R33-108-101b. Transitional Costs -- Cost-Benefit Analysis

(1) For this section, the following definitions shall apply: (a) "Competing type of procurement item" means a type of procurement item that is the same, equivalent, or superior to the existing type of procurement item currently under contract in all material aspects including: (i) performance; (ii) specifications; (iii) scope of work; and (iv) provider qualifications, certifications, and licensing. (b) "Competing provider" means another provider other than the existing provider under contract that provides a competing type of procurement item. (c) "Significant," "unreasonable or cost-prohibitive" transitional costs are defined as costs associated with changing from an existing provider of a procurement item to another provider of that procurement item or from an existing type of procurement item to another type that: (i) constitute a measurably large amount that would likely have an influence or effect on the award of a contract if a competitive procurement were to be conducted for the procurement item being considered; and (ii) provides a compelling justification for not conducting a competitive standard procurement process. (2) Transitional costs that must be considered in a cost-benefit analysis include: (a) costs that are directly associated with changing from an existing provider of a procurement item to a competing provider of that procurement item or from an existing type of procurement item to a competing type of procurement item; and (b) a full life-cycle cost analysis of the existing type of procurement item and competing type of procurement items to determine which procurement item is more cost-effective. (3) Transitional costs that may be considered in a cost-benefit analysis include: (a) costs identified in Section 63G-6a-103; (b) costs offered by a competing provider for a competing type of procurement item in a competitive bid or request for proposals process conducted within the last 12 months; (c) costs offered by a competing provider for a competing type of procurement item in a competitive bid or RFP process conducted before the most recent 12 months, updated using an applicable price index; (d) written cost estimates obtained by the procurement unit from a competing provider for a competing type of procurement item; and (e) other transitional costs determined to be applicable by the procurement official. (4) Transitional costs or other information that may not be considered in a cost-benefit analysis include: (a) costs prohibited in Section 63G-6a-103; (b) data provided by the existing provider for establishing: (i) the market value of the existing type of procurement item; or (ii) a competing provider's price for a competing type of procurement item; (c) costs associated with any other procurement item other than the existing type of procurement item or a competing type of procurement item; (d) non-monetary factors, such as the provider's performance, agency preference, and other data or information not specific to the transitional costs associated with the existing type of procurement item or a competing type of procurement item; (e) factors other than the monetary transitional costs directly associated with changing from an existing provider of a procurement item to a competing provider of that procurement item or from an existing type of procurement item to a competing type of procurement item; and (f) other transitional costs or other information deemed inappropriate by the procurement official. (5) The conducting procurement unit shall complete a written cost-benefit analysis and submit it to the issuing procurement unit for approval. (6) The cost-benefit analysis should not be overly time-consuming to complete or involve hiring costly consultants or financial analysts.