemy, fires, floods, epidemics, quarantine restrictions, freight embargoes, acts of terrorism, and unusually severe weather. The Contractor shall notify the Contracting Officer immediately in writing of its inability to perform because of a cause beyond the control of the Contractor. iii. Nothing in this subparagraph 33(C) shall abridge the PLCB’s right to suspend, debar, or take other administrative action against the Contractor. iv. If it is later determined that the PLCB erred in terminating the Contract for default, then the Contract shall be deemed to have been terminated for convenience under subparagraph 33(A). v. If this Contract is terminated as provided by this subparagraph 36(C), the PLCB may, in addition to any other rights provided in this subparagraph 33(C), and subject to Paragraph 20(R), Ownership Rights of this Contract, require the Contractor to deliver to the PLCB in the manner and to the extent directed by the Contracting Officer, such reports and other 72
documentation as the Contractor has specifically produced or specifically acquired for the performance of such part of the Contract as has been terminated. Payment for such reports and documentation will be made consistent with the Contract. 34.
CHANGE OF OWNERSHIP - In the event that the Contractor should change ownership for any reason whatsoever, the PLCB shall have the exclusive option of continuing under the terms and conditions of this Contract with the Contractor or its successors or assigns for the full remaining term of this Contract, or continuing under the terms and conditions of this Contract with the Contractor or its successors or assigns for such period of time as is necessary to replace the products, materials, reports, studies, or computer programs, or immediately terminating this Contract. Nothing in this paragraph limits the PLCB’s exercise of any rights that the PLCB may have under Paragraph 33, Termination Provisions.
35.
INSOLVENCY - In addition to any other provisions of this Contract, regardless of any order of court, and not by way of limitation, if at any time during the term of this Contract, pursuant to any statute either of the United States or of any state, bankruptcy proceedings, voluntary or involuntary, and including Chapter XI - Reorganization of the Federal Bankruptcy Act; appointment of a receiver of all or a portion of the Contractor's property; or if the Contractor makes an assignment for the benefit of the creditors; or the Contractor assigns the Contract voluntarily or involuntarily by judicial sale or otherwise; and the same are not withdrawn, settled or disposed within thirty (30) days of filing, appointment or assignment, this Contract, at the option of the PLCB, exercised within a reasonable period of time of notice of the happening of any one (1) or more such events, may be cancelled and terminated and the Contractor shall be in default of the terms of this Contract. This provision shall in no way limit any other rights of the PLCB in the event of the Contractor's default of any other terms of this Contract.
36.
INDEPENDENT CONTRACTOR - In performing its obligations under the Contract, the Contractor and any agents and employees of the Contractor will act as an independent contractor and not as an officer, employee or agent of the Commonwealth/PLCB. Nor shall Contractor and any agents and employees of the Contractor, for any purpose, be deemed or considered officers, employees or agents of the Commonwealth/PLCB
37.
ASSIGNABILITY AND SUBCONTRACTING – A.
Subject to the terms and conditions of this paragraph, this Contract shall be binding upon the parties and their respective successors and assigns.
B.
The Contractor shall not subcontract with any person or entity to perform all or any part of the work to be performed under this Contract without the prior written consent of the Contracting Officer, which consent maybe withheld at the sole and absolute discretion of the Contracting Officer.
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C.
The Contractor may not assign, in whole or in part, this Contract or its rights, duties, obligations, or responsibilities hereunder without the prior written consent of the Contracting Officer, which consent may be withheld at the sole and absolute discretion of the Contracting Officer.
D.
Notwithstanding the foregoing, the Contractor may, without the consent of the Contracting Officer, assign its rights to payment to be received under the Contract, provided that the Contractor provides written notice of such assignment to the Contracting Officer together with a written acknowledgement from the assignee that any such payments are subject to all of the terms and conditions of this Contract.
E.
For the purposes of this Contract, the term “assign” shall include, but shall not be limited to, the sale, gift, assignment, pledge, or other transfer of any ownership interest in the Contractor provided, however, that the term shall not apply to the sale or other transfer of stock of a publicly traded company.
