CTR058925_Contract_Documents.pdf

Procurement OFFER AND ACCEPTANCE

OFFER

TO THE STATE OF ARIZONA:

The undersigned hereby offers and agrees to perform in compliance with all terms, conditions, specifications and amendments of this solicitation and any written exceptions in the offer. Signature also acknowledges receipt of all pages indicated in the Table of Contents.

The Public Group (dba Public Surplus)

Offeror (Company) Name Signature of Person Authorized to Sign Offer

3520 North University Avenue Zackary Corbett 1/1/22

Address Printed Name Date Provo Utah 84605 Product Manager

City State Zip

Title zackaryc@thepublicgroup.com 801-932-7000 x 153

Email Address Phone Number zackaryc@thepublicgroup.com 801-932-7001

Company Email Address Fax Number

By signature in the Offer section above, the Offeror certifies that the submission of the Offer did not involve collusion or other anticompetitive practices.

ACCEPTANCE OF OFFER (FOR DEPARTMENT USE ONLY)

The Contractor is now bound to perform based upon Contract Number _________________________________including all terms, conditions, specifications, amendments, etc., and the Contractor's offer as accepted by the state.

The Contractor is hereby cautioned not to commence any billable work or provide any material, service or construction under this contract until contractor receives a purchase order document.

State of Arizona

Effective this day of 20

Procurement Officer Awarded Date

Solicitation No: BPM004114 Available online at https://app.az.gov

Rev 04/2020

DocuSign Envelope ID: F2395CED-D720-45DB-883F-9A42407F7DF3

09 22

CTR058925

Ferbruary

2/9/2022 https://app.az.gov/ mailto:zackaryc@thepublicgroup.com mailto:zackaryc@thepublicgroup.com

Procurement

ARIZONA DEPARTMENT OF TRANSPORTATION

1739 W. Jackson Street, MD 100P

Phoenix, AZ 85007 602.712.7211

Solicitation Amendment Summary SOLICITATION NO.: BPM004114 AMENDMENT NO.: One (1)

DESCRIPTION: Online Auction Services

Rev. 04/2020

Pursuant to the Uniform Instructions to Offerors, Item B.6, Solicitation Amendments, the above referenced solicitation shall be amended as follows:

1. The solicitation due date has been changed from January 7, 2022 at 3:00 PM MST to January 11, 2022 at

3:00 PM MST.

2. All other terms, conditions and provisions of this solicitation remain unchanged.

Rev. 04/2020

STATE OF ARIZONA

ARIZONA DEPARTMENT OF TRANSPORTATION

1739 W. Jackson St., Ste. A Phoenix, AZ 85007

REQUEST FOR PROPOSAL

SOLICITATION NUMBER: BPM004114

DESCRIPTION: Online Auction Services

QUESTIONS: Inquiries regarding the solicitation are to be submitted online through the State’s e-Procurement system, Arizona Procurement Portal (APP) (https://app.az.gov/) using the Discussion Forum tab.

OFFERORS ARE STRONGLY ENCOURAGED TO READ THE ENTIRE SOLICITATION.

Thomas Kornell Procurement Officer Phone: 602-712-8520 Email: TKornell@azdot.gov

This solicitation is issued in accordance with A.R.S. §41-2534 and A.A.C. R2-7-C301 et seq., Competitive Sealed Proposals.

“An Equal Opportunity Agency”

The Arizona Department of Transportation, in accordance with the provisions of Title VI of the Civil Rights Act of 1964 (78 Stat. 252.42 U.S.C. §§ 2000d-4) and the Americans with Disabilities Act (ADA), hereby notifies all bidders that it will affirmatively ensure that any contract entered into pursuant to this advertisement, disadvantaged business enterprises will be afforded full and fair opportunity to submit bids in response to this invitation and will not be discriminated against on the grounds of race, color, national origin in consideration for an award.

Persons that require a reasonable accommodation based on language or disability should contact ADOT’s Procurement Office by phone (602) 712-2089. Requests should be made as early as possible to ensure the State has an opportunity to address the accommodation.

Las personas que requieran asistencia (dentro de lo razonable) ya sea por el idioma o discapacidad deben ponerse en contacto con ADOT (602) 712-2089.

https://app.az.gov/

TABLE OF CONTENTS

SECTION PAGE

Notice 1

Table of Contents 2

Scope of Work 3

Special Terms and Conditions 12

Uniform Terms and Conditions 28

EXHIBITS

1 - Title VI/Non-Discrimination Assurances Appendix A (Exhibit 1) 38

2 - Title VI/Non-Discrimination Assurances Appendix E (Exhibit2) 39

3 – Quarterly Usage Report (Exhibit 3) 40

SCOPE OF WORK

1. Statement of Need

1.1 Pursuant to the Arizona Procurement Code, A.R.S. §41-2501 et seq., the State of Arizona Department of Transportation (Agency) and the Arizona Department of Administration (Agency), Surplus Property Office has a requirement for Online Auction Services.

2. Introduction and Background

2.1 The State of Arizona Department of Transportation (Agency) and the Arizona Department of

Administration (Agency) are responsible for receiving, warehousing, and redistributing personal property that is surplus to the Agency's needs. The Agency is responsible for coordinating the disposal, transfer or sale of surplus property, obsolete or unserviceable Agency property. Property is first made available to organizations or Donees that meet eligibility requirements as established by Federal Property Management Regulations and the Arizona Administrative Code. Property not redistributed to eligible organizations is made available to the general public.

