OPERATIONS COMMITTEE COMMITTEE RECOMMENDATIONboardarchives.metro.net/items/1993/10_October/items_g_0446.pdfOperations Committee September 29, 1993 Page 2 So Policies and Procedures.

OPERATIONS COMMITTEE

COMMITTEE RECOMMENDATION

The Operations Committee recommends upholding the contracting

offi~cer’s decision on protest filed by Amagic Technologies covering

monthly bus passes.

OPEP~ATIONS COMMITTEE AUI~UST 5, 1993

M

REVISED

Los Angeles Count),

Metropolitan

Transportation

Authority

818 West Seventh Street

Suite 300

Los Angeles, CA 9ooJ7

2J3.623.1194

TO:

THROUGH:

FROM:

SUBJECT:

September 29, 1993

OPERATIONS COMM/~,TEE

BID NO. ~-9325: MONTHLY BUS PASSES

RECOMMENDATION

Deny an appeal of the Contracting Officer’s decision on aprotest filed by Amagic Technologies on the award of MonthlyBus Passes. Contracts were awarded at the August 25, 1993,Board Meeting to Daval Communications Inc., Chino andDigital Printing, Monrovia; under IFB No. 05-9325 coveringMonthly Bus Passes for a one-year period, with an option forone additional year at the election of the LACMTA for anestimated annual cost of $377,558.

In the evaluation process the committee concluded that theproducts recommended for award represented the most costeffective deterrent to counterfeiting. They also determinedthat in a flash pass environment the products are easilyrecognized by the operator as legitimate.

ALTERNATIVES CONSIDERED

I. Sustain Appeal and Rescind Board action of August 25,1993, this action is not recommended.

BUDGET IMPACT

Funds for this procurement were included in the FY93Operating Budget.

BACKGROUND

A. Justification

A protest was filed by Amagic Technologies on August23, 1993, and received by the Procurement Department onAugust 24, 1993. Staff reviewed the allegations raisedby Amagic in accordance with the LACMTA Protest

Operations CommitteeSeptember 29, 1993Page 2

So

Policies and Procedures. Staff determination andfindings concluded that the protest was without meritand recommends that the award decision be upheld°

Procurement Process

The LACMTA issued an Invitation to Bid onApril 27, 1993, to 40 prospective suppliers.Invitation For Bid included a DBE goal of 20%.LACMTA received eight responses.

TheThe

The solicitation included four types of passes:Regular Monthly Passes, Semi-Monthly Passes, RegularReduced and the Los Angeles County Reduced Passes.Each of these pass categories are considered to beseparate and distinct. The MTA reserved the option toaward each category as an individual item with theunderstanding that one item or category must not affectthe unit price of another item or category. Because ofthe different levels of security required for each passcategory it was the MTA’s intent to award the contracton an item by item basis.

For the Regular Monthly Passes (Item i) and the Semi-Monthly Passes (Item 2), the specifications stressedthe importance of ease of recognition by the operatorand the requirement to provide the maximum deterrent tocounterfeiting. The concern for duplication andcounterfeiting was not as important for the RegularReduced Passes (Item 3) and the Los Angeles CountyReduced Passes (Item 4).

An evaluation committee consisting of representationfrom the Procurement, Transportation, Transit Police,and Customer Relations Departments was established toevaluate the samples submitted and determine whichpasses best met the needs of the MTA for recognizabi-lity and the greatest deterrent to counterfeiting. Thecommittee recommended that an award be made to DavalCommunications Group for the Regular Monthly Passes(Item i) and the Semi-Monthly Passes (Item 2), and thatan award be made to Digital Printing on the RegularReduced Passes (Item 3) and the Los Angeles CountyReduced Passes (Item 4).


The evaluation committee determined that the Monthlyand Semi-Monthly Passes (Items 1 & 2) submitted Daval Communications Group was the only pass that metthe MTA’s requirement for ease of recognition in a"flash pass" environment and allowing maximumdeterrence to counterfeiting. Several bids weresubmitted which were lower in price for the RegularMonthly and Semi-Monthly Passes but they did not meetthe specified criteria.

The evaluation committee also determined that theproposed Regular Reduced Passes and Los Angeles CountyReduced Passes (Items 3 & 4) submitted by DigitalPrinting, Inc., Daval Communications Group and Amagicmet the specified criteria. Again, it should be notedthat the ease of recognition and the deterrence tocounterfeiting was not as significant for these twocategories. Since Digital, Daval and Amagic met theMTA’s requirements, an award was recommended to Digitalbecause they had the lowest price for Items 3 & 4.