F.
Any assignment consented to by the Contracting Officer shall be evidenced by a written assignment agreement executed by the Contractor and its assignee in which the assignee agrees to be legally bound by all of the terms and conditions of the Contract and to assume the duties, obligations, and responsibilities being assigned.
G.
A change of name by the Contractor, following which the Contractor’s federal identification number remains unchanged, shall not be considered to be an assignment hereunder. The Contractor shall give the Contracting Officer written notice of any such change of name.
38.
OTHER CONTRACTORS - The PLCB may undertake or award other contracts for additional or related work, and the Contractor shall fully cooperate with other contractors and Commonwealth/PLCB employees, and coordinate its work with such additional work as may be required. The Contractor shall not commit or permit any act that will interfere with the performance of work by any other contractor or by Commonwealth/PLCB employees. This paragraph shall be included in the Contracts of all contractors with which this Contractor will be required to cooperate. The PLCB shall equitably enforce this paragraph as to all contractors to prevent the imposition of unreasonable burdens on any contractor.
39.
DOCUMENTATION - The Contractor shall provide documentation as required by the PLCB or the RFP, as incorporated herein by reference.
40.
AUDIT PROVISIONS/EXAMINATION OF RECORDS - The PLCB shall have the right, at reasonable times and at a site designated by the PLCB, to audit the books, documents and records of the Contractor to the extent that the books, documents and records relate to costs or pricing data for the Contract. The Contractor agrees to maintain, using its standard procedures, and in accordance with Generally Accepted 74
Accounting Principles (“GAAP”), books, records, documents and other evidence pertaining to the conduct of the contracted services to the extent and in such detail as will properly reflect all charges for which reimbursement is claimed under the provisions of this Contract. A.
The Contractor agrees to make available at the office of the Contractor at all reasonable times, and upon reasonable written notice, during the term of this Contract and the period set forth in Subparagraph 40(B) below, any of those records pertinent to the physical performance of the contracted services, for inspection, audit or reproduction by any authorized representative of the Commonwealth. To the extent allowed by law, the Commonwealth agrees to maintain any documents so provided in accordance with the confidentiality provisions in Paragraph 44, Confidentiality.
B.
The Contractor shall preserve and make available its records for a period of three (3) years from the date of final payment under this Contract: i. If this Contract is completely or partially terminated, the records relating to the work terminated shall be preserved and made available for a period of three (3) years from the date of any resulting final settlement. ii. Non-privileged records which relate to litigation or the settlement of claims arising out of the performance of this Contract, or charges under this Contract as to which exception has been taken by the auditors, shall be retained by the Contractor until such litigation, claims, or exceptions have been finally resolved.
41.
SINGLE AUDIT ACT OF 1984 - In compliance with the Single Audit Act of 1984, the Contractor agrees to the following: A.
This Contract is subject to audit by federal and state agencies or their authorized representative in accordance with the auditing standards promulgated by the Comptroller General of the United States and specified in Government Auditing Standards, 1994 Revisions (Yellow Book).
B.
The audit requirement of this Contract will be satisfied if a single audit is performed under the provisions of the Single Audit Act of 1984, 31 U.S.C. § 7501, et seq., and all rules and regulations promulgated pursuant to the Act.
C.
The Commonwealth reserves the right for federal and state agencies or their authorized representatives to perform additional audits of a financial/compliance, economy/efficiency, or program results nature, if deemed necessary.
D.
The Contractor further agrees to comply with requirements that may be issued by the state agency upon receipt of additional guidance received from the federal government regarding the Single Audit Act of 1984. 75
42.
LIMITATION OF LIABILITY – A.