2.2 It is the Agency’s intent to enter into a contract for an online based auction service on an “as needed” basis for use by state agencies statewide. Any account established will be used solely at the discretion of the Agency and no minimum or maximum activity or sales volume is offered or guaranteed by the Agency. All items auctioned will be sold on an “as is,” “where at” basis, and the successful buyer will be responsible for pick-up and transportation of all items after payment to the Agency.

2.3 Gross annual sales for the Department of Transportation are approximately $2.5 million for 400 auctions. This is offered as an approximation and in no way guarantees future auction sales. The following categories represent the types of items traditionally offered by the Agency for sale at auction:

Item Category

Sedans Salvaged Auto and Car Parts Office Equipment

Light Duty Van/Truck Equipment Parts Office Furniture

Heavy Duty Van/Truck Various New and Used Truck Parts

Construction Equipment

Utility Trucks Commercial Equipment Industrial or IT Equipment

3. Definitions

Term Definition

Agency The State of Arizona departments, agencies, commissions and boards.

Department A specific division within the Agency.

Contract Administrator

Procurement Officer

Contractor Firm and/or individual that will perform the work requested in this contract.

Surplus Manager Arizona Department of Administration (ADOA) Surplus Administrator.

Donee Organizations that meet eligibility requirements (Donees) as established by Federal Property Management Regulations and the Arizona

Administrative Code.

Proxy Bidding Often referred to as absentee or automatic bidding which is a method for bidding in an in-person or online auction.

Hypertext Transfer Protocol with Secure Sockets Layer (HTTPS)

The secure version of HTTP, the protocol over which data is sent between your browser and the website that you are connected.

Uniform Resource Locator (URL)

Unique address for a file that is accessible on the Internet.

Designee A person who has been designated by the Surplus Manager.

Industry Standard Generally accepted requirements by the members of an industry.

Shill Bidding When a bid is placed without the intent to win the auction.

Bid Siphoning When a person lures bidders off an authentic auction website offering to sell the same item at a lower cost.

Required Agency has an identified need and is otherwise considered essential or mandatory.

Desirable Agency has an identified want and is otherwise considered sought after or wished for.

4. Specific Requirements

4.1 Contractor Minimum Qualifications

The Contractor shall meet the following minimum qualifications:

4.1.1 As the sole and prime Contractor, the Contractor shall provide total responsibility for all requirements contained herein.

4.2.1 The Contractor shall have a minimum of five (5) year’s continuous experience during which time online auction services has been the primary business service.

4.3.1 The Contractor shall have successfully performed at least one contract with a public or private agency of similar size to the Agency that has been active for a minimum of two (2) years, with services that are similar to that required by the Agency.

4.2 Online Auction System Performance Objectives

4.2.1 The Agency’s primary system performance objectives, listed in order of importance, are:

Performance Objectives Required Desirable

4.2.1.1 Ability to sell all miscellaneous surplus, vehicles, heavy equipment, lost, unclaimed and confiscated property, real and personal property;

X

4.2.1.2 Increase revenue generated from surplus property; X

4.2.1.3 Convenient auction participation for the bidding

community;

X

4.2.1.4 Ease of program administration for Agency staff; X

4.2.1.5 Increased market presence and bidder base; X

4.2.1.6 Reduction in direct and indirect auction costs. X

4.3 Online Auction System

4.3.1 The Contractor shall provide an online auction system that has the following auction management and auction access control, but is not limited to:

Auction Management and Access Control Required Desirable

4.3.1.1 A fully hosted website that provides effortless

program administration and allows for total control of the auction by the Agency.

X

4.3.1.2 All hardware, software, servers along with

any/all maintenance and upgrades needed to operate the online auction service.

X

4.3.1.3 Agency ability to manage all aspects of the auction

online which includes, but is not limited to, uploading pictures and descriptions of the items available for sale, setting time frames for the auction, setting minimum acceptable bids, the ability to add or delete items at any time, responding to bidder questions, and blocking default bidders.

X

4.3.1.4 Internet connectivity to the website accessible

through industry standard connections, web browsers, and email.

X

4.3.1.5 A website that meets industry standards and best

practices for secure use. To set a standard, Hypertext Transfer Protocol with Secure Sockets Layer (HTTPS) or equivalent shall be used.

X

4.3.1.6 A link to the website for Agency use, that

is seamless to the bidding community and allows bidders direct access to Agency auctions with minimal clicks.

X

4.3.1.7 A Uniform Resource Locator (URL) which links to only

A specific Agency’s auctions or landing spot.

X

4.3.1.8 The ability to add, update or remove Agency logos to

each Agency auction home page.

X

4.3.1.9 The ability to click the Agency logo and be directed back to the using Agency’s website.

X

4.1.3.10 Total Agency administrative access to the area of the online auction website or Agency account that controls the Agency auctions, with the Surplus Manager or designee controlling the auctions.

X

4.3.1.11 The ability for each Agency to display the Agency’s

terms and conditions of sale and the ability to upload or modify the Agency’s terms and conditions of sale.