The following bidders were determinednonresponsive for the reasons cited:

to be

Premiere Southern Ticket - did not meet DBE goal.No samples were submitted, and the bids werebased on using the same holographic foil eachmonth. This would enable a counterfeiter to usefoil from a previous month.

2 o Data Focus - did not meet the DBE goal. Bid wasbased on production and shipment of four-monthssupply and not on the one-month supply asrequested.

3 o Thomas De La Rue Inc. - did not meet the DBEgoal. Bid was based on using the sameholographic foil each month. This would allowcounterfeiters to use the foil from a previousmonth.

Standard Register - did not meet DBE goal. Biddid not include enough information to properlyevaluate.

5o Amagic Technologies, Inc.-DBE goal met. The firmsubmitted two bids, the bids offered anti-counterfeiting deterrents at the level currently used.


6 o

7 o

The evaluation committee determined that thesamples submitted by Amagic did not offer themaximum deterrent to counterfeiting as specifiedin the bid package. The technology submitted byAmagic has been counterfeited. In June, 1993Transit Police apprehended three persons who wereprepared to duplicate the July Passes and

confiscated the plates in their possession. The

level of protection was not acceptable to the

committee.

Bimandari International Corp. - did not meet DBEgoal. Did not comply with requirement for passesto be sequentially numbered. Paper proposedwould not stand the rigors of use.

The following bidders were recommended by theevaluation team:

Daval Communications - DBE goal met. Theevaluation team felt that this proposal wouldoffer the greatest degree of protection againstcounterfeiting especially for the highertechnology needed for Regular Monthly Passes andSemi-Monthly Passes.

Digital Printing - DBE goal met. Digital wasselected as a mid-level technology slightlyhigher than the current pass. The teamdetermined that it was not the highest level oftechnology available, but it m~t the requirementfor a mid-level technology on the Reduced FarePasses where counterfeiting was not as great aproblem as the higher cost Regular MonthlyPasses. Therefore, Digital Printing offered thebest value for the MTA’s money.


DBE PARTICIPATION

The goal for this procurement was established at 20%Communication and Digital Inc. have met the goal.

CONCLUSION

Daval

It is in the LACMTA’s best interests to proceed with therecommendation.

~JC~~~litie I and Procurement

Assistant General Manager

C~ RelationsPaul L. Como, DirectorProcurement

August 24, 1993

Mr. A1 MitchellSenior BuyerLOS ANGELES COUNTY METKOPOLITAN

TRANSIT AUTHORITY470 Bauchet StreetLos Angeles, California 90012

Re: Bid No. 05-932H--Monthly Bus Passes

Dear Mr. Mitchell:

P~rsuant to our conversation, this letter is to serve twop~Lrposes.

The first is to protest the award o£ a contract for buspasses to Daval Communications, Inc. and Digital Printing. Thesecond is to request additional information from you regardingthe Ama~ic Technologies, Inc. bid and information from otherbidders on the subject bid.

We would like a copy of the evaluations prepared for eachbidder, including rankings and points provided by any and allmembers of the Evaluation Committee.

We would also like specific infok~~iation regarding the "new"technology proposed to be used by Daval Communications, Inc. andDigital Printing.

Your letter of August 19, 1993 to Amagic Technologies, Inc.indicates that their bid was non-responsive to the requirement ofthe bid, specifically Page IS, Paragraph 3.2. Please be informedthat Amagic, pursuant to Paragraph 3.2, submitted a sample of thefinished product they were propos£ng for each of their twonroposals. In addition, they submitted a separate Bid for~ for

~ product. These two submittals fulfill the rec~/irements of"graph 3.2.

Mr. A1 MitchellAugust 24, 1993Page Two

We would also like you to supply us with any an~ alldocuments in your possession or in the possession of other MTApersonnel or agent regarding the subject bid, including but no~limited to evaluations of any and all bids and all othercommunication an~ document&rich.

Due to The short time frame involved in this matter, wereserve the right to request ~dditional information upon receiptof the above-requested information.

Should you have any questions or need any additional~nformation, please feel free to give me a call.