Except to the extent that the required Contractor insurance coverage under Paragraph 17, Insurance exceeds the Contract value, the Contractor’s liability to the PLCB under this Contract shall be limited to the value of this Contract. This limitation will apply, except as otherwise stated in this paragraph, regardless of the form of action, whether in contract or in tort, including negligence. This limitation does not, however, apply to damages for: i. Bodily injury; ii. Death; iii. Intentional injury; iv. Damage to real property or tangible personal property for which the Contractor is legally liable; or v. The Contractor’s indemnity of the PLCB for patent, copyright, trade secret, or trademark protection.
B.
43.
In no event will the Contractor be liable for lost profits, lost revenue or lost savings. Except as set out in Paragraph 18, Virus; Malicious, Mischievous or Destructive Programming, the Contractor will not be liable for damages due to lost records or data, unless otherwise specified in this Contract. Notwithstanding the foregoing, the Contractor shall provide reasonable assistance to the PLCB in restoring such lost records or data to their most recent backup copy.
RESPONSIBILITY FOR PROPERTY DAMAGE – A.
The Contractor is responsible for damage, loss, breakage, shortage, burglary or theft of the PLCB’s equipment or other Commonwealth property when in the Contractor’s custody.
B.
The Contractor shall be responsible for any and all damage to PLCB premises and/or property or third party property caused by the Contractor while performing under this Contract.
C.
The PLCB reserves the sole right to determine liability under this paragraph. Should a loss be incurred under this paragraph such loss may be charged against any monies due the Contractor from the PLCB. The terms and conditions of Paragraph 17, Insurance, and Paragraph 25, Contractor Invoicing/Claims, are applicable.
76
D.
44.
45.
Until Acceptance of equipment, risk of loss or damage shall remain with the Contractor. The Contractor shall be responsible for filing, processing, and collecting all damage claims.
CONFIDENTIALITY - The PLCB deems its documents, data, records and other information provided to the Contractor under this Contract as “Confidential Information.” A.
The Contractor agrees not to disclose to any third party individual or organization the Confidential Information of the PLCB unless disclosure of such information is approved in writing by the PLCB or to the extent necessary for the Contractor to perform its obligations or exercise its rights under this Contract or is directed by a court or other tribunal of competent jurisdiction.
B.
The Contractor's use of such Confidential Information shall be limited to use for its internal business purposes and such information shall not be disclosed to third parties without the PLCB’s written approval.
C.
The Contractor shall protect the confidentiality of the Confidential Information of the PLCB in the same manner that it protects the confidentiality of its own proprietary and confidential information of like kind, which shall be at least a commercially reasonable manner.
D.
Nothing in this Contract shall prohibit or limit the Contractor's use of information (including, but not limited to, ideas, concepts, know-how, techniques and methodologies) (i) previously known to it without an obligation of confidence, (ii) independently developed by or for it, (iii) acquired by it from a third party which is not, to its knowledge, under an obligation of confidence with respect to such information, or (iv) which is or becomes publicly available through no breach of this Contract.
INTEGRATION – A.
The Contract, including all referenced documents (including RFP 20121016) and any Purchase Order, constitutes the entire agreement between the parties. No agent, representative, employee or officer of either the PLCB or the Contractor has authority to make, or has made, any statement, agreement or representation, oral or written, in connection with the Contract, which in any way can be deemed to modify, add to or detract from, or otherwise change or alter its terms and conditions. No negotiations between the parties, nor any custom or usage, shall be permitted to modify or contradict any of the terms and conditions of the Contract. No modifications, alterations, changes, or waiver to the Contract or any of its terms shall be valid or binding unless accomplished by a written amendment signed by both parties. All such amendments will be made using the appropriate Commonwealth form.
77
B.
It is expressly understood that any practice between the Contractor and the PLCB that may deviate from the terms and conditions hereof, whether a single incident or arising out of a course of dealing, shall not be construed as a modification to this Contract, as prevailing over the terms and conditions hereof, or as a waiver of any provisions or terms contained herein.
C.
All headings in this Contract are for reference only and shall not be deemed as part of this Contract.
D.
