Agency Reply to Patrick Rowe - March 23, 2006

March23, 2006

Patrick Rowe
Deputy Executive Director
Committee for Purchase from People who are
Blind or Severely Disabled
Jefferson Plaza 2, Suite 10800
1421 Jefferson Davis Hwy
Arlington, VA 22202-3259

Dear Mr. Rowe:

In this correspondence and the accompanying documents, you will find our reply to your questions of March 20, 2006. I will reply to each of your three questions individually, and provide you with accompanying documents that detail the information.

1. What is the process that ARC employs to determine whether a response will be submitted for an invitation to bid. Name the individuals and their respective positions involved in the decision and the formulation of the bid response.

From the beginning of this program, ARC has responded to each invitation issued by KCCO against the requirement to produce 15, now 20 percent of the invitation. The procedures for managing this process are listed in document package labeled ‘Contract Review-USDA Export Oil.’ Materials are priced for each invitation through solicted bids for supplies to qualifying vendors. USDA is provided with summary documentation for each solicitation, and copies are kept on file here. The names of the persons who manage this process are:

Tim Durm, Assistant Executive Director/COO
Lori Turner, Business Ops Manager
Melissa Wilson, Customer Service Manager
Karen Norris, Customer Service Supervisor

2. Describe ARC’s capability to fulfill 4-liter cans, 20 liter pails and 55 liter drums.

Arc is fully capable of filling all three package sizes. Our facilities and equipment were featured in Packaging World Magazine in August 2005. Film clips and video of our operations are featured at the following web address: http://www.packworld.com/. Copy is provided to you for your information in this reply. One should note however, that as package sizes increase, efficiencies of scale decrease. We have been limited to pricing 4 liter and 20 liter pails for USDA’s programs, and the costing and pricing packages reflect this.



Patrick Rowe, Committee for Purchase, page 2


3. Provide a summary ledger of ARC’s “Other Burden” broken out in the following categories: (1) Overhead, (2) General & Administrative costs, and (3) Net Profit for years 2003, 2004, and 2005.

I have enclosed a summary ledge for the years 1991-current as of Feb end, 2006. The years 2002-2005 are highlighted in yellow. These numbers are derived from independent audits of our organization performed in accordance with Generally Accepted Accounting Principles. I have also provided corresponding information about the JWOD program in relation to these numbers. These figures clearly reflect the continued reinvestment of net return into those facility and equipment assets necessary to gain the efficiencies necessary to meet our customer’s expectations.

Please let me know how or whether I can assist you further. A copy of this package of information will also be forwarded to Hal Goulding and Jill Beery at Nish. I am going to do my best to provide electronic copies also. Thank you for your inquiry.


Terri Lewis McRae
CEO



Cc; Kenneth Williams, Esq
Hal Goulding & Jill Beery, Nish