4.3.1.12 The ability for the Agency to view a detailed bid history of its auctions at any time during the auction or after it closes.

X

4.3.1.13 Agency shall be able to access to bidder profile

information in order to call, fax or email any bidder that bids on Agency auctions from within the auction site platform.

X

4.3.1.14 User administration access to control ability to designate who will be allowed to use the auction system and features they can access (i.e. load an auction, release an auction, etc.)

X

4.3.1.15 The ability for the Agency to create and maintain

separately a minimum of ten (10) accounts.

X

4.3.1.16 The ability for the Agency to create and maintain

separately more than ten (10) accounts.

4.3.2 The Contractor shall provide the following auction listing features with the online auction system, but is not limited to:

Auction Listing Features Required Desirable

4.3.2.1 The ability to control the number of items listed with each auction.

X

4.3.2.2 The ability to upload auction related documents and

images, such as specifications and disclosures in PDF, JPG, word or excel format, and videos.

X

4.3.2.3 The ability to add or customize auction data elements such as fields to track inventory/vehicle numbers and storage location. Fields should populate on the auction receipt as well as auction reports.

X

4.3.2.4 The ability to configure Agency account components

within the website to accommodate the needs of various Agencies and have the ability to contain individual identifiable Agency designations within the website.

X

4.3.2.5 The ability to notify the winning bidder and the Agency by e-mail through the website of the final selling price.

X

4.3.2.6 The ability for the Agency to block individual bidders who have defaulted on payment, etc. from participating in an auction.

X

4.3.2.7 The ability for communications (both manual and

automatic), instructions and Agency supplied forms to be electronically sent through the website to the successful buyer after payment has been received by the Agency.

4.3.2.8 The ability to upload forms and documents to closed

auctions for transparency and audit purposes.

X

4.3.2.9 The ability to copy previous auctions. X

4.3.2.10 The ability to repost previous auctions. X

4.3.2.11 The ability to upload and hold items for later

auction release.

X

4.3.2.12 The ability to load specific auction end dates and times to the half hour.

X

4.3.2.13 The ability to feature an Agency auction on the website. X

4.3.2.14 The ability to load and edit multiple locations for sales and the system would retain or have the ability to restore those locations. Locations should be available from a pick list or drop down menu.

4.3.3 The Contractor shall provide the following auction bidding features with the online auction system, but is not limited to:

Bidding Features Required Desirable

4.3.3.1 Compatibility with, but not limited to, industry

standard personal computer (PC) browsers such as, Internet Explorer, Google Chrome, Firefox, Mac OS and industry standard portable device browsers such as Android, Windows and IOS.

X

4.3.3.2 The ability to amend or extend auctions. X

4.3.3.3 The ability to provide a period of time for bidding

Questions and Answers.

X

4.3.3.4 The ability to allow bidders to ask questions of the

Agency through the website and can be answered through the site.

X

4.3.3.5 The ability to publish questions and answers to be visible to all registered bidders at the Agency’s sole discretion.

X

4.3.3.6 The ability to withhold or not publish a questions or answer.

X

4.3.3.7 User friendly browse and search features, to include

basic and advanced functionality.

X

4.3.3.8 The ability for bidders to set up an interest or watch list specific to Agency auctions.

X

4.3.3.9 The ability to set restrictions on bidders. X

4.3.3.10 The ability to automatically extend auctions if a bid is received in the last minute of the auction (i.e. increment of 5 minutes of auction ending).

X

4.3.3.11 The capability to add proxy bidding. X

4.3.3.12 The ability to set minimum reserves and adjust minimum reserve amounts or bids.

4.3.4 The Contractor shall provide the following auction reporting features with the online auction system, but is not limited to:

Reporting Features Required Desirable

4.3.4.1 An auction end date report. X

4.3.4.2 A customizable closed auction report which includes

internal reuse transactions as well as all public sales.

X

4.3.4.3 An accounting report showing payment information. X

4.3.4.4 A report showing all current auctions and closed

auctions.

X

4.3.4.5 User management reports (for internal and

multi-tiered users).

X

4.3.4.6 A commodity breakdown, most popular items, average

price, etc. report.

X

4.3.4.7 A report reflecting buyer history for Agency auctions. X

4.3.4.8 A report reflecting fees assessed to bidders by the

Agency.

X

4.3.4.9 The ability to download reports into various formats

from the website.

X

4.3.4.10 The ability to maintain buyer feedback ratings to

determine buyer record of fulfilling purchase commitments.

X

4.3.4.11 The ability to create standard and custom monthly reports for Agency use, including but not limited to the following: access on bidder activity, sold items, non-sold items, sales value to the Agency, fees owed by the Agency, and sold asset reports. The sold asset report should lists all items sold by any date range chosen by the Surplus Manager, and include, at a minimum, the following:

4.3.4.11.1 ID of item

4.3.4.11.2 Description

4.3.4.11.3 Category

4.3.4.11.4 Starting Bid Amount

4.3.4.11.5 Sold Amount

4.3.4.11.6 Bids received

5. General Requirements

5.1 System Registration

The Contractor shall:

5.1.1 Not charge a fee, perform a credit check or in any other way, prohibit potential bidders from registering to participate in online bidding unless authorized by the Agency. The Contractor may only require that a potential bidder registers as a user in order to place a bid.

