Banking and Investment Activity Services
The USDA, Rural Development (RD) is seeking sources for Market Research ONLY to support the USDA RD CSC’s disbursement, banking and investment activity services as they relate to managing and administering escrow funds, and investing residual balances. The Prospective offeror will provide professional banking services, ensure timely and accurate reconciliation of the various investment and disbursement bank accounts and provide professional investment advice to ensure maximum return on investments while preserving principle. The applicable NAICS code is 523920-Portfolio Fund Managing.
NO AWARD will be made from this Sources Sought. NO SOLICTATION, SPECIFICATION, OR DRAWINGS ARE AVAILABLE AT THIS TIME. Potential offerors having the skills and capabilities necessary to perform the described services below are invited to provide feedback via email to:
All responses will be analyzed in order to determine the appropriate strategy for a potential future acquisition. Particularly, the purpose of this NOTICE is to gain knowledge of potential small business sources including certified HUBZone small business, Service-Disabled Veteran Owned small business, Veteran-Owned small business, Certified 8(a) small business, Women-Owned small business, etc. Other than Small Business are encouraged to respond to this notice as it may be that the market will not indicate significant Small Business entities able to perform service type of this magnitude..
Project Description: This is a non-personal services contract to provide escrow fund and investment fund support services. United States Department of Agriculture (USDA), Rural Development (RD), Customer Service Center (CSC) provides loans for low and moderate-income applicants located in rural geographical areas to assist them in obtaining decent, sanitary and safe dwellings through Single-Family Housing (SFH) portfolio. CSC currently services a portfolio of approximately 277,000 SFH loans. The loans are located in each of the 50 states and United States Territories including Puerto Rico, Virgin Islands, Guam and the remainder of the Western Pacific Rim islands.
The SFH loan portfolio has reached approximately 173,000 “escrowed” borrowers. The escrow portion of the monthly payments (principal, interest and escrow) received from these borrowers are retrieved from the U.S. Treasury and directed to an escrow bank account that CSC is custodian of for the SFH borrowers.
CSC currently utilizes bank accounts at the current service provider to accumulate and invest the escrow deposits, and other receipts, and later disburse on behalf of SFH borrowers that have a mortgage with RD. An Escrow Concentration Account acts as the “primary” bank account, where escrowed checks are funded from, and other sub-accounts are associated with.
The USDA – RD – CSC Escrow Concentration Account is funded with ACH transmissions received from the U.S. Treasury (contains borrower escrow and U.S. Government funds). The Escrow Concentration Account should be capable of receiving and disbursing ACH and wire transfer transactions of approximately $350 Million annually and allow sweeps to/from associated sub-accounts. Balances are invested nightly in a Money Market Mutual Fund that contains 100% U.S. Treasury Securities, a prospective offeror NOW account or utilized for compensating balances offset of prospective offeror fees. The Escrow Concentration Account shall have overdraft protection. In the event of an overdraft, the prospective offerors Contract Manager, or designee, will call COR, or designee, to fund the shortfall. At month-end all associated banking fees incurred by the Escrow Concentration Account from services utilized will be deducted from the USDA – RD – CSC Net Income Account after written direction from the COR, or designee. All income earned from investments in the Escrow Concentration Account will be moved to the USDA – RD – CSC Net Income Account at month-end automatically by prospective offeror.
The USDA – RD – CSC Escrow Disbursement Account is a controlled disbursement, zero-balance account (ZBA) that checks are drawn against. CSC disburses checks daily payable to taxing authorities, insurance carriers, etc., on-behalf of borrowers and other miscellaneous disbursements for RD. There are two check presentment clearings at the prospective offeror bank for the Escrow Disbursement Account each business day. At the end of each day, the gross amount of the check presentments is swept from the Escrow Concentration Account. Currently, an average of 60,000 checks are disbursed annually for a total of approximately $82 million. Prospective offeror will provide a compact disk (CD-rom) monthly that contains images (front and back) of USDA - RD - CSC checks that have cleared the Escrow Disbursement Account. The prospective offeror shall provide written instructions and the software required to view the check images. The prospective offeror shall provide the CD-rom’s no later than the 12th calendar day of the following month. The software shall be compatible with Windows 7. Provide on-line access to allow for Escrow Disbursement Account check voids and stop payments processing. The prospective offeror shall provide written instructions and the software required to accomplish each function on-line.
