IT Supplemental for Specialty Financial Examination Auditing Services BPM054787.pdf

Information Technology (IT) Supplemental

MIA RFP MIA/FR-25-001 EMMA#: BPM054787 Effective Date: August 2024

This supplemental contains additional requirements under Section 2 of the solicitation.

1.1 Disaster Recovery and Data

1.1.1 Redundancy, Data Backup and Disaster Recovery

a) Unless specified otherwise, throughout the Contract term, the Contractor shall maintain or cause to be maintained disaster avoidance procedures designed to safeguard State data and other confidential information, Contractor’s processing capability and the availability of hosted services. Any force majeure provisions of the Contract do not limit the Contractor’s obligations under this provision.

b) The Contractor shall have robust contingency and disaster recovery (DR) plans in place to ensure that the services provided under the Contract will be maintained in the event of disruption to the Contractor/subcontractor’s operations (including, but not limited to, disruption to information technology systems), however caused.

1) The Contractor shall furnish a DR site.

2) The DR site shall be at least 100 miles from the primary operations site, and have the capacity to take over complete production volume in case the primary site becomes unresponsive.

c) The contingency and DR plans must be designed to ensure that services under the Contract are restored after a disruption within 24 hours from notification, with a recovery point objective of one hour or less prior to the outage in order to avoid unacceptable consequences due to the unavailability of services.

d) The Contractor shall test the contingency/DR plans at least twice annually to identify any changes that need to be made to the plan(s) to ensure a minimum interruption of service.

Coordination shall be made with the State to ensure limited system downtime when testing is conducted. At least one annual test shall include backup media restoration and failover/fallback operations at the DR location. The Contractor shall send the Contract Monitor a notice of completion following completion of DR testing.

e) Such contingency and DR plans shall be available for the State to inspect and practically test at any reasonable time, and subject to regular updating, revising, and testing throughout the term of the Contract.

1.1.2 Data Export/Import

a) The Contractor shall, at no additional cost or charge to the State, in an industry standard/non-proprietary format:

1) perform a full or partial import/export of State data within 24 hours of a request; or

2) provide to the State the ability to import/export data at will and provide the State with any access and instructions which are needed for the State to import or export data.

b) Any import or export shall be in a secure format per the Security Requirements.

1.1.3 Data Ownership and Access

As set forth in the Contract, data, databases and derived data products created, collected, manipulated, or directly purchased as part of the solicitation are the property of the State. The purchasing State agency is considered the custodian of all State data. The use, access, and distribution of all data shall comply with the requirements of this Supplemental, as well as the Contract and any document incorporated therein by reference.

The Contractor may not access State data other than as necessary to perform the services under this Contract.

The Contractor shall limit access to and use of State data to Contractor Personnel whose responsibilities require such access or use and shall train such Contractor Personnel on the confidentiality obligations set forth herein.

At no time shall any data or processes – that either belong to or are intended for the use of the State or its officers, agents or employees – be copied, disclosed or retained by the Contractor or any party related to the Contractor for subsequent use in any transaction that does not include the State.

The Contractor shall not use any information collected in connection with the services furnished under the Contract for any purpose other than fulfilling such services.

Provisions in Sections 1.1.1 - 1.1.3 shall survive expiration or termination of the Contract.

Additionally, the Contractor shall flow down the provisions of Sections 1.1.1 - 1.1.3 (or the substance thereof) in all subcontracts.

1.2 Security Requirements

The following requirements are applicable to the Contract:

1. Employee Identification

a) Contractor Personnel shall display his or her company ID badge in a visible location at all times while on State premises or the premises of an Examinee. Upon request of authorized State personnel, each Contractor Personnel shall provide additional photo identification.

b) Contractor Personnel shall cooperate with State site requirements, including but not limited to, being prepared to be escorted at all times, and providing information for State badge issuance.

c) Contractor shall remove any Contractor Personnel from working on the Contract where the State determines, in its sole discretion, that Contractor Personnel has not adhered to the Security requirements specified herein.

d) The State reserves the right to request that the Contractor submit proof of employment authorization of non-United States Citizens, prior to commencement of work under the Contract.

2. Security Clearance / Criminal Background Check

The State reserves the right to refuse any individual Contractor Personnel to work on State premises, based upon certain specified criminal convictions, as specified by the State.