5.1.2 Assist the Agency in setting up accounts for each requesting Department on the website auction system.

5.2 Training and Support

5.2.1 Assist and train Agency employees on the use and operation of the system. Training may be done online or via telephone at the need of the Agency. In addition, technical and user support shall be made available to the Agency for training issues or problem resolution Monday through Friday (excluding Holidays) between the hours of 8:00 AM to 5:00 PM MST/AZ Local Time.

5.2.2 Provide easily accessible and highly responsive technical support and customer service. The

Contractor shall endeavor to respond within one-hour, and shall respond within one business day, to all inquiries from the Agency and buyers. In addition, technical issues identified by the Contractor, which have the potential to disrupt business, must be relayed to the Agency within one business day of issue identification.

5.3 Bidder Support

5.3.1 The Contractor shall offer support to assist public users (potential bidders) in the use and operation of the system Monday to Friday (excluding Holidays) between 8:00 AM to 5:00 PM MST. Contractor support for bidders shall be easily accessible through the Contractors website and the support shall be available to respond to requests or questions that are submitted online or by phone.

5.4 Marketing

5.4.1 Actively market auctions to prospective bidders in order to expand the Contractor’s bidders list.

5.4.2 Offer specialized marketing when needed and requested by the Agency.

5.5. Hours and Location of Work

5.5.1 The online auction website shall be available 24 hours a day, 7 days a week, and 365 days a year.

5.6 Monitoring and Security

5.6.1 Provide system monitoring to include, but is not limited to, securing privacy and protecting against fraud, bid rigging, offensive and defensive shill feedback, transaction interference, shill bidding, and bid siphoning.

5.6.2 Provide all security systems, anti-virus and firewalls capable of preventing the hacking of any auction information stored on the Contractor’s system or systems.

5.7 Maintenance

5.7.1 The Contractor shall be responsible for all repairs and updates to ensure systems (i.e.

hardware, software and/or applications) are current and secure.

5.7.2 The Contractor shall notify the Agency 48 hours prior to scheduled system maintenance that may affect access to the online auction process.

5.8 Reporting

5.8.1 The Contractor shall provide all reporting needs through the online auction website and reporting shall be available to Agency personnel on an as needed basis.

5.8.2 Upon request by the Agency, the Contractor shall provide liquidity statistics such as the numbers of buyers and sellers who use the Contractors auction site annually, the volume of transactions that occur within an annual period and the average size of transactions that occur on an annual basis.

5.9 Fee Structure

At a minimum, the Contractor shall offer:

5.9.1 An all-inclusive non-tiered, fixed fee structure in which the Contractor’s fee is a percentage based on the actual amount for which an auctioned item is sold (excluding sales tax).

5.9.1.1 An itemized expense schedule and fee report shall be prepared for each auction.

5.9.1.2 The Contractor will only be paid its auction fee on items that have sold and have been paid.

5.9.2 The option for an Agency pays or Buyer pays auction fees arrangement or a combination of the two.

5.9.3 No fee charged for items that are internally allocated or transferred to a Donee.

5.10 Agency’s Responsibilities

The Agency is responsible for:

5.10.1 Creating, monitoring and releasing auctions.

5.10.2 Monitoring and coordinating a response to auction questions that are submitted through the website.

5.10.3 Coordinating the pick-up, payment and recording of all required Federal and state documents and Motor Vehicle Division (MVD) permitting.

5.10.4 Collecting payment from buyers for sold auction items and issuing a payment receipt to the buyer for purchased items.

5.10.5 Remitting payment to Contractor for sold auction items or miscellaneous services provided as stated in the contract.

SPECIAL TERMS AND CONDITIONS

1. Contract Term

The term of any resultant contract shall commence on the effective day of award and shall continue for a period of twelve (12) months thereafter, unless terminated, cancelled or extended as otherwise provided herein.

2. Contract Extension

By mutual written contract amendment, any resultant contract may be extended for supplemental periods of up to a maximum of forty-eight (48) months.

3. Eligible Agencies

This contract shall be for the exclusive use of the Arizona Department of Transportation.

4. Non-Exclusive Contract

This contract shall be for the sole convenience of the Department. The Department reserves the right to obtain like goods or services from another source when necessary. The Off-Contract Purchase Authorization and subsequent procurement shall be consistent with the Arizona Procurement Code.

5. Ordering Process

The Agency shall issue a purchase order to the Contractor. Each purchase order must cite the contract number. This purchase order shall be the only document required for the Agency to order and the Contractor to deliver the service.

Any attempts to represent any material and/or service not specifically awarded as being under contract is a breach of the contract and a violation of the Arizona Procurement Code. Any such action is subject to the legal and contractual remedies available to the State inclusive of but not limited to contract cancellation, suspension and/or debarment of the Contractor.

