SOURCES SOUGHT
R -- ALTERNATIVES ANALYSIS OF PENSION INSURANCE MODELING SYSTEM
- Notice Date
- 12/30/2014
- Notice Type
- Sources Sought
- NAICS
- 541611
— Administrative Management and General Management Consulting Services
- Contracting Office
- Pension Benefit Guaranty Corporation, Chief Management Officer, Procurement Department, Suite 1090, 1200 K Street, N.W., Washington, District of Columbia, 20005-4026
- ZIP Code
- 20005-4026
- Solicitation Number
- RQ-32-15-000002
- Archive Date
- 1/27/2015
- Point of Contact
- GIORGIANA CHEN, Phone: 202-326-4000 ext.7496, Patrick McFarlane, Phone: 20232640003334
- E-Mail Address
-
chen.giorgiana@pbgc.gov, mcfarlane.patrick@pbgc.gov
(chen.giorgiana@pbgc.gov, mcfarlane.patrick@pbgc.gov)
- Small Business Set-Aside
- N/A
- Description
- Request for Information (RFI) Pension Insurance Modeling System (PIMS) 1. ISSUED BY: Pension Benefit Guaranty Corporation (PBGC) Procurement Department, 1200 K Street NW Suite 1090, Washington, DC 20005-4026. 2. FOR INFORMATION CONTACT: NAME: Giorgianna Chen, Contract Specialist PHONE: (202) 326-4000 Ext. 7496 FAX: (202) 326-4162 E-MAIL: Chen.Giorgiana@pbgc.gov 3. QUESTIONS: Questions to this RFI are to be submitted by email to Giorgiana Chen, Chen.Giorgiana@pbgc.gov and are due on or before January 6, 2015 by 2:00 PM EST. 4. RFI DUE DATE/TIME: January 12, 2015 by 2:00 PM EST * 5. NAICS: 541611- Financial Management Consulting - This U.S. industry comprises establishments primarily engaged in providing operating advice and assistance to businesses and other organizations on administrative management issues, such as financial planning and budgeting, equity and asset management, records management, office planning, strategic and organizational planning, site selection, new business startup, and business process improvement. This industry also includes establishments of general management consultants that provide a full range of administrative; human resource; marketing; process, physical distribution, and logistics; or other management consulting services to clients. 6. SUBMISSION OF RFI RESPONSES: Interested vendors shall submit one (1) electronic copy of the response to this RFI using the specific format described below and shall be limited to 30 pages. 8.5 by 11 inch paper 11 pitch print, Arial or Times New Roman style font 1.25 inch left hand margin,.75 inch right hand margin and 1 inch margins at both the top and bottom for each page all pages single spaced every page sequentially numbered; and page numbers shall be centered in the bottom margin. The RFI is not an RFP, may be canceled at any time, and may not result in the issuance of an RFP or award of a contract. This is a Request for Information ONLY and does not constitute a solicitation for proposal or any obligation on behalf of the Government. A response to this RFI is not an offer and cannot be accepted by the Government to form a binding contract. This RFI is issued solely for information and planning purposes-PBGC is not currently seeking proposals and will not accept unsolicited proposals. Respondents are advised that the Government will not pay for any information or administrative costs incurred in response to this RFI. All costs associated with responding to this RFI will be solely at the respondent's expense. All submissions, detailed below, become Government Property and will not be returned. Failure to respond to this RFI does not preclude participation in any future RFP, if any such request is issued. The information provide will not be used for any purpose other than for market research in determining the proper acquisition strategy and as support in our market research for future potential procurements actions in this service area. All responses must be submitted electronically to Chen.Giorgiana@pbgc.gov. The total email size should not exceed 5 megabytes (MB). Emails larger than this size may not be received. 7. Background & Introduction About PBGC The Pension Benefit Guaranty Corporation (PBGC) was established to develop and administer the pension plan insurance programs as provided in Title IV of the Employee Retirement Income Security Act (ERISA) of 1974. PBGC's mission is primarily to: 1) encourage the continuation and maintenance of voluntary private pension plans for the benefit of their participants, 2) provide for the timely and uninterrupted payment of pension benefits to participants and beneficiaries under plans to which Title IV applies, and 3) maintain PBGC insurance premiums at the lowest level consistent with carrying out it's obligations under Title IV. ERISA established two insurance programs to be administered by PBGC. The single-employer (SE) program covers plans maintained by one employer, or by a group of employers, but not pursuant to a collective bargaining agreement. The multiemployer program (ME) covers plans that are collectively bargained and cover the employees of two or more unrelated employers. Each insurance program is operated and financed separately from the other, and assets from one cannot be used to support the other. 