Swiss Challenge Negotiated Request for Proposals for a Digital Government Platform

Governments must seize the opportunity to fast forward innovation, create greater resiliency to respond to future challenges, reinforce new behaviours, and leverage digital for better customer experience and operating efficiencies. At the corporate-level, the City has developed a new strategic approach to offering services in an integrated, convenient, and increasingly personalized way, similar to the services they receive from their financial institutions and now their health care providers. It is about pivoting the organization to an 'outside-in' approach that improves customer experience, accessibility, and engagement, while implementing a more effective city-wide approach with standards on service design, business process engineering, enabling technology, privacy, and security. As an important step in the City's transition to offer more services digitally, the City of Toronto is seeking a relationship with a partner-with proven experience modernizing government services-to offer digital services and a payment platform. The City of Toronto will work with this partner to bring together digital services (commencing with revenue services) in an accelerated, but phased approach so that residents, businesses, and visitors can seamlessly interact with the City of Toronto and access services across any device or medium. In July 2020, a Council report outlined the opportunity to seek a commercial relationship with PayIt LLC ("PayIt"), an organization that had submitted an unsolicited proposal to the City on a digital government platform to accelerate the customer service transformation. That report (EX15.5), Innovative Partnership for Digital Government Platform, was referred back to the City Manager for further consideration. In response, the Purchasing and Materials Management Division (PMMD) and the Office of Partnership recommended a Swiss Challenge procurement process-the appropriate approach to ensure a fair and transparent consideration of the unsolicited proposal from PayIt. A Swiss Challenge takes the unsolicited proposal and effectively puts it to market using a Request for Proposal procurement vehicle that invites other suppliers to submit a counter-proposal that may meet or exceed the original unsolicited proposal. If a supplier's counter-proposal is able to meet or exceed the original unsolicited proposal, the supplier of the original unsolicited proposal has an opportunity to meet the counter-proposal. The City Manager, Deputy City Manager of Corporate Services, and the Chief Financial Officer and Treasurer agreed with this approach, and a Swiss Challenge Negotiated Request for Proposals (SC-nRFP) was issued to market in September 2020. To ensure that the process was conducted in a fair and transparent manner, a third party Fairness Monitor was retained and the City's Internal Audit Division was asked to oversee the process. The purpose of this report is to provide an update on the SC-nRFP process and outline next steps. The competitive procurement process is ongoing, but the evaluation stages have been completed. Twenty-two suppliers confirmed their intent to participate in the SC-nRFP, with six suppliers attending an optional information and question meeting. At the time of deadline, the City received one counter-proposal to be evaluated against the PayIt proposal. Both the PayIt proposal and the counter-proposal passed the mandatory requirements set out in Stage 1 and Stage 2A of the SC-cRFP requirements. But after evaluation of Stage 2B, only the PayIt proposal earned a score that met the evaluation threshold needed to advance to the next stages of the evaluation process, and ultimately quality for negotiation. Staff will now begin negotiations with the successful supplier, PayIt, over the course of February and March 2021. Based on the success of the negotiations, Staff will return to Council in April 2021 to seek approval to award the contract. There is an opportunity for the City to enter into a cost-effective, high-impact commercial relationship that meets many desired objectives. The City is seeking opportunities for more innovative relationship models with all sectors given the current fiscal situation, as outlined in EX17.1, Towards Recovery and Building a Renewed Toronto. While the greatest benefit of this relationship will be a modern and integrated experience for residents and businesses, there must also be a viable financial return on investment (ROI) where potential savings can be reinvested in other City priorities. The move to a unified digital experience will be undertaken in phases, beginning with the integration of property tax payments, utility bill payments, and revenue collection services across one digital payment platform. The platform will be scalable and the experience iterative, gradually integrating a range of residential City services, such as permits and licensing, program registrations, integration with 311, and more. The objective is to allow residents and businesses to transact, interact, and engage with the City of Toronto in the way they want and when they want, all in one place.