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RFP Rater

Head Start/Early Head Start Services RFP

Department of Education

Issue Date 03/13/2019 • Close Date 08/05/2019

Risk Profile

Update:

The Human Services Council (HSC) and its members would like to thank the DOE for responding to and addressing some of the concerns from applicants through an Addendum to this Request for Proposals. HSC would also like to thank the Citizens’ Committee for Children, United Neighborhood Houses, FPWA, UJA-Federation of NY and a number of early childhood education providers for their leadership and advocacy efforts in negotiating these changes in which many of the issues were raised in our previous rating of this RFP. Originally, the overall score for this RFP was 66 percent, but the rating is lowered to 60% due to the DOE incorporating the suggestions from coalition groups and providers on improving this RFP. A summary of the changes can be found on Citizens’ Committee for Children website. Four key issues were tackled through this Addendum:

  1. Providers can apply to operate the program structure that reflects the length of day and year that their organization would like to offer ensuring a holistic program model.
  2. The DOE will allow certain cost increases over the term of the contract, fund documented increases in occupancy cost, and fund industry-wide changes in labor costs with the approval by the Office of Management and Budget.
  3. Providers can submit a budget that includes indirect costs calculated according to the new Cost Manual developed by the Nonprofit Resiliency Committee.
  4. Contractors will receive a base payment of 75% of their contract value. By January, extended day and year programs will have received payments that equal 75% of their total contract value. Subsequent months will be based on actual enrollment rates.

Please note that the proposal deadline was extended from June 13th to August 5th.

We appreciate the DOE for listening to the concerns of providers for this RFP and recognize that making these changes to the RFP was a significant undertaking that recognized the concerns of the provider community. However, this RFP still has not addressed the issue of salary parity for teachers and there is still a moderate risk for applicants. We look forward to continuing to work with the DOE and our partners to ensure that nonprofits can deliver quality services for the benefit of all New Yorkers.

Score Summary

The overall score for this Request for Proposals is 66 percent, which makes this RFP a moderate to substantial risk for applicants.

Background

This request for proposals (“RFP”) is for the implementation of Head Start/Early Head Start Services, which provide programs to children six weeks to five years old for eight or ten hours per day and either 225 or 260 days per year. The birth-to-five system of early care and education is being redesigned to be administered through one system by the New York City Department of Education (“DOE”). This includes EarlyLearn NYC at the Administration for Children’s Services (“ACS”) and Pre-K for All and 3-K for All at the DOE.

It is important to note that this rating cannot be considered in isolation given the interdependence of the birth to five programs being put forward by the DOE. It is particularly challenging for potential bidders to fully assess the risk level when not all of the RFPs are yet public.

The goal of this RFP is to provide Head Start and/or Early Head Start services in accordance with the regulations of the Federal Office of Head Start. “Head Start is a federally funded program designed to promote the school readiness of young children from low-income families through agencies in their local community.” Head Start and Early Head Start programs focus on the comprehensive development of children ages birth to five through early care and education, health and family well-being services. This RFP is not meant to be a supplement for services to children who are already served through a direct Head Start grant.

Head Start/Early Head Start Services are complimentary to the Birth-to-Five Services and Family Child Care Networks. The DOE is the contracting agency, and the anticipated contract start date is July 1, 2020.

Key Points

There are many different risks in applying for this RFP resulting from the transfer of early childhood education programs to the DOE and the uncertainty in overall funding. The five key issues are listed below, but for a more extensive list, please click this link.

Salary Parity

Although it is laudable that the City is expanding free pre-K and 3-K programs and the City is striving to establish a comprehensive birth to five early education system, a significant portion of these programs are provided by community-based organizations (CBOs) and this RFP exacerbates a substantial pay gap between teachers at CBOs and the DOE. According to the Citizens’ Committee for Children, teachers at CBOs earn $15,000 less in the first year of employment and this disparity grows as teachers gain more experience, even though many have the same training as their DOE counterparts.

Pay for Enrollment

The DOE is also moving towards an enrollment-based payment model in which monthly payments are calculated based on monthly enrollment for each service model and age group. If a provider has a monthly enrollment rate of less than 58%, they are only awarded 65% of the monthly contracted funding received. This is a risk because providers staff and build up their programs and allocate space according to the number of seats that could be filled and not depending on the number of children enrolled. The RFP also contains a disclaimer that “All payments are subject to contract registration timelines. Any delay in the contracting process may delay or prevent contract registration and disbursement of payments.” If the DOE is not committed to prompt payment and is only paying for a portion of the contract value, providers will not be able to maintain their programs. The DOE should reimburse nonprofits at a rate that addresses the full costs of a program.

