U.S. Department of the Treasury, TBARR Procurement Office, 1500 Pennsylvania Ave., NW, Room 3064, Washington, DC 20220

R -- FINANCIAL SERVICES SURVEY SOL A-99-0036 DUE 092299 POC James Burleson, Contract Specialist, 202-622-0792, Harry Shank, Contracting Officer, 202-622-9392 The Department of the Treasury, Departmental Offices, Procurement Service Division, Room 1310G, Suite 400E, 1500 Pennsylvania Avenue NW, Washington, DC 20220, is issuing this combined synopsis/solicitation for commercial items prepared in accordance with Federal Acquisition Regulation 12.6, as supplemented with additional information included in this notice. The contractor shall assist the Office of Community Development Policy, Department of the Treasury in the preparation of a market profile of non-bank financial service centers. This announcement constitutes the only solicitation; proposals are being requested and a written solicitation will not be issued. Request for proposal number is A-99-0036. The incorporated clauses are those in effect through Federal Acquisition Circular 11. This solicitation is open to any responsible and responsive vendor. SIC code is 8748. Statement of Work. 1.0 BACKGROUND: One of Treasury's main policy goals in implementing EFT '99 is to assist those federal check recipients who do not have a banking relationship to transition into the financial services mainstream. The ETA product was designed to meet the banking needs and preferences of these unbanked consumers. The Administration is equally committed to ensuring that affordable entry points to the financial services mainstream exist for all Americans. Increasingly, however, many Americans especially those from lower-income areas purchase their financial products and services at non-bank financial institutions (NBFIs) such as check cashers and money transmitters. Some of these entities offer reasonably priced access to financial services in areas that are not served by traditional financial institutions. Others expose their customers to substantial fees and provide them with more limited access to their funds. A number of NBFIs have also begun to contract with depository institutions to provide their customers with access to Direct Deposit payments of their federal benefits. Although the NBFI industry has grown rapidly overthe last few years, there has been little empirical research on the nature of the industry its size, competitive structure, pricing and profitability. As these entities become more prominent players in the financial services industry generally, it is increasingly important to understand how they compare with mainstream financial institutions, and to highlight any information gaps that may impede the movement of more Americans into the financial services mainstream. Gaining more data on their business structure -- where they locate, what products and services they offer, the fees and interest rates they charge would reveal a great deal about this access point to financial services. 2.0 PURPOSE: The purpose of this statement of work is to retain the services of a contractor to conduct a market profile of non-bank financial service centers. This market profile including information on number and type of establishments, geographical distribution, transaction types, volumes and pricing will provide valuable input into the policy decision-making process to increase the number of low-income Americans in the financial services mainstream. The contractor shall conduct a survey of such entities to reveal detailed information about their business practices, analyze the survey results in order to describe the supply of the industry's products and services, and produce a final report to document these findings. 3.0 OBJECTIVE: The ultimate objective of this statement of work is to produce a final report based upon the results of a defined survey of non-bank financial service centers in selected geographies. The survey will collect information from a representative sample of these entities in two urban/metropolitan areas and two rural areas. The report shall describe the survey findings, including but not limited to number and distribution of NBFIs and mainstream financial institutions in the targeted geographies (including maps and geo-coding), products and services offered, prices and transaction volumes. This survey and report will provide input into efforts to increase low-income individuals' access to the financial mainstream. The location of these non-bank providers, their inventory of products and services offered, and their prices, will help Treasury to: (1) assess whether and how mainstream financial institutions could offer these same products profitably in these communities; and (2) assess whether these non-bank providers benefit disproportionately from any market information gaps that should be addressed by new regulation. 