Very truly yours,

SNYDER & ARCHUT,F, TTAprofessional corporation

GILBENT M. ARCHDT,F.~TA, Attorney at Law

M

470 Bauchet StreetP.O. Box ~o8

Los Angeles. CA 9oo5~

August 31, 1993

Mr. Gilbert M. ArchulettaSnyder & ArchulettaAttorneys at LawThirty Seventh Floor355 S. GrandLos Angeles, CA 90007-3101

Dear Mr. Archuletta:

Subject: Protest. of the Proposed award of IFB NO. 05-9325,Monthly Bus Passes

This letter is in response to your protest letter datedAugust 24, 1993. As the LACMTA’s Contracting Officer, Ihave reviewed the allegations raised in the letter inaccordance with the Policies and Procedures Manual of theOffice of Contracts and Procurement, Section 6.2 ProtestsReceived After Bid Openinq, But Before Award and find thatyour protest is without merit. The following is thedetermination and findings of that review.

The bid specifications state that a contract will beawarded to the firm which offers the most cost effectivedeterrent to reproduction or counterfeiting.

Under the provisions of the Invitation For Bids (IFB), theevaluation committee reviewed each proposal according tothe following criteria:

i. Degree of difficulty to duplicate and reproduce.

2. Ease of recognition of validity of pass by busoperators in a "Flash Pass" Environment.

Mr. ArchuettaAugust 31, 1993Page 2

3. Cost

Abi~l--lty of vendor to fulfill contract

LACMTA will be the Sole judqe of the suitability ofthe products submitted. ~

The sample products submitted by Amagic for Rec~alar andSemi--Monthly Passes did not represent the greatest

deterrent to duplication and reproduction ofcounterfeiting.

The committee also determine~ that use of printed media, asproposed by Amagic does not deter duplication by colorphoto or process printing and offers marginal protectionfrom counterfeiting. -The addition of a holographic stripdoes not add significant additional protection fromduplication.

The committee determined that the proposals submitted forReq~lar and Los Anqeles County Reduced Fare Passes byDaval Communications, Amagic and Digital Printing alloffered The same degree of difficulty to reproduce orcounterfeit "and all were equally recognizmble by busoperators as valid. As the pass offered by all threebidders were considered equal, price became the determiningfactor in recommending award. The lowest bidder wasrecommended for this award.

It is the LACMTA’s policy to provide.a formal debriefing toall bidders following the Board’s action on a

recommendation. This debriefing process is utilized toclarify the procurement process and the methodologyutilized by the evaluation committee to reachrecommendation for award. Once the Board of Directors hasmade a final decision, a debriefing can be scheduled. Atthis debriefing, we will discuss the evaluation committee’sprocedures, review of all bid submittals and technicalcompliance.

Based on the findings of the Contracting Officer, Amagic’sprotest is denied. It is our intent that the Staffrecormmendation be considered by the Authority’s Board ofDirectors at their meeting of October 27, 1993. TheContracting officer’s decision may be appealed to theAuthority’s Board of Directors.

Mr. ArchuettaAugust 31, 1993Page 3

A copy of the Authority’s protest procedures is availableupon request, so that you may know and understand theprocedures necessary to process an appeal to the Board. Bycopy of this letter, all proposers shall be notified that aprotest has been filed, the basis of the protest and theAuthority’s decision to deny the protest.

~ely,

Paul L. Como

OCPM-19REV 10/91

~’9B~d mtg

R’ri~ Item No. 5ACCOUNT NO. A.F.F- NO.

50499

Supplier: out to bid

Payment Terms

REQUEST TO PURCHASESOUTHERN CALIFORNIA RAPID TRANSIT DISTRICT

OFFICE OF CONTRACTS, PROCUREMENT & M~_T..~RIEL(213) 972-5028 ~.~..-_.

6/10/93 .,,.,,\~ ~ ,~.

3000~ User Order DateZ~-7-92

F.O.B.SHIP Via:

P.O. No.

Reqn. No. 2-1600-132

Order Placement Date ~

Please Ship To:~----]470 Bauchet Street NOV I 0

Los Angeles, CA 90012

~--~425 S. Main St. OM~" " ~Los Angeles CA 90013

User Required Date Vendor DeliveryCommitment

Quantity Description/Part Number

12 Monthly Bus Pass sets, delivered in

monthly increments

Only order one class ofMaterial on a Requisition PRICE UNIT EXTENSIO

’RE CEIVED*Not to exceed $296,000 plus tax

)V I u ;992

Placed BY:F-]Telephone r’-]Fax.