6. Invoicing and Payment Requirements

6.1 Separate invoices are required on a monthly basis and shall be sent to the agency whose address appears on the purchase order as the “bill to” address and shall include at a minimum the information listed below:

6.1.1 Agency Location’s Name and Address

6.1.2 Vendor Name, Remit to Address and Contact Information

6.1.3 Contract Number

6.1.4 Purchase Order Number

6.1.5 Invoice Number and Date

6.1.6 Itemized Description of Services broken down by Auction

6.1.7 Price per Unit and Total per Unit

6.1.8 Applicable Taxes

6.1.9 Total Invoice Amount Due

Invoices not sent to the proper address, or not containing the necessary and required information may delay payment. A Contractor whose payments are delayed due to improper invoicing shall make no claim against the Agency or the State for late or finance charges.

The Agency will make every effort to process payment for the purchase of product within thirty (30) calendar days after the Agency has conducted the necessary reviews, inspections and acceptance as described herein.

The Agency acceptance date will be the valid date for starting the thirty (30) calendar day payment period.

Payment due dates, including discount periods, will be computed from the date of acceptance or date of correct invoice (whichever is later) to the date the Agency’s warrant is mailed.

7. Estimated Usage

The Department anticipates considerable usage under this contract. The Department reserves the right to increase or decrease actual quantities ordered as circumstances may require. No guarantees are made concerning actual purchases under this contract.

8. Price Reduction

A price reduction adjustment may be offered at any time during the term of a contract and shall become effective upon notice.

Throughout the life of the Contract, the Agency reserves the right to pursue negotiations with the Contractor to secure price reductions. Any negotiated price changes shall be documented via a bilateral Contract Amendment.

9. Price Increase

The Agency will review fully documented requests for price increases for any contract which will or has been in effect for twelve (12) months. The request shall be submitted no less than 60 days prior to the contract renewal date. The Contractor shall provide fully documented information which supports the price increase request. Fully documented means that the request shall present detailed information and calculations that make it clear how the claimed increase has an impact on the contract unit prices. All assumptions regarding cost factors that have an impact on the requested increase shall also be clearly identified and justified. The requested price increase must be based upon a cost increase that was clearly unpredictable at the time of the offer and can be shown to directly affect the price of the item concerned.

Any price increase adjustment request prior to the time of contract extension will be a factor in the extension review process. The Department will determine whether the requested price increase or an alternate option, is in the best interest of the State.

10. Contract Administration

The Contractor shall contact the Procurement Officer for guidance or direction in matters of contract interpretation or questions regarding the terms, conditions or scope of the contract.

11. Notices

All notices, requests, demands, consents, approvals, and other communications which may or are required to be served or given hereunder (for the purposes of this provisions collectively called “Notices”), shall be in writing and shall be sent by certified United States mail, return receipt requested, or by any other method that provides evidence of receipt, addressed to the party or parties to receive such notice as follows:

a. If intended for the State, to:

Arizona Department of Transportation, Procurement Group 1739 West Jackson Street, Suite A, MD 100P Phoenix, Arizona 85007-3276

b. If intended for the Contractor, to the address as identified in the Contractor’s electronic vendor profile.

Or to such other address as either party may from time to time furnish in writing to the other by notice hereunder. Any notice so mailed shall be deemed to have been given as of the date such notice is received as shown on the return receipt. Furthermore, such notice may be given by delivering personally such notice, if intended for the State, to the Arizona Department of Transportation, Procurement Officer and, if intended for the Contractor, to the person named on the Offer & Contract Award of this contract, or to such other person as either party may from time to time furnish in writing to the other by notice hereunder. Any notice so delivered shall be deemed to have been given as of the date such notice is personally delivered to the other party.

12. Cancellation for Possession of Weapons

This contract may be cancelled if Contractor or any subcontractors or others in the employ or under the supervision of the Contractor or subcontractors is found to be in possession of weapons.

Possession of weapons (firearms, explosive device, knife or blade of more than three inches, or any other instrument designed for lethal or disabling use) is prohibited on ADOT property.

Further, if the Contractor or any subcontractors or others in the employ or under the supervision of the Contractors or subcontractors are asked by an ADOT official to leave the ADOT property, they are advised that failure to comply with such a request shall result in cancellation of the contract and anyone who refuses, whether armed or not, is subject to prosecution under A.R.S. § 13-1502, "Criminal trespass in the third degree; classification.."

13. Accuracy of Work

The Contractor shall be responsible for the accuracy of the work and shall promptly make all the necessary revisions or corrections resulting from errors and omissions on the part of the Contractor without additional compensation. Acceptance of the work by the Department will not relieve the Contractor of the responsibility for subsequent correction of any such errors and clarification of ambiguities.

14. Usage Report

The Contractor shall furnish the Agency a quarterly report showing purchasing activity under this contract.

This usage report shall be provided in a form substantially equivalent to Exhibit 3 and preferably in excel format. Usage reports shall be submitted to the Procurement Officer no later than 30 days after the end of each quarter.

Usage report quarters shall be defined as follows:

January through March – Report due April 30

April through June – Report due July 30

July through September – Report due October 30

October through December – Report due January 30

15. Key Personnel

It is essential that the Contractor provides adequate experienced personnel, capable of and devoted to the successful accomplishment of work to be performed under this contract. The Contractor must agree to assign specific individuals to the key positions.

The Contractor agrees that, once assigned to work under this contract, key personnel shall not be removed or replaced without written notice to the Procurement Officer. The Contractor shall immediately notify the Procurement Officer of key personnel changes. Replacement personnel shall be of substantially equal ability and qualifications. All key personnel changes are subject to the written concurrence of the Procurement Officer prior to any billable work being performed.