4.0 SCOPE OF WORK: The Treasury Department (Treasury) requires that the following tasks and deliverables be prepared and submitted. Description of Deliverables: Task 4.1: Literature Review. Although the non-bank financial institution industry has expanded dramatically over the last few years, previous research on the industry can still reveal much on its current state. The Contractor shall review the existing literature on the NBFI industry, and provide FMS with a summary of any findings to date on the size of the industry, its geographical concentration, the products and services it offers, prices and volumes, and the effects of competition and regulation on the success of these institutions. Deliverable for Task 4.1: The Contractor shall produce a report summarizing existing literature on the NBFI industry that is relevant to the data sought in this Statement of Work (outlined in Task 4.3). Task 4.2: Selection of Relevant Geographies and Representative Samples. Contractor shall assist FMS in the completion of OMB supporting documents for review by OMB for approval to conduct the survey. The completion of the supporting documents for OMB approval shall be considered a priority of the contractor. FMS will work with the contractor to identify two urban and two rural areas in which to conduct the survey, preferably areas in which alternative financial service providers are capturing a substantial market share of financial services activity. Using appropriate means on-site inspection, Census data review or local business data review documented in its sampling plan, the contractor shall select a representative sample (at least 30) of non-bank financial service providers in each of the targeted areas. Deliverable for Task 4.2: The contractor shall develop and submit a list of the geographies to be studied, a plan for sampling the non-bank financial service centers, and a list of the non-bank financial service centers to be surveyed within each of these geographies. The contractor shall also provide a map and geo-coded list of all non-bank financial service centers in each of the geographies, highlighting those to be surveyed. Additionally, this map shall highlight: (1) the location of traditional financial institutions (banks, thrifts and credit unions); (2) bank electronic access points (ATMs); and (3) median income data at the census tract level, using 1990 Census data. Task 4.3: Survey Methodology and Design. The contractor shall devise a methodology for surveying non-bank providers in each of the targeted geographies. Because mail and phone surveys are likely to be inadequate methods for discerning the actual product offerings and prices at these entities, the contractor may choose to: conduct one-on-one interviews at survey sites; purchase actual products and services; and/or interview related financial institutions for relevant data. As designed, the survey should capture price information on products and services including, but not limited to: Check cashing (payroll, federal government, other government, other) Money orders Direct deposit services (by source) Electronic bill payment Third party electronic accounts Consumer loans Deferred deposit (payday loans) Rent-to-own products Municipal services (e.g., licenses, public transportation fares) Public assistance distribution Postage The survey shall also collect information, to the extent available, on the sales volume for each of the products/services offered. This will provide crucial insight into the revenue structure of these non-bank entities (i.e.,which products are revenue drivers in which locations?). The contractor shall also develop a data analysis plan. The data analysis shall address, at a minimum, the following research questions: What are the observed regional differences and urban versus rural differences? What is the relative importance of each product/service to revenue streams? What are the effects of local non-bank provider competition? What are the effects of local bank competition? What are the differences between low/middle/upper-income tracts? Are effects of state regulation, where applicable, evident? Deliverable for Task 4.3: The contractor shall develop and submit a draft technical plan which describes their survey methodology, data analysis plan, and any documents used by the contractor in the performance of this Statement of Work for FMS approval. Task 4.4: Execute Survey. The contractor shall conduct the survey in the four geographical settings specified in Deliverable 4.1 with the non-bank financial service centers. Deliverablefor Task 4.4: The contractor shall develop and compile the results of the survey/questionnaire and raw data collected by the research instruments used in Task 4.3. The report in Deliverable 4.5 shall include all research results. Task 4.5: Develop a Draft Report. The contractor shall present the results from the survey in a draft report for approval by Treasury. The report shall include analyses of sales volumes, prices, and product offerings that address, at a minimum, the research questions