If any conflicts or discrepancies should arise in the terms and conditions of this Contract, or the interpretation thereof, the order of precedence for resolution shall be: i. This Contract. ii. Any attachments, riders or amendments to this Contract. iii. Any change orders prepared pursuant to this Contract. iv. The RFP. v. The Contractor’s Response to the RFP.
46.
APPLICABLE LAW - This Contract shall be governed by and interpreted and enforced in accordance with the laws of the Commonwealth of Pennsylvania (without regard to any conflict of laws provisions) and the decisions of the Pennsylvania courts. The Contractor explicitly consents to the jurisdiction of any court of the Commonwealth of Pennsylvania and any federal courts in Pennsylvania, waiving any claim or defense that such forum is not convenient or proper. The Contractor agrees that any such court shall have in personam jurisdiction over it, and consents to service of process in any manner authorized by Pennsylvania law.
47.
NOTICES - The parties agree that all legal notices pursuant to this Contract shall be sufficient if in writing and mailed certified United States mail, Return Receipt Requested, and all other communications shall be sufficient if in writing, and mailed prepaid first class United States mail, to the following addresses of the parties or such other addresses as may be designated from time-to-time by the parties in writing: A.
As to the PLCB: Faith S. Diehl Chief Counsel Pennsylvania Liquor Control Board 401 Northwest Office Building Harrisburg, Pennsylvania 17124
B.
As to the Contractor: 78
48.
CHANGE IN FUNCTIONS OF THE PLCB - In the event that any law is enacted which would eliminate the PLCB’s authority to operate warehouse(s) for the servicing of the wine and spirits stores, the Contractor shall be compensated in the same manner as that described in Paragraph 33 related to Termination for Convenience.
49.
SURVIVAL - Following termination of this Contract, through the passage of time or by means of an event of Termination as defined herein, the Parties agree that provisions relating to indemnification, obligation to pay, confidentiality, and any other provision which, in accordance with its terms or by operation of law is intended to survive the Contract, shall so survive termination hereof.
79
IN WITNESS WHEREOF, the PARTIES to this Contract have executed it through their respective duly authorized officers. This Contract shall not be fully executed and will not be binding on the PARTIES unless and until all signatures required below are affixed hereto and have been fully executed by the PLCB/Commonwealth and all approvals required by Commonwealth contracting procedures have been obtained.
CONTRACTOR
PENNSYLVANIA BOARD
LIQUOR
CONTROL
BY: _____________________________
BY: ____________________________
NAME: __________________________
NAME: ____________________________
TITLE: __________________________
TITLE: ____________________________
FED ID NO: ______________________
APPROVED FOR FORM AND LEGALITY
_________________________________ OFFICE OF ATTORNEY GENERAL
_________________________________ OFFICE OF CHIEF COUNSEL (PLCB)
Approved as to Fiscal Responsibility, Budgetary Appropriateness and availability of funds in the amount of $____________
_________________________________ COMPTROLLER
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APPENDIX I LIQUOR CODE SECTION, LAWS OF PENNSYLVANIA
LIQUOR CODE SECTION, LAWS OF PENNSYLVANIA The Contractor shall comply with Liquor Code Sections 210 and 214 [47 P.S. §§ 2-210, 2214], which provide as follows: Section 2-210. Restrictions on members of the board and certain employees of Commonwealth (a) A member or employee of the board or enforcement bureau or a member of the immediate family of a member or employee of the board or enforcement bureau shall not be directly or indirectly interested or engaged in any other business or undertaking within the Commonwealth dealing in liquor, alcohol, or malt or brewed beverages, whether as owner, part owner, partner, member of syndicate, holder of stock exceeding five percent (5%) of the equity at fair market value of the business, independent contractor or manager of a licensed establishment required under 40 Pa. Code §5.23 (relating to appointment of managers), and whether for his own benefit or in a fiduciary capacity for some other person. For the purpose of this subsection only, "employee of the board or Enforcement Bureau" shall mean any individual employed by the board or Enforcement Bureau who is responsible for taking or recommending official action of a non-ministerial nature with regard to: (1)
Contracting or procurement;
(2)
Administering or monitoring grants or subsidies;
(3)
Planning or zoning;
(4)
Inspecting, licensing, regulating or auditing any person; or
(5)
Any other activity where the official action has an economic impact of greater than a de minimis nature on the interests of any person.