16. Licenses, Permits, Certifications

The Contractor, at their expense, shall maintain in current status without any violations, complaints, or suspensions during the term of this contract all Federal, State and Local licenses, permits and certifications required for the operation of a business conducted by the contractor.

17. Removal of Contractor’s Employees

The Contractor agrees to utilize only experienced, responsible and capable personnel in the performance of the work. The Department may require that the Contractor remove from the job covered by this contract, employees who endanger persons or property or whose continued employment under the contract is inconsistent with the interest of the Department.

18. Post Award Meeting

At the discretion of the Department, the Contractor, at their expense, shall attend and participate in post award meetings as scheduled by the Procurement Officer.

19. Contract Implementation Meetings

Upon award, the Contractor may be required to participate in meetings for the successful implementation of the contract. The meetings will be at the discretion of the agency. The Contractor will be notified in advance of the meeting(s) time, frequency, and locations to ensure all appropriate contract staff and representatives attend. The State reserves the right to decline conference call attendance or participation.

20. Indemnification

To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless the State of Arizona, and its departments, agencies, boards, commissions, universities, and any jurisdiction or agency issuing permits for any work included in the project, and their respective directors, officers, officials, agents and employees (hereinafter referred to as "Indemnitee") from and against any and all claims, actions, liabilities, costs, losses, or expenses, (including reasonable attorney's fees), (hereinafter collectively referred to as "Claims") arising out of actual or alleged bodily injury or personal injury of any person (including death) or loss or damage to tangible or intangible property caused, or alleged to be caused, in whole or in part, by the negligent or willful acts or omissions of Contractor or any of Contractor's directors, officers, agents, employees, volunteers or subcontractors. This indemnity includes any claim or amount arising or recovered under the Workers' Compensation Law or arising out of the failure of Contractor to conform to any federal, state or local law, statute, ordinance, rule, regulation or court decree. It is the specific intention of the parties that the Indemnitee shall, in all instances, except for Claims arising solely from the negligent or willful acts or omissions of the Indemnitee, be indemnified by Contractor from and against any and all Claims. It is agreed that Contractor will be responsible for primary loss investigation, defense and judgment costs where this indemnification is applicable. This indemnification will survive the termination of the above listed contract with the Contractor.

This indemnity shall not apply if the Contractor or subcontractor(s) is/are an agency, board, commission or university of the State of Arizona

21. Insurance Requirements

21.1 Contractor and subcontractors shall procure and maintain, until all of their obligations have been discharged, including any warranty periods under this Contract, insurance against claims for injury to persons or damage to property arising from, or in connection with, the performance of the work hereunder by the Contractor, its agents, representatives, employees or subcontractors.

21.2 The Insurance Requirements herein are minimum requirements for this Contract and in no way limit the indemnity covenants contained in this Contract. The State of Arizona in no way warrants that the minimum limits contained herein are sufficient to protect the Contractor from liabilities that arise out of the performance of the work under this Contract by the Contractor, its agents, representatives, employees or subcontractors, and the Contractor is free to purchase additional insurance.

22. Minimum Scope and Limits of Insurance:

Contractor shall provide coverage with limits of liability not less than those stated below.

22.1 Commercial General Liability – Occurrence Form

Policy shall include bodily injury, property damage, personal injury and broad form contractual liability.

General Aggregate $2,000,000

Products – Completed Operations Aggregate $1,000,000

Personal and Advertising Injury $1,000,000

Damage to Rented Premises $50,000

Each Occurrence $1,000,000

a. The policy shall be endorsed, as required by this written agreement, to include the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees as additional insureds with respect to liability arising out of the activities performed by or on behalf of the Contractor.

b. Policy shall contain a waiver of subrogation endorsement, as required by this agreement, in favor of the State of Arizona, its departments, agencies, boards, commissions, universities and its officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor.

22.2. Business Automobile Liability

Bodily Injury and Property Damage for any owned, hired, and/or non owned automobiles used in the performance of this Contract.

• Combined Single Limit (CSL) $1,000,000

a. Policy shall be endorsed, as required by this written agreement, to include the State of agents, and employees as additional insureds with respect to liability arising out of the activities performed by, or on behalf of, the Contractor involving automobiles owned, hired and/or non-owned by the Contractor.

b. Policy shall contain a waiver of subrogation endorsement as required by this written agreement in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor.

22.3. Worker's Compensation and Employers' Liability

Workers' Compensation Statutory

Employers' Liability o Each Accident $1,000,000 o Disease – Each Employee $1,000,000 o Disease – Policy Limit $1,000,000

c. Policy shall contain a waiver of subrogation endorsement, as required by this written agreement, in favor of the State of Arizona, and its departments, agencies, boards, commissions, universities, officers, officials, agents, and employees for losses arising from work performed by or on behalf of the Contractor.

d. This requirement shall not apply to each Contractor or subcontractor exempt that is exempt under A.R.S. 23-901, and when such Contractor or subcontractor executes the appropriate waiver form (Sole Proprietor or Independent Contractor).