A. A criminal background check for each Contractor Personnel that will perform examinations or analyses under the Contract in one of the five designated functional areas shall be completed within six months (6) months of Contract award.

B. The Contractor shall obtain at its own expense a Criminal Justice Information System (CJIS) State and federal criminal background check, including fingerprinting, for all Contractor Personnel listed in sub-paragraph A. This check may be performed by a public or private entity.

C. The Contractor shall obtain criminal background checks on candidates it sends for employment under the Contract. At a minimum, these checks must contain convictions and probation before judgment (PBJ) pleadings within the State of Maryland. This check may be performed by a public or private entity.

D. The Contractor shall provide the Contract Monitor with certification of completion of the required criminal background check described in this IFB for each required Contractor Personnel prior to assignment, and that the Contractor Personnel have successfully passed this check.

E. Persons with a criminal record may not perform services under the Contract unless prior written approval is obtained from the Contract Monitor. The Contract Monitor reserves the right to reject any individual based upon the results of the background check. Decisions of the Contract Monitor as to acceptability of a candidate are final.

F. The CJIS criminal record check of each Contractor Personnel who will work on State premises shall be reviewed and documented by the Contractor for convictions of any of the following crimes described in the Annotated Code of Maryland, Criminal Law Article:

1) §§ 6-101 through 6-104, 6-201 through 6-205, 6-409 (various crimes against property);

2) any crime within Title 7, Subtitle 1 (various crimes involving theft);

3) §§ 7-301 through 7-303, 7-313 through 7-317 (various crimes involving telecommunications and electronics);

4) §§ 8-201 through 8-302, 8-501 through 8-523 (various crimes involving fraud);

5) §§9-101 through 9-417, 9-601 through 9-604, 9-701 through 9-706.1 (various crimes against public administration); or

6) a crime of violence as defined in CL § 14-101(a).

G. Contractor Personnel that would have access to systems supporting the State or to State data who have been convicted of a felony or convicted of a crime involving telecommunications and electronics or convicted within the past five (5) years of a misdemeanor from the above list of crimes shall not be permitted to work on the Contract.

H. A particular on-site location covered by the Contract may require more restrictive conditions regarding the nature of prior criminal convictions that would result in Contractor Personnel not being permitted to work on those premises. Upon receipt of a location’s more restrictive conditions regarding criminal convictions, the Contractor shall provide an updated certification regarding the Contractor Personnel working at or assigned to those premises.

3. On-Site Security Requirement(s)

THIS SECTION IS INAPPLICABLE TO THIS SOLICITATION.

1.2.1 Information Technology Security

A. Contractors shall comply with and adhere to the State IT Security Manual, Policies and Standards, and the MIA’s Information Technology Security Policy. These policies may be revised from time to time and the Contractor shall comply with all such revisions. Updated and revised versions of the State IT Policy and Standards are available online at: Policies, Standards, and Guidelines. A copy of the MIA’s policy will be posted on eMMA., and any updates thereto provided to the Contractor as applicable.

B. The Contractor shall not connect any of its own equipment to a State LAN/WAN without prior written approval by the State as directed and coordinated with the Contract Monitor.

The Contractor shall:

1) For IT Security Policies and Standards that are not covered by the State IT Security Manual, the Contract shall Implement administrative, physical, and technical safeguards to protect State data that are no less rigorous than accepted industry best practices for information security such as those listed below (see Section 1.2.2)

2) Ensure that all such safeguards, including the manner in which State data is collected, accessed, used, stored, processed, disposed of and disclosed, comply with applicable data protection and privacy laws as well as the terms and conditions of the Contract; and

3) Ensure compliance with all applicable federal, State, and local laws, rules and regulations concerning security of Information Systems and Information Technology.

1.2.2. Data Protection and Controls

A. Contractor shall ensure a secure environment for all State data and any hardware and software (including but not limited to servers, network and data components) provided or used in connection with the performance of the Contract according to a written security policy (“Security Plan”) no less rigorous than that of the State and using best practices that comply with an accepted industry standard, such as the NIST cybersecurity framework.

1) The Security Plan shall detail the steps and processes employed by the Contractor as well as the features and characteristics which will ensure compliance with the security requirements of the Contract. Such Security Plan shall be provided to the State for its review with solicitation response. If awarded a contract, the Security Plan shall be provided on an annual basis or whenever updates are made.