Core v. Additional Hours

The RFP divides the Extended Day programs into “core hours,” which is for 6 hours and 20 minutes of each program day and “additional hours,” which is for hours outside of the core 6 hours and 20 minutes. However, early childhood education programs should be designed to ensure that participants receive the same high quality program throughout the day instead of splitting the time between core and additional hours, which defeats the purpose of equity and socioeconomic integration.

Limited Indirect Costs

Closely related to the overall underfunding of this program is the restriction of indirect costs. This RFP allows a maximum indirect cost reimbursement rate of 15 percent of the total program costs, but it places large reporting, compliance, and administrative burdens on the service provider that increase indirect expenses. The lack of alignment between actual and fundable costs put the organizations’ sustainability at risk.

Lack of Cost Escalators

This RFP is a four year contract with up to five one-year extensions. This implies that there is the risk that providers could potentially receive the same rate for nine years. Nonprofits struggle to meet rising costs as rates on contracts are not increased from year to year to address an increase in the costs of delivering services. With the current underfunding of early education programs, it is crucial that the DOE include cost escalators in their contracts.

Private Match Requirement

This RFP states “The DOE reserves the right to require Head Start programs to contribute a non-federal Share up to 20%, per the Head Start Program Performance Standards.” Since the funding for the Head Start/Early Head Start program is unclear, it is difficult for nonprofits to determine how much additional funds they need to secure. Also, this match requirement makes it infeasible for many nonprofit organizations to apply given the administrative or financial resources needed to come up with the additional funds.

HSC’s Methodology

The HSC RFP Rater assesses the feasibility, opportunities, and risk in City and State human services procurements. Rater scores are based on the RFP and related documents available to the public via New York City’s HHS Accelerator or New York State’s Grants Gateway. The rater consists of 60 questions developed and tested by a team of procurement professionals. The questions are based on information that is necessary to help prospective proposers assess risk.

Each answer is weighted based on the degree of risk inherent in the subject of the question. Answers that imply low to moderate risk are allotted points on a lower scale range compared to higher risk questions. For compound questions, the answer to both parts must be “yes” or “not applicable” to be considered low risk. Scores are calculated by adding all the question scores together. The higher the score, the greater the risk. The scoring range is from 60 to 230, with 0 percent risk equal to a score of 60 and the maximum risk score or 100 percent equal to 230 points. Users can view the answer to each question by clicking the down arrow next to each section to expand the section.

The HSC RFP Rater is not a substitute for the due diligence necessary to inform individual organization decisions.

Low Risk
High Risk

Program Design

Questions

1. Does the RFP include a clear scope of services?
Yes
2. Funding notwithstanding, is the program model/service design likely to produce the goals sought in the RFP?
Yes
3. Does the RFP allow for program innovation or service adaptation to meet community/population need?
No
4. If applicable, does the RFP include additional documents that enable a thorough review of program model, contract terms and conditions, or award agreements?
Yes
Low Risk
High Risk

Operating Requirements

Questions

1. Does the RFP detail or include an Appendix that spells out the terms and conditions for new contracts or delineate any changes in terms and conditions for renewals?
No
2. Does the RFP require staff to be credentialed, certified or licensed and allow a study or supervision plan for uncertified or unlicensed staff while they are pursuing required credentials?
No
3. Does the RFP specify caseload or staffing ratios and include a rationale for the methodology used?
Yes
4. Does the RFP specify staff:supervisor ratios and include a rationale for the methodology used?
No
5. Does the RFP require the use of a particular MIS system, HIT platform, case management or financial system?
Yes
6. Does the RFP allow shared staffing, equipment, vehicles, space or other efficiencies?
Yes
7. Does the RFP require operating licenses or permits that must be obtained from a city/state agency or department that is not the issuing agency?
Yes
8. If the issuing agency requires reporting and compliance activities, do they create an administrative burden and are these costs covered by the funding and built into the budget?
No
9. Does the RFP include specifications about organizational capacity to handle program administration: claiming/billing, reporting, compliance, and oversight requirements and are these costs built into the budget model?
No
10. Does the program require prior approval from multiple city or state agencies before beginning operations?
Yes
11. Does the RFP or Appendix include data governance rules describing ownership, portability, use and provision of provider access to program/client data and reports?
No
12. Does the RFP provide flexibility to amend budgets across line items or budget categories within the overall contract amount?
No
13. Does the RFP require the applicant organization to deliver services or operate programs in locations where it does not have site control?
Yes
14. Does the RFP or Appendix specify the process for year-end reconciliation?
Yes
15. Are payment terms (e.g., timeliness, advances, and recoupment) detailed in the RFP or Appendix?
No
16. To meet the operating requirements of the RFP will successful applicants be expected to submit paper copies of all invoices?
No
17. To meet the requirements of the RFP will successful applicants be expected to submit employee timesheets?
No
18. Does the RFP include additional documents that enable a thorough review of program model, funding, contract terms and conditions or award agreements?
Yes
Low Risk
High Risk

