COUNTY OF SAN MATEO

Inter-Departmental Correspondence

Employee & Public Services

DATE:

November 16, 2005

BOARD MEETING DATE:

December 6, 2005

SPECIAL NOTICE/HEARING:

None

VOTE REQUIRED:

Majority

TO:

Honorable Board of Supervisors

FROM:

Mary Welch, Director of Employee & Public Services

Girdie Bernard, Division Manager, Revenue Services

SUBJECT:

Agreement with California Service Bureau

RECOMMENDATION:

Adopt a resolution authorizing the President of the Board of Supervisors to execute a three-year Agreement with California Service Bureau to provide collection services for selected accounts through December 5, 2008, with an option for an additional two year extension at the County’s discretion.

VISION ALIGNMENT:

Commitment: Responsive, effective and collaborative government.

Goal(s) 20: Government decisions are based on careful consideration of future impact, rather than temporary relief or immediate gain.

This Agreement with the California Service Bureau supports this commitment and goal by contributing to the overall collections for the Revenue Services Division.

Performance Measure(s):

Measure

FY 2004-05
Actual

FY 2005-06
Projected

Dollars Collected

$16.3M

$18M

Percent of accounts collected

31.0%

50%

BACKGROUND:

The Revenue Services Division is responsible for collecting monies for services rendered or for fines against persons with outstanding debts to the County. Typical collection accounts include court fines, medical and clinic services, welfare over-payments and private defender fees. As part of the County’s collection efforts, the division refers accounts to external collection agencies when County collection efforts have been exhausted. External collectors have access to information databases for locating debtors that the County does not have. In this way, the County assures that all practical efforts at collection have been pursued.

DISCUSSION:

In August 2005, the County solicited proposals from firms to perform second level collection services. Thirty RFP’s were distributed, 4 firms submitted proposals and all were interviewed. California Service Bureau was selected for several reasons:

1) Their commission rate of 17.5% was lower than the other two agencies with experience collecting similar accounts and competitive with the company that had very little experience handling hospital accounts.

2) They currently provide collection services for another County hospital (Marin General Hospital).

3) Their recovery rate is competitive with other agencies that were part of the RFP process.

4) They have a local San Mateo mailing address and a toll free phone number.

5) They have experience working with County accounts.

In the contract between California Service Bureau and San Mateo County, the commission rate for all accounts except legal accounts will be 17.5%. The commission rate for legal accounts will be 24.5%.

FISCAL IMPACT:

The amount of the contract will be based on the amount of revenue collected by California Service Bureau and will range from 17.5% for non-legal accounts to 24.5% for legal accounts. A non-legal account is one for which we have not initiated legal action against the defendant such as filing in small claims court. A legal account is one for which we have initiated such legal proceedings.

The contract will be for an amount not to exceed $125,000 per year or $375,000 for the three-year term of the contract and if the County exercises the option to extend the contract for an additional two years, the total contract amount will be for an amount not to exceed $625,000. If collections exceed projections, we will request a modification to increase the total amount of the contract. There is no net county cost associated with this Agreement.

1.

General description of RFP

Three-year contract for a private company to provide collection services for selected accounts.

2.

List key evaluation criteria

*Commission rates

*Recovery rates

*Company stability

*Experience handling medical accounts

*System capability

3.

Where advertised

San Mateo Times

4.

In addition to any advertisement, list others to whom the RFP announcement was sent

1 Day Co, Inc.

Able Credit Services

Accelerated Recovery Services, Inc

All County Collection

Athena Credit

Attorney Recovery System

Bureau of Commercial Collect

California Credit Service

California Service Bureau

Classified Collection

Coast to Coast Collections, Inc

Collectal Association

Collection Bureau of America

Collections Data Service

Collections, Inc

Collection People

Collection Service, Inc

Consolidated Collections

Credit Bureau of San Mateo & Burlingame

Farwest Collection

GC Services Limited

Great Western Collection

J & L Collection Services, Inc

Livingston Stern and Associate

National Recovery Control

Northwest Creditors

Professional Recovery Systems

Santa Clara Valley Collections

Transworld Systems, Inc

United Collections

5.

Total number of RFP’s sent to prospective proposers

30

6.

Number of proposals received

4

7.

Who evaluated the proposals

Proposal Screening committee & Interview panel: Girdie Bernard (Revenue Services Manager), Rocio Kiryczun (EPS, Financial Services Manager), Beverley Evans (Revenue Services Sr. Accountant), Bob Fine (Revenue Services Supervisor)

8.

In alphabetical order, names of proposers (or finalists, if applicable) and location

Accelerated Recovery Services, Inc

855 Veterans Blvd

Redwood, CA 94063

California Service Bureau

1602 Grant Ave – 2^nd Floor

Novato, CA 94945

Collection Bureau of America

25954 Eden Landing Road – 1^st Floor

Hayward, CA 94545

Professional Recovery System

3005 Almanden Expressway

San Jose, CA 95118