REMARKS:

Date

[] Mail With

-_STATE SALES TAX APPUCABLE

TECHNICAL INSPEC~ON RKQUIRED

/~" ~-~/~~DO~S I~/~TERIAL

Buyer

Purchase C~nttact Manager

Assistant Oirector/OCPM

DirectorlOCPM

OCPM-19" " -" " " : REQUEST TO PURCHASE~ SOUTHERN CALIFORNIA RAPID TRANSIT DISTRICT

OFFICE OF CONTRACTS, PROCUREMENT & MATERIEL(213) 972-5028

ACCOUNT NO. I A.F.E. NO.

I50499WORK ORDER/MODE

30OO

Supplier: out, to bid -’ ¯

GRANT NO. 1 BUYER/CA

Payment Terms SHIP Via: F.O.B.

P.O. No.

Reqn. No.’ 2’1600-1~2

Order Placement Date__

User Order Date

Please Ship To’. " " ¯r--y147o Bauchet Street ..~;: ....I ILos:~Angeles, CA

i~----].425. S.. Main Sty’" .~:~.- _Los ~mgeles CJ~:.90013

tUser’Required Date Vendor Delivery .Commitment -- ...> -

Quantity

12

Description/Part Number Only order one class ofMaterial on a Requisition PRICE UNIT EXTENSIOI

Placed By: F’-] Telephone Fax .F-] Mail With ;"~’: - " "

STATE SALES TAX APPUCABLEREMARKS: ~ ~_ " TECHNICAL INSPECTION i~F~I~IRED

SOUTHERN CALIFORNIA RAPID TRANSIT DISTRICTEQUAL OPPORTL~NITY DEPARTMENT-DBE OFFICE

INTERDEPARTMENTAL MEMORANDUM

DATE: November 19, !992

TO: Paul Como

FROM: Pat Padilla:~

SUBJECT: DBE Goal for Requisition No. 2-1600-132: Monthly bus passsets. Received in EO/DBE Office on 11/19/92

By action of the Board of Directors on August 8, 1991, Districtstaff was directed to "increase the participation of all sociallyand economically disadvantaged groups~by setting contract specificgoals on every subcontracting/procurement opportunity (includingamendments)." A prime consideration when establishing goals isthe number of DBEs available based on the type of opportunity.

The EO and OCPM Departments have established methodology fordetermining subcontracting/procurement opportunities and DBEavailability. The goal setting process requires minimuminformation which must be provided with all procurement reqt~estsfor DBE analysis. This information is listed below:

Requisition signed by Originating Department, ExecutiveStaff and OMB.

OCPM-accepted scope of work.

Sub-contract Planning form.

Basis for contract award.

Identification of the method of solicitation.

6- Points of contact for consultation.

a. OCPM and User office

If all of the above is included in the attached-request, the goalthat is hereby established is to be considered final. If there aredeficiencies listed below, the goal is established on an interimbasis until all required documentation is provided fer analysis.

The DBE Participation Goal for this procurement is 15%;

(If applicable) the following items are required for final goalsetting: No(s).6

The DBE Representative for this procurement is Audrey Noda.

cc: F.Hanock

OCPM-6 SOUTHERN CALIFORNIA RAPID TRANSIT DISTRICT

PURCHASE REQUISITION JUSTIFICATION FORM

A. Requestor’s Name Dale T.anz Phone No. ,=~rf 7nr14

B. Requisition No. 2-1600-132 Date 11-7-92

C. Was item included in department’s approved budget? Yes

If not, please explain:

D. Justification (Include impact on District and department objectives and why item is required):

Item is used as monthly prepaid fare media generating advance

revenue and increasinq patron convenience.

E. Basis of cost estimate (if over $10,000, show how all costs were developed, including assumptionsand calculations):

Cost of priQ~ contract

F. Suggested sources of supply (a~ach separate sheet if necessa~/):

Go

2.

3.

4.

5.

Company Name Address Contact Phone

See Attached

Sale

Disposition of equipment being replaced (if applicable)

Trade-in Salvage

Use by other department

Comments:

No Attach any of the following documents which are applicable to this procurement. If they are notavailable at this time, please provide the availability date of each.

Check if attached or providedate of availability

1. Scope of workI~]

2. Specifications ~

3. Quotations I---I

4. Microcomputer H/W & SNV Form I---1

5. Subcontract Planning Form ~

Requestofs Signature Date

SUBCONTRACT ’PLANNING FORM

SUMMARY CF GOODS OR SE,-qVICI~. SCOFE OF WORK. AND F_~"CIMATE~ VALUE.