Financial Adequacy

Questions

1. Does the RFP provide resources to train, certify or credential staff and provide resources for coverage while staff are in training?
No
2. Does the RFP include requirements to hire residents, public assistance recipients, consumers/peers and provide resources in the budget model for recruitment, training, and supervision?
No
3. Does the RFP rate structure permit providers to pay a prevailing or competitive wage?
No
4. Does the RFP include a price/fee/rate per participant that supports program expenses, program outcomes and program administration?
No
5. Does the RFP allow the use of a federally approved indirect rate or allow a minimum of 15% overhead/indirect rate?
Yes
6. Do rates cover facility costs for owned/leased space?
Yes
7. Does the RFP limit the calculation of overhead to direct client services (no org admin)?
No
8. Does the RFP permit the organization to negotiate an indirect rate post-award?
No
9. Is start-up funding available for new programs?
Yes
10. Are resources available to support the technology, reporting, evaluation and monitoring activities associated with evidence-based or performance-based program models?
No
11. Is the rate methodology/budget model transparent and based on the actual cost of running a quality program?
No
12. Is close-out funding available to cover space, severance, vacation and other liabilities when the contract or program ends?
No
13. Does the RFP include a commitment to prompt payment?
No
14. Does the RFP budget model allow interest costs in the event of late payment?
No
15. Does the RFP include or require any private match (cash or in-kind) in its budget model?
Yes
Low Risk
High Risk

Performance Expectations

Questions

1. Does the RFP include enrollment and/or utilization targets that can be achieved with the model and resources available?
No
2. Does the RFP direct or limit the source of client referrals (control of referrals, eligibility or enrollment)?
Yes
3. Are RFP expectations for performance aligned with program design and goals (can deliverables and metrics be achieved with proposed model)?
No
4. Is significant performance risk built into RFP requirements (expectations of >85% performance goals reached before full payment)?
Yes
Low Risk
High Risk

Compliance

Questions

1. Does the RFP include unfunded compliance activities or mandates?
Yes
2. Does the RFP or Appendix specify annual program and financial audit requirements?
Yes
3. Does the RFP or Appendix detail reporting requirements?
Yes
Low Risk
High Risk

Sustainability

Questions

1. Does the RFP advance a unified approach to data collection, reporting and compliance monitoring across programs?
No
2. Does the RFP support a unified approach to staff salaries/wage levels and benefits across programs?
No
3. Does the RFP require/assume that the bidder will bring infrastructure (administrative, technology or programmatic) or other resources (staffing, in-kind) to support the program?
Yes
4. Will this be a multi-year or renewable contract?
Yes
5. Will this be a year-to-year contract?
No
6. Does the RFP budget model/rate structure build in annual baseline operating cost escalator/increase over the term of the contract for salaries/COLA?
Yes
7. Does the RFP budget model/rate structure build in annual baseline operating cost escalator/increase over the term of the contract for employee benefits and OTPS?
No
8. Does the RFP require linkage agreements or MOUs with community organizations or networks and provide resources in the budget model for program-related coordination or collaboration activities?
No
Low Risk
High Risk

Procurement Process

Questions

1. Does the RFP provide a minimum of six weeks in total to respond/submit?
Yes
2. Does the RFP specify a methodology for assessing an applicant’s past performance (Vendex score, program and/or financial audits
Yes
3. Does the RFP review process or scoring give a higher weight to the lowest price/bid?
No
4. Does the RFP scoring for organization expertise, experience and management capacity align with program/service goals and expectations?
Yes
5. Is the RFP review process and rationale for scoring programs/services transparent?
Yes
6. Is the RFP review process and rationale for scoring operating requirements transparent?
Yes
7. Is the RFP review process and rationale for scoring budget transparent?
No
8. Is the review process and rationale for scoring successful performance transparent?
Yes

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