GovGuam retirement plan services procurement on hold over protest

Procurement of a third-party administrator to run the pay and benefit plans for thousands of government retirees is on hold after ASC Trust LLC filed a protest with the Government of Guam Retirement Fund.

ASC Trust is now appealing to the public auditor, after the Retirement Fund denied the initial protest.

The procurement appeal, filed on April 30, asserts the Retirement Fund did not follow laws that advantage local companies when it solicited bidders for the third-party administrator work.

ASC Trust, through attorney William Brennan, asks the public auditor to order the Retirement Fund to comply with the law or else cancel and reissue a request for proposals, according to the appeal filed at the Office of Public Accountability.

The Retirement Fund went out to bid on March 31 for a company to oversee the government’s 16,451-member Defined Contribution Retirement System, the 6,287-member Deferred Compensation Plan, and Welfare Benefit Plan.

According to the request for proposals, initial bids for the service would have come due April 24.

Procurement is now frozen, while ASC Trust’s protest is resolved.

ASC Trust on March 31 sent written questions to the Retirement Fund, asking whether Guam-based companies would get an advantage when competing on the project, according to OPA documents.

An April 11 response from the Retirement Fund noted there was no geographic preference or scoring advantage based on the offeror’s location.

ASC Trust contends in its appeal that Guam procurement law requires local companies to get an advantage.

It points to a section of Guam law that requires that government procurement of supplies and services come from businesses that:

• Are licensed to do business on Guam
• Maintain an office of other facility on Guam
• A service business actually in business, doing a substantial portion of its business on Guam, hiring at least 95% U.S. citizens or U.S. permanent residents or nationals from the region

Notably, ASC Trust’s webpage asserts it is the largest retirement plan manager in Micronesia, doing business on Guam, Saipan, and throughout the region. 

A protest against the Retirement Fund’s solicitation requirements was filed by ASC Trust on April 16.

The Retirement Fund denied ASC Trust’s protest on April 23.

According to the denial, the third-party administrator work counted as professional services, which are evaluated solely on the qualifications of offerors, under Guam law.

Interpreting the local preference as requiring an award to go to a lower-ranked local company based solely on price would conflict with other sections of the law, Retirement Fund Paula Blas wrote in the denial.

Blas did agree with a separate section of ASC Trust’s protest, which dealt with requirements for a transition plan to be submitted along with proposals.

ASC Trust wrote that the requirement unfairly advantaged the incumbent third-party administrator, which would be Empower Retirement.

Blas agreed to strike the requirement for a transition plan until the top three bidders are selected.

When the Retirement Fund extended the bid deadline to April 28, ASC Trust filed a second protest arguing a stay needed to be placed until their first protest was resolved.

Blas agreed in an April 28 letter.

The procurement is frozen, pending a resolution of the appeal now before the public auditor.