Printing, assembling, packaging and delivery of 12 monthly sets

of Bus Passes

OPPORTUNITY FOR SUBCONTRACTING7 YE~ x NO

IF YE~. LIST ~ ~GIB! ETASKS OR ~ELE.MF-NTS AND ~T~MATED VALU~

Eligible tasks are partly dependent on final design choice.

or tasks that may be subcontracted include: final assembly,

portion of printing, security devices, delivery, sec,~rity.

Elements

packaging

IF NO. li--TZPLAIN.

LIST OF POTI-~NTIAL SOURCES. IDENTIFY AS PRIME (P), SUB (S). OR SUPPLIER (SP), USEADDITIONAL PAG;::-~ AS NECF_..,~SARY. ,,,

see attached .

AWARD SUMMARY~SPLIT AWARD

ABSTRACT OF PROPOSALS TO FURNISH MATERIAL - BID TABULATION: PAGE 1 OF 4

DATE

BID NO.

BIDS OUTS 04/27/93 TOTAL 40

BIDS OPENED 06/01/93 TOTAL 8

ADVERTISEMENT: NO BID I

DATE 04/27/93 NO RESPONSE 31

NEWSPAPER DAILY NEWS

NON-MINORITY BIDS

MINORITY BIDS

ITEM

SENT REC’D

30 6

I0 2

ARTICLES

Monthly Bus Passes

Regular Monthly Passes

PRICE PRICE

.1199 EA

PRICE

(2) Semi-Monthly Passes .... .1206 EA

(3) Regular Reduced Passes .3318 EA ....

(4) LA County Regular Reduced Passes .3318 EA ....

Invoice Terms Net 30 Net 30

8.25% Sales Tax $ 2,135.13i$ 28,837.24

Total $ 28,015.53 $ 349,542.47

PRICE PRICE

07-18-93

05-9325

PRICE

$ 380,000.00

ETHNIC BREA~DOWN

MAJORITY (4) ORIENTAL

BLACK (5) AMERICAN-INDIAN

SPANISH SURNAME (6) OTHER

I HEREBY CERTIFY Digital Printinq/Daval Communications AS BEING THE LOWEST

RESPONSIBLE BIDDERS AND RECOMMEND THE AWARD TO THEM FOR TOTAL BID PRICE INCLUDING

SALES TAX OF $ 377,558,00

DATE

B~D37-15/mw Paul L. Como, Director, Procurement

LOS ANGELES COUNTY METROPOLITAN TRANSPORTATION AUTHORITY

TABULATION OF ACCEPTABLE BIDS

ABSTRACT OF PROPOSALS TO FURNISH MATERIAL - BID TABULATION:


BIDS OPENED 06/01/~3 TOTAL 8

ADVERTISEMENT: NO BID 1

9ATE 04/27/93 NO RESPONSE 31


SENT REC’D

30 6

10 2

YON-MINORITY BIDS

~INORITY BIDS

.’4

.,4

DATE 07-18-93

PAGE 2 OF 4 BID NO. 05-9325

ITEM ARTICLES

Monthly Bus Passes

Rejected Bids

A. Didn’t Meet DBE Goal

B. Didn’t Meet Technical Req.

Invoice Terms

8.25% Sales Tax

Total

PRICE PRICE PRICE PRICE PRICE PRICE

X

Net 30

$ 45,016.21

545,651.00

(3)

ETHNIC BREAKDOWN

MADORITY

BLACK

SPANISH SURNAME

(4) ORIENTAL

(5) AMERICAN-INDIAN

(6) OTHER

I HEREBY CERTIFY AS BEING THE LOWEST RESPONSIBLE

BIDDER AND RECOMMEND THE AWARD .TO THEM FOR TOTAL BID PRICE INCLUDING SALES TAX

oF $

DATE


TABULATION OF NON-RESPONSIVE BIDS


DATE

BID NO.

07-18-93

05-9325


BIDS OPENED 06/01/93 TOTAL 8

ADVERTISEMENT: NO BID I

DATE 04/27/93 NO RESPONSE 31


NON-MINORITY BIDS

MINORITY BIDS

SENT REC’D

30 610 2

ITEM ARTICLES PRICE PRICE PRICE PRICE PRICE PRICE

Monthly Bus Passes

Rejected Bids

A. Didn’t Meet DBE Goal X X X X

B. Didn’t Meet Technical Req. X X X X X X

Invoice Terms Net 30 Net 30 Net 30 Net 30 Net 30 Net 30

8.25% Sales Tax $ 6,391.66 $ 7,265.53 $ 9,373.14 $ 9,693.30 $ 19,633.02 $ 21,379.88