(b)
No member or employee of the board or enforcement bureau or a member of the immediate family of a member or employee of the board or enforcement bureau nor any employee of the Commonwealth shall solicit or receive, directly or indirectly, any commission, remuneration or gift whatsoever, from any person having sold, selling or offering liquor or alcohol for sale to the board for use in Pennsylvania Liquor Stores.
(c)
No person convicted of an infamous crime may be employed as a member or employee by the board or enforcement bureau.
(d)
No member or employee of the board or enforcement bureau may use his position with the board or enforcement bureau, or any confidential information received through his position with the board or enforcement bureau, to obtain financial gain,
Appendix B, Page 1 of 4
other than compensation provided by law, for himself, a member of his immediate family or a business with which he is associated. (e)
No person may offer or give to a member or employee of the board or enforcement bureau or a member of his immediate family or a business with which he is associated, and no member or employee of the board or enforcement bureau may solicit or accept anything of value, including a gift, loan, political contribution, reward or promise of future employment, based on an understanding that the vote, official action or judgment of the member or employee of the board or enforcement bureau would be influenced thereby.
(f)
No member or employee of the board or enforcement bureau or a member of his immediate family or any business in which the member or employee or a member of his immediate family is a director, officer or owner or holder of stock exceeding five percent (5%) of the equity at fair market value of the business may enter into any contract valued at five hundred dollars ($500.00) or more to provide goods or services to the board or enforcement bureau unless the contract has been awarded to the lowest responsible bidder through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded.
(g)
No former member or employee of the board or enforcement bureau may represent a person, with or without compensation, on any matter before the board or enforcement bureau for one year after leaving the board or enforcement bureau.
(h)
No member or employee of the board or enforcement bureau or an advisor or consultant thereto having recommended to the board or enforcement bureau either the making of a contract or a course of action of which the making of a contract is an express or implied part, may, at any time thereafter, have an adverse interest in that contract.
(i)
No member or employee of the board or enforcement bureau may influence or attempt to influence the making of, or supervise or deal with, a contract with the board or enforcement bureau in which he has an adverse interest.
(j)
No member or employee of the board or enforcement bureau may have an adverse interest in a contract with the board or enforcement bureau.
(k)
No person having an adverse interest in a contract with the board or enforcement bureau may become an employee of the board or enforcement bureau until the adverse interest has been wholly divested.
(l)
No member or employee of the board or enforcement bureau, except in the performance of his duties as such employee, may, for remuneration, directly or indirectly, represent a person upon a matter pending before the board or enforcement bureau.
Appendix B, Page 2 of 4
(m) (1)
Any person who violates the provisions of this section shall have his employment by the board or enforcement bureau immediately terminated by the appropriate person having the power to terminate and shall be liable to the board or enforcement bureau to reimburse the board or enforcement bureau for all compensation received by him from the board or enforcement bureau while employed in violation of subsection (c).
(2)
Any person who violates the provisions of subsections (b), (d) or (e) shall be guilty of a felony and, upon conviction thereof, shall be sentenced to pay a fine of not more than ten thousand dollars ($10,000.00) or to undergo imprisonment for not more than five (5) years, or both.
(3)
Any person who violates the provisions of subsections (a) or (f) through (l) shall be guilty of a misdemeanor and, upon conviction thereof, shall be sentenced to pay a fine of not more than one thousand dollars ($1,000.00) or to undergo imprisonment for not more than one (1) year, or both.
(4)
Any person who obtains financial gain from violating any provisions of this section, in addition to any other penalty provided by law, shall pay into the accounts of the board a sum of money equal to three (3) times the financial gain resulting from the violation.