6.1 PIMS Background By coverage, the single-employer program is by far the larger of the two programs, insuring about 33.4 million workers and retirees covered by nearly 26,000 plans. The SE program guarantees payment of benefits, subject to limits set by law. If an insured plan terminates without enough money to pay all benefits, then PBGC trustees the plan, takes over any assets and assumes the responsibility to pay plan participants. As of September 30, 2011, PBGC has trusteed more than 4,200 terminated single-employer plans and assumed responsibility for the benefits of nearly 1.4 million workers and retirees. In fiscal year 2012, PBGC paid a total of nearly $5.4 billion in benefits, and by the end of the year it was paying retirement benefits to more than 775,000 people each month. There are about 1,500 multiemployer plans that cover more than 10.1 million workers and retirees. Unlike the single-employer program, under which PBGC guarantees payment of benefits upon termination of an underfunded plan, under the multiemployer program, PBGC guarantees payment of benefits if a covered plan is insolvent and unable to pay basic PBGC guaranteed benefits when due. Also unlike the single-employer program, insolvent multiemployer plans are not trusteed by PBGC. Rather PBGC financially assists insolvent plans to enable them to continue paying guaranteed benefits themselves. As of September 30, 2012, PBGC has provided $788 million in total financial assistance, net of repayments, to 74 multiemployer plans. Only one plan has ever repaid PBGC. Single-Employer (SE) PIMS- What is now PBGC's Policy Research & Analysis Department (PRAD) began development of the Pension Insurance Modeling System (PIMS) for the single-employer insurance program (SE PIMS) in 1992. The initial version went into production in 1997. SE PIMS is a stochastic (i.e., random) simulation model that PBGC uses to evaluate its exposure and likelihood of future claims and to quantify the amount of risk facing the single-employer insurance program. SE PIMS portrays PBGC's future financial condition as a function of a variety of economic parameters. SE PIMS' has over 30,000 lines of computer code written in C++ programming language and is currently run under Windows 7. The input database for the model includes significant details on a sample of nearly 460 pension plans, key financial variables from approximately 350 companies that sponsor those pension plans, details on the PBGC's current assets and benefit payment obligations, and recent history of key financial market returns. Pension plan and actuarial data is taken from the Form 5500, the Schedule SB (MB for Multiemployer PIMS, see below) and attachments, and includes benefit formulae, age-service matrices of active workers, number of retirees, benefit payouts, actuarial assumptions, and schedules of amortization bases.. The program simulates thousands of random scenarios of potential future outcomes using a pseudo-random number generator and measures of the volatility of key variables and the correlation among them. The scenarios projected in the simulation extend up to 20 years into the future. In each year of a scenario, the program simulates: 1. Annual returns of stock and bond market indices; changes to the financial variables of each plan sponsor; 2. Changes to each pension plan's liabilities reflecting advancements in age and service, as well as retirements and other employment separations, among the active participants, hiring and retirement rates consistent with changes to sponsors' total employment levels, advancement in ages and mortality rates among the retired population, benefit and/or salary level increases, and changes to valuation discount rates; Changes to the asset level of each plan, including asset returns determined by plans' portfolio selections and the simulated market returns, benefit payments to retired participants, and contributions from the plan sponsor meeting the constraints of Internal Revenue Code funding rules; 3. Random occurrences of bankruptcy among the pension plan sponsors, with bankruptcy probabilities being determined by each firm's financial variables, and calculation of whether the funding levels of plans sponsored by bankrupt firms implies a claim on the PBGC; and 4. Changes to PBGC assets and liabilities which reflect premium payments from plan sponsors, benefit payments to trusteed beneficiaries, asset returns and changes to liability discount rates, age advancement and mortality among beneficiaries, and new claims presented by underfunded plans of bankrupt firms. The program stores output on key variables related to pension funding and PBGC assets and liabilities. The output is analyzed by the PBGC to develop probability distributions over the range of financial outcomes the PBGC could experience in the future. The actuarial component of the program, which tracks plans' liabilities, assets and contribution requirements through time, represents the most significant component of the model in terms of programming detail and complexity. It is also the component that is the focus for continued development/enhancement of the model. PBGC uses SE PIMS to satisfy statutory requirements under ERISA Section 4008 as amended by the Pension Protection Act of 2006 (PPA of 2006) to produce annually, an actuarial evaluation of PBGC's expected operations for the next five years for publication in PBGC's annual report. PBGC has chosen in the past to extend this projection to ten and twenty years instead of the required five. PPA of 2006 requires that PBGC's annual report also include a summary of SE PIMS, "including the specific simulation parameters, specific initial values, temporal parameters, and policy parameters used to calculate the financial statements for the corporation." SE PIMS is updated regularly for legislative, regulatory and/or policy changes. The model was critical to the legislative processes that led to enactment of the Deficit Reduction Act of 2005, PPA of 2006 and the Worker, Retiree