Total $ 77,474.61 $ 88,067.00 $ 113,613.79~$ 117,494.55 $ 237,976.00 $ 259,150.00

(4) (I) (~) (1) (1) (~)

ETHNIC BREAKDOWN

MAJORITY (4) ORIENTAL

BLACK (5) AMERIC~J~-INDIAN

SPANISH SURNAME (6) OTHER

I HEREBY CERTIFY AS BEING THE LOWEST RESPONSIBLE

BIDDER AND RECOMMEND THE AWARD TO THEM FOR TOTAL BID PRICE INCLUDING SALES TAX

OF $

DATE


LOS ~NGELES COUNTY METROPOLITAN TRANSPORTATION

TABULATION OF NON-RESPONSIVE BIDS


DATE

BID NO.

07-18-93

05-9325

DS OUTS 04/27/93 TOTAL 40

9S OPENED 06/01/93 TOTAL 8

/ERTISEMENT: NO BID I

FE 04/27/93 NO RESPONSE 31

ISPAPER DAILY NEWS

SENT REC’D

;-MINORITY BIDS 30 6

MINORITY BIDS 10 2

ITEM ARTICLES

Monthly Bus Passes

Rejected Bids

A. Didn’t Meet DBE Goal

PRICE PRICE PRICE PRICE

X

B. Didn’t Meet Technical Req. X X X X X

Invoice Terms Net 30 Net 30 Net 30 ~ Net 30

8.25% Sales Tax $ 24,777.13 $ 27,156.24!$ 28,732.49 $ 28,877.81

Total

ETHNIC BREAKDOWN

PRICE

MAJORITY

BLACK

SPANISH SURNAME

(4) ORIENTAL

(5) AMERICAN-INDIAN

(6) OTHER

Net 30

$ 45,016.21

$ 300,328.80 $ 329,166.60 $ 348,272.64 $ 350,034.00 $ 545,651.00

(4) (4) (I) (3) (3)

PRICE

HEREBY CERTIFY AS BEING THE LOWEST RESPONSIBLE

BfDDER AND RECOMMEND THE AWARD TO THEM FOR TOTAL BID PRICE INCLUDING SALES TAX

OF $

DATE

B~37-15/mw Paul L. Como, Director, Procurement

SNYDER ARCHULETTAA PROFESSIONAL CORPORATION

ATTORNEYS AT LAW

THIRTY-SEVENTH FLOQR~ IBM TOWER~ WELLS FARGO CENTER

385 SOUTH GRAND AVENUE~ SUITE 3788~ LOS ANGELES, CALIFORNIA 90071-3101 / TELEPHONE (~13) 6~.-8~

FAX {~13) 628-3S06

October 25, 1993

Members of theMETROPOLITAN TRANSIT AUTHORITY BOARDc/o Helen M. Bolen, Board Secretary818 West Seventh Street3rd FloorLos Angeles, CA 90017

RE: Bid No. 05-9325, MONTHLY BUS PASSESREQUEST FOR REEVALUATION OF BIDS.

Dear Directors,

This office represents AMAGIC, Inc., which company producesmonthly bus passes for MTA, as well as for transit authorities inOrange County, Chicago, Oakland, and many other jurisdictionsthroughout America.

The~referenced file recommends that your Board approve:

i. The purchase of bus passes from other than the lowbidder, at ~n additional cost to MTA of $78,000.

2. The purchase of bus passes which use the most easilyand simply counterfeited technology on the market, while reject-ing the low bid, which uses the latest and most sophisticatedanti-counterfeiting technology.

3. Purchase from a non-existent contractor with no historyof production of bus passes or other security devices.

Setting aside for a moment the truly extraordinary historyof this matter, which is briefly described below and more exten-sively in the addendum to this letter, this contract must not betreated as a relatively small $300,000 contract, but one whichaffects millions in lost revenues from a pervasive counterfeitingindustry.

As such it deserves careful attention, and certainly areevaluation of what has taken place.

SNYDEP. g ARCHULE’TTAA PROFESSIONAL CORPORATION

October 25, 1993Page 2

There are three classes of anti-counterfeiting technologiespractically available to be used on bus passes. The first andmost primitive of these is a simple printing of a symbol onto ametallic foil, similar to the Christmas wrapping paper availableuniversally. This is the material which has been used in thepast year to hounterfeit holograms.

Your pass supplier initially used a metallic foil technologyuntil it became apparent that the counterfeiters found it ulti-mately simple to duplicate it. They then switched to a two-tierhologram.