The USDA – RD – CSC Borrowers Escrow Funds Custody Account contains borrower escrow and U.S. Government funds and is invested in “second tier” investments (i.e., individual U.S. Treasury Bills and/or a Money Market Mutual Fund that contains 100% U.S. Treasury Securities). The Escrow Funds Custody Account should be capable of supporting custody services for investment balances over $100 Million. The funds invested in this Custody Account are moved to/from the Escrow Concentration Account (greater than the targeted $10 million dollar balance) after receiving written instructions from the Contracting Officer Representative (COR), or designee. As individual investments mature and/or new funds are deposited, the COR, or designee, will discuss with the service provider’s investment advisor a new investment vehicle and maturity. At month-end all associated custody and asset management fees incurred by the Borrowers Escrow Funds Custody Account will be forwarded to CSC for review and direction will be given by COR, or designee, to deduct these charges from the USDA – RD – CSC Net Income Account. All income earned from investments in the Borrowers Escrow Funds Custody Account will be moved to the USDA – RD – CSC Net Income Account at month-end automatically by prospective offeror.
The USDA – RD – CSC Net Income Custody Account contains RD “net income” and is invested in individual U.S. Treasury Bills and/or a Money Market Mutual Fund that contains 100% U.S. Treasury Securities. The income earned from the Escrow Concentration Account and the two Custody Accounts are automatically credited to this account monthly, as well as, the associated Prospective offerors monthly fees deducted for the primary Escrow Concentration Account and all other associated sub-accounts after review and approval by the COR, or designee. As individual investments mature and/or new funds are deposited, the COR, or designee, will discuss with the service provider’s investment advisor a new investment vehicle and maturity. The Net Income Custody Account should be capable of supporting custody services for investment balances over $18 Million.
The USDA – RD – CSC EFT Account is the conduit to disburse new loan origination funds via electronic fund transfer (ACH and wire transfer) daily to pre-approved mortgage loan closing agents. CSC prepares each business day a data file that contains detailed ACH transmission information (i.e., payee name, bank ABA number, payee bank account number, dollar amount of transaction, addenda information, etc.) for mortgage closing agents. A separate “funding” ACH transaction is directed from the USDA – National Finance Center (NFC) to the EFT Account for the daily gross disbursement dollar amount. The EFT Account should be capable of supporting ACH and wire transfer services for disbursement transactions of at least 6,700 items and totaling $770 Million annually. The prospective offeror shall provide a guarantee, in excess of FDIC insurance coverage, for funds disbursed to closing agents on all new loans originated by USDA – RD. The conditional guarantee pertains only to loss of U.S. Government funds if such loss is due to failure of the financial institution with which the closing agent has deposited the loan funds. The prospective offeror shall list payment premiums (of the additional coverage indicated above) with the other monthly banking fees. At month-end all associated banking fees incurred by the EFT Account from services utilized will be deducted from the USDA – RD – CSC Net Income Account after written direction from the COR, or designee.
Another sub-account utilized by USDA is the USDA – RD – CSC Escrow Voucher Account. The Escrow Voucher Account was established to receive electronic fund transfers (ACH and wire transfer). The Escrow Voucher Account should be capable of supporting ACH and wire transfer receipts of at least 10,000 items and totaling more than $60 Million annually. At month-end all associated banking fees incurred by the Escrow Voucher Account from services utilized will be deducted from the USDA – RD – CSC Net Income Account after written direction from the COR, or designee.
The final sub-account utilized by USDA is the USDA – RD – CSC Emergency Disbursement Account. The Emergency Disbursement Account is a ZBA that CSC has established to disburse manual checks in a continuing operation (COOP) environment when the loan servicing platform is unavailable and checks cannot be initiated from the Escrow Disbursement Account. Checks disbursed from this account are funded by the Escrow Concentration Account. Prospective offeror shall provide manual check stock for this purpose. Checks disbursed from this account are funded from the Escrow Concentration Account. At month-end all associated banking fees incurred by the Emergency Disbursement Account from services utilized will be deducted from the USDA – RD – CSC Net Income Account after written direction from the COR, or designee.
The prospective offeror shall provide all personnel, compatible software, access to reconciliation tools, financial system administrative set-up, supervision and other items and services necessary to perform the disbursement, banking, custody and investment services.
The purpose of this contract is to maintain, administer and report USDA – RD – CSC’s disbursement, banking, custody and investment activity services as they relate to deposits and disbursements. The Prospective offeror will provide professional banking services, ensure timely and accurate reconciliation of the various investment and disbursement bank accounts and provide professional investment advice to ensure maximum return on investments while preserving principal.