(5)
Any person who violates the provisions of this section shall be barred for a period of five (5) years from engaging in any business or contract with the board or enforcement bureau.
(6)
The penalties and sanctions provided by this subsection shall supersede any similar penalties and sanctions provided by the act of July 19, 1957 (P.L. 1017, No. 451), known as the "State Adverse Interest Act” and the act of October 4, 1978 (P.L. 883, No. 170), referred to as the Public Official and Employee Ethics Law.
(n)
As used in this section, the following words and phrases shall have given to them in this subsection:
the meanings
"Business" shall mean a corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self-employed individual, holding company, joint-stock company, receivership, trust or legal entity organized for profit or as a not-for-profit corporation or organization. "Immediate family" shall mean a spouse residing in the person's household and minor dependent children. "Infamous Crime" shall mean a violation and conviction for an offense which would disqualify an individual from holding public office pursuant to section 6 of Article II of the Constitution of Pennsylvania; a conviction within the preceding ten (10) years for a violation of this section or of 18 Pa.C.S. § 4113 (relating to misapplication of entrusted property and property of government or financial institutions), Ch. 47 Appendix B, Page 3 of 4
(relating to bribery and corrupt influence), Ch. 49 (relating to falsification and intimidation), Ch. 51 (relating to obstructing governmental operations) or Ch. 53 (relating to abuse of office); or a violation of the laws of this Commonwealth or another state or the Federal Government for which an individual has been convicted within the preceding ten (10) years and which is classified as a felony. Section 2-214. Prohibitions (a)
The board may not make a contract or otherwise do business with a corporation, vendor or service contractor that has not complied with the regulatory and statutory requirements of any other administrative agency.
(b)
The board may not make a contract or otherwise do business with a transportation carrier for hire of liquor, wine or malt or brewed beverages which (carrier) has not obtained the proper permits from the Pennsylvania Public Utility Commission under 66 Pa. C.S. Ch. 25 (relating to contract carrier by motor vehicle and broker).
Appendix B, Page 4 of 4
APPENDIX J BID BOND FORM
BID BOND FORM KNOW ALL PERSONS BY THESE PRESENTS that __________________________________________________________________, (“Principal”) whose principal place of business is located at _____________________________________________________________________ and _________________________________________________________________ (“Surety”), which is authorized to do surety business under the laws of the Commonwealth of Pennsylvania, are held and firmly bound unto the Pennsylvania Liquor Control Board (“PLCB” or “Obligee”) in the amount of one million dollars ($1,000,000.00) lawful money of the United States of America, for the payment whereof, Principal and Surety bind themselves, their heirs, executors, administrators, successors and assigns, jointly and severally, firmly by these presents. WHEREAS, the Principal has submitted proposal for services to be supplied to the PLCB over a period of ten (10) year in response to Request for Proposal #20121016 (“RFP”), Distribution Center Consolidation and Management Services. NOW, THEREFORE, the conditions of this obligation are as follows: This Bid Bond shall guarantee that: 1. The Principal shall not withdraw its proposal in response to the RFP until the PLCB has executed a contract with the selected Principal or rejected all bids, whichever date is later. 2. Should the PLCB issue to the Principal a Notice of Intent to Award, the Principal shall obtain, within seven (7) days of the date of the Notice, a performance bond as required by the terms of the RFP. Thereafter, the Principal shall execute a written contract with the PLCB consistent with the Principal’s accepted proposal. 3. Should the Principal fail to meet either of the guarantees provided above in Paragraphs 1 and 2, the Principal and the Surety agree to pay the PLCB the difference between the amount of the Principal’s proposal, as accepted by the PLCB, and the higher amount for which the required work shall be contracted for by the PLCB, together with any additional advertising costs, legal fees (including but not limited to legal fees and costs associated with litigating the Principal’s failure to perform), and any and all other fees, expenses, and consequential damages incurred by the PLCB by reason of the failure of the Principal to meet such guarantees, provided however that: a. The obligation of the Surety shall not exceed the stated principal amount of this bond; and b. If the PLCB does not procure an executed contract with any other person for the performance of the work contemplated in the RFP, as accepted by the PLCB, upon the same terms and conditions, other than price as provided in the contract documents, within the period provided in the RFP during which no proposals of offerors may be withdrawn, whether because of the lack of another offeror to enter into an appropriate contract or because the cost under any higher proposal would be greater than the PLCB can afford, which it shall determine in its sole discretion, then the Principal and the surety agree to pay to the PLCB the full amount of this bond as liquidated damages. The Principal, by submitting a proposal, agrees and recognizes that if the PLCB is