For the bulk of the past year, a two-tier hologram has beenused as a protective device on your passes. This device givesthe appearance of depth, with two layers of reproduction. Unfor-tunately ingenious counterfeiters, while they could not perfectlymatch the appearance of depth, using metallic foil they repro-duced the symbol itself. This, combined with understandabledriver inattention, has been sufficient to cause loss to theAuthority which can be counted in the millions.

In the current bidding, Amagic bid two devices. One was thetwo-tier hologram, at a very low price. The other was thethree-tier hologram, at a price which was the low bid.

A three-tier hologram is the same device used on MasterCardor Visa, and most bankcards as well, and is the most sophisticat-ed printed technology in common use in the world. While, likeanything less (U.S. currency, for example) it is possible counterfeit a three-tier hologram, it is so very difficult thatit is just not cost-effective for a bus pass.

Nevertheless, the device recommended to the Board is theeasily-duplicated metallic foil with a printed Symbol over athree-tier hologram--even though the three-tier hologram was thelow bid!

This is a conclusion which has startled every expert in thefield to which it has been described, all of whom are dumbfoundedand unable to suggest any reason why a cheap and easily-copiedtechnology would have been selected by an entity with a counter-feiting problem.

Finally, it is equally surprising that a company would havebeen selected which has never produced a bus pass and whichfunctionally does not exist. Its address is another company, anidle printing plant. When your representatives visited the

October 25, 1993Page 3

plant, they described the only activity as "simulated," and thesecurity as "inadequate." When our investigator visited it,there was no activity at all.

Amagic is one of the most experienced producers of buspasses in the United States, including MTA, Orange County, Chica-go, Oakland and many other transportation organizations through-out the nation.

As you will see in the attached addendum, we have asked tosee the evaluation sheets for this bidding. At first we weredenied access, then later we were told that an Authority employeehad "walked out" of his employment, had taken the evaluationsheets with him, and that Purchasing was unable to find eitherhim or the sheets. This is only one event in the chain of inex-plicable events surrounding this bid, and which are outlined inthe Addendum.

For the foregoing reasons, we request that the AuthorityBoard order a reevaluation of the bids by a new panel made up ofpersons well-acquainted in the field of security devices, withevaluation sheets and interviews of the bidders, and a fully-documented result to be submitted to the Board.

Most respectfully submitted,

SNYDER & ARCHULETTAa pro~ional corporation

~THUR K. SNYDER, Attorney at/LawI

AKS/ap

Attachment

TO:

FROM:

DATE :

RE :

Whom It May Concern

Gilbert Archuletta, Attorney at Law

October 22, 1993

Amagic Technologies’ Bid for MTA Bus Passes(Bid No. 05-9325)

The following is a summary and a chronology of activitiesregarding the MTA bid for bus passes:

I. By letter of August 19, 1993, MTA ’staff indicatedAmagic Technologies’ bid was non-responsive to the Bid Specifica-tions. They cited Page 19, Paragraph 3.2 Of the Bid Specifica-tions and indicated that Amagic was non-responsive in meetingthat specification, even though Amagic had met all of the re-quirements stated in the Bid Specifications.

2. In a phone conversation with Senior Buyer A1 Mitchellof MTA on August 23, 1993, Mr. Mitchell indicated that AmagicTechnologies’ bid was possibly not non-responsive, but mayberather did not meet the requirement for low bid.

3. On August 24, 1993, Amagic filed a protest with MTAsince staff was recommending Daval Communications and DigitalPrinting for the~bus pass contract and, since Amagic had met allBid Specifications, was low bid and submitted the latest hologramtechnology for the bus passes.

4. By letter dated August 24, 1993, Paul Como, Director ofProcurement for MTA, in a letter, indicated that they had re-ceived Amagic’s protest and would review the issues raised in theletter in accordance with Section 6.2 of the Policies and Proce-dures Manual of the Office of Contracts Procurement and Materiel.He also indicated that the Authority will not proceed with theproposed award until completion of the review of the issuesraised in your protest.

5. Amagic’s attorneys requested and received a copy of thePolicies and Procedures Manual of the Office of Contracts Pro-curement and Materiel specifically ~asking for Subsection 6.2referred to by Paul Como~in his letter of August24, 1993. Thesepolicies were later determined to be obsolete by MTA staff.