and Employer Recovery Act of 2008, having been used to evaluate the financial impact upon ongoing pension plans, their sponsors and participants, PBGC and the Federal budget of numerous and varied legislative proposals considered by the Executive and Legislative branches, the Congressional Budget Office, the Joint Committee on Taxation and the Office of Management and Budget (OMB). PBGC has also used SE PIMS at the request of the Government Accountability Office (GAO) and other Federal agencies/Departments to conduct special analyses to assess the financial condition of PBGC's single-employer program and evaluate legislative/regulatory/policy alternatives to eliminating PBGC's long-term single-employer deficit. Multiemployer PIMS- The companion version of PIMS to model PBGC's multiemployer insurance program (ME PIMS) was first implemented in 2009. ME PIMS has been used to provide the same types of analyses for the Multiemployer program, as SE PIMS does for the single-employer program and to satisfy PBGC's statutory requirement under Section 4022 of ERISA to conduct quinquennial (once every five years) studies of the multiemployer insurance program to determine the adequacy of multiemployer premium rates and benefit guarantees. ME-PIMS shares many of the aforementioned features of SE-PIMS, as well as reflecting fundamental differences between the single-employer and multiemployer programs, including: 1. a different universe of plans - ME-PIMS currently contains data for roughly 250 multiemployer pension plans, but this is expected to expand significantly; 2. the failure-pattern for multiemployer plans: typically mass withdrawal of sponsorship followed by insolvency, rather than bankruptcy of a single-employer sponsor; 3. the unavailability of financial data from individual sponsors of most multiemployer plans, and the resultant need for stochastic modeling of the mass withdrawal event to use variables describing the condition of the plan rather than of its sponsors; 4. the collective bargaining framework of multiemployer plans, in which employer contribution rates are collectively bargained; 5. the ERISA environment, where multiemployer plans have their own rules concerning cost methods (traditional methods still used under PPA), amortization periods, special calculations associated with Reorganization status, and Funding Improvement and Rehabilitation plans, associated with Endangered and Critical statuses, under PPA; 6. special computations for the Withdrawal Liability payments owed by sponsors who discontinue making contributions to a plan (individually or en masse); 7. different benefit levels, than single employer plans, guaranteed by PBGC; 8. different PBGC premium levels than single employer plans pay; and 9. a different obligation toward failed plans than the single-employer model of sponsor-bankruptcy and PBGC-trusteeship: in the multiemployer realm PBGC pays enough cash assistance to allow insolvent plans to continue functioning as ongoing (if wasting) trusts, receiving withdrawal liability payments from former sponsors and continuing to pay benefits to participants; 10. different measurement criteria for booking claims against PBGC, which are computed as present value of future financial assistance, booked when plans are in mass withdrawal and within 20 years of insolvency, or when they are ongoing but within 10 years of insolvency, and removed from PBGC's books if they emerge from these criteria. As with SE PIMS, the actuarial component of the ME PIMS program, which tracks plans' liabilities, assets and contribution requirements through time, represents the most significant component of the model in terms of programming detail and complexity. It is also one of the components that is the likely focus for continued development/enhancement of ME PIMS. 7 Objective & Scope of Work The overall objective of this acquisition is to provide the government with a high level analysis of PIMS with a focus on replacement or upgrade, while incorporating microsimulation best practices. The specific goal of this effort is to provide detailed alternatives analysis services using detailed alternatives analysis techniques and methodologies in alignment with the PBGC Information Technology Solutions Life Cycle Management and existing relevant policies (e.g., OMB Circulars A-11, A-94). Business drivers include the following PIMS program initiatives: • Technology Updates: Position PIMS to avoid becoming obsolete and meeting participant needs via enhancements and technology upgrades. • Accountability: Maintain and Unqualified Audit Opinion 7.1 Activities At a minimum, the contractor is expected to perform, the following activities: 1. Evaluate the PIMS models and provide recommendations to improve; - Model governance - Procedures and processes - Programming platform and structures - Documentations - Input data sources - Risks mitigation 2. Identify and recommend commercially available software as replacement components for PIMS - Sample components: Economic scenarios generator, random number generator, actuarial functions calculator.... 3. Provide recommendations on future generations of PIMS - Options to upgrade or replace the models - Steps to improve/upgrade the models 4. Evaluate comparable micro-simulation models with similar focus - Determine best practices from these models - Illustrate how recommendations provided minimize risks and steer PIMS towards best practices 5. Perform benefits analysis for each alternative to include qualitative benefits, cost savings, cost avoidance, stakeholder benefits and non-monetary quantitative benefits. 