required to repeat the RFP process as a result of the Principal’s failure to meet its guarantees as set forth above, assessing and determining damages suffered by the PLCB would be difficult and speculative. Accordingly, the Principal and the PLCB recognize and agree that under these circumstances, liquidated damages in the full amount of the bid bond is a reasonable measure of the PLCB’s damages and is not considered a penalty of punitive damages. 4. This bid bond shall remain in full force and effect until all of the conditions as set for the above have been completed. IN WITNESS WHEREOF, intending to be legally bound, the parties have hereunto set their hands and seals, the day and year above written. Witness (or Attest if a Corporation): (SEAL) (PRINCIPAL) BY (SIGNATURE)
(TYPED NAME, TITLE)
Pennsylvania Resident Agent for Surety: ___________________
(SEAL) (SURETY) BY (SIGNATURE)
(TYPED NAME, TITLE)
(ADDRESS)
(DATE) (Attach Power of Attorney for the Surety)
APPENDIX K TRADE SECRET/CONFIDENTIAL PROPRIETARY INFORMATION NOTICE
APPENDIX K TRADE SECRET/CONFIDENTIAL PROPRIETARY INFORMATION NOTICE
Trade Secret/Confidential Proprietary Information Notice Instructions: The Commonwealth may not assert on behalf of a third party an exception to the public release of materials that contain trade secrets or confidential proprietary information unless the materials are accompanied, at the time they are submitted, by this form or a document containing similar information. It is the responsibility of the party submitting this form to ensure that all statements and assertions made below are legally defensible and accurate. The Commonwealth will not provide a submitting party any advice with regard to trade secret law. Name of submitting party: Contact information for submitting party:
Please provide a brief overview of the materials that you are submitting (e.g. bid proposal, grant application, technical schematics):
Please provide a brief explanation of why the materials are being submitted to the Commonwealth (e.g. response to bid #12345, application for grant XYZ being offered by the Department of Health, documents required to be submitted under law ABC)
Please provide a list detailing which portions of the material being submitted you believe constitute a trade secret or confidential proprietary information, and please provide an explanation of why you think those materials constitute a trade secret or confidential proprietary information. Also, please mark the submitted material in such a way to allow a reviewer to easily distinguish between the parts referenced below. (You may attach additional pages if needed) Note: The following information will not be considered a trade secret or confidential proprietary information:
Any information submitted as part of a vendor’s cost proposal Information submitted as part of a vendor’s technical response that does not pertain to specific business practices or product specification Information submitted as part of a vendor’s technical or disadvantaged business response that is otherwise publicly available or otherwise easily obtained Information detailing the name, quantity, and price paid for any product or service being purchased by the Commonwealth
Page Number Description
Explanation
Acknowledgment The undersigned party hereby agrees that it has read and completed this form, and has marked the material being submitted in accordance with the instructions above. The undersigned party acknowledges that the Commonwealth is not liable for the use or disclosure of trade secret data or confidential proprietary information that has not been clearly marked as such, and which was not accompanied by a specific explanation included with this form. The undersigned agrees to defend any action seeking release of the materials it believes to be trade secret or confidential, and indemnify and hold harmless the Commonwealth, its agents and employees, from any judgments awarded against the Commonwealth in favor of the party requesting the materials, and any and all costs connected with that defense. This indemnification survives so long as the Commonwealth has possession of the submitted material, and will apply to all costs unless and until the undersigned provides a written statement or similar notice to the Commonwealth stating that it no longer wishes to exempt the submitted material from public disclosure. The undersigned acknowledges that the Commonwealth is required to keep all records for at least as long as specified in its published records retention schedule. The undersigned acknowledges that the Commonwealth reserves the right to reject the undersigned’s claim of trade secret/confidential proprietary information if the Commonwealth determines that the undersigned has not met the burden of establishing that the information constitutes a trade secret or is confidential. The undersigned also acknowledges that if only a certain part of the submitted material is found to constitute a trade secret or is confidential, the remainder of the submitted material will become public; only the protected information will be removed and remain nonpublic. If being submitted electronically, the undersigned agrees that the mark below is a valid electronic signature.