22.4. Network Security (Cyber) and Privacy Liability

Each Claim $2,000,000

Annual Aggregate $2,000,000

a. The Such insurance shall include, but not be limited to, coverage for third party claims and losses with respect to network risks (such as data breaches, unauthorized access or use, ID theft, theft of data) and invasion of privacy regardless of the type of media involved in the loss of private information, crisis management and identity theft response costs. This should also include breach notification costs, credit remediation and credit monitoring, defense and claims expenses, regulatory defense costs plus fines and penalties, cyber extortion, computer program and electronic data restoration expenses coverage (data asset protection), network business interruption, computer fraud coverage, and funds transfer loss.

b. In the event that the Network Security and Privacy Liability insurance required by this

Contract is written on a claims-made basis, Contractor warrants that any retroactive date under the policy shall precede the effective date of this Contract and, either continuous coverage will be maintained, or an extended discover period will be exercised for a period of two (2) years beginning at the time work under this Contract is completed.

c. The policy shall be endorsed, as required by this written agreement, to include the State of agents, and employees as additional insureds with respect to vicarious liability of the insured arising out of the activities performed by or on behalf of the Contractor.

d. The certificate shall state that the insurance applies to any and all work performed for or on the behalf of the State of Arizona/ADOT.

22.5. Additional Insurance Requirements: The policies shall include, or be endorsed to include, as required by this written agreement, the following provisions:

The Contractor's policies, as applicable, shall stipulate that the insurance afforded the Contractor shall be primary and that any insurance carried by the Department, its agents, officials, employees or the State of Arizona shall be excess and not contributory insurance, as provided by A.R.S. §41-621 (E).

Insurance provided by the Contractor shall not limit the Contractor’s liability assumed under the indemnification provisions of this Contract.

22.6. Notice of Cancellation: With the exception of (10) day notice of cancellation for non-payment

Applicable to all insurance policies required within the Insurance Requirements of this Contract, Contractor’s insurance shall not be permitted to expire, be suspended, be canceled, or be materially changed for any reason without thirty (30) days prior written notice to the State of Arizona. Within two (2) business days of receipt, Contractor must provide notice to the State of Arizona if they receive notice of a policy that has been or will be suspended, canceled, materially changed for any reason, has expired, or will be expiring. Such notice shall be sent directly to the Department and shall be mailed or hand delivered to:

1739 West Jackson Street, Suite A, MD 100P Phoenix, AZ 85007-3276

22.7. Acceptability of Insurers: Contractor’s insurance shall be placed with companies licensed in the State of Arizona or hold approved non-admitted status on the Arizona Department of Insurance List of Qualified Unauthorized Insurers. Insurers shall have an “A.M. Best” rating of not less than A- VII. The State of Arizona in no way warrants that the above-required minimum insurer rating is sufficient to protect the Contractor from potential insurer insolvency.

22.8. Verification of Coverage: Contractor shall furnish the State of Arizona with certificates of insurance (valid ACORD form or equivalent approved by the State of Arizona) evidencing that Contractor has the insurance as required by this Contract. An authorized representative of the insurer shall sign the certificates.

All such certificates of insurance and policy endorsements must be received by the State before work commences. The State’s receipt of any certificates of insurance or policy endorsements that do not comply with this written agreement shall not waive or otherwise affect the requirements of this agreement.

Each insurance policy required by this Contract must be in effect at, or prior to, commencement of work under this Contract. Failure to maintain the insurance policies as required by this Contract, or to provide evidence of renewal, is a material breach of contract.

All certificates required by this Contract shall be sent either as an attachment via email or directly to the address below, and to the attention of the Purchaser identified in Arizona Procurement Portal (APP). The State of Arizona project/contract number and project description shall be noted on the certificate of insurance. The State of Arizona reserves the right to require complete copies of all insurance policies required by this Contract at any time. DO NOT SEND CERTIFICATES OF INSURANCE TO THE STATE OF ARIZONA'S RISK

MANAGEMENT DIVISION.

1739 West Jackson Street, Suite A, MD 100P Phoenix, AZ 85007-3276

22.9. Subcontractors: Contractor’s certificate(s) shall include all subcontractors as insureds under its policies or Contractor shall be responsible for ensuring and/or verifying that all subcontractors have valid and collectable insurance as evidenced by the certificates of insurance and endorsements for each subcontractor. All coverages for subcontractors shall be subject to the minimum Insurance Requirements identified above. The Department reserves the right to require, at any time throughout the life of this contract, proof from the Contractor that its subcontractors have the required coverage.

22.10 Approval and Modifications: The Contracting Agency, in consultation with State Risk, reserves the right to review or make modifications to the insurance limits, required coverages, or endorsements throughout the life of this contract, as deemed necessary. Such action will not require a formal Contract amendment but may be made by administrative action.

22.11 Exceptions: In the event the Contractor or sub-contractor(s) is/are a public entity, then the Insurance Requirements shall not apply. Such public entity shall provide a Certificate of Self- Insurance. If the Contractor or sub-contractor(s) is/are a State of Arizona agency, board, commission, or university, none of the above shall apply.

