Unsolicited proposals submission and assessment guidelines

1. Introduction

The Government of Ontario believes in fostering and engaging in opportunities led by private-sector innovation that supports economic development and community needs. In most cases, traditional government infrastructure procurement processes aim to deliver a specific asset. But the government also wants to encourage good proposals to be brought forward that it might not have considered or developed itself – particularly proposals that create jobs and improve public services.

The following document provides the guidelines that formalize the government’s framework for infrastructure-focused unsolicited proposals.

Where these guidelines conflict or are inconsistent with the existing government procurement directives or policies, those directives or policies shall apply. These guidelines are not intended to create any rights or obligations. Where a submission is made, all rights and obligations are solely contained within the terms and conditions agreed to as part of the submission process.

1.1 Definition

Unsolicited proposals (USPs), also known as market-led proposals, are proposals to the government not requested through an existing government procurement.

1.2 Scope

The scope of the USP framework is currently limited to infrastructure projects, which includes, but is not limited to, asset types such as transit projects, health care facilities, highways, law enforcement facilities, housing and digital infrastructure (including broadband and cellular networks). The details on the scope are presented in Table 1 below. If you have suggestions or questions about other sectors, please refer to ontario.ca for contact information on relevant ministries.

1.3 Who can submit

All organizations, businesses and individuals are invited to submit a USP. Potential participants are requested to carefully consider the guiding principles of the USP process before making a submission.

1.4 Objectives

The key objectives of the USP program are to:

• generate new and innovative infrastructure proposals
• make government open for business and jobs
• harness the creativity and innovation of the private sector
• create a clear and fair process for receiving and evaluating proposals

1.5 Procurement and transaction approaches

While the government’s default position is to request a proposal via a competitive procurement process, the government recognizes not all infrastructure projects are alike. The commercial dynamics and technical requirements applicable to an infrastructure proposal may require a bespoke procurement solution. Therefore, the government will be flexible in its design of the procurement process and choice of the delivery model for any infrastructure USP it chooses to pursue.

The government recognizes, in its existing Ontario Public Service (OPS) Procurement Directive and Realty Directive, that circumstances can arise where it may be in the public interest to engage in other procurement approaches, such as dealing exclusively with one party.

The government may, in its absolute discretion, subject to the OPS Procurement Directive or Realty Directive, negotiate with a participant that presents a USP where the government has determined that circumstances warrant such an approach (in accordance with the assessment criteria in this guideline).

Where the government enters into an exclusive negotiation with a participant, it retains the right to withdraw its interest or offer at any stage with suitable notice.

1.6 Confidentiality of submissions

The government will not publish or disclose any information about any unsolicited proposal and will treat all such information as strictly confidential, unless:

1. the proposal is selected to proceed to procurement, in which case information will only be disclosed to the extent necessary to support a fair and effective procurement process; or
2. we are obligated to do so by operation of law.

2. USP criteria

Each USP will be assessed in accordance with the following criteria:

1. The proposal must be a genuine “USP”

   The proposal must not constitute a response to an existing, pending or announced request for proposals (RFP) under any government procurement.

   The government will also assess if there is another existing channel (for example, programs or grants) better suited to pursue the proposal.

2. The proposal must demonstrate a clear value or benefit for the people of Ontario

   A proposal could demonstrate value by yielding an economic benefit, such as a revenue stream or payment to the government. But the benefit does not have to be economic. For example, a proposal could demonstrate value by:

   • improving a community’s access to public services
   • providing commuters with a new transit line or highway
   • developing a solution for improving the movement of people and goods or reducing congestion
   • improving the infrastructure used by first responders and emergency personnel to keep Ontarians safe
   • expanding access to broadband or cellular services
   • unlocking the economic potential of a region or sector whose growth was limited by the absence of infrastructure
   • addressing capacity needs in the energy sector
   • increasing the supply of housing
3. The proposal must relate to the development or improvement of an infrastructure asset

   The government will not consider USPs that do not relate to infrastructure. See Section 1.2 of these guidelines for more information on the types of proposals that qualify.

4. The proposal must align with government priorities

   The government has limited resources. In considering each USP, the government must ensure that the use of these resources aligns with its commitments and priorities.

5. The proposal must reasonably demonstrate commercial, financial and technical viability

   The proposal’s commercial, financial and technical viability will be assessed on several factors, including:

   • the viability of the commercial transaction under which the project would be built and maintained (including whether there would be sufficient market interest in the transaction)
   • the financeability of the construction of the project (either through public sources of funds or the raising of private capital)
   • the extent to which, over the long term, the project is financially sustainable (either on its own through a revenue stream or through a public source of funding)
   • whether the proposed design for the project achieves its intended purpose
   • whether the project can be constructed within the proposed timelines and budget

   A fulsome analysis of these factors may not be possible until the “Detailed Proposal” stage (discussed in Section 3 below), however participants should keep these factors in mind when preparing their submission at the “Initial Proposal” stage.

6. If government funding is required, the proposal must demonstrate value for money with respect to the government’s investment

   The government must always ensure it is investing the people’s money wisely and effectively. If a proposal requires government funding, then evaluation of the proposal will include a value-for-money assessment (i.e., an assessment of the extent to which the proposal provides value in proportion to its cost and risk to government).

   In support of this assessment, the proposal should:

   • identify what is being sought from government to facilitate the proposal (which may include financial support, assets, legislative/regulatory amendments or other support)
   • demonstrate that the proposal involves an acceptable and optimal sharing of costs and risks between the government and the participant

3. The process

3.1 Overview – three-stage process

The process involves three stages:

1. Initial proposal
2. Detailed proposal
3. Procurement and transaction

In order for interested parties to submit a USP, they must complete an intake form on the USP portal website. For general terms and conditions, including rights and obligations of parties and treatment of intellectual property (IP) refer to the General Terms and Conditions document available on the USP portal.