6. Qn Auqust 25, 1993,. the Board Of DirectQrs of MTAawarded the contract for the subject bus pa~ses to Dav~l Communi-cations and Diqit~l Printinq, even though Amagic ha~ been in-formed both by telephone from A1 Mitchell and by ~etter datedAUqUSt 24,. 1993, that the ~uthority.wi!l not proceed with theproposed contract until Amaglc’s protest hadbeen reviewed.

october 22, 1993Page Two

7. By letter dated August 31, 1993, signed by Paul Como,Amagic’s attorneys were informed that the protest had been re-viewed and that it was found to be without merit. ~n th~ let~ter, Mr. Como indicated that the Authority’s Board of Directorswould consider this matter at its meetinq of October 27, 1993.He also indicated that the reason for rejecting Amagic’s protestwas that the Evaluation Committee for the bids had determinedthat Amagic’s bid did not represent the greatest deterrent toduplication and reproduction of counterfeiting.

8. Amagic’s attorneys asked for a meeting with MTA staffto discuss this matter pursuant to the Policies and Proceduresfor Protests given to Amagic’s attorneys. However, the Policiesand Procedures Manual supplied to Amagic’s attorneys was laterdetermined by MTA staff to be outdated and erroneous. There-fore, a separate Evaluation committee to review Amagic’s protestwas not convened. A meeting was held on September 9, 1993, atMTA offices with Paul Como, A1 Mi£chell and other MTA staffmembers regarding this bid. Mr. Como had to leave the meetingafter a very short period of time, and therefore he was notpresent to hear Amagic’s presentation. Subsequently, A1 Mitchellindicated that he was going to supply Amagic with additionalinformation, since he still insisted that Amagic was not thelowest bid nor did they have themost updated technology. Mr.Mitchell indicated that Daval Communications was using a reflect-ing foil which was less susceptible to counterfeiting and, there-fore, they were recommending Daval Communications and DigitalPrinting for the contract.

9. A subsequent meeting was requested by Amagic’s attor-neys on September 21, 1993.. At ’that meeting, it was indicated byM~A staff that, in fact, Amaqic’s bid was th~ low bid. However,staff felt that the reflecting foiltechnology was better thanAmagic’s use of a hologram for the passes since they believed itwould eliminate much of the passes’ counterfeiting.

i0. At the September 21, 1993 meeting,.staff also indicatedthat they had some problems internally regarding documentation onthe bid and evaluations conducted by the initial EvaluationCommittee. They also indicated that it was an error when theBoard approved the contracts with Daval and Digital at theirmeeting of August 25, 1993, and the matter pursuant to theirprevious communications to Amagic should have been removed fromthe MTA Board’s agenda. The evaluations have never been madeavailable to Amaqic. Amagic was told bY MTA Procurement staffthat an employee had left MTA employment and had taken theevaluations with him!

October 22, 1993Page Three

In fact, Amagic is not sure if their second bid was everevaluated. Amagic has the highest level of technology availableanywhere. It has also supplied to MTA, under prior contract, thereflecting foil Daval is now proposing as a higher and newertechnology. Moreover, Daval has no~ met the facility securityrequirements of the MTA Transit police.

ii. On October 6, 1993, a letter was received by Amagic’sattorneys from A1 Mitchell indicating that the "Authority’s Boardof Directors" is scheduled to meet on the bus passes award onWednesday, October 13, 1993. The letter further indicates thatthe Authority’s secretary should be contacted regarding the timeof the "Committee meeting". Amagic’s attorneys contacted Mr.Mitchell immediately upon receipt of that letter, and heindicated that there were some errors in the letter and that itshould be disregarded, and another letter will be sent regardingthe matter.

12. On October 8, 1993, Amagic’s attorneys received aletter from A1 Mitchell indicating that the Operations Committeewill meet on that matter on October 13, and the full Board willmeet on October 27 regarding the protest on the monthly buspasses.

In summary, MTA staff indicated initially ~that Amagic’s bidwas non-responsive, then said they were not, the lowest bidl thensaid they would consider their protest, then disregarded theprotest and approved the contract, then said that Amagic Technol-ogies was inferior, then said the full Board would take up thematter on October 13, then said Operations Committee would takeup the matter on the 13th. They have never supplied theevaluations of the bids to Amagic!

Please note: Copies of letters~ minutes, etc. ar~ availableto substantiate all of the above-noted informa-tion.

OPERATIONS COMMITTEE COMMITTEE RECOMMENDATIONboardarchives.metro.net/items/1993/10_October/items_g_0446.pdfOperations Committee September 29, 1993 Page 2 So Policies and Procedures.

Documents