The prospective offeror shall provide a hard copy monthly account analysis of services provided with associated volumes and cost on each bank account established and maintained for USDA – RD – CSC. These hard copy reports shall be provided no later than the 10th calendar day of the following month.
The prospective offeror shall provide software, written instructions and training that will allow CSC to access all banking requirements listed above over the internet (on-line).
The prospective offeror investment advisors shall have expertise and propose sound investment advice to meet USDA – RD principal preservation goal in the U.S. Treasuries forum. The COR, or designee, will provide final investment decisions which will follow USDA – RD – CSC Investment Policy Board guidelines.
The prospective offeror supplied investment advisors, banking services account representative and appropriate prospective offeror support staff shall meet with USDA – RD – CSC officials approximately every 3 to 4 months to discuss U.S. economic and investment market trends, Federal Reserve Board decisions, current and projected U.S. Treasury yields, etc. Additionally, any USDA – RD bank account servicing issues will be discussed and resolved at these meetings (RD-FO-01-03).
The prospective offeror shall provide the names and contact information for the key contact for Account Reconciliation Plan (ARP) purposes. A hard copy shall be provided of the “Full” ARP reports for the USDA – RD – CSC Escrow Concentration, Escrow Disbursement and Emergency Disbursement Accounts monthly. These hard copy reconciliations shall be provided no later than the 10th calendar day of the following month.
The prospective offeror shall provide CSC with necessary data transmission configurations and/or software that will allow bank information and transactions to be processed and communicated between prospective offeror and CSC. All upfront or one-time charges by prospective offeror for this software, training or access should be documented and presented to the CO in the initial proposal. The software shall be compatible with Windows 7.
The CO, COR or Contract Manager may request a meeting as deemed necessary. Written minutes of such meetings shall be recorded and signed by the CO, COR or Contract Manager. If the prospective offeror does not concur with any portion of the minutes, such non-concurrence shall be provided to the CO, COR or Contract Manager within 10 calendar days following receipt of the minutes.
Anticipated solicitation issuance date is on or about July 27, 2017 and the estimated proposal due date is on or about August 28, 2017. The official synopsis citing the solicitation number will be issued on Federal Business Opportunities (www.fbo.gov) and inviting firms to register electronically to receive a copy of the solicitation when it is issued.
CAPABILITIES AND QUALIFICATIONS:
Qualified personnel are required with recent knowledge and experience in:
1. Expertise in escrow disbursement, banking, custody and investment activity services of a large SFH mortgage servicing portfolio. Knowledge and experience with rural SFH real estate loan servicing across all of the United States Territories including Puerto Rico, Virgin Islands, Guam and the remainder of the Western Pacific Rim islands is preferred. Verifiable experience in handling SFH mortgage servicing problems. Prior experience working with a federal government agency.
2. Period of Performance: The period of performance shall be for one (1) Base Year of 12 months and four (4) 12-month option years. Period of Performance begins as soon as contract is executed in 2017.
3. Offeror's type of business and Business Size (Other than Small Business, Small Business, Certified 8a, Certified HUB Zone, and Service-Disabled Veteran-Owned Small Business (SDVOSB), etc.).
4. Firm's capability to perform a contract of this magnitude and complexity based on the scope of work (include the firm's capability to execute SFH mortgage escrow disbursement, banking, custody and investing services in the last (3) years): Provide a brief description of the project(s), customer name, timeliness of performance, customer satisfaction, and dollar value of the fees charged. Provide at least three (3) examples maximum three (3) pages.
RESULTS INFORMATION: Respondents will not be notified of the results of the evaluation. Firms responding to this sources sought announcement, who fail to provide ALL of the required information requested, will not be used to help the Government make the acquisition decision, which is the intent of this sources sought announcement.
Your response is limited to 10 single-sided pages total. Sources Sought market research for "Escrow Disbursement, Banking, Custody and Investment Management Services."
All interested prospective offerors or potential offerors having the skills and capabilities necessary to perform the described services above should notify this office in writing by email by 1:00 PM on July 5, 2017. Submit response and information to:
Colin Beckford, Contract Specialist, Phone 2026920115, Email colin.beckford@wdc.usda.gov - Berel Dorfman, Contracting Officer, Phone 2026920247, Email berel.dorfman@wdc.usda.gov