outlined in Task 4.3. The draft report shall include an Executive Summary and study findings. The contractor shall also include highlight any alternate figures that may result from the implementation of multiple survey methodologies (e.g., disagreement between reported price in interview and actual purchase price). The report shall also include updated maps and surveyed provider lists that document price and product variations. Deliverable for Task 4.5: The contractor shall deliver 10 Draft Reports for Treasury review and approval. Task 4.6: Produce Final Report and Presentation of Findings. The contractor shall incorporate any revisions made to the draft report. Deliverable 4.6: A minimum of ten copies of the Final Report shall include an Executive Summary and study findings incorporating any revisions resulting from the draft report review. 5.0 REPORTING REQUIREMENTS: The contractor shall submit weekly written progress reports and will detail tasks accomplished in the previous reporting period, problems encountered, and a work schedule for the current reporting period with an updated task work plan. The contractor shall submit this report to the Contract Administrator and the General Task Master. 6.0 DESCRIPTION OF DELIVERABLE PRODUCTS: The contractor shall provide, for each deliverable, one original and three copies prepared on 8 x 11" paper, one side only, with one-inch margin at the top and sides. A software file copy on a 3" diskette in Microsoft Word 7.0 format shall also be provided. 7.0 SCHEDULE FOR PERFORMANCE ANDDELIVERY/MILESTONE SCHEDULES: A kickoff meeting shall take place on a date mutually agreed to by the General Task Master and the contractor, but in no event later than 2 business days following the award date of the task order. This schedule shall not exceed 90 calendar days. =Contact Award The schedule for major milestones and deliverables are as follows: Kick Off Meeting with Treasury personnel & Task Work Plan/Schedule + 2 (business) days* Deliverable 4.1 -- Select Geographies and Samples; Produce Maps +30 days*; Deliverable 4.2 -- Finalize Survey Methodology and Data Analysis Plan + 40 days*; Deliverable 4.3 -- Results of Survey/Questionnaire + 70 days*; Deliverable 4.4 -- Draft Report + 85 days*; Deliverable 4.5 -- Final Report + 90 days*; *Approximate days after contract award. 8.0 REVIEW PERIOD FOR DELIVERABLE PRODUCTS: Treasury will have 2 business days to complete the review of deliverables. If deficiencies are found, the contractor will be notified and shall have 2 business days to correct the deficiencies at no additional cost to the Government. 9.0 ACCEPTANCE CRITERIA FOR DELIVERABLE PRODUCTS: The deliverables shall be prepared according to the schedule above. Deliverables will be reviewed for quality, completeness, and correctness. Treasury requires high quality in the contractor's deliverables received under this task order. Deliverables will be accepted or rejected in writing by the Contracting Officer's Technical Representative. 10.0 CONTRACTOR FURNISHED MATERIAL: The contractor shall provide all administrative, clerical, and secretarial support. The contractor shall provide all necessary equipment, supplies and materials necessary to perform the requirements of this task. Materials developed for this task become the property of the Government and shall not be used by the contractor. 11.0 GOVERNMENT FURNISHED MATERIALS: All relevant documents will be available at the Kickoff meeting. Availability of Treasury personnel will be between the core hours of 9:00 A.M. and 5:00 P.M. daily. 12.0 MEETINGS: All ad hoc and scheduled meetings shall take place at the Main Treasury, 1500 Pennsylvania Avenue NW, Washington, D.C., or at another location to be determined by Treasury. 13.0 TRAVEL AND PER DIEM: The work under this task may require travel outside of the Washington Metro area. The contractor shall meet with Treasury staff on a weekly basis. The contract will be awarded using the "Lowest Price, Technically Acceptable Offer" method. This contract award shall be subject to the availability of funds. The following FAR Clauses are applicable to this solicitation: 52.212-1, Instructions to Offerors Commercial; 52.212-1 Instruction to Offerors Commercial; 52.212-2, Evaluation Commercial Items; 52.212-3, Offeror Representations and Certifications Commercial Items; 52.212-4, Contract Terms and Conditions-Commercial Items; 52.212-5, Contract Terms and Conditions Required to Implement Statutes or Executive Orders-Commercial Items. Mail three copies of your technical and price proposal to: Department of the Treasury, Procurement Services Division, RM 1310G, Suite 400E, 1500 Pennsylvania Avenue, NW, Washington, DC 20220, ATTN: Mr. James Burleson (202) 622-0792, or hand deliver to 1310 G Street NW, Suite 400 E, Washington DC. All responses must be received by 4:00 PM, EDT, September 22, 1999. Posted 09/09/99 (W-SN378266). (0252)

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