|Sole Source Only Justification:||1. IDES has a high volume of time-sensitive mailed items that require effective delivery within a tight time frame and the Department can only accomplish this business functions through the use of postage mailing machines and postage meters manufactured by Pitney Bowes. No other means of assigning postage will suffice or meet IDES’ compliance requirements with the United States Postal regulations. Therefore, it is imperative that IDES postage machine equipment has in place a contract to provide maintenance and repair services to ensure sustainable functional equipment.|
2. An IFB was solicited in 2006 for the purchase of 65 new postage machine which included maintenance and repair services for an initial three years with two one-year renewals. The solicitation resulted in one bid from Pitney Bowes. Prior to 2006, IDES procured postage machines maintenance and repair services as a sole source with Pitney Bowes.
3. Pitney Bowes is the manufacturer of IDES’ owned postage machine mailing equipment, and as such, has factory trained technicians and original equipment manufacturer (OEM) parts for the equipment. Pitney-Bowes does not authorize other vendors to perform maintenance services on Pitney Bowes equipment. Additionally, due to the patent on Pitney Bowes equipment, accessories, replacement parts and services is only available from Pitney Bowes. IDES’ mailing equipment requires inspections and preventive maintenance to keep it in proper operating condition and without maintenance the equipment would experience excessive downtime preventing IDES mailing time-sensitive correspondence.
4. Also, in 2006, an IFB was solicited resulting in one bid from the proprietary vendor Pitney Bowes for mailing equipment with removable postage meters. This procurement includes maintenance and repair for IDES’ existing postage machines used by the agency since January 1, 2007 which was replacements required because of the promulgation of new postal regulations.
5. IDES owns 65 postage machines manufactured by Pitney Bowes that maintenance and repair services have been provided by PB since the original purchase. As the original equipment manufacturer, only Pitney Bowes can provide compatible equipment and the required maintenance and repair services needed for IDES mailing equipment. Pitney Bowes equipment is patent and no other vendors are authorized to distribute its equipment, accessories, replace parts and/or provide service on PB equipment.
6. The current annual rate of $621.60 is within the IFB award price solicited under PSD3413990 in 2006. The award included postage machine mailing maintenance and repair services for three years at an annual cost $45,255 or $571 monthly; and two one-year renewals with cumulative increase from the base contract maintenance rates not exceeding 5% in year four and 10% in year five. The maintenance and repair rate increase for year four was at 5% or $599.55 monthly and year five at approximately 3.7% or $621.60 monthly for each machine. The rates have remained at or below the required base contract price increases for the five year contract term. Some IDES office closures are contributed to the annual reduction cost to $37,674. Also prior to including this service in the IFB of 2006, IDES procured this services as sole source with Pitney Bowes and government services were discounted by approximately 10% of the list rates.
7. Non approval of this sole source procurement for Pitney Bowes to provide maintenance and repair services will jeopardize DES’ ability to timely mail critical business correspondence. In addition, IDES will not be able to secure the use of compatible meters and, accordingly, will not be able to assign postage to or mail time-sensitive materials as required by law. IDES will also be at risk of being non-compliant with U.S. Postal regulations.