2) The Contractor shall supply a copy of such policy to the State for validation, with any appropriate updates, on an annual basis.

https://doit.maryland.gov/cybersecurity/Pages/policies-and-guidance.aspx https://doit.maryland.gov/cybersecurity/Pages/policies-and-guidance.aspx

3) If any Security Plan information, including procedures, are different based on a Task Order, Contractor shall furnish such differences to the respective TO Manager.

B. To ensure appropriate data protection safeguards are in place, the Contractor shall implement and maintain the following controls during the Contract Term (the Contractor may augment this list with additional controls):

1) Apply hardware and software hardening procedures as recommended by Center for Internet Security (CIS) guides, Security Technical Implementation Guides (STIG), or similar industry best practices to reduce the systems’ surface of vulnerability, eliminating as many security risks as possible and documenting what is not feasible or not performed according to best practices. Any hardening practices not implemented shall be documented with a plan of action and milestones including any compensating control. These procedures may include but are not limited to removal of unnecessary software, disabling or removing unnecessary services, removal of unnecessary usernames or logins, and the deactivation of unneeded features in the Contractor’s system configuration files.

2) Ensure that State data is not commingled with non-State data through the proper application of compartmentalization Security Measures.

3) Apply data encryption to protect Sensitive Data at all times, including in transit, at rest, and also when archived for backup purposes. Unless otherwise directed, the Contractor is responsible for the encryption of all Sensitive Data.

4) Apply data encryption to all Contractor managed or controlled State data when the data is in transit over untrusted network segments.

5) Utilize encryption algorithms for encrypting data that comply with current Federal Information Processing Standards (FIPS), “Security Requirements for Cryptographic Modules.”

6) Enable appropriate logging parameters to monitor user access activities, authorized and failed access attempts, system exceptions, and critical information security events as recommended by the operating system and application manufacturers and information security standards, including the Maryland Department of Information Technology’s Information Security Manual.

7) Retain the aforementioned logs and review them at least daily to identify suspicious or questionable activity for investigation and documentation as to their cause and remediation, if required. The State shall have the right to inspect the logs and the Contractor or subcontractor’s performance to confirm the effectiveness of these measures for the services being provided under the Contract.

8) Perform regular internal vulnerability testing of operating system, applications, and all network devices utilized in this Contract. Such testing is expected to identify outdated software versions; missing software patches; device or software misconfigurations; and to validate compliance with or deviations from the security policies applicable to the Contract. Contractor shall evaluate all identified vulnerabilities for potential adverse effect on security and integrity and remediate the vulnerability no later than 30 days following the earlier of vulnerability’s identification or public disclosure, or document why remediation action is unnecessary or unsuitable. The State shall have the right to conduct vulnerability testing and inspect the results of similar Contractor performed vulnerability testing to confirm the effectiveness of these measures for the services being provided under the Contract.

9) Ensure that anti-virus and anti-malware software is installed and maintained on all systems and end points supporting the services provided under the Contract;

that the anti-virus and anti-malware software is automatically updated; and that the software is configured to actively scan and detect threats to the system for remediation. The Contractor shall perform weekly routine vulnerability scans and take corrective actions for any findings.

1.2.3 Security Logs and Reports Access

a) Reports shall include latency statistics, user access, user access IP address, user access history and security logs for all State data (including data concerning the Examinee(s), whether provided directly or indirectly),, systems, and software data, systems, and software related to the Contract.

1.2.4 Payment Card Industry Compliance

This solicitation does not require a Payment Card Industry Compliance.

1.2.5 Security Incident Response

A. The Contractor shall notify the State when any Contractor system that may access, process, or store State data or State systems experiences a Security Incident or a Data Breach as follows:

1) notify the State within twenty-four (24) hours of the discovery of a Security Incident by providing notice via written or electronic correspondence to the Contract Monitor, State Chief Information Security Officer and Maryland Security Operations Center (MD-SOC);

2) notify the State within seventy-two (72) hours if there is a threat to Contractor’s solution as it pertains to the use, disclosure, and security of State data; and

3) provide written notice to the State within one (1) Business Day after Contractor’s discovery of unauthorized use or disclosure of State data and thereafter all information the State requests concerning such unauthorized use or disclosure.

B. Contractor’s notice shall identify:

1) the nature of the unauthorized use or disclosure;

2) the State data used or disclosed,

3) who made the unauthorized use or received the unauthorized disclosure;

4) what the Contractor has done or shall do to mitigate any deleterious effect of the unauthorized use or disclosure; and

5) what corrective action the Contractor has taken or shall take to prevent future similar unauthorized use or disclosure.

6) The Contractor shall provide such other information, including a written report, as reasonably requested by the State.

C. Discussing Security Incidents with the State should be handled on an urgent as-needed basis, as part of Contractor communication and mitigation processes as mutually agreed upon, defined by law or contained in the Contract. The Contractor shall obtain approval from the State prior to communicating with outside parties regarding a Security Incident, which may include contacting law enforcement, fielding media inquiries and seeking external expertise.

D. The Contractor shall comply with all applicable system security breach laws.

1.2.6 Data Breach Responsibilities

A. If the Contractor reasonably believes or has actual knowledge of a Data Breach, the

Contractor shall, unless otherwise directed:

1) Notify the appropriate State-identified contact within 24 hours by telephone and email to the Maryland Security Operations Center (MD-SOC) in accordance with the agreed upon security plan or security procedures unless a shorter time is required by applicable law;

2) Cooperate with the State to investigate and resolve the data breach;

3) Promptly implement commercially reasonable remedial measures to remedy the

Data Breach; and

4) Document responsive actions taken related to the Data Breach, including any post-incident review of events and actions taken to make changes in business practices in providing the services.

B. With respect to State data within the possession or control of the Contractor, the Contractor shall bear the costs associated with (1) the investigation and resolution of the data breach; (2) notifications to individuals, regulators or others required by State law; (3) a credit monitoring service required by State or federal law; (4) a website or a toll-free number and call center for affected individuals required by State law; and (5) complete all corrective actions as reasonably determined by Contractor based on root cause; all [(1) through (5)] subject to the Contract’s limitation of liability.

C. The public disclosure of a cybersecurity incident shall be pursuant to Guidelines for the Public Disclosure of Cybersecurity Incidents or any successor thereto..

1.2.7 The State shall, at its discretion, have the right to review and assess the Contractor’s compliance to the security requirements and standards defined in the Contract.

https://doit.maryland.gov/cybersecurity/Documents/Cybersecurity-Guidelines-PDCI.pdf https://doit.maryland.gov/cybersecurity/Documents/Cybersecurity-Guidelines-PDCI.pdf https://doit.maryland.gov/cybersecurity/Documents/Cybersecurity-Guidelines-PDCI.pdf

1.2.8 Provisions in Sections 1.2.1 – 1.2.7 shall survive expiration or termination of the Contract.

Additionally, the Contractor shall flow down the provisions of Sections 1.2.1 - 1.2.7(or the substance thereof) in all subcontracts.

1.3 SOC 2 Type 2 Audit Report

A SOC 2 Type 2 Audit Report applies to the Contract. The applicable trust services criteria are:

Security and Confidentiality. The Contractor shall cause an SOC 2 Type 2 audit report to be conducted annually covering the previous 12- month period of the contract.

Such audits shall be performed in accordance with audit guidance: Reporting on an Examination of Controls at a Service Organization Relevant to Security, Availability, Processing Integrity, Confidentiality, or Privacy (SOC 2) as published by the American Institute of Certified Public Accountants (AICPA) and as updated from time to time.

a) The Contractor shall provide to the Contract Monitor, within thirty (30) calendar days of the issuance of the annual SOC 2 Type 2 Audit Report, a copy of the SOC 2 Type 2 audit report and a documented corrective action plan that addresses each audit finding or exception contained in the SOC 2 Type 2 Audit Report, identifying in detail the remedial action to be taken by the Contractor along with the date(s) when each remedial action is to be implemented. The scope of the SOC 2 Type 2 Audit Report shall include work performed by any subcontractors that handles, store or process Sensitive Data or are responsible for security controls and provide essential support to the Contractor for or essential support to the Information Functions and Processes for the services provided to the State under the Contract. The Contractor shall ensure the audit includes all such subcontractors operating in performance of the Contract or, in the case the subcontractor’s services are covered by a separate SOC 2 Type 2 Audit, that separate SOC 2 Type 2 Audit reports are obtained from all subcontractors and submitted to the Contract Monitor via the Contractor’s primary point of contact.

b) All SOC 2 Type 2 Audit Reports shall be submitted to the Contract Monitor as specified in subsection a above. The initial SOC 2 Type 2 Audit shall be completed within a timeframe to be specified by the State. The audit period covered by the initial SOC 2 Type 2 Audit shall start with the Contract Effective Date unless otherwise agreed to in writing by the Contract Monitor. All subsequent SOC 2 Type 2 Audits after this initial audit shall be performed at a minimum on an annual basis throughout the Term of the Contract, and shall cover a 12-month audit period or such portion of the year that the Contractor furnished services.

c) The SOC 2 Type 2 Audit shall report on the suitability of the design and operating effectiveness of controls over the Information Functions and Processes to meet the requirements of the Contract, including the Security Requirements identified in Section 1.2, relevant to the trust services criteria identified above: as defined in the aforementioned Guidance.

d) The audit scope of each year’s SOC 2 Type 2 Audit Report may need to be adjusted (including the inclusion or omission of the relevant trust services criteria of Security, Availability, Processing Integrity, Confidentiality, and Privacy) to accommodate any changes to the environment since the last SOC 2 Type 2 Audit Report. Such changes may include but are not limited to the addition of Information Functions and/or Processes through modifications to the Contract or due to changes in Information Technology or the operational infrastructure. The Contractor shall ensure that the audit scope of each year’s SOC 2 Type 2 Audit Report engagement shall accommodate these changes by including in the SOC 2 Type 2 Audit Report all appropriate controls related to the current environment supporting the Information Functions and/or Processes, including those controls required by the Contract.

e) The scope of the SOC 2 Type 2 Audit Report shall include work performed by any subcontractors that handle, store or process Sensitive Data and provide essential support to the Contractor for or essential support to the Information Functions and Processes for the services provided to the State under the Contract. The Contractor shall ensure the audit includes all such subcontractors operating in performance of the Contract or shall ensure their subcontractors obtain a SOC 2 Type 2 Audit Report as described in this Section.

f) All SOC 2 Type 2 Audits shall be completed at the Contractor’s expense, including any required SOC 2 Type 2 Audits of the Contractor’s subcontractor(s). The SOC 2 Type 2 Audit(s), shall be performed at no additional expense to the State.

g) If the Contractor currently has an annual, independent information security assessment performed that includes the operations, systems, and repositories of the Information Functions and Processes being provided to the Department under the Contract, and if that assessment generally conforms to the content and objective of the Guidance, the Department will determine in consultation with appropriate State government technology and audit authorities whether the Contractor’s current information security assessments are acceptable in lieu of the SOC 2 Report(s).

h) If the Contractor or any relevant subcontractor fails during the Contract term to submit an annual SOC 2 Type 2 Audit Report as specified in subsections a, the State shall have the right to retain an independent audit firm to perform an audit engagement to issue of a SOC 2 Type 2 Audit Report (or similar audit) of the Information Functions and/or Processes utilized or provided by the Contractor any relevant subcontractor under the Contract. The Contractor agrees to allow the independent audit firm to access its facility/ies for purposes of conducting this audit engagement(s), and will provide the necessary support and cooperation to the independent audit firm in the performance of the engagement that is required to perform the audit engagement. The State, at its option, will invoice the Contractor for the expense of these audit services, or deduct the cost from future payments to the Contractor.

Provisions in subsections a-h shall survive expiration or termination of the Contract. Additionally, the Contractor shall flow down the provisions of subsections a-hg (or the substance thereof) in all subcontracts.

1.4 Nonvisual Access

This solicitation does not contain Information Technology (IT) provisions requiring Nonvisual Access.

1.5 Mercury and Products That Contain Mercury

This solicitation does not include the procurement of products known to likely include mercury as a component.

1.6 Location of the Performance of Services Disclosure

The Bidder/Offeror is required to complete and submit with the Bid/ Proposal the Location of the Performance of Services Disclosure. A copy of this Disclosure is included as Attachment K.

1.7 HIPAA - Business Associate Agreement

This section does not apply to this Solicitation.

1.8 Additional Clauses

The Contractor is subject to the requirements in this section and shall flow down the provisions of (or the substance thereof) in all subcontracts.

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