The government reserves the right to go to market, end the proposal consideration process and withdraw from any exclusive negotiations at any time, including where the government determines that a proposal does not meet the criteria at any stage of the process.

3.2 Initial proposal

The initial proposal stage allows a participant to provide government with a high-level outline, which enables the government to form a preliminary view whether the proposal warrants further consideration under the USP framework. The initial proposal must be submitted electronically via the online USP portal.

Initial stage proposals will be assessed by the Ministry of Infrastructure and any other relevant ministries and agencies.

The government is under no obligation to consider, assess, respond to, accept or reject any proposal or to correspond with the participant regarding a proposal.

The government will assess the proposal with reference to the criteria set out in Section 2 of these guidelines.

3.3 Detailed proposal

If, after review by public officials, the government has selected a proposal to move to the second stage of evaluation, the participant will receive an email setting out next steps.

The detailed proposal stage involves advanced assessment of the proposal, particularly the commercial, financial and technical elements of the proposal. In most cases the advanced assessment will be conducted by Infrastructure Ontario, under the oversight of the capital ministry with responsibility for the type of asset that is the subject of the proposal (for example, the Ministry of Municipal Affairs and Housing would lead the assessment of a proposal related to the supply of housing).

The additional information required at the detailed proposal stage may vary, but in most cases a detailed business case will be required. During this stage of evaluation, participants should expect to attend meetings with public officials to discuss the proposal.

In addition to the criteria set out in Section 2 of these guidelines (and such other criteria as the government deem relevant), the detailed assessment will consider:

1. Comparative value assessment

   The comparative value assessment will be based on the merit of the proposal in comparison to other options, via:

   • identification of issues the proposal is trying to solve/business requirements
   • core considerations of the proposal
   • analysis of different options against the proposal
   • the impact on the business requirements if the proposal is not pursued
   • any other matters considered relevant
2. Uniqueness of the proposal

   The uniqueness assessment is relevant for the government to understand the ideal procurement structure for the proposal were the government to choose to move ahead with it.

   Uniqueness relates to the participant possessing strategic assets, innovative ideas or other unique attributes such that it would be difficult or impossible for another party to deliver the project.

   The following questions may be relevant to the uniqueness assessment:

   • Can the proposal be readily delivered by competitors?
   • Are there genuine intellectual property rights, without which the proposal could not proceed to implementation (for example, software or technology)?
   • Does the participant have ownership of strategic assets such as contractual rights or real property that would place it in a unique or exclusive position to deliver the aims of the proposal, and which other parties could not deliver?
   • Are there unique financial arrangements that support the delivery of the project?
   • Does the participant’s proposal have other demonstrably unique elements or innovative ideas that cannot be delivered by another party within acceptable timeframes?

3. Capacity and capability of participant

   Typically, in a competitive procurement, the assessment of a proponents’ qualifications to deliver a project would be assessed at the RFQ (Request for Qualifications) stage.

   If a participant in the USP framework wishes to participate in the procurement of the project that forms the subject of their proposal, the government may make initial queries of the participant to assess their capacity to deliver the project.

3.4 Procurement and transaction

If the government decides to proceed with a proposal, it will design a transaction and procurement structure that is best suited to delivering the project and protecting the public interest.

Based on assessment in either initial proposal stage or detailed proposal stage and subject to the OPS Procurement Directive or Realty Directive, the government may choose to proceed with any or none of the following transaction processes:

1. Competitive procurement
2. Swiss Challenge/Advance Contract Award Notice (ACAN)
3. Exclusive contract negotiation
4. Other

However, participants should be aware that, other than in exceptional circumstances, the government will seek to ensure any procurement arising through the USP framework features competitive tension.

Competitive procurement

This is the default and preferred method of procurement under the OPS Procurement Directive. Competitive procurement methods are conducted either in an open competitive or an invitational competitive manner.

The government may consider an appropriate incentive mechanism for the participant to participate in a competitive procurement such as advancement as a prequalified proponent in a two-stage competitive procurement process. The participant has the right to withdraw its proposal at this stage. However, should the participant withdraw its proposal, the government reserves the right to proceed with a competitive procurement for the concept of the proposal, if it deems this to be in the best interests of the Province.

Swiss Challenge/Advance Contract Award Notice (ACAN)

An alternative to the traditional competitive procurement model which still maintains a significant degree of competitive tension is the Swiss Challenge model.

Under the Swiss Challenge model, the government would publish the proposal and invite third parties to match or better it within a defined time period.

The government may also choose to use an ACAN approach, which requires the government to publicly post a notice that contains information on the procurement strategy, the rationale for not conducting a traditional competitive procurement, and request a statement of capabilities from other outside vendors. Ministries will review all statements of capabilities received in response to the ACAN and use this information to decide on the procurement process.

Exclusive contract negotiation

Exclusive contract negotiation is a non-competitive procurement method under which the government would negotiate and enter into a transaction to deliver the project exclusively with the participant that submitted the applicable USP. The government would only choose this procurement route if the unique character of the proposal necessitated such an approach, the proposal could not reasonably be delivered in any other way or it was otherwise in the public interest.

Other

There may be cases where the appropriate procurement model may be an approach not identified in this section. In all cases, and within the existing procurement framework, the government will seek to design a transaction and procurement structure that is best suited to delivering the project and protecting the public interest.