Signature
Title
Date
APPENDIX L SYSTEM LEVELS AND TROUBLESHOOTING
In order to resolve issues quickly, the PLCB will be using the following process, based upon severity of case, to identify problems and hopefully guarantee a timely and smooth process for resolution. The selected Offeror is expected to abide by this and work with the PLCB towards resolutions as such. Severity Definitions Severity Level 1 - Critical Business Impact: PLCB (customer), regardless of environment or product usage, has complete loss of service or resources. There is no work around and the customer's work cannot continue. Severity Level 2 - Serious Business Impact: PLCB (customer), regardless of environment or product usage, is experiencing significant or degraded loss of service or resources. Severity Level 3 - Minor Business Impact: PLCB (customer), regardless of environment or product usage, has a minor loss of service or resources. There may be a work around but regardless of frustration or an irritation, the customer's work can continue. Severity Level 4 – Enhancement Request: PLCB making requests\recommendations for future releases
Escalation procedure and time lines The selected Offeror shall provide a point of contact for all issues raised. The selected Offeror must provide an alternate point of contact in the case that the first cannot be reached. The selected Offeror must respond (not resolve, but at least respond) within the following timelines: Severity 1: 15 minutes after initial call Severity 2: 30 minutes after initial call Severity 3: 2 hours after initial call Severity 4: 8 hours after initial call After the initial call (follow up), the selected Offeror must respond as follows: Severity 1: Every 1/2 hour (30 minutes) after initial response until issue no longer exists or can be downgraded in severity Severity 2: Every 1 hour (60 minutes) after initial response until issue no longer exists or can be downgraded in severity Severity 3: Every 48 hours (2 days) after initial response until issue no longer exists, can be downgraded in severity, or is agreed upon by PLCB to stop responses. Severity 4: Weekly updates after initial response until issue no longer exists or is agreed upon by PLCB to stop responses.
APPENDIX M SMALL DIVERSE BUSINESS LETTER OF INTENT
[DATE] [SDB Contact Name Title SDB Company Name Address City, State, Zip] Dear [SDB Contact Name]: This letter serves as confirmation of the intent of [Offeror] to utilize [Small Diverse Business (SDB)] on RFP [RFP number and Title] issued by the [Commonwealth agency name]. If [Offeror] is the successful vendor, [SDB] shall provide [identify the specific work, goods or services the SDB will perform, and the specific timeframe during the term of the contract and any option/renewal periods when the work, goods or services will be performed or provided]. These services represent [identify fixed numerical percentage commitment] of the total cost in the [Offeror’s] cost submittal for the initial term of the contract. Dependent on final negotiated contract pricing and actual contract usage or volume, it is expected that [SDB] will receive an estimated [identify associated estimated dollar value that the fixed percentage commitment represents] during the initial contract term. [SDB] represents that it meets the small diverse business requirements set forth in the RFP and all required documentation has been provided to [Offeror] for its SDB submission. We look forward to the opportunity to serve the [Commonwealth agency name] on this project. If you have any questions concerning our small diverse business commitment, please feel free to contact me at the number below. Sincerely, Acknowledged,
Offeror Name Title Company Phone number
SDB Name Title Company Phone number