23. Ownership of Intellectual Property

Any and all intellectual property, including but not limited to copyright, invention, trademark, trade name, service mark, or trade secrets created or conceived solely pursuant to or as a result of this Contract and any related subcontract (collectively, the "Intellectual Property"), shall be work made for hire and the State shall be the owner of such Intellectual Property. The agency, department, division, board or commission of the State of Arizona requesting the issuance of this Contract shall own (for and on behalf of the State) the entire right, title and interest to the Intellectual Property throughout the world. Software and other Materials developed or otherwise obtained by or for Contractor or its affiliates independently of this Contract ("Independent Materials") do not constitute Intellectual Property. If Contractor creates derivative works of Independent Materials, then the elements of such derivative works created pursuant to this Contract shall constitute Intellectual Property owned by the State. Contractor shall notify the State, within thirty (30) days, of the creation of any Intellectual Property by it or its subcontractor(s). Contractor, on behalf of itself and any subcontractor(s), agrees to execute any and all document(s) necessary to assure ownership of the Intellectual Property vests in the State and shall take no affirmative actions that might have the effect of vesting all or part of the Intellectual Property in any entity other than the State. The Intellectual Property shall not be disclosed by Contractor or its subcontractor(s) to any entity not the State without the express written authorization of the agency, department, division, board or commission of the State of Arizona requesting the issuance of this Contract.

Notwithstanding the foregoing, if the State elects, in its sole and absolute discretion, to relinquish its ownership interest in any or all of the Intellectual Property, the State shall have the rights to use, modify, reproduce, release, perform, display, sublicense or disclose such Intellectual Property within State government and operations without restriction for any activity in which the State is a party (collectively, "Government Purpose Rights").

24. STATE IT ARCHITECTURE AND STANDARDS

To support standardized, interoperable IT environments, the state developed enterprise architecture (EA). The EA and subsequent standards can be accessed through the Arizona Strategic Enterprise Technology (ASET) web page at http://aset.azdoa.gov/security/policies‐standards‐and-procedures.

https://aset.az.gov/resources/policies-standards-and-procedures

Technical solutions developed by the Contractor shall conform to Department standards and to ASET EA standards.

In accordance with ADOT Information Technology Group policy 03.01, Information System Authorization Policy, the Contractor shall assist with the completion of a security plan within a template prescribed by the Department. Prior to deploying the Contractor solution, a Department risk assessment must be completed. Certification results must also be completed by the Department to comply with system lifecycle process requirements.

25. NON-DISCLOSURE

The Contractor shall meet the requirements of all applicable State of Arizona and Department policies, standards and procedures for securing, managing and handling information. As such, the Contractor shall:

Only access information and files for which it has been given specific authority.

Not discuss, divulge, copy, release, sell or loan any Departmental information unless authorized by the Department.

Not misuse or carelessly handle Departmental information.

Not release or disclose Departmental information to unauthorized personnel.

Store, send, and dispose of system and written information in a secure manner with proper regard for privacy and confidentiality and in accordance with applicable policies, standards and procedures.

Not disclose any personal information contained in any system of record except as authorized.

Safeguard all user password(s) and any other security mechanism(s) granted by the Department and used to access Departmental information.

Protect all Departmental information in accordance with applicable state and federal laws.

Report any security system breach, computer infection or theft of information immediately to the Department.

The Contractor shall secure paper-based, sensitive information by locking it in secure containers and applying user-privilege restriction mechanisms. The Contractor shall be responsible and accountable for all actions undertaken on a Department information technology resource (e.g., computer system, or application system, etc.). The Contractor shall not utilize its network connections with the Department for any purpose other than the purpose specified herein.

A. Personnel Security

Identify roles and responsibilities of technical support personnel.

Ensure separation of duties based on technical support personnel responsibilities.

Ensure technical support personnel are trained in securely handling personally identifying information (PII).

Adhere to Department non-disclosure and acceptable use agreements.

B. Configuration Management

Ensure system documentation (e.g., application configuration, network definitions, dataflow diagrams, entity relationship diagrams, etc.) is maintained and up-to-date.

Ensure formal change control is implemented and coordinated with the Department.

C. Prevent loss, modification or misuse of user data

Ensure Department PII is encrypted at rest (where stored).

Ensure Department PII is encrypted in transit (where transmitted).

Ensure Department PII is not stored on any portable device.

D. Security Plan & State Security Requirements

The Contractor shall assist with Security Plan completion during the application design phase of the project.

The security plan shall be approved by the department prior to the commencement of project construction activities

The Contractor shall ensure the system security plan complies with:

NIST security framework

State of Arizona statewide standards

Arizona Department of Transportation policy

ASET Arizona NIST Baseline Security Controls

E. System Development

If developing software for the Department, the contractor shall:

Maintain the security of application system software and data.

Ensure secure coding practices comply with the Open Web Application Security Project Top 10 and SANS Top 25.

Ensure application security by scanning, identifying and correcting: Command Injection, SSL Injection, Malicious CGI Scripts, Buffer Overflows, Client Side Vulnerabilities, Directory Indexing, Server misconfigurations, Malicious Downloads, Malicious Affiliations (Links), Phishing Scams, Browser Exploits, Misuse of personal information, Annoyances (excessive Pop-ups), SQL Injection, Blind SQL Injection, SQL Database Error Disclosure, Local File and Remote File Includes, Directory Traversals, Improper Error Handling and Application Source Code Disclosure on an ongoing basis.

Applications developed by the…