6. At the conclusion of the study period, PBGC expects to receive from the Analysis, at least four (4) different alternatives regarding the development and modernization of PIMS at the component level (not for the whole system) as driven by the PBGC Architectural Analysis Recommendations Report and Modernization Roadmap for PIMS. The resulting outputs of these activities will be used as supporting documentation inputs for the Options Analysis of PIMS, which will be used for making decisions for information technology solution investments. The following list includes alternative options that should be explored: a) Maintain the Status Quo (required) - This alternative recommends that maintaining the current state is the favorable alternative b) Government Service Provider or Federal Line of Business - This alternative recommends that PBGC should partner with a separate agency as a service provider in order to leverage existing services possessed by a government entity c) Partial Commercial off the Shelf COTS with Customization - Replace all or a portion of PIMS with a product with a commercial off the shelf solution with customization as needed to support the business process d) Build Custom - This alternative recommends that PBGC complete all work in-house 7.2 Notes This acquisition may result in the contractor providing information that can be used as specifications for future government requirements. Due to this the successful bidder may not be able to bid on future requirements resulting out of the deliverables from this acquisition. See FAR 9.505-2. The anticipated period of performance is three calendar months. 8.0 Deliverables & Work Products PBGC expects the contractor will deliver the following artifacts. In addition, PBGC expects the contractor to provide in its proposal the completion dates for each of the artifacts. PBGC anticipates these artifacts (deliverables and work products) will include: • Detailed Alternatives Analysis Report: The contractor shall furnish documentation supporting the alternatives analysis that will describe the methodology used in identifying viable alternative solutions. It also shall identify all the data sources and any information used in the analysis. The documentation should be in sufficient detail to permit reviewers to follow the logic from assumptions to conclusion. Alternatives and Analysis deliverables at minimum should include the following area: o Description of the alternative solutions considered for accomplishing the strategic goals for PBGC. o The specification of all assumptions, ground rules and constraints, assumed or imposed, underlying the analysis. Each must each be explained with adequate rationale. o Summary of the market research that was conducted to identify innovative solutions for this investment (e.g., obtained four different solutions to evaluate, held open meetings with contractors to discuss investment scope, etc.). o Justification for the selected alternatives (including how each of the alternatives was judged according to specific criteria related to PBGC business needs and which permits a comparison of the relative merits and drawbacks of each alternative). o Date of the analysis. • Project Management Plan: The Project Management Plan (PMP) shall include the Work Breakdown Structure (WBS), timeline and key milestones, risks and mitigation strategy. It will be used to support the Weekly Project Status Report. • Meeting Agendas/Minutes: This document will be used to capture meeting agendas, attendees, meeting highlights, meeting outcomes and meeting action items. • Approval Form: Approval form that documents all project deliverables that were completed as part of the project and documents the date of each deliverable. • Project Modification Requests (if needed): Form used to document changes to project scope, cost and schedule. This document will be created only if there are changes to one of the triple constraints (scope, cost, schedule). • Corrective Action Plan (if needed): It will be used when a target milestone has not been met and to define a plan of action for getting the project back on track. The examples above are for informational purposes. The contractor is encouraged to consider and recommend different or additional artifacts based on their expertise in alternatives analysis and in coordination with the sponsor for this effort. 9.0 RFI RESPONSE EXPECTATIONS RFI respondents must respond in the form of a Capability Statement or White Paper that addresses: 1. Company's profile and capability in providing these types of analyses, if any, 2. Past Performance History in this area of expertise; 3. Experience with other micro-simulation models in similar disciplines We ask that respondents remove personal identifiers prior to submission. To the full extent that it is protected by law and regulation, information identified by respondents as Proprietary or Confidential will be kept confidential.
- Web Link
-
FBO.gov Permalink
(https://www.fbo.gov/spg/PBGC/CMO/PD/RQ-32-15-000002/listing.html)
- Place of Performance
- Address: Pension Benefit Guaranty Corporation (PBGC), 1200 K Street NW, WASHINGTON, District of Columbia, 20005-4026, United States
- Zip Code: 20005-4026
- Zip Code: 20005-4026
- Record
- SN03606553-W 20150101/141230234341-91a418f81bca2c2dd1f14dfce945e340 (fbodaily.com)
- Source
-
FedBizOpps Link to This Notice
(may not be valid after Archive Date)
| FSG Index | This Issue's Index | Today